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Important Current Affairs for CLAT-27th December 2022

What is global recession 2023 and its impact on India?

Global Recession 2023: According to the Centre for Economics and Business Research (CEBR), a global recession will start in 2023. A global recession is predicted by other agencies as well to begin in 2023. New borrowing costs put in place to fight inflation cause several economies to shrink. According to the British consultancy’s annual World Economic League Table, the global economy topped $100 trillion for the first time in 2022 but will halt in 2023 as governments continue to struggle against growing costs.

The researcher’s findings are more negative than the most recent IMF forecast. According to Bloomberg, this organisation warned in October that more than a third of the world’s economies will collapse and that there is a 25% possibility that in 2023, global GDP will expand by less than 2%, which it characterizes as a worldwide recession.

The global gross domestic product will have doubled by 2037 as developing economies catch up to the wealthier ones. According to Bloomberg, the East Asia and Pacific region will produce more than a third of the world’s output by 2037, while Europe’s share will drop to less than a fifth as a result of changing power dynamics.

The data from the IMF’s World Economic Outlook and an internal model serve as the foundation for the Centre for Economics and Business Research’s estimates of growth, inflation, and currency rates.

Global Recession Impact on India

The report predicts that India’s economy will reach $10 trillion by 2035 and rank third globally by 2032.

Since the US is one of the great superpowers, a mild or deeper recession will eventually have worldwide repercussions.

The crisis ultimately grew and spread into a global economic shock, manifesting itself in a number of European bank failures, drops in several stock indices, and significant falls in the value of the Indian market.

Given that Indian businesses had significant outsourcing agreements with US clients, a slowdown in the US economy was undoubtedly terrible news for India.

Over the years, India’s exports to the US have grown. However, India was impacted and managed to survive the severe financial crisis of September 2008.

Global Recession 2008

Before 2008, the Great Recession had already started. The first warning indicators appeared in 2006 when home values started to decline. By August 2007, the Federal Reserve had injected $24 billion in additional liquidity into the banking system in response to the subprime mortgage crisis. By October 2008, Congress had authorized the Troubled Asset Relief Program, a $700 billion bank bailout. Obama proposed the $787 billion economic stimulus programme in February 2009, helping to prevent a global depression.

Factors that Saved India from Global Recession 2008

The Indian economy was shielded from the negative effects of the global recession by a number of factors.

Due to the fact that India’s economy is heavily dependent on agriculture, it was prevented from experiencing mass unemployment like other impacted nations.

The mortgage-backed securities and credit that turned toxic and brought down western financial institutions were nearly entirely ignored by Indian banks and financial institutions at the time.

Despite the fact that the Great Recession had a significant negative impact on India’s merchandise exports, IT and BPO exports did not suffer as a result.

Despite the financial crisis, foreign direct investment increased.

Financiers stopped flowing into India, but long-term owners of companies and plants continued with their ongoing projects.

Indian Billionaire Gautam Adani to Control Nearly 65% of NDTV

Indian Billionaire Gautam Adani is to control 64.71% of New Delhi Television Ltd (NDTV) as the founders have decided to sell most of the shares. The founders of NDTV, Prannoy Roy and his wife Radhika Roy have decided to transfer most of the shares in the company giving Gautam Adani his conglomerate control of about 65% of NDTV. The decision comes after four months after Gautam Adani announced his takeover of the news channel.

Radhika Roy and Prannoy Roy will sell a 27.26% stake of their remaining 32.26% shareholding in NDTV.

Gautam Adani already holds 37% of shares after an open offer and an acquisition of NDTV.

Adani Group will become the single largest shareholder in NDTV after first buying out a firm backed by the founders and then acquiring more shares from the open market.

Radhika and Prannoy Roy will have a combined 5% stake in NDTV.

Last month, NDTV announced the resignation of the founders Radhika Roy and Prannoy Roy from the RRPR board, however, they continued on the NDTV board.

About New Delhi Television Ltd

New Delhi Television Ltd or NDTV is an Indian news media company that was founded in 1984. The founders of NDTV are economists Prannoy Roy and Radhika Roy. The husband-and-wife duo is from Kolkata. In August 2022, the Adani Group launched a hostile bid to take over NDTV.

Piyush Goel Launched Right to Repair Portal for Consumer

Food and Consumer Affairs Minister Piyush Goyal launched a host of new initiatives, including the right to repair portal and an NTH mobile app and opened new premises of National Consumer Helpline centre in the national capital. A memorandum of understanding was also signed between the Consumer Affairs Department and IIT (BHU), Varanasi as well launched a capacity building programme of consumer commissions.

These initiatives were launched on the occasion of the National Consumer Day. The theme was “Effective disposal of cases in consumer commission”. Minister of State for Food and Consumer Affairs Sadhvi Niranjan Jyothi was also present at the event.

In July 2022 the Department of Consumer Affairs had set up a committee headed by the Additional Secretary Nidhi Khare to develop a comprehensive framework on ‘Right to Repair’.

Its Significance:

On the ‘right to repair’ portal, manufacturers will share the manual of product details with customers so that they can either repair by self, by third parties, rather than depend on original manufacturers. Initially, mobile phones, electronic, consumer durables, automobile and farming equipments will be covered.

Under the Consumer Protection law, a complaint is required to be disposed of within 90 days of its filing and within 150 days wherever expert evidence is required to be taken

International Day of Epidemic Preparedness 2022 celebrates on 27 December

International Day of Epidemic Preparedness 2022:

International Day of Epidemic Preparedness on December 27 serves the purpose of creating awareness about epidemics. This day encourages every individual, every institution, and every government to prepare its citizens in an appropriate manner and in accordance with national contexts and priorities, through education and awareness-raising activities, in order to highlight the importance of the prevention of, preparedness for, and partnership against epidemics.

International Day of Epidemic Preparedness 2022: Significance

The International Day of Epidemic Preparedness reminds us what we went through during the two years of peak-COVID infections. Hospitals were overwhelmed. Family members could not conduct the last rites of their loved ones. Such grim situations could be avoided in the future if people remain alert and prepared.

International Day of Epidemic Preparedness: History

In its 75th session and 36th plenary meeting on December 7, 2020, the United Nations General Assembly (UNGA) passed a resolution which declared December 27 as the International Day of Epidemic Preparedness. The decision is part of the 2030 Agenda for Sustainable Development. The declaration recognised the “devastating impacts of major infectious diseases and epidemics,” especially of the current COVID-19 pandemic, on people’s lives and the long-term damage to social and economic development. The UN General Assembly also noted how the present pandemic had overwhelmed the medical faculty and health systems globally, disrupted supply chains and disproportionately affected the livelihoods of people in poorer countries.

India to Become $10-Trillion Economy by 2035: CEBR

The Centre for Economics and Business Research (CEBR), which is a UK-based economics consultancy, predicted that India will become the third-largest economy by 2037. 14th edition of the report noted that over the next five years, the annual rate of GDP growth is expected to average 6.4%. After that, the growth is expected to average 6.5% in the subsequent nine years.

What The Report Highlighted:

As per the report, India seems “unstoppable in its momentum” to become the third economic superpower. The report has predicted that in 2035, India will become the third $10 trillion economy.

While commenting on the Chinese economy, the report said that despite modest output performance in 2022, inflation was at an anticipated 11.6%. The Chinese economy, therefore, faces a potential stagflationary trade-off between growth and price rises.

In last year’s report, it was mentioned that India will regain its position from France and the South Asian nation will witness an improvement in its World Economic League Table (WELT) ranking over the next 15 years.

Like the world, India also faced the wrath of the coronavirus (COVID-19) pandemic as the nation has the third-highest death toll globally. In the beginning, the pandemic caused a significant decline in economic activity, with output contracting by 6.6% in the fiscal year 2020/21.

But in the post-pandemic times, countries are now looking to revive their economy, and so is India. The report mentioned that a sharp rebound in economic activity in the post-pandemic era was led by a rise in domestic demand. It has resulted in GDP growing by 8.7% in the fiscal year 2021/22, making India the fastest-growing major economy in the world.

Despite decelerating global demand and tightening monetary policy to curb inflationary pressures, the report states that India is expected to grow in the fiscal year 2022/23 at 6.8%. This would bring output 8.4% above 2019 levels.

Over the next five years, the annual rate of GDP growth is expected to average 6.4%, after which growth is expected to average 6.5% in the subsequent nine years.

The reported growth trajectory will see India rise from fifth place on the WELT in 2022 to third in the global rankings by 2037.

Govt organizes “Dance to Decarbonize” event to generate power by dance floor

Dance to Decarbonize event: The Petroleum and Natural Gas ministry is planning a one-day event where renewable energy produced by dance will be utilized to charge electric automobiles as part of a novel effort. The “Dance to Decarbonize” event, which is a lead-up to the India Energy Week set to take place in Bengaluru in February 2022, will take place on December 23 at the National Stadium nearby India Gate in New Delhi.

Through the use of dance and music, the event hopes to increase participation in the sustainability topic.

A cutting-edge stage will be built, and people dancing on it will generate renewable energy that will be used to power an e-autorickshaw and a sports utility vehicle.

It should be noted that India’s goal of attaining net-zero emissions by 2070 must be considered against the nation’s increasing energy needs, expanding economy, and preference for the implementation of responsible energy sources over revolutionary energy systems for the long term.

Indian Billionaire Gautam Adani to Control Nearly 65% of NDTV

Dance to Decarbonize: Mechanism

Kinetic dance floors are a notion that has been around for a long. There are devices that have a sustained output of far over 35 watts. Simply jumping or dancing on the floor produces electricity. Stepping generates unconventional energy by converting pressure energy into mechanical energy, which is then converted into electrical energy.

A dynamo and a rack and pinion are both parts of the mechanism. The pinion transforms the pressure energy generated by the dancers on the floor into mechanical energy. A ratchet mechanism, speed-conversion gears, chains, and other components transform mechanical energy into electrical energy.

Jio to Acquire Reliance Infratel for Rs 3,720 Crore

Dance to Decarbonize Event: Attendees

Industry dignitaries, including Cabinet ministers, members of parliament, representatives from the Petroleum and Natural Gas Ministry, foreign diplomats, executives from manufacturers of electric vehicles, CEOs and senior executives of specific industries, representatives from airlines, oil Public Sector Undertaking associates in defense, and Border Road Organization, will attend the event, which is being billed as a step towards showcasing India’s goal of achieving net-zero emissions by 2070.

RBI Emerges As The Largest Gold Buyer Among The Central Banks Across The Globe

With 132.34 metric tonnes (MT) of gold purchase, RBI emerged as the largest buyer of the yellow metal among central banks between April 2020 and September 2022. Also, RBI was the top gold buyer among its peers in 2020 while it stood third in 2021. In 2020, it bought 41.68 MT of gold while in 2021 and 2022 (till September end) it bought 77.5 MT and 31.25 MT respectively.

Across The Globe Phenomena:

RBI’s Gold Reserve:

At the end of March 2022, RBI’s gold reserve stood at 760.42 MT that went upto 785.35 MT at the end of September 2022, which increased share of gold reserve to 7.86% from 7.01% in India’s total forex reserve. In March 2021, the gold reserves were at 695.31 MT, accounting for 5.87 percent of total forex reserves.

Significance Of This Move:

Every major central bank keeps a portion of its reserves in gold as it plays a fine hedging instrument in the time of uncertainty and economic turmoil. During the balance of payment crisis in 1990-91, Indian government pledged 67 MT of gold to the Bank of England and Union Bank of Switzerland. During uncertain economic conditions, gold price takes upward trajectory and it was evident in 2020 when Covid induced economic turmoil made gold price touch an all time high of $2,067 per ounce. Since then GDP across the globe has picked up. Demand for yellow metal reduced with economic stability and prices declined consistently in 2021.

Why Is There Trigger for Yellow Metal:

In 2021 the huge gold buying by RBI occurred in the backdrop of falling yellow metal price in the global bullion market but War in Europe proved beneficial for gold as the price crossed $2,000 per ounce in the first week of March 2022. But, the yellow metal lost its gains in the middle of March as consistent rate hikes by the Federal Reserve strengthened Dollar Index and bonds emerged as attractive investment options for Institutions and retail investors.

Why is RBI Buying Gold:

Why is the RBI buying gold when there is tepid global demand for yellow metal as investors are seeking refuge in fixed assets? For one, the economic outlook for 2023 looks very uncertain as inflation around the world is inching up.

During  inflationary period gold creates a fine balance in central banks’ overall reserves as rising global inflation means decline in the value of all major currencies including US dollars against real assets like gold.

As per the RBI data at the end of September 2022, the central bank had total forex reserves of $537.27 billion in which it held gold worth $42.21 billion while the rest were mainly held as Foreign Currency Assets (FCA).

In an inflationary environment any decline in the value of currencies like Euro, Pound, Yen etc adversely impacts India’s forex reserves. Any weakness would have a profound impact on the current account balance of commodity importing nations like India. Any plunge in the value of fiat currency could be countered by raising gold reserves.

Is RBI Alone Buying Gold to Diversify its Reserves: Who Are The Others In This List:

While the Reserve Bank of India has always been partial towards gold and marks its spot as the third largest buyer of the yellow metal in Q3 2022, trends show marked surprises when it comes to other central banks. The central bank of Qatar, for instance, made history by buying 15 MT of Gold in a single month of Q3 2022, breaking its old record of a similar buying spree way back in 1967. Turkey bought 94.87 MT of gold in the first nine months of 2022.

Across The Globe Phenomena:

Central banks globally have accumulated gold reserves this year at a pace never seen since 1967, when global finance followed diktats of Bretton Woods when the US dollar was backed by the precious metal. In the first 9 months of 2022, net purchase of central banks across the globe amount to 673 MT, as per World Gold Council Report.

In 2020, Central Banks bought 272.9 MT of gold. The number rose to 463 MT for 2021, around 82% more compared to 2020. And gold acquisition of almost 400 MT in just the July-September quarter of 2022 is approximately 87% of central banks’ annual purchase of gold in 2021

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