 A very good evening aspirants. I have an important announcement regarding your prilims preparation. Yes, it is about pre-storming batch 3 The orientation for this batch already concluded and the first test will commence on next Sunday. That is 20th of November 2022 Still you have a chance to enroll in batch 3. Those who have missed the chance to enroll already The window to register is still open. Use this wise chance and enhance your prilims score Now with this happy note, let's move on to the Hindu news analysis for the date 11th of November 2022 Displayed here are the list of articles that we are going to discuss today. You can go through it without much delay Let's get into the article discussion See this article here. This news article says that the SB has forecasted the current account deficit for India to be around 3 percentage Earlier the current account deficit was expected to reach 3.5 percentage Yes, they in its report said that the current account deficit will be 5 base points lower than that and it will reach 3 percentage The report said the fall in current account deficit is due to increase in software exports Then increase in inbound remittance and an expected jump in India's forex reserve And this is about news article in this context in our discussion today Let us brush up our basics regarding balance of payment Balance of payment is a statement which records all the monetary transactions made between Residents of a country and the rest of the world during any given period This statement includes all the transactions made by individuals Corporations and the government So basically the balance of payment helps in monitoring the flow of funds within and outside the country See the balance of payment also helps us understand whether a country has surplus or a deficit of funds The balance of payment has two main components. They are current account and the capital account now We will see about them one by one first. Let's take current account See the current account has three components in it first one is trade in goods that is important export of goods Second one is trade in services which include income earned through exporting service and interest earnings The third one is transfer payments. It includes remittance and grants So, basically the current account includes all the transactions that do not bring change to the total asset and liability The current account may be surplus or deficit See current account is said to be in surplus when the sum of exports Inbound payment for services and inbound gifts and grants is higher than the sum of Imports outbound payment for services and outbound gifts and grants and the reverse is termed as Current account deficit that is when outflow of funds is more than inflows And this is about the current account current account deficit and current account surplus now Let's take capital account while seeing about the current account I said the current account includes all the transactions that do not bring change to the total asset and liability Here the reverse is true for capital accounts See the capital account includes all the transactions that bring changes to the total asset and liabilities For example, if India is borrowing funds from another country, it is a liability for our country because we must pay it back Likewise, if India is lending to another country, it is an asset because India will earn interest for that amount And it will also get its money back after a while So this type of capital inflow and outflow comes under the capital account See the capital account includes foreign investments like foreign direct investment foreign institutional investment and investment in the equity markets External commercial borrowing by the private corporations and the government then NRA deposits in Indian banks and Indians depositing in foreign banks and external assistance provided by multilateral organizations For example, assistance provided by the World Bank Group for the strengthening of the national duty submission It is accounted for the capital inflow here The capital account may also be surplus or deficit when the capital inflow is more than the capital outflow Then the capital account is said to be in surplus Then when the capital outflow is more than the capital inflow then the capital account is said to be in deficit And this is all about capital account capital account surplus and capital account deficit See in the news article we saw that India's SB report estimated India's current account deficit to be 3% of the GDP right. But what about the capital account deficit? The thing is that India normally does not have a capital account deficit. India only has a capital account surplus. This is because India is a fast growing country with a huge domestic demand. So India attracts a huge volume of foreign direct investment and foreign institutional investment. So the net capital inflow into India is always positive. This is why India for the most of time has a capital account surplus. But why does India have a current account deficit? This is due to India's huge dependence on imported crude oil. Although India receives a huge amount of remittance and exports lots of services, the crude oil import overshadows that and the current account is always in deficit. See here are three important points which some people might confuse regarding current account and capital account. I will list out the difference here. Kindly make note of it. First one regarding NRI. While NRI deposits are included in the capital account, the remittances received are included in the current account. Secondly about grants. While external grants are included in the current account, then the external assistance in the form of loans are included in the capital account. And third is that borrowings. While the external commercial borrowings are included in the capital account, then the interest for those loans are included in the current account. So these are all some of the differences that you have to make note of. That's all regarding this discussion. In this discussion we saw about balance of payments and its components, that is the current account and the capital account. With these key points in mind, now let's move on to the next news article discussion. Have a look at this news article. This news article is about the T board. The chairman of the T board was seeking assistance from the commerce ministry. He cited three reasons for seeking assistance. First is that 52 percentage of total tea production in the country comes from small tea growers. So this assistance will help the small tea growers. Then second is to promote the Indian brand tea abroad. Currently tea from India is exported as a bulk commodity due to lack of value addition and branding. And to create a globally recognizable Indian brand, proper financial assistance is required. And thirdly, a domestic tea consumption has stagnated. So the assistance can be used to kick-start domestic tea consumption. And this is about the news article. In this context, let us see some points about T board. T board is a statutory body under the ministry of commerce and industry. It was established in 1954 under the T Act 1953. Before the T board, there was the central T board and the Indian tea licensing committee, which functioned respectively under the Central Tea Board Act 1949 and the Indian Tea Control Act 1938. These two bodies focused on regulation of tea cultivation, export of tea and promotion of tea. In 1954, the T board replaced the central T board and the tea licensing committee. So right now the T board focuses on promotion of tea inside and outside the country. And they also helped in improvement of tea production quality through R&D. And they also promote welfare schemes to the plantation workers. And they also collect and publish data regarding tea and finally they assist the small tea growers. The vision of the board is to make India the leading producer and supplier of quality tea in the global market. So this is all regarding T board. Now let's see about the organizational structure of the T board. See the present T board consists of 31 members including chairman. The T board reconstituted every three years. The members of the T board consist of members of parliament, tea producers, tea traders, tea brokers, consumers and representatives of governments from the principal tea producing states and trade unions. Also note that there are six standing committee in the T board. They are executive committee, export promotion committee, labor welfare committee, development committee, licensing committee for not India and licensing committee for South India. Here the executive committee deals with the administrative matters. Then the export promotion committee deals with export promotion. Then the labor welfare committee looks after the welfare of the laborers. Then the development committee looks into the various development steps taken by the T board. And finally the licensing committees issues license and act in accordance with the directions of the executive committee. So this is all regarding this discussion. This discussion is about the T board and its functions and finally about six standing committees in the T board. With these key points in mind, now let's move on to the next news article discussion. Have a look at this news article. This news article says that the central government released two installments of tax devolution to states. The total amount is more than rupees 1.16 lakh crore and this is done to help accelerate the state's capital expenditure. And the government gave 1.16 crore instead of normal monthly devolution of rupees 58,333 crore. And this is the crux of the news article given here. In this context, let us see about 15th finance commission's recommendations on tax devolution. Before getting into discussion, the syllabus related to this article is given here. Please go through it. Before getting to see 15th finance commission recommendations, first you should know what is tax devolution. C tax devolution is nothing but a portion of net proceeds of the center taxes that are awarded to the states. In simple words, it is an amount of money that are given to states from the center's tax and duties. C tax devolution is one of the core tasks of 15th finance commission under article 280 class 3 of the Indian constitution. As we all know, article 280 is about the finance commission. So what does this tell you? See, finance commission is a constitutional body. Now coming to the class 3 of article 280, it says that it shall be the duty of the commission to make recommendations to the president. And the recommendations are regarding, first one, the distribution between the union and the states of the net proceeds of taxes and the allocation between the states of the respective shares of such proceeds. So this covers vertical devolution, which is distribution between center and states. And it also covers horizontal devolution, which is distribution between the states. Secondly, the finance commission recommend about the principles that should govern the grant in aid of the revenues of the states out of Consolidate Fund of India. Thirdly, finance commission recommends the measures needed to augment the Consolidated Fund of State to supplement the resources of the panzites in the state. Fourthly, finance commission makes recommendations regarding the measures needed to augment the Consolidated Fund of State to supplement the resources of the municipalities in the state also. And finally, they will make recommendations on any other matter referred by the president in the interests of sound finance. Now with this information, let's move on to see the recommendations of the 15th finance commission regarding tax devolution. See in order to maintain predictability and stability of resources, 15th finance commission has recommended maintaining the vertical devolution at 41%. This means that the share of states in the center taxes recommended to be 41%. And this is for the period of 2021 to 2026. This is less than the 42% share recommended by 14th finance commission for 2015 to 2020 period. See this 41% recommended in 15th finance commission amounts to 42.2 lakh crore for 2021 to 2026 period. Also note that the adjustment of 1% is provided for the newly formed union territories of Jamun, Kashmir and Ladakh. And this 1% is given from the resources of the center. This is all about vertical devolution. Now coming to horizontal devolution, that is the distribution between the states. See the distribution between states are made based on certain criteria. And this table here shows the criteria used by the finance commission to determine each state's shares in central taxes and the weight assigned to each criteria. See three criteria are included in 15th finance commission, which is not in 14th finance commission. They are first one, forest and ecology. Note that in the 14th finance commission, it was forest cover but not forest and ecology. Here this is one criteria. And second criteria which are included in 15th finance commission that was not in 14th finance commission was tax and fiscal efforts. And the third one demographic performance. Just note the difference here. See all these six criteria forms basis of tax devolution among states. So this means that the horizontal tax devolution depends on firstly population of the state. Here population is based on 2011 census and the weightage for this criteria is 15 percentage. Secondly area of states. Here the weightage is also 15 percentage. Thirdly forest and ecology. This is arrived by calculating the share of the dense forest of each state in the total dense forest of all the states. And here the weightage is 10 percentage. Fourthly income distance. This is the distance of your state's income from the state with highest income. Here the weightage is 45 percentage. See a state with low per capita income will get a higher share to maintain equity among states. Fifthly tax and fiscal efforts. It means efforts taken by states to increase the efficiency of tax collection. Here the weightage is 2.5 percentage. See this criteria only is used to reward states with higher tax collection efficiency. And finally demographic performance. It means efforts taken by states in controlling population. Here the weightage is 12.5 percentage. So this is all about six criteria. And the total will be calculated adding all these six criteria. And based on the final value only the tax devolution happens between states. So this is all with respect to vertical and horizontal tax devolution. That's all regarding this discussion. In this discussion we saw about tax devolution and the 15th finance commission's recommendations on tax devolution. With these key points in mind I will just move on to the next news article discussion. Have a look at this opinion article here. This article reports about a discussion moderated by two eminent persons. Here they have discussed about many things. Firstly about the role and conduct of governors. Then the relation of governors with the center and state government. And whether chief ministers should have a say in the appointment of governors in their respective states or not. So in this backdrop let us understand some of the important points mentioned in the news article. Before getting into that the syllabus relevant to this topic is highlighted here for your reference. You can go through it. Now firstly let us understand what are all the roles and responsibilities of governor. Then what is the significance of governor post. To find answer to these questions firstly you must know that the constitution of India envisages the same pattern of government in the states as that for the center that is a parliamentary system. Coming to the states here the state executive consists of governor the chief minister the council of ministers and the advocate general of the state. Among them the governor is the chief executive head of the state. But like the president he is just a nominal executive head. And the governor also acts as an agent of the central government. So the office of governor has a dual role. Now talking about his appointment governor is neither directly elected by the people nor indirectly elected by a specially constituted electoral college as is the case with the president. See he is appointed by the president by warrant under his hand and seal. So in a way he is a nominee of the central government. Note one fact here the office of governor of a state is not an employment under the central government. It is an independent constitutional office and it is not under the control of or subordinate to the central government. Here you must know why the constituted assembly opted for the present system of appointment of a governor by the president instead of direct election. The first reason for that is they thought that an elected governor would naturally belong to a party and he would not be a neutral person and an impartial head. Secondly the chief minister of the state would like his nominee to contest for governorship. Hence a second great man of the ruling party is elected as governor. Coming to the direct election see the direct election of the governor might create a serious problem of the leadership at the time of general election in the state. And due to these reasons the constituted assembly opted for the present system of appointment of a governor by the president instead of direct election. Additionally the constitution lays down only two qualifications for the appointment of a person as a governor. First he should be a citizen of India and second he should have completed the age of 35 years. Except these two conditions we have no criteria or no minimum qualifications laid out for a governor. See governor holds office for the term of five years from the date on which he enters upon his office. But this term of five years is subject to the pleasure of president. That is the governor has no security of tenure and no fixed term of office and he may be removed by the president at any time. The president can also make any such provision as he thinks fit for the discharge of the functions of the governor in any contingency which is not provided in the constitution. But like the president the governor is also entitled to a number of privileges and immunities. He enjoys personal immunity from legal liability for his official acts. And during his term of office he is immune from any criminal proceedings even in respect of his personal acts. So he cannot be arrested or imprisoned. And considering all these Mr. Madhavan one of the eminent person said that we are a federal country which means there is a clear design that there will be constituent states who elect their own governments and they remain as a union of states. So there is a need to ensure unity and some level of uniformity across the union of states. But this federal structure also has its own tension. So one of the designs of the constitution is supposedly to manage this tension and this is through the post of governor who may act as a link between the center and the states. Now you may argue that the post of governor itself has added various tensions at various times. So to resolve that only many committees were constituted. This includes the Rajmanar commission 1969 then Anandpur Saheb resolution 1973 and then came the Sarkarya commission set up in 1983 and the Punchi commission 2007. Know that both Sarkarya commission and the Punchi commission recommended that the chief minister should be consulted before appointing the governor for proper working of the parliamentary system and they recommended that the appointment of governor should be entrusted to a committee comprising prime minister, home minister, speaker of the Lokshaba and chief minister of the concerned state and the vice president may also be involved in the process. So here comes the question should the condition that the chief minister be consulted prior to the governor's appointment be made mandatory to answer this question both eminent persons that is Margaret Alva and Mr Madhavan said that asking chief minister's approval for the appointment of governor is not correct but for sure there must be general consultation with the chief minister. See the eminent persons listed several reasons why chief minister is consulted before making an appointment of governor. We will see them one by one. Firstly Margaret Alva said that nowadays the appointment of the governor is in the hands of ruling party New Delhi and many governor's office are functioning as party offices of the ruling party. They always take decisions as directed by the union home ministry and the central government which is very wrong constitutionally. Just now we saw that the person who is appointed as a governor is an independent person who must be divided by his right. The person is supposed to keep the interest of the state in mind and also ensure that the link between the state and the center is maintained in the smooth way. And to have a smooth functioning the governor must also take care of the relationship between himself and the chief minister of the state. But this is not happening in many cases. Because of these reasons the eminent person Margaret Alva supported consultation of chief minister before the appointment of the governor. She added that since the governor has to be independent and above the chief minister getting the chief minister involved in the process of selection is not right. The governor should not get this feeling that since the chief minister was one of those responsible for the selection he is indebted to the ruling party or to the chief minister. So because of these reasons she said that the chief minister must be consulted in the process of appointment of the governor and not to be involved in selection process. Don't get confused here I am saying that the CM can be consulted like how the Chief Justice of India consults the Collegium for the appointment of Supreme Court judges. After consulting the Chief Justice of India forms an opinion and recommends a judge to the president of India to be appointed as the judge of Supreme Court. Likewise here CM is to be just consulted but is not to be involved in the selection committee to appoint a governor. The other eminent person Mr. Madhavan also accepted with this. So to conclude to have smooth functioning general consultation with the chief minister is most crucial. See in the beginning we saw why we should not opt to direct election for governor right. Both eminent persons rejected direct election because the governor might be biased towards the state from where he came from. And the governor is supposed to be a friend, philosopher and guide who is helping from the back sorting out issues and resolving disputes even between political parties also and this will make everything right. That's all regarding this discussion. In this discussion we saw about the office of governor and the opinions of the two eminent persons regarding the appointment of governor. With these key points in mind now let's move on to the next news article See this article here. This news article is about ISRO's CE-20 cryogenic engine. The CE-20 cryogenic engine is the one that powers the launch vehicle March 3. We shortly call this as LMV 3. The article says that the hot test done on the CE-20 engine was successful and achieved the required parameters. Here what is a hot test and how is the hot test different from cold test. See hot tests are done on engines to check all the engine parameters like wear and tear, temperature etc as they would function in real time. The main difference between hot test and cold test is that in the hot test the engine is loaded with fuel and the engine performs combustion while in the cold test there is no need for combustion. By looking at this news article itself you can know that the test that was done on the CE-20 engine was a hot test as you can notice combustion here. The news article also says that a 3D printed liquid oxygen and liquid hydrogen turbine exhaust casings were inducted in the CE-20 engine and this will enhance its payload carrying capacity. So this is about the news article in this context let us see some points about cryogenic technology and CE-20 cryogenic engines. First let's see about the cryogenic engine and associated technology. Do you guys remember about the little science experiment that we used to do in our school days? When we mix sulphuric acid with a metal like zinc or iron a gas is released and when you bring a burning match or a candle near the gas you can hear a loud pop sound. The gas that is emitted in this reaction is hydrogen and the pop sound that you hear is because hydrogen is combustible and this combustible property of hydrogen is used in the cryogenic engine. See the cryogenic engine uses the liquid hydrogen as propellant and liquid oxygen as oxidizer. Know that oxygen liquefies at 183 degree centigrade while hydrogen exists in liquid form below 253 degree centigrade. Since these engines deal with various operations at such low temperatures they are called cryogenic engines. This is because cryogenic is the science of extremely low temperatures. Although the operation of the engine is very complex let me explain to you a highly simplified version of the working. Look at the schematic diagram in the blue tank liquid hydrogen is stored and in the cyan tank liquid oxygen is stored and these two mix in the combustion chamber where combustion takes place. In the combustion chamber hydrogen reacts explosively with oxygen to produce water vapor and energy and this hydrogen oxygen reaction generates tremendous heat causing the water vapor to expand and exceed the engine nozzles at a speed of 10,000 miles per hour. So this fast moving steam creates the thrust that propels the rocket from earth according to Newton's third law. One of the biggest advantages of the cryogenic engine is it is eco-friendly. This is because as we saw the exhaust from the cryogenic engine is mainly water vapor. So this is all about working of cryogenic engines and its associated technology. Now let's see some points about CE20 cryogenic engine of ISRO. CE20 is an indigenously developed cryogenic engine that is used in LMV Mark III. The LMV III has three stages there is the solid first stage a liquid second stage and a cryogenic third stage. So the CE20 cryogenic engine is used in the upper stage of LMV MK III. This engine also uses liquid hydrogen as fuel and liquid oxygen as oxidizer. So this is all regarding this discussion in this discussion we saw about cryogenic engine and its technology and finally some points about CE20 cryogenic engine. See these kinds of topics are very important for your prelims exam kindly make note of it. With these key points in mind now let's move on to the next news article discussion. See this news article here this article talks about India's universal periodic review session at the United Nations Human Rights Council. During the session Solicitor General of India appreciates the role of human rights defenders journalists and activists in the democratic system. Then he also asked them to function in conformity with the law of the land. So in his background let us learn few facts about Human Rights Council. See the Human Rights Council is an intergovernmental body within the United Nations system. It is responsible for strengthening the promotion and production of human rights around the globe and its main mandate is to address situations of human rights violations and make recommendations on them. Remember it has the ability to discuss all thematic human rights issues and situations that require its attention throughout the year. See the council meets at the UN office at Geneva. Now talking about its membership it is made up of 47 members. The UN General Assembly elects those members. The members of the council so for a period of three years and shall not be eligible for immediate reelection after two consecutive terms. Note one point here the UN General Assembly has the power to suspend the rights of any human rights council member if it is found to have been constantly committing human rights violations during its tenure. Here the suspension comes into effect with their two by third majority by the General Assembly. Moving on for the smooth functioning of the United Nations Human Rights Council the following subsidiary bodies have been established which directly reports to the council. First in the list is the Universal Periodic Review Working Group. Here the review cycle is about four and half year period within which all UN member states human rights records are reviewed and the working group convenes three two-week sessions per year or 14 sessions over the course of an entire cycle. So far two cycles have been taken place currently the third cycle is going on. See the review meeting mentioned in the news article talks about this only. Coming to the second subsidiary body it is advisory committee. See it serves as the council's think tank providing it with expertise and advice on thematic human rights issues. And the third one is complaints procedure. Here it allows individuals and organizations to bring human rights violations to the council's attention. So that's all regarding this discussion. In this discussion we saw about United Nations Human Rights Council and then about its membership and finally about the subsidiary bodies under human rights council. With these key points in mind now let's move on to the next part of the news article discussion that is to discuss preliminary practice questions. Look at this first question with reference to balance of payments which of the following constitutes or constitute the current account. First one balance of trade. Second one foreign assets. Third one balance of invisibles. Fourth one special drawing rights. See no discussion we saw that current account includes trade in goods trade in services and transfer payments. Know that trade in goods is also called as balance of trade and trade in services is also called as balance of invisibles. Coming to the statements balance of trade. Yes it obviously comes in current account. Then the foreign assets. See the name itself mentions assets. So it comes in capital account and not current account. Third one balance of invisibles. Yes it is trade in services. So it constitutes current account. And then fourth one special drawing rights. See special drawing rights are supplementary foreign exchange reserves maintained by IMF. See this is neither a currency nor a claim on IMF and it is a potential claim on the freely usable currencies of IMF members. So here a special drawing rights are not included in current account. Now coming to the answer only statement one and three constitute the current account. So the correct answer for the question is option C one and three only. Coming to the second question consider the following statements about cryogenic engine. Let's take up the first statement CE 7.5 is the cryogenic engine used in the upper stage of GSLV MK2. Here statement one is correct. Yes CE 7.5 is a cryogenic engine used in the upper stage of GSLV MK2. Whereas CE 20 is a cryogenic engine used in upper stage of LMV Mark 3. So statement one is correct. Coming to the second statement the CE 7.5 cryogenic engine is imported from Russia. See this statement is incorrect because the CE 7.5 cryogenic engine is indigenously produced. I know that KVD 1 which is a cryogenic engine used in GSLV MK1 was only imported from Russia. So the second statement is incorrect. Now coming to the third statement CE 7.5 uses liquid helium as a fuel and liquid oxygen as oxidizer. See this statement is also incorrect because CE 7.5 uses liquid hydrogen as a fuel and liquid oxygen as oxidizer. Now the question is asking for incorrect statements. Here statements two and three are incorrect. So the correct answer for the question is option B two and three only. Moving on coming to the third question. Consider the following statements about United Nations Human Rights Council. Let's take up the first statement. It was established in the year 1946 as a statutory body of United Nations Economic and Social Council. See the statement one is incorrect because it talks about the United Nations Commission on Human Rights. See it was established in the year 1946 as a subsidiary body of Economic and Social Council. The commission was later replaced by the United Nations Human Rights Council due to the reason that it was under severe criticism as its members were primary human rights abusers themselves. Know that the United Nations Commission on Human Rights held its final meeting in Geneva on March 27 2006 and was replaced by the United Nations Human Rights Council in the same year. So the statement one is wrong. See it is mentioning about United Nations Commission on Human Rights and not United Nations Human Rights Council. So it is wrong. Now coming to the second statement. The council has 47 members who are elected for a three-year term on a regional group basis. Yes this statement is correct. This we saw in our discussion itself. Here the question asks for correct statement. Here only second statement is correct. So the correct answer for the question is option B2 only. And this is the quiz question for you today. I will post this quiz question in a community section. Try to answer it and this is the main question for you today. Go through the question, write your answer and post it in the comment section. With this we come to the end of the video. If you like our analysis, please like, comment and share it with your friends and don't forget to subscribe to Shankar IS Academy YouTube channel. Thank you for listening.