 Welcome to the Hindu News Analysis by Shankar Reyes Academy. As a part of our today's analysis, we'll discuss an editorial on India-United States Relations, an editorial on data-based governance in transportation sector. We'll discuss Finance Commission in detail and 15th Finance Commission, some of the terms of references and recommendations put in into local bodies. We'll discuss Kalistan Movement, Operation Blue Star and Operation Black Thunder and we'll see Consumer Price Index, Wholesale Price Index, Index of Industrial Production and also the status of Indian banks at the global level, so as to reach the target of $5 trillion economy. The link for the handwritten notes in the PDF format and the time-stamping of the discussed articles are provided in the description and also in the comment section for the benefit of mobile phone users. Now let's move on to the analysis of first editorial article. This editorial article is a response article with respect to the recent news that the United States President will be visiting India in this month, that is February 2020. In the context of the analysis of this editorial, we will see some of the possible deals that could be signed between India and US and we will also see some challenges highlighted by the author that may be faced in the time to come. The syllabus relevant for the analysis of this article is highlighted here for your reference. The United States President has scheduled to visit India during 24th and 25th of February 2020. Here in September 2019, an Indian community event was organized in Houston, United States, where Indian Prime Minister addressed the Indian Americans. Similarly, when US President is visiting this time, India is to reciprocate almost the same for the US President in the world's largest cricket stadium in Gujarat. While the Indian community event in Houston was called as Haudymoodi, the event in India for US President is to be called as Khemcho Trump. The article implies that, at present, the personal chemistry between the leaders of two countries are well established and also growing. While this is on one side, the India-US relations have faced some skirmishes in the recent times. We will see few such incidents way back in March 2018. The United States government imposed a 25% tariff on steel imports to United States and a 10% tariff on aluminum imports to United States from various countries including the exports from India. So it was widely reported that, as a result of this tariff, India's steel export to United States has actually decreased by 49% in 2018. In 2019, there were some bitter exchanges between India and United States. We could see this particularly with respect to two decisions taken by United States that hampered the interests of India. One is that in April 2019, US removed the waiver for India to purchase oil from Iran and with the effect from June 5 2019, United States terminated or removed India as a beneficiary in its Generalized System of Preferences program. So finally, with effect from 16th June 2019, India has imposed retaliatory tariffs on 28 products that is originating or exported from United States. If you closely observe the benefits obtained from GSP program, government reports say that annually the benefits were around the tune of 190 million US dollars. If you see the increase in amount of duty because of retaliatory tariff imposed by India, it comes around some 217 million US dollars. So while this is on one side, United States has also been consistently asking Indian government to relax or remove the cap of pricing of medical devices that come from the companies of United States. So these are some of the issues between India and United States with respect to trade. So the author states that with these issues simmering around India-US relations, there is actually hope for a limited trade deal in the upcoming President visit. And this limited trade deal could be worth around some 10 billion US dollars. In addition, there are also brighter prospects in terms of defense cooperation. India is reportedly going to sign a deal with the United States to purchase around 24 Seahawk helicopters. And there could be an agreement to buy an integrated air defense weapon system from US. We should also remember that way back in 2019, US has also threatened India with imposing sanctions under CARTSA Act. If India makes a payment or if India purchases S-400 missile system from Russia. So these are the developments that are expected. Now in the second part of the editorial, the author actually cautions about relying on personal chemistry of the present leaders of two countries with reference to taking up of strategic plans. This is because according to the author, there are deeper fault lines in domestic policies in both countries. And these fault lines could impact smooth bilateral relations in the long term. In case of India, the fault line is domestic policy with reference to policy shifts on special status of Kashmir Citizenship Amendment Act. The National Register of Indian Citizens. The announcements with reference to National Population Register. See the members of United States Congress or US National Legislature. They have already raised concerns over these matters. And they have expressed concerns that India is moving against its commitment of being a tolerant and pluralist democracy. Simply we can say pluralist here refers to multiple or plural communities living peacefully in harmony and in brotherhood. When we say intolerance, here it refers to say for example, mob lynching. And with respect to mob lynching, there is allegation that there is no strong efforts by the central government against mob lynching. So these are some fault lines in the Indian side that may attract implications from members of US Congress. Now if you see the fault line in the United States, the question is will Mr. Trump win the November 2020 presidential election? The author states that if Trump loses the election, the next president of the United States will be from the Democratic Party. Our Democratic Party members are heavily critical about India with respect to the perceived lack of tolerance. In such a case, the author feels that some plans that India might have taken during the Trump regime may face a setback. And author states that even if Trump wins, there is a growing congressional opposition to India-friendly White House policies. And this growing opposition from United States Congress could endanger the bilateral prospects between two countries. So these are the opinions of other. End of the day, the author's suggestion and point is that in the present scenario, India should not base its strategic plans on the personal chemistry between the present head of government of two countries. So for the time being, the author asks to tread carefully and also to resolve the growing opposition in US Congress with respect to India-friendly policies that are announced by US president. So with this, we come to the end of analysis of this editorial article. We saw the brief history of relations in the recent times between India and US in 2018 and 2019, between India and US. Then we saw the limited prospects available for cooperation in the upcoming visit of US president to India. And finally, we concluded by discussing the fault lines that may have an impact on India's relations in the long term. Now let's move on to the analysis of next news article. This news article is with reference to the recommendations of Finance Commission when it comes to local bodies. We'll discuss the matters mentioned in this news article in the end of the analysis of this article. Before entering to it, we'll see about the constitutional provisions about Finance Commission. Then we'll see about important information about the 15th Finance Commission. And finally, we'll discuss the article. The syllabus relevant for the analysis of this news article is highlighted here for your reference. See, Finance Commission is a constitutional body. It is mandated by the constitution under article 280 to carry out certain functions. If you see article 280, clause one, it states that president shall constitute a Finance Commission by an order at the expiration of every fifth year or at such earlier time. This commission consists of a chairman and four other members. All of them are appointed by the president of India. Clause two of this article deals with the qualifications that are required for the appointment as members in this commission. And these qualifications are to be determined by the parliament through a legislation. And accordingly, we are having a law called as Finance Commission Miscellaneous Provisions Act of 1951. Now come to clause three. It states, what are the duties of the commission? It mentions that it shall be the duty of the commission to make recommendations to the president for certain purposes. First, it shall make recommendations about how the net proceeds of taxes are to be distributed or divided between the union and the states under this chapter. Here, when we say under this chapter, it refers to chapter one of part 12 of Indian constitution. Part 12 deals with finance, property, contracts and suits. In this chapter one deals with finance. Under this chapter, there are some articles that discuss about how the revenue shall be distributed between union and the states. And here the net proceeds of taxes are actually calculated based on article 279 of Indian constitution. Secondly, this finance commission makes recommendation to the president on allocation of net proceeds of taxes among the states or between the states. The distribution between union and states is called as vertical distribution and the distribution between the states or among the states is called as horizontal distribution. Next, the finance commission shall make recommendations regarding principles that should govern the grants in aid to the states by the center out of the consolidated fund of India. And here, when we say grants in aid to the states, it refers to the assistance or donations or contributions that are made by the union government to the state governments. Next, finance commission makes recommendation on measures that are needed to augment the consolidated fund of a state. The augmentation of consolidated fund of the state is to supplement the resources of panchayats and municipalities of the state. And these measures are to be on the basis of recommendations made by finance commission of the particular state. Here you should know about finance commission of the states. See, based on 73rd constitutional amendment act of 1992, article 243 capital I was inserted in the constitution. It states that states can have their own finance commission for the purpose of panchayats. Similarly, the 74th constitutional amendment act inserted 243 capital Y, this article deals the same thing with respect to municipalities. And the finance commission of the concerned state will review the financial position of panchayats and municipalities in the states. And they will make recommendations to the governor of the particular state on these matters. Now let's come back to the finance commission under article 280. See, this finance commission shall also make recommendations to president on any other matter referred to the commission by the president in the interest of sound finance. It is this area that will become part of terms of reference of a particular finance commission in addition to the duties mentioned under article 280. One such term of reference is that the commission may review the present arrangements on financing disaster management initiatives. And the review shall be with reference to the funds that are constituted under the disaster management act of 2005 and the finance commission shall make appropriate recommendations. And the commission was also asked to consider and in the terms of reference, it is mentioned that the commission may consider proposing measurable performance based incentives for states in various areas. For example, efforts that are made by states in expanding and deepening the tax net under GST, progress made in promoting ease of doing business, then progress made in sanitation, solid waste management, bringing behavioral change to end open defecation, et cetera. So this is with respect to the terms of reference or those matters that are referred to the commission in addition to the tasks explicitly mentioned under article 280. Now, in what way this finance commission will carry out its procedures? Class four of article 280 states that the finance commission shall determine the procedure in which it shall carry out its functions. And the commission shall have powers in the performance of functions as parliament may by law confirm. Accordingly, as we saw already, we have the finance commission miscellaneous provisions act of 1951 which has covered the procedure and powers of finance commission. Finance commission shall have its own procedure and it shall have the powers of the civil court. And the act also states that the commission shall be deemed to be a civil court. So these are some of the general information with reference to finance commission and its duties. So we saw that finance commission will be constituted at the end of five years or before. And since the beginning, so far around 15 finance commissions were constituted. The recent one being the 15th finance commission. This was constituted by the president in November 2017. Terms of reference were issued to this commission. And initially, the commission was asked to make recommendations for a period of five years from 1st April 2020. It was asked to submit its report by 30th October 2019. However, the period was extended till 30th November. And in November 2019, the finance commission decided that it will submit for the time being only the report for the first financial year that is starting from April 1, 2022, 31st March, 2021. And the 15 finance commission was asked to submit the report for the next five years. That is from financial year 2021-22 to 2025-26, by 30th October 2020. So by around October November of this year, there will be again a lot of discussion with reference to finance commission. Here we can also observe that the period for which the 15th finance commission will make recommendation has also been extended for one more year. Usually the finance commissions make recommendations after visiting the states, after undertaking detailed consultations with union government, think tanks, domain experts, state governments, and the recommendations made by finance commission are not binding on the government. They are only of a recommendation nature or advisory nature. So what will happen once the finance commission submits recommendations to the president? See, as per article 281 of Indian constitution, the recommendations of the finance commission will be laid before both houses of parliament by the president. The recommendations will be laid along with an explanatory memorandum on the action taken on the recommendations made by finance commission. So this report was tabled in parliament and some of the recommendations made by the finance commission were incorporated in the union budget 2020-2021. So this is the reason why we are now seeing related articles with respect to 15th finance commission, particularly after the union budget speech. Now let's come to today's news article. If you see the terms of reference for the 15th finance commission, one of them is to propose measurable performance-based incentive for states in providing grants in aid to local bodies for the purpose of basic services. So one recommendation made by 15th finance commission is related to the grants that is to be given to the local bodies of the states. In the news article, the grant recommended to the state of Karnataka is compared with other states such as Maharashtra, Uttar Pradesh and Bihar. So the finance commission has recommended a total of 90,000 crore to be allocated as grants to local bodies of the states, out of which the majority, around 60,750 crore has been recommended for rural local bodies and 29,750 crore has been recommended for urban local bodies. It is actually in the ratio of 67.5 is to 32.5. That is 67.5% of the total amount has been recommended for rural local bodies. And out of all the states, Uttar Pradesh has got the maximum share of 16.05%. This is followed by Maharashtra and Bihar. And if you see, Karnataka, which is one of the largest states, has actually got a lower share that is just 5.29 percentage. And while making these recommendations on grants, the finance commission has also asked how to make use of these funds, wherein the commission has asked to give focus to critical sectors of sanitation and drinking water in rural and urban local bodies. Earlier we saw that it is up to the government to accept the recommendations of finance commission. If you see the union budget, the central government has actually allocated more than what was recommended by the 15th finance commission. While the total amount recommended as grants to local bodies was 90,000 crore, the government of India has allocated almost one lakh crore. So these are some of the information with reference to the analysis of this news article. In the analysis of this news article, we saw about the finance commission, its duties, the constitutional provisions for the finance commission. And we saw about 15th finance commission. We saw some terms of reference of 15th finance commission. Then we analyze this news article in particular with reference to grants given to local bodies of the states. Now let's move on to the analysis of next news article. This news article states that a non-billable warrant has been issued by national investigation agency against two terrorists from Kalistan-Zindabad force. In the context of analyzing this news article, we'll see about Kalistan movement, Operation Blue Star and Operation Black Thunder. The syllabus relevant for the analysis of this news article is highlighted here for your reference. See, news article mentions a banned organization called as Kalistan-Zindabad force. For this militant organization, it aims to establish a sovereign Kalistan state. When we say Kalistan, it means land of the Kalsa. In other words, land of people belonging to Sikh religion. So they had a Sikh political ideology and their belief is that it is God-given right for Sikhs, that is only Sikhs to rule the Punjab without the subordination of any other government. The reason why we are calling it as banned organization is because central government has blacklisted Kalistan-Zindabad force as a terrorist organization in the first schedule of unlawful activities prevention act of 1967. In addition to this organization, Kalistan command of force, Babar Kalsa International and Kalistan Liberation force, these organizations and their manifestations were also declared or blacklisted as terrorist organizations under the first schedule. And we also know that with the recent amendment to this legislation, even individual terrorists could be blacklisted under the schedule of UAPA Act. Now these organizations, they aim to establish an independent Kalistan country as a homeland for Sikhs and they aim to achieve it through violent means. And when they say homeland for Sikhs, if you see the geographical territory, according to them, it includes Punjab from both India and Pakistan and then it includes parts of Khyber, Paktunkha, then parts of Haryana, Himachal Pradesh and even Jamun, Kashmir and Rajasthan. And it all started with the Kalistan movement that was in the peak in the second half of 1970s and in 1980s. Punjab in India faced militancy, separatism, communalism, socialist tendencies, insurgency and terrorism because of these movements. The main person associated with various anti-India movements in that period was Jarnal Singh Bindranwale to achieve the political ideology. Bindranwale and his gang were doing a lot of criminal activities such as looting banks, smuggling weapons and others. Historians say that he moved into the Golden Temple of Amritsar, particularly he moved into the safe haven of Akal Thakth inside the Golden Temple. He has given a call for separation of Punjab from India and he also called for an armed struggle against Indian nation. His headquarters was inside the Golden Temple and he made the place inside the Golden Temple as the place of Amri as a sanctuary for his communal and terrorist followers of whom many are criminals and smugglers. The violent separatist and terrorist activity escalated to an explosive point or it went beyond control in May, June months of 1984. Government of India tried various means to solve the issues, however, finally decided to take military action and this action is to be taken under the operation called as Operation Blue Star. So under this operation, Indian Army entered the Golden Temple to deal with the separatists, the terrorists who are involved in various criminal activities, murders and who held Amri inside the Golden Temple and who were planning to attack the Indian Union in the future. The military action was carried out in the first week of June, 1984. Historians say that the terrorists inside the temple were far greater in number and they were also having better arms than the members of Indian military who were initially staying outside the temple. However, gradually Indian Army entered into the temple and Bindranwale and many of his followers were killed. This operation Blue Star, which ended in killing of Bindranwale and many of his followers, established that Indian state is strong enough to deal with separatism, secessionism and terrorism. However, Operation Blue Star was criticized as something that has been hastily conceived, something which was undertaken without proper planning and something which was executed poorly. The main reason why the criticisms were placed is because the operation actually failed to take into confidence of the person's belonging to Sikh community. The operation failed in making the people belonging to Sikh community to think that the operation is not against the religious sentiments of Sikh population, rather the operation was carried out to deal with Bindranwale and his communal terrorist followers. Since the population of Sikh religion were not taken into confidence, they took it so emotional and they thought the operation is an attack on religious identity, that is the attack on golden temple. Therefore, Operation Blue Star produced a deep sense of anger and outrage among Sikhs in all over the country. They thought the military action by Indian Army has spoiled the sacredness and holiness of the golden temple. And finally, on 31st October, 1984, the then Indian Prime Minister, Msindra Gandhi was assassinated by two security guards who belong to Sikh religious community. It was reported that they assassinated the Prime Minister in retaliation to the Operation Blue Star. After the assassination, there were riots in Delhi and various regions in the country targeting persons belonging to Sikh religion and therefore, these riots are called as anti-Sikh riots. Thousands of people from Sikh religious community were killed and as a result, government at that time has to deal with two things. One, tracing the masterminds behind the decisionist movements and insurgent activities in Punjab and the other is that the anti-Sikh riots have to be effectively contained and various efforts were taken by the government and finally, government launched Operation Black Thunder in the year 1988. Operation Black Thunder was hailed as a success because compared to Operation Blue Star in a bloodless fashion. It made the insurgents, terrorists and communalists to surrender to the police. So with this, the separatist movement in Punjab that gained momentum in 1980s and late 1970s were brought to culmination. However, even still there are sporadic instances in Punjab and in Punjab of Pakistan where there are terrorist activities to resurrect this Kalistan movement. So in one of the efforts by these terrorists, government of India has blacklisted the various organizations that are working against Indian Union. So these are some of the information with reference to the analysis of this news article. In the analysis we saw about Kalistan movement, Operation Blue Star, Operation Black Thunder and few information about this news article. We would like to inform you that with reference to National Investigation Agency, viewers are requested to view the analysis on 17th January 2020 wherein we discussed in detail about National Investigation Agency, the schedule defenses under NIA Act and the objectives of NIA, the role of central government and state governments in handling the cases of terrorism and we also saw about National Investigation Agency Amendment Act of 2019. Now let's move on to the analysis of next news article. This editorial article is about data-based governance in the transportation sector or in mobility. The syllabus relevant for the analysis of this editorial is highlighted here for your reference. See, one of the authors of this editorial is actually heading the department of open data initiative in the state government of Telangana. This author, along with a representative from Ola Mobility Institute, they have written this editorial. The authors are actually highlighting how data can be useful in the transport sector. So what do we mean by data when we speak about data-based governance in the transport sector? See, these are data that are collected from CCTV cameras, that are collected from spot find centers, that are collected from traffic management centers, that are collected from transportation service providers. And these also include data from map services, say, for example, Google Maps. And these also include data about bus stops, bus routes, metro routes, metro stations, bus fares and also frequency of public transit services. And as you can observe, we need to process these data. You can see some of the data are static in nature and some of them are real-time. For example, bus fare could be a static information, bus stops could be static information, whereas the movement of traffic and various other parameters, they could be dynamic or real-time basis. Processing and sharing such data is expected to give immense benefits in the transportation sector. They are saying mainly it will help address the growing congestion in the urban cities and urban areas. By addressing congestion, the authors say that we can save a lot of money that is actually lost because of congestion. Studies are saying that congestion caused an estimated loss of 87 billion US dollars to United States economy in 2018. In four metro cities in India, in 2018, congestion has led to a loss of around 24 billion US dollars. So this means the four metro cities in India because of congestion has lost around 170,000 crore just because of congestion in 2018. So handling traffic congestion will also help us to save money from losses. While this is on one side, we are actually feeling difficulty in expanding our road networks because of limited land resources. So in this context, database governance is the need of the hour to make the transportation efficient by reducing traffic congestion. Then this database governance and transportation will help us reduce the travel time and also the cost of travel. And finally, it will also provide a greater convenience. So overall, we can say it will improve the efficiency in the transportation system and sector to a different level. You may be thinking that many individuals are currently using database traveling, maybe using Google Maps. But this travel that is based on Google Maps are still in nascent stage. And even after using the services from Google Map, there is still lack of reliability from the users. So what we need is more and more integration of data from multiple sources so that a comprehensive system is achieved wherein there is reliability, authenticity, et cetera. See, when we say database governance, here first the government authorities have to build an open data initiative for transportation. Why government authorities have to take the first role here? This is because it is the government authorities who regulate road maintenance. It is the government authorities who take complaints on deterioration of road quality. It is also the government authorities who maintain traffic. So when there is such a digital data system, then various services from the government can be done on a timely basis in this transportation sector. And the information that is shared because of the database governance will be helpful in carrying out road repairs as soon as possible. And it will also help authorities to take initiatives for road safety to monitor the quality of construction of roads. And it will also help us to study various parameters that will help in improving efficiency in transportation. For example, using the data that is generated by this data initiative. One can study the role of bad roads or deteriorated roads in causing congestion and a research based on this research question will help to bring appropriate data-driven policies. The authors highlight that there are immense benefits and to substantiate, they're highlighting some results that are observed from three regions. One in United Kingdom, one in China and one in our country itself. In UK, there is a local body called as Transport for London. This local body is responsible for the transport in and around the capital of United Kingdom, London. Transport for London has conducted a study on its open data initiative for transportation. This study has found out that its initiative has improved productivity and efficiency in transportation. They're saying that as a result of sharing of real-time transit data, they were able to add around 130 million pounds sterling every year to the economy of London. So this comes to around some 1,200 crores if you convert it to Indian rupee. Now come to China, there they are having a traffic management platform but it is based on artificial intelligence. This platform is reportedly developed by Alibaba and they're saying that there, they're able to improve average speeds to the tune of by around 15%. So this is one another benefit. The third example is from India. In Hyderabad, an initiative called as Open Transit Data was launched by Open Data Team of Telangana. This Hyderabad Open Transit Data Initiative is reportedly mentioned as country's first data portal that publishes data sets on bus stops, bus routes, metro routes, metro stations, schedule of public transportation services and bus fares and also frequency of public transit services. In this system, they're actually encouraging startups and developers to create useful mobility applications or in other words, useful transport applications. And in this system, we talked about data sets. These data sets are actually built by intensive exercise that is carried out by Open Data Team of Telangana and also Telangana State Road Transport Corporation. It is these two bodies that have involved in collecting verification and also digitizing the data that is collected and verified. And here they have also began carrying out collaboration with private sector as well to improve traffic infrastructure. For example, a memorandum of understanding was signed between the government of Telangana and Ola Mobility Institute. Under this collaboration, Ola has developed a tool which is called as Ola CitySense. Now the special feature of this tool is that it provides data-based insights to monitor the quality of roads in Hyderabad. Also, this Ola CitySense helps to identify bad quality patches in roads. So these are information given in this editorial and we saw that one of the authors of this editorial itself is from Ola Mobility Institute. So end of the day, what Telangana government has found is that the data system is extremely helpful in carrying out road repairs to improve road safety, to monitor quality of construction of roads, to study the role of bad roads in causing congestion. So it is no doubt that data-based governance in transportation sector has numerous benefits. And therefore the authors call for such an open data initiative all over India so as to take or accrue the various benefits as soon as possible. And also to prevent the loss of money because of lack of such a system. Now to realize such a data initiative, what is required is various departments in the government that are associated with transportation. Now these departments have to be made data-centric departments. How can we do this? One way is by institutionalizing data collection in these departments. Then by building technology platforms to ensure that these departments are data-centric and these departments should also have the capacity to handle various information and insights that are derived or generated from the collected and verified data. The authors actually give us a suggestion by which this project of data initiative can begin in various cities in our country. What they are suggesting is to start this data initiative from the command and control centers under the smart cities mission. And they are also calling to use artificial intelligence in this data system at the same time to provide appropriate attention and to address the genuine concerns of data protection and privacy. So in this way, there can be a digital-based transformation in the transportation sector where data in such system is used for the good of public and data in itself will become a public good. So with this, we come to the end of analysis of this editorial article. In the analysis, we saw about the ingredients for data-based governance in transportation sector. We saw the advantages and benefits. Then we saw the international and regional examples. These examples are special because we can learn and adopt best practices from their systems. And we concluded the article by seeing how such a data-based infrastructure can be built in our country. Now let's move on to the analysis of next news article. This news article appears in the newspaper because of the recent release of Consumer Price Index for the month of January 2020 yesterday by the National Statistical Office which comes under Ministry of Statistics and Program Implementation. The news article talks about retail inflation and also industrial output in our country. We know that the retail inflation in our country is measured in terms of consumer price index and industrial output is measured in terms of index of industrial production. So in the context of analyzing this news article, we'll discuss about consumer price index, wholesale price index and also index of industrial production. The syllabus relevant for the analysis of this news article is highlighted here for your reference. See consumer price index is a measure of retail inflation rate. To put it in a simple manner, we can say that it is a measure of increase in the price that is experienced by consumers at the retail level or at the retail shops. So CPA is a measure of change in retail prices of goods and services that are consumed by defined population group in a given area with reference to a base year. The base year for the purpose of releasing consumer price index is 2012. So at present the consumer price index numbers are released. In three sets, one is CPI Rural, then CPI Urban and CPI Combined. And we should note that RBI is using CPI Combined as the inflation measure for setting inflation target and to ensure price stability. So based on inflation targeting under RBI Act of 1934, RBI is required to maintain CPI rate of inflation of 4% with the change of plus or minus 2% each. The CPA measures price changes of a fixed basket of goods and services. These goods and services are classified into six groups. They are food and beverages, panned tobacco and intoxicants, clothing and food wear, housing, fuel and light and miscellaneous. In miscellaneous you can see household goods and services, health, transport and communication, which are services, recreation and amusement, education, personal care and effects. Of these six groups, highest weightage is given to food and beverages. The weightage out of 100 is 54.18%. The second highest weightage is given for miscellaneous 27.26%. Note that food and beverages category is one main group under consumer price index. But national statistics office is also releasing one another index called as consumer food price index. See this index measures the change in retail price of only food products with reference to a base year. If you see consumer price index, there are 12 subgroups under food and beverages. Of these 12 subgroups, consumer food price index is based on only 10 subgroups. It excludes two that are non-alcoholic beverages and prepared meals, snacks, sweets, et cetera. So this is about consumer price index which is released by the National Statistical Office of Ministry of Statistics and Program Implementation. Now let's see in brief about wholesale price index. See, wholesale price index reflects the price changes at the wholesale level or at the bulk sale level or at the level of early stage of transactions. It captures all bulk transactions of goods that are carried out in the domestic market. In other words, it measures the changes at price before the retail level sale of products. And WPI is calculated using the base year 2011-2012, whereas the base year for CPI is 2012. WPI is compiled and released on monthly basis by Office of Economic Advisor under Ministry of Commerce and Industry. We saw CPI is released by National Statistical Office of Ministry of Statistics and Program Implementation. Index basket of WPI, it covers commodities under three major groups. Index basket under CPI, it covers commodities under six major groups. In WPA, you can see three major groups that are primary articles, fuel and power, manufactured products. Now coming to weightage that is given to each category in WPA. The highest weightage is for manufactured products 64.2%. Followed by primary articles 22.6%. Then fuel and power, weightage is 13.2%. Here what you can observe is that under primary articles, there are food articles and non-food articles. And since the weightage of primary articles is less, the price change in food products will not have greater impact than the price change of manufactured products in the WPA. But if you see consumer price index, 54.18% of weightage is for food and beverages. Therefore, the price changes in food and beverages will be captured sharply or in a better way in CPI rather than in WPA. And the three categories or groups of WPA cover prices of commodities from four sectors, their agriculture, mining, manufacturing and electricity. In case of CPI, we saw under miscellaneous category, services such as transportation, communication, education, recreation and amusement, household services, personal care were covered. But know that in WPA, services sector is not covered. So these are some of the information with reference to CPI and WPA. Now let's see with respect to index of industrial production. See, it shows performance of different industrial sectors of Indian economy published on a monthly basis by National Statistical Office. Actually it measures short term changes in the volume of production. That is volume of production for a basket of industrial products for a given period with respect to base period. The base year for IAP is 2011-12. The present basket of IAP has 407 items in three groups of mining, manufacturing and electricity. 405 items belong to manufacturing sector and the weightage is 77.63%. And in mining and electricity, one item is there. You can see the weightage here. And these item groups in IAP, they are further divided into primary goods, capital goods, infrastructure goods, intermediate goods, consumer durables and consumer non-durables. Now let's come to the news article. The news article states that retail inflation or CPI combined inflation has touched 7.59%. For January, in December it was 7.35%. At that time it was told that CPI inflation rate has become highest in last six years. This is because the rate that is higher than December CPI rate was 8.33% witnessed in May 2014. So with retail inflation going up, it is bound to affect common citizens. And in such a scenario, majority of disposable income of people is expected to meet the inflated price. The news article states that the food inflation for January 2020 is 13.63%. Now this is nothing but consumer food price index for January 2020. In December it was 14.19%. Now the reason for this food inflation is mainly because of inflation in the price of vegetables. Even the prices of pulses, meat, fish and eggs also remained quite high. Now coming to index of industrial production, it has recorded a negative growth of 0.3% in December 2019. In November 2019 it has shown a positive growth of 1.8%. Now the fall in index of industrial production shows that industrial output has reduced. And within IAP fall in growth is witnessed in manufacturing and electricity sectors. Whereas there is a positive growth in mining sector. These are some of the information with respect to IAP. Overall you know that what is WPA, what is CPA, what is IAP, what are the various groups under these indices, how much is the weightage, what are the special information about each of these indices for your prelims examination. With this we come to the end of analysis of this news article. Now let's move on to next news article. This news article is with respect to the need to have an efficient and bigger banking system in India to support growth of Indian economy, to achieve the target of $5 trillion economy by the year 2025. In this context we'll be seeing some facts with respect to the ranking related to world's top 100 banks. And how Indian banks have performed in that list, whether we have some banks that feature in the top 100 list. And we'll also see few information with reference to public sector banks in India. And some of the important points raised in the economic survey that was released recently for the financial year 2020. The syllabus relevant for the analysis of this news article is highlighted here for your reference. Yesterday, that is on 12th February 2020. While attending an event in Pune, the president of India had said that India has become one of the largest economies in the world. And as India aims to become a $5 trillion economy, the banking sector has to prepare for the next big leap. This requires banking with the unbanked and securing the unsecured. The event was held in National Institute of Banking Management. Here, banking with the unbanked refers to taking forward the banking services to the hitherto unbanked section of population. And securing the unsecured in a way refers to securing the money that are in the hands of people. So as to put in savings in banks. And the president also said that India should aim to have more than just one bank in the world's top 100 banks. So what is this ranking of top 100 banks in the world that the president has referred to? Now this ranking of top 100 banks at the global level is done by standard and poor global market intelligence. Now this S&P Global Market Intelligence is a United States based company that is having expertise in real time data, research and analytics. The inputs given by this company are mainly used by institutional investors, commercial banks, investment advisors, wealth managers, et cetera. See, every year S&P Global Market Intelligence ranks largest 100 banks in the world. This they will do by converting the total assets of the banks into US dollars. If you see the latest ranking released by S&P in April 2019, overall China has 19 banks in the top 100 list, almost 20%. And this is followed by United States that has 12 banks in this top 100 list. And coming to India, which is fifth largest economy in the world, has just only one bank in the top 100 list. This bank is the state bank of India. In 2019 ranking it was in 54th position. Earlier in 2018 it was in 55th rank. Know that SBI is around some 50 to 60 range of rank. The total assets of SBI is just above half a trillion, that is around 0.5 trillion. So highlighting to this global ranking, the recently released economic survey mentions that India needs much bigger banks to become a $5 trillion economy. For this it calls for efficient financial sector to enhance efficiency in the economy. One of the reasons why US is acting as an economic superpower, it is because of the support of United States banking system. In recent times, China has also emerged as one of the economic superpowers. Main reason is their banks. All the largest economies have proportionately large banks, but Indian banks are disproportionately small when compared to the size of Indian economy. These are the points that are raised in the economic survey in chapter Golden Jubilee of Bank Nationalization, taking stock. Here taking stock refers to having an assessment of banks. Economic survey has also noted that public sector banks have constituted nearly 70% of the market share in Indian banking sector. While the penetration of credit from the public sector banks is also lower in India to the population, the survey also mentions that public sector banks are also inefficient and are also not functioning up to the required level. The performance of public sector banks are further questioned because of bad loans that are in the tune of around 66,000 crores in 2019. An economic survey also states that public sector banks account for 85% of reported bank frauds. So these things have to be immediately addressed and the economic survey proposes the public sector banks to adopt financial technology, machine learning, artificial intelligence and big data to overcome the present challenges and inefficiencies and also to deal with frauds and loan defaults. If you see, there are three important committees that we have to keep in mind whenever there is talk regarding enhancing the efficiency of public sector banks. They are Narsimhan Committee of 1991 and 1997, then Rajan Committee of 2007, then PJ Nayak Committee of 2014. So economic survey calls the public sector banks to implement the recommendations and several suggestions given by these committees to enhance the efficiency. So a cleaning up is required in the banking system and the legal framework such as insolvency and bankruptcy code and the entire banking system should more focus on scaling up efficiency so as to support the economy. So these are some of the observations made with reference to public sector banks in the chapter Golden Jubilee of Bank Nationalization taking stock of the economic survey 2019-2020. So with this, we come to the end of analysis of all the news articles taken up for today and now we are moving to the last session, the practice questions discussion session. This question is with reference to Finance Commission. Two statements are given and which of the above statements are incorrect. First statement as per article 280 of Indian Constitution, the President shall constitute a Finance Commission. Now this statement is correct. The President by order shall constitute a Finance Commission with Chairman and four other members. Since the statement is correct, question asks for incorrect statement. You can eliminate option A and option C. Now second statement, the qualifications for appointment of the members of the Finance Commission is determined by the President. Now this statement is incorrect. This is because class 2 of article 280 states that the qualifications may be determined by the Parliament by law. So only the second statement is incorrect. Correct answer is option B. Second statement only is incorrect. Now this question is with reference to public sector banks in India. Two statements are given. They are asking to select the correct statements using the code given below. First statement, three public sector banks in India have featured in the world's 100 largest banks. Now this statement is incorrect. Only one public sector bank that is State Bank of India has featured in the world's 100 largest banks. And this ranking is based on the ranking annually given by standard and poor global market intelligence. If you take United States, 12 banks of United States are in this 100 largest banks. In the case of China, around 19 banks are there. These facts are with reference to the data released by standard and poor global market intelligence in April 2019. Now come to second statement. The credit growth of public sector banks has increased significantly since 2013 and has become stable since 2016. Now this statement is incorrect. This is because economic survey for the year 2019-2020, it states that credit growth among public sector banks has declined significantly since 2013. And has also been anemic since 2016. Here anemic refers to the state where credit growth is not according to the required level for the growth of the economy. So here both the statements are incorrect. Therefore the correct answer is option D, neither one nor two is correct. Now in this question they have asked which of the above are incorrectly matched. Here the understanding is that who releases these indices. Consumer food price index, they are saying it is released by Nithya Yoke. This is wrong. Consumer food price index is released by National Statistical Office of Ministry of Statistics and Program Implementation. So one is incorrectly matched. So you can eliminate option B and option C. Come to the second one, Wholesale Price Index, Office of Economic Advisor. This is correct because Office of Economic Advisor of Ministry of Commerce and Industry releases Wholesale Price Index. So this means obviously the correct answer is option A one only. Come to the third point, Index of Industrial Production. This is correctly matched because index of industrial production is released by National Statistical Office of MozP. So the correct answer is option A one only. Now this question is with reference to Unlawful Activities Prevention Act of 1967. Three statements are given. They're asking to select the correct statements. First statement, the act will be applicable to the offenders only if the crime is committed inside India. Now this statement is incorrect. This is because the provisions of Unlawful Activities Prevention Act applies to citizens of India in India. It applies to citizens of India outside India. It applies to persons in the service of the government wherever they may be. It even applies to persons who are on ships and aircrafts that are registered in India irrespective of the location where they are. So the first statement is incorrect. So this means you can obviously arrive at the correct answer option C two and three only. Now come to the second statement. Persons on ships and aircrafts registered in India wherever they may be. They are also under the ambit of this act. This statement is correct. Third statement, both individuals and organizations can be listed as involving in terrorist activities under the schedule of the act. Under a schedule of the act. Now this statement is also correct. Before the 2019 amendment to this UAPA, only organizations could be listed or blacklisted under the first schedule of this act. However, after the amendment of 2019, both individuals and organizations can be listed as terrorist and terrorist organizations under first schedule of this act. So the correct answer for this question is option C two and three because only second and third statements are correct. With this, we come to the end of today's the Hindu news analysis. If you like the video, click the like button, comment, share and subscribe to Shankaray's Academy YouTube channel for more updates and content on civil services exam preparation. We'll meet you tomorrow.