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| Exclusive for Subscribers Daily: Wholesale Price Index (WPI) and Gig Worker for the UPSC Exam? Why are topics like Monetary Policy Committee (MPC) and Mycobacterium tuberculosis (Mtb) important for both preliminary and main exams? Discover more insights in the UPSC Exam Notes for October 15, 2024 |
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Critical Topics and Their Significance for the UPSC CSE Examination on October 15, 2024
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Sept. wholesale food prices leapt 9.5%
For Preliminary Examination: Current events of national and international importance
For Mains Examination: GS III - Indian Economy
Context:
Fuel, power costs slid over 4% last month, while manufactured product prices rose just 1%, reining in overall wholesale inflation pace to 1.84% from 1.3% in Aug.; most economists expect WPI to rise further in Oct. on West Asia crisis, food prices
Read about:
What is Consumer Price Index (CPI)?
What is Wholesale Price Index (WPI)?
Key takeaways:
- Inflation in India's wholesale prices increased to 1.84% in September, up from 1.31% in August. This rise was driven by food prices, which hit a two-year high of 9.5%, compared to August's ten-month low of 3.3%. Notably, vegetable prices surged nearly 49%, marking the steepest increase in 14 months.
- In September, prices for potatoes and onions rose by 78.1% and 78.8%, respectively, reflecting a significant acceleration from the previous month. Tomato prices surged by 74.5%, reversing a 53% drop seen in August. While inflation for fruits and pulses saw a slight decrease, it remained elevated at 12.2% and 13%, respectively.
- Cereal and paddy inflation dipped slightly to 8.1%, although wheat prices increased at a faster rate of 7.6% in September. Meanwhile, milk inflation eased to 3.2%, and prices for eggs, meat, and fish fell by 0.8%.
- Manufactured food products experienced a 5.5% inflation rate in September, while vegetable and animal oils and fats rose by 10.5%, albeit from a low base last year when prices had dropped for both categories.
Mild Increase
- Despite the rebound in food prices, the Wholesale Price Index (WPI) only showed a slight increase, as fuel and power prices fell over 4% compared to September 2023, and inflation for manufactured products eased to 1%.
- On a month-to-month basis, the WPI rose a modest 0.06%, with the food index recording the highest gain of 1.1%.
- Given the uptick in oil and commodity prices this month amid rising tensions in West Asia, along with expectations of continued elevated food prices, many economists anticipate further increases in the WPI for October.
- ICRA's chief economist, Aditi Nayar, projected that wholesale inflation could range between 2% and 2.5% in October. She added that if commodity prices rise further and geopolitical conflicts escalate, the latter half of 2024-25 could experience a more rapid increase in prices than expected
Follow Up Question
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Answer (C)
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The Union Ministry of Labour and Employment is in the process of drafting a national law aimed at integrating gig workers into social security systems, providing them with benefits like health insurance and retirement savings. The government is likely to require aggregators to contribute 1%-2% of their revenue to create a social security fund that would offer these benefits. Additionally, there are plans to revise the definitions of gig and migrant workers to ensure they are more inclusive and reflective of the current employment landscape.
The proposed legislation intends to establish a welfare board model, which would create a fund specifically for the social security of gig workers. It would mandate the registration of all gig workers and require aggregators to provide a 14-day notice period with valid reasons prior to termination, while promoting transparency in automated systems. New dispute resolution mechanisms will also be implemented to safeguard the rights of gig workers.
The Labour Minister indicated that aggregator companies employing gig and platform workers would be encouraged to take the lead in registering their workers on the designated portal. Workers registered on the Labour Ministry’s e-Shram portal will have access to life and accidental insurance, along with additional benefits.
Labour Codes
- In this context, it's worth noting that India established four new labour codes in 2019 and 2020. These codes aim to simplify and rationalize existing labour laws by merging 29 central labour laws into four broad categories: wage, social security, industrial relations, and occupational safety and health. Among these, the Social Security Code of 2020 is the only one that specifically mentions gig and platform workers.
- Under this code, gig and platform workers are classified as a subset of informal sector workers. Consequently, the code provides for the creation of social security schemes for gig and platform workers by the central government. Furthermore, similar to informal workers, gig workers are required to self-register on the e-Shram portal.
Definition of Workers
- The issue arises from how gig workers are defined in the Social Security Code 2020, which places them outside the conventional employer-employee relationship. This is problematic because many gig employers, including some well-known companies, function as formal entities within the formal sector. The exclusion of gig workers from traditional employment frameworks is at the heart of the problem.
- This intentional strategy by "aggregators" seeks to obscure employment relationships in gig and platform economies, thereby circumventing the application of existing labour laws. In a gig economy, employment relationships remain ambiguous, with workers often categorized as independent contractors.
- This confusion about employment relationships leads to the erroneous belief that gig workers are independent workers. The Social Security Code 2020 perpetuates this misconception by categorizing gig workers as part of the informal sector without clarifying the actual employment relationship within the gig economy.
- Additionally, there is a significant disparity in entitlements between institutional social security and social security schemes. For instance, formal workers are entitled to 26 weeks of paid maternity leave under the Maternity Benefit Act, 1961, as part of institutional social security coverage.
- In contrast, registered informal workers receive only cash benefits ranging from ₹5,000 to ₹10,000 for maternity support under social security schemes. This stark difference in entitlements highlights the limitations of the Social Security Code 2020, which aims to provide gig workers with access to certain social security schemes but does not extend to institutional social security.
- Furthermore, other institutional protections, such as minimum wage safeguards, are absent for gig workers. Occupational safety and health regulations do not apply to them, and they are excluded from the Industrial Relations Code 2020, which means they lack access to the dispute resolution mechanisms it provides.
- A clear employment relationship is fundamental for protection under labour laws, but this relationship remains undefined in the context of gig work in India. Recent legislation introduced in states like Rajasthan and Karnataka also suffers from this same deficiency.
The Core Issue
- If the Union Ministry of Labour and Employment is genuinely committed to safeguarding the interests of the growing number of gig workers in the country, it must explicitly define the employment relationship within gig and platform work and eliminate the ambiguity created by so-called "aggregators." Recognizing "aggregators" as employers and clarifying the employment relationship in gig work is essential.
- A significant precedent is the 2021 ruling by the U.K. Supreme Court in the Uber case, where Uber was recognized as an employer, and its drivers as "workers," leading to the requirement that Uber comply with existing labour laws.
- Once the employment relationship is clearly defined, gig workers can be integrated into the proposed four labour codes, which would eliminate the need for separate legislation.
- The welfare board model suggested by the Union Ministry of Labour and Employment has had limited success in the past, especially with construction workers who were also categorized as informal despite being employed by formal companies. Clarifying employment relationships in gig work would further facilitate the formalization of workers in this sector.
- Moreover, the overall labour code was designed for simplification and rationalization. Introducing separate laws for specific workforce segments undermines this goal. Recognizing the employment relationship in gig work is crucial; once this issue is resolved, the rest will follow
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Answer (B)
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- In a 5:1 majority ruling, the Reserve Bank of India’s Monetary Policy Committee (MPC) opted to maintain the benchmark interest rate at 6.50%, a level it has held since April 2023. One of the three newly appointed external members advocated for a 25 basis point (0.25 percentage points) cut, likely due to the decline in the headline inflation rate falling below the RBI’s median target of 4% in July and August.
- However, the MPC characterized this downward trend in inflation as slow and inconsistent, anticipating that it would reverse starting in September, which indeed occurred as inflation rose to a nine-month high of 5.5%.
- While the committee has kept its retail inflation projection at 4.5% and its GDP growth estimate at 7.2% for 2024-25, it has adjusted its calculations. For the second quarter (Q2), the expected average inflation is now 4.1%, revised from 4.4%, but the September figure exceeds 4.2%. In the third quarter (Q3), inflation is now anticipated to average 4.8%, up from the previous August estimate of 4.7%, before decreasing to 4.2% between January and March 2025.
- Although the MPC has unanimously decided to shift its monetary policy stance from hawkish to ‘neutral’, the likelihood of a rate cut during the next policy review in December appears low, particularly as the committee reiterated its “unambiguous” commitment to achieving a durable alignment of inflation to the 4% target.
- Food inflation continues to be a concern, especially with rising vegetable prices, and central bank Governor Shaktikanta Das has noted that core inflation (excluding food and energy) has likely reached its lowest point.
- Global oil and metal prices present additional challenges, alongside the persistent threat of climate-related disruptions. If these risks remain hypothetical, a rate cut might be anticipated in February.
- It's notable that the RBI Governor made only a brief mention of the U.S. Federal Reserve's recent 50 basis point interest rate cut as a “policy pivot,” suggesting that domestic trends will guide the bank’s strategy.
- However, with the European Central Bank also likely to reduce rates and U.S. inflation falling to a three-year low, discussions of another imminent rate cut are underway, which may pressure the RBI to respond swiftly.
- While the RBI remains optimistic about India's growth trajectory compared to many agencies, there are evident signs of slowing economic activity in the first half of this year, with weak car sales indicating reduced urban consumption and industrial output contracting in August. If these trends do not improve, the MPC, committed to supporting growth while controlling inflation, could face a challenging situation in the months ahead
The Monetary Policy Committee (MPC) is a critical body within the Reserve Bank of India (RBI) responsible for formulating and overseeing the country’s monetary policy. Its primary objective is to manage inflation and ensure price stability while promoting economic growth. Here are some key points regarding the MPC:
Composition
- The MPC comprises six members:
- Three members are from the RBI, including the Governor.
- Three external members are appointed by the Government of India, chosen for their expertise in economics, finance, and related fields.
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Answer (C)
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Tuberculosis (TB) has become a significant focus of India's healthcare objectives. The nation is making strides in enhancing its capacity to diagnose and monitor TB patients, as well as assisting them in adhering to the lengthy antibiotic regimen necessary for treatment. However, the rising antimicrobial resistance in Mycobacterium tuberculosis (Mtb), the bacteria responsible for TB, means that many current antibiotics are losing their effectiveness. Consequently, researchers are investigating Mtb to pinpoint crucial proteins and develop new medications that target these proteins.
A Long-Standing Relationship
Addressing this challenge is complex, as the pathogen has evolved alongside humans for thousands of years. Evidence suggests that the Mtb complex has existed for up to 70,000 years. This prolonged coexistence has given the microbe ample opportunity to adapt and evade the human immune system in various ways.
One such adaptation is Mtb's ability to thrive within macrophages, which are the first line of defense in the human immune system against many microorganisms. While macrophages are designed to engulf foreign particles, including bacteria, and initiate a range of chemical reactions to destroy them, Mtb has found ways to evade these processes. These reactions often lead to a state of oxidative stress, which can damage or disrupt essential biological molecules like DNA, RNA, and proteins. Macrophages also employ different strategies to deprive engulfed microbes of vital nutrients, ultimately leading to their death.
However, these methods are ineffective against Mtb, which forms clusters known as tubercles (from which the disease gets its name) that are encased in lipids (fatty substances) in the lungs. Although primarily a respiratory pathogen, it can spread to various other tissues and can remain dormant in cells for extended periods, sometimes even decades, without causing illness or transmitting to others.
Enzymatic Focus
Researchers believe that Mtb's remarkable survival skills stem from its expansive genome, which comprises 4.4 million base pairs. In comparison, the respiratory bacteria Staphylococcus aureus has 2.8 million base pairs, while Streptococcus pneumoniae has between 1.9 million and 2.7 million base pairs.
A larger genome translates to a greater number of proteins, and while scientists are still working to understand the functions of many Mtb proteins, they suspect that Mtb's genetic and protein machinery enables it to live independently once it establishes itself inside macrophages.
Researchers are particularly interested in understanding what enables Mtb to endure and thrive in the harsh environment of macrophages, focusing on proteins that provide protection. One category of interest is cysteine synthase enzymes, which facilitate the synthesis of cysteine, a sulfur-containing amino acid. Cysteine is vital for cells to produce antioxidants, as the sulfur disrupts reactions that lead to oxidative stress.
Exploring Cysteine Synthases
A recent study published on August 29 in the journal eLife by scientists from the CSIR-Centre for Cellular and Molecular Biology (CCMB) in Hyderabad examined the role of various cysteine synthases in Mtb. The researchers cultivated Mtb in a bacterial growth medium with limited nutrient access, then induced oxidative stress conditions (by adding specific compounds) and analyzed the expression patterns of genes affected. They discovered that Mtb’s cysteine synthase genes were more active during oxidative stress.
Mtb possesses at least three cysteine synthase enzymes that synthesize cysteine through distinct chemical processes. The study revealed that two enzymes, CysK2 and CysM, played crucial roles in the bacterium’s survival during periods of nutrient scarcity and oxidative stress. Additionally, when researchers eliminated the genes responsible for producing either of these two enzymes, they observed a marked decline in Mtb’s capacity to generate various antioxidants.
Conducting experiments with human lung tissue is nearly impossible. Instead, the researchers infected mice with both wild-type and mutant Mtb. After allowing time for infection and immune response, they measured bacterial levels in both groups, finding that wild-type Mtb fared better in mice than the mutant strain. Similar effects were noted when they infected just the macrophages from the lungs and spleen (the spleen being the second organ Mtb infects after the lungs).
In examining the pathogen’s survival in mice genetically modified to prevent oxidative stress, researchers found that the presence of cysteine synthases did not significantly impact Mtb's growth; Mtb with and without these enzymes thrived equally well in these mice.
Countering Mtb's Resilience
A 2017 study from the Karolinska Institute in Stockholm identified 71 compounds capable of inhibiting cysteine synthases. Researchers in Vinay Nandicoori’s lab at CCMB tested these compounds on Mtb and found that all demonstrated some level of inhibition. Fortunately, these inhibitors also enhanced the effectiveness of isoniazid, a known antibiotic against Mtb, creating a potent antibiotic combination. Since humans do not possess cysteine synthase enzymes, these inhibitors represent promising targets for new antibiotics.
In addition to cysteine synthases, global scientists are exploring other strategies Mtb employs to survive within macrophages. They are investigating the roles of phosphates and carbon metabolism, which are crucial to Mtb's life cycle. Some studies focus on how Mtb develops a resilient cell wall that can withstand oxidative stress, while others examine how it prevents the production of molecules that lead to oxidative stress, tricks macrophages into releasing damage-repair molecules sooner, or remains dormant without triggering immune responses.
Expanding Research Horizons
New studies have uncovered how Mtb can erase the epigenetic memory of macrophages, which enables healthy macrophages to modify their genomes and pass this information to their offspring. This ability allows new cells to quickly recognize and eliminate ongoing or past infections. Without this memory, newly formed macrophages lack the preparedness to combat an Mtb infection.
Collectively, these research efforts are unraveling the complexities of Mtb, opening multiple avenues for addressing the TB crisis. However, for these discoveries to translate into effective treatments, significant steps remain, including finding methods to conduct similar studies with human cells, a focus that India needs to prioritize
Read the following passages and answer the question, your answers to these items should be based on the passages only.
A majority of the TB infected in India are poor and lack sufficient nutrition, suitable housing and have little understanding of prevention. TB then devastates families, makes the poor poorer, particularly affects women and children, and leads to ostracisation and loss of employment. The truth is that even if TB does not kill them, hunger and poverty will. Another truth is that deep-seated stigma, lack of counselling, expensive treatment and lack of adequate support from providers and family, coupled with torturous side-effects demotivate patients to continue treatment - with disastrous health consequences.
Which one of the following is the most logical, rational and crucial message conveyed by the above passage? (UPSC 2019)
- TB is not a curable disease in Indian circumstances.
- Curing TB requires more than diagnosis and medical treatment.
- Government's surveillance mechanism is deficient, and poor people have no access of treatment.
- India will be free from diseases like TB only when its poverty alleviation programmes are effectively and successfully implemented.
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Answer (2)
The passage highlights that factors such as poverty, lack of nutrition, housing, understanding of prevention, stigma, and inadequate support significantly hinder the successful treatment of TB. It emphasizes that these social and economic issues must be addressed alongside medical treatment for effective curing of the disease
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| Subject | Topic | Description |
| History | Modern Indian History | Company rule and Crown rule 1773 - 1947 |
| History | Modern Indian History | Fall of Mughals |
| History | Modern Indian History | Establishment of British rule in India |
| History | Modern Indian History | Economic Policies of the British |
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