Boost financing for green projects
Published On:
Why in the news ?
The Finance Minister has placed a greater emphasis on green growth in his budget speeches, in line with PM Modi's declaration at COP26 that India will reach 500GW of fossil fuel-free capacity by 2030 and net zero by 2070.
It is imperative that these promises be reaffirmed in the Budget speech. The usage of fossil fuels must peak, plateau, and then decline as quickly as feasible if India is to achieve net zero. In order to achieve net zero, this would reduce the expenses for businesses and the economy.
To prevent making large, unfavorable capital investments in an economy dependent on fossil fuels, investors should take this viewpoint into account before making important investment decisions.
In a cutthroat market, private investment is developing renewable energy (RE) capacities at a falling cost. Renewable energy is currently less expensive than new thermal power when paired with storage for continuous supply. It will take far greater RE capacities to reach 500GW of fossil fuel-free capacity by 2030, which means that additional RE bids will need to be invited.
This goal ought to be made public. Large-scale storage is necessary to fulfill changing demand because renewable energy (RE) output is sporadic and rigid. A strong strategy to create storage through an invitation to bid should be included in the budget speech. This would motivate prospective investors to get ready for the rapidly expanding demand for massive storage.
Hydro pump storage in rivers and off-rivers are both feasible choices, while concentrated solar thermal energy stored in molten salt for use in conventional thermal turbines is a well-developed and reasonably priced technology. These storage initiatives feature large upfront expenditures, lengthy payback periods, and low ongoing expenses.
Centre amends rules to broaden the administrative role of J&K L-G
Why in the news?
The modifications increase the Lieutenant Governor's (L-G) jurisdiction over matters pertaining to public order and law enforcement in Jammu & Kashmir. By changing the Transaction of Business Rules, the Union Ministry of Home Affairs (MHA) increased the L-G's administrative authority. With the approval of the Finance Department beforehand, these revisions provide greater authority on the L-G with regard to matters pertaining to law enforcement, public order, All India Services (AIS), and their postings and transfers.The L-G must be consulted first on recommendations for the nomination of the Advocate-General, Law Officers, and judgments about criminal sanctions or appeals.
J&K's unique status under Article 370 of the Constitution was removed on August 5, 2019, resulting in the division of the former state into two Union Territories: J&K and Ladakh, the latter of which lacks an assembly. Since June 2018, J&K has been governed by the Central government, which has pledged to reinstate statehood following Assembly elections. Elections for the J&K Assembly must be held by the Election Commission by September 30, 2024, as directed by the Supreme Court. New provisions outlining the L-G's responsibilities were added to the modified Rules under Section 55 of the Jammu and Kashmir Reorganisation Act, 2019, which were issued by the MHA.
According to the notification, the Chief Secretary must provide any plan to the L-G regarding "Police," "Public Order," "All India Service," and "Anti Corruption Bureau" that needs the Finance Department's approval in advance. Furthermore, through the Chief Secretary and the Chief Minister, suggestions for the appointment of the Advocate-General and other Law Officers to support legal procedures must be made to the L-G for approval.
Appeals and recommendations for prosecution sanctions must also be sent to the L-G by the Department of Law, Justice, and Parliamentary Affairs through the Chief Secretary. The L-G should also be consulted on issues pertaining to the Forensic Science Laboratory, the Directorate of Prosecution, and prisons.
Food inflation accelerates to 9.4%, highest in 6 months
Why in the news?
Costlier fruits, vegetables, and cereals increased food prices by 9.4% in June, a six-month high. The retail inflation rate increased from 4.8% in May to a four-month high of 5.08% as a result of this jump.
Inflation for rural consumers grew to 5.66% from 5.3% in May, while prices for urban consumers jumped by 4.4% from 4.2%. The rate of food inflation in cities was 9.55%, while it was 9.2% in rural areas.
Retail inflation is above the central bank's 4% objective even though it hasn't exceeded 6% since September 2023. Given that the Reserve Bank of India is waiting for inflation to return to its target rate, the Consumer Price Index (CPI) data from June lessens the chance of an interest rate drop this year. Retail inflation was 4.87% in June 2023, with a 4.55% increase in the food price index.
Vegetable prices increased by 29.3% in June, up from 27.3% in May, due to the warmth and delayed monsoon start in some areas of the nation. This is the ninth consecutive month of double-digit price rises.
Fruit prices grew by 7.15%, but pulse prices increased by 16.1%, marking the twelfth straight month of 10% inflation.
"Significant Concern"
Dharmakirti Joshi, the chief economist of Crisil, acknowledged that food inflation in vegetables and grains was a significant worry, but he also voiced optimism that the monsoon's advancement would help contain it in the upcoming months.
He issued a warning that growing international freight costs, rising crude prices, and telecom rate hikes could cause non-food inflation, which dropped for the seventeenth consecutive month to a record low of 2.3% in June, to rebound.
Because manufacturers are raising their costs, personal care items continue to see significant inflation of 8.2%, according to Madan Sabnavis, chief economist at Bank of Baroda.
Additionally, he made note of the fact that half of India's states had inflation rates higher than the 5.1% national average, with Odisha seeing the largest increase at 7.2%.
