EDITORIALS & ARTICLES

December 16, 2024 Current Affairs

Climate Centre predicts La Nina will emerge during Jan-March 2025

  • Latest forecasts from WMO Global Producing Centres of Long-Range Forecasts indicate a 55 per cent likelihood of a transition from the current neutral conditions to La Nina conditions during December 2024 to February 2025.
  • As of the end of November 2024, oceanic and atmospheric observations continue to reflect ENSO-neutral conditions which have persisted since May. Sea surface temperatures are slightly below average over much of the central to eastern equatorial Pacific.
  •  El Nino and La Nina events are a natural part of the global climate system. They occur when the Pacific Ocean and the atmosphere above it change from their neutral (‘normal’) state for several seasons.
  •  It occurs on average every two to seven years, and typically lasts nine to 12 months. 
  •  El Nino, which is the warming of the waters in the Pacific Ocean near South America, is generally associated with the weakening of monsoon winds and dry weather in India.
  • It influences weather and storm patterns in different parts of the world. But it takes place in the context of a climate being changed by human activities. 
  • It is associated with increased rainfall in the Horn of Africa and the southern US, and unusually dry and warm conditions in Southeast Asia, Australia and southern Africa. 
  • La Nina, which is the opposite of El Nino, typically brings good rainfall during the monsoon season.
  • These changes in the Pacific Ocean and its overlying atmosphere occur in a cycle known as the El Nino–Southern Oscillation (ENSO). 
  • The term ‘El Nino’ translates from Spanish as ‘the boy-child’. Peruvian fishermen originally used the term to describe the appearance, around Christmas, of a warm ocean current off the South American coast. It is now the commonly accepted term to describe the warming of the central and eastern tropical Pacific Ocean. ‘La Nina’ translates as ‘girl-child’ and is the opposite ENSO phase to El Nino.
  •  However, naturally occurring climate events such as La Nina and El Nino events are taking place in the broader context of human-induced climate change, which is increasing global temperatures, exacerbating extreme weather and climate, and impacting seasonal rainfall and temperature patterns.

World Meteorological Organisation (WMO)

  • The World Meteorological Organisation (WMO) is a specialised agency of the United Nations. 
  • It is the UN system’s authoritative voice on the state and behaviour of the Earth’s atmosphere, its interaction with the oceans, the climate it produces and the resulting distribution of water resources.
  •  The WMO has 193 Members, including 187 Member States and 6 territories, maintaining their own meteorological services.
  •  It originated from the International Meteorological Organisation (IMO), which was founded in 1873.
  • Established in 1950, WMO became the specialised agency of the UN in 1951 for meteorology (weather and climate), operational hydrology and related geophysical sciences. 
  •  WMO facilitates the free and unrestricted exchange of data and information, products and services in real or near-real time on matters relating to safety and security of society, economic welfare and the protection of the environment. It contributes to policy formulation in these areas at national and international levels.
  •  WMO coordinates the activities of National Meteorological and Hydrological Services in 193 States and territories so that basic weather, climate and water services are made available to anyone who needs them.
  • The Secretariat, headquartered in Geneva, is headed by the Secretary-General.

UNCCD 16th session of the Conference of the Parties

  • The sixteenth session of the Conference of the Parties (COP16) of the United Nations Convention to Combat Desertification (UNCCD) took  place in Riyadh, Saudi Arabia, from 2 to 13 December 2024.
  • UNCCD COP 16 is more than a critical milestone – it represents a moonshot moment to raise global ambition and accelerate action on land and drought resilience through a people-centered approach.  
  • The United Nations Convention to Combat Desertification (UNCCD) is the global voice for land and one of the three major UN treaties known as the Rio Conventions, alongside climate and biodiversity.
  • The Conference of the Parties (COP) is the main decision-making body of UNCCD’s 197 Parties – 196 countries and the European Union. COP16 will take place in Riyadh, Saudi Arabia from 2-13 December 2024 under the theme Our Land. Our Future
  • After two weeks of intense negotiations on how to tackle land degradation, desertification and drought, the largest and most inclusive United Nations land conference wrapped up in Riyadh, Saudi Arabia.
  •  The nearly 200 countries convening at the 16th Conference of the Parties (COP16) to the United Nations Convention to Combat Desertification (UNCCD)  committed to prioritise land restoration and drought resilience in national policies and international cooperation as an essential strategy for food security and climate adaptation. 
  •  While parties failed to agree on the nature of a new drought regime, they adopted a strong political declaration and 39 decisions shaping the way forward.
  • Nations also made significant progress in laying the groundwork for a future global drought regime, which they intend to complete at COP17 in Mongolia in 2026.
  • According to UNCCD’s newly released World Drought Atlas and Economics of Drought Resilience reports, droughts affect the livelihoods of 1.8 billion people worldwide, pushing already vulnerable communities to the brink. 
  • They also cost an estimated $300 billion per year, threatening key economic sectors such as agriculture, energy and water.
  • The first-ever UNCCD COP in the Middle East and North Africa provided an opportunity to shine a light on the specific challenges facing the region and bring to the fore innovative solutions to land degradation and drought.
  •  During the Conference, participants heard that UNCCD estimates that at least $2.6 trillion in total investments are needed by 2030 to restore more than one billion hectares of degraded land and build resilience to drought.
  • This equals $1 billion in daily investments between now and 2030 to meet global land restoration targets and combat desertification and drought.

Key outcomes of COP16:

 More than $12 billion were pledged to tackle desertification, land degradation and drought around the world, especially in the most vulnerable countries.

  • A prototype launch of the International Drought Resilience Observatory, the first ever global AI-driven platform to help countries assess and enhance their capacity to cope with harsher droughts.
  • Mobilisation of private sector engagement under the Business4Land initiative.The creation of designated caucuses for Indigenous Peoples and for local communities to ensure their unique perspectives and challenges are adequately represented.
  •  A continuation of the Convention’s Science-Policy Interface to strengthen science-based decision-making.New pledges for large-scale land restoration and drought preparedness were announced, such as the Riyadh Global Drought Resilience Partnership which attracted $12.15 billion to support 80 of the world’s most vulnerable countries in building their resilience to drought, including a $10 billion pledge from the Arab Coordination Group.
  •  The Great Green Wall (GGW), an African-led initiative to restore 100 million hectares of degraded land, also mobilised €11 million from the Italian government for landscape restoration in the Sahel and €3.6 million from the Austrian government to strengthen the coordination and implementation of the initiative across 22 African countries.
  • The drive is part of the GGW Accelerator, a UNCCD-supported effort to achieve the ambitions for a greener, more prosperous Sahel.
  • Additionally, the United States and several partner countries and organisations announced total investments of nearly $70 million to advance the Vision for Adapted Crops and Soils (VACS).
  •  The initiative looks to build resilient food systems grounded in diverse, nutritious, and climate-adapted crops grown in healthy soils.

United Nations Convention to Combat Desertification

  •  The United Nations Convention to Combat Desertification (UNCCD) is the sole legally binding international agreement linking environment and development to sustainable land management. 
  •  The Convention addresses specifically the arid, semi-arid and dry sub-humid areas, known as the drylands, where some of the most vulnerable ecosystems and peoples can be found.
  •  The Convention was adopted in Paris on June 17, 1994 and entered into force on December 26, 1996 after the 50th ratification was received.
  •  It is the only legally binding framework set up to address desertification and the effects of drought. 
  • There are 197 Parties to the Convention, including 196 country Parties and the European Union.
  •  The Convention’s 197 Parties work together to improve the living conditions for people in drylands, to maintain and restore land and soil productivity, and to mitigate the effects of drought. 
  • Parties to the Convention meet in Conferences of the Parties (COP) every two years, as well as in technical meetings throughout the year, to advance the aims and ambitions of the Convention and achieve progress in its implementation.
  •  It unites governments, scientists, policymakers, private sector and communities around a shared vision and global action to restore and manage the world’s land for the sustainability of humanity and the planet.
  •  The UNCCD is particularly committed to a bottom-up approach, encouraging the participation of local people in combating desertification and land degradation. 
  • The UNCCD Secretariat facilitates cooperation between developed and developing countries, particularly around knowledge and technology transfer for sustainable land management.

Jalvahak Scheme

  • The Government of India has initiated development in cargo transportation by launching a fixed scheduled service of cargo vessels. This step aims to promote the use of inland waterways for trade.
  •  The service commenced under the ‘Jalvahak’ scheme, which incentivises long-haul cargo movement across National Waterways 1, 2, and 16.
  • The launch event was led by Shri Sarbananda Sonowal, the Union Minister of Ports, Shipping and Waterways.
  • The ‘Jalvahak’ scheme is designed to promote cargo movement via national waterways. It offers a reimbursement of up to 35% of total operating costs for transporting goods over 300 kilometres. This initiative aims to reduce logistics costs and encourage businesses to utilise waterways for cargo transport.
  • The service operates between Kolkata, Patna, Varanasi, and Pandu in Guwahati. The first vessels, including MV Trishul, MV AAI, and MV Homi Bhaba, have set sail carrying various cargo types. The transit times are fixed, ensuring timely delivery and boosting user confidence in the waterways’ efficiency
  • The government targets a modal shift of 800 million tonne-kilometres by investing ₹95.4 crores by 2027. This is expected to enhance cargo movement through waterways, which has seen a substantial increase from 18.07 million tonnes in 2013-14 to 132.89 million tonnes in 2023-24. The long-term goal is to achieve 200 million tonnes by 2030 and 500 million tonnes by 2047
  • Utilising waterways for cargo transport is seen as an eco-friendly alternative to road and rail transport. The initiative aligns with sustainable development goals by reducing congestion and promoting a cleaner mode of transportation.
  • India’s inland waterways network spans over 20,236 km, yet it remains under-utilised compared to global standards. The government aims to enhance infrastructure to support increased cargo transport via these routes. The Inland Waterways Authority of India (IWAI) plays a very important role in this development.
  • The initiative involves multiple stakeholders, including the IWAI and the Shipping Corporation of India.
  • The collaboration aims to facilitate a seamless cargo transport experience for businesses, enhancing the overall logistics landscape in India.
  • The successful implementation of the ‘Jalvahak’ scheme could revolutionise cargo transport in India.
  •  It is expected to transform the logistics sector, especially in eastern India, encouraging economic growth and improving connectivity for communities along the waterways.

Olive Ridley Turtles – Facing Threats

  • The Olive Ridley turtle is currently facing threats along the Visakhapatnam coast during its breeding season.
  • Numerous carcasses have been discovered on local beaches, raising alarms among environmentalists and the community.
  • The primary causes of these deaths are marine pollution and fishing activities, particularly trawling. This situation marks the urgent need for conservation measures and community awareness.
  • Recently, multiple Olive Ridley turtle carcasses have washed ashore in Visakhapatnam.
  • These incidents have been reported mainly at Mangamaripeta beach. Eyewitnesses noted the distressing sight of dead turtles, particularly over a single weekend. The turtles typically come close to shore to lay their eggs, making them vulnerable during this time.
  • Experts attribute the deaths primarily to marine pollution and accidental capture by fishing vessels.
  • Trawling operations pose risk as turtles surface to breathe, leading to unintended entanglement. This marks a critical intersection between marine life and fishing practices.
  • The Andhra Pradesh State Forest Department has initiated conservation efforts. Four artificial hatcheries have been established in strategic locations, such as R.K. Beach and Jodugullapalem.
  • These hatcheries will operate until May, facilitating the safe collection and incubation of turtle eggs. A dedicated team will oversee these efforts to ensure the survival of the hatchlings.
  • Community awareness and involvement are crucial for the success of conservation efforts. Education campaigns are being conducted to inform the fishing community about the importance of protecting turtles. The use of turtle excluder devices is being promoted to prevent accidental captures. Last year, successful releases of hatchlings demonstrated the effectiveness of these initiatives.
  • Olive Ridley turtles have a unique breeding cycle. Female turtles can nest up to three times a year, laying around 100 eggs per clutch.
  • The incubation period lasts approximately 40 to 45 days. This continuous cycle from December to May is vital for the species’ survival.
  • Despite conservation efforts, challenges remain. Ongoing marine pollution and fishing practices continue to threaten Olive Ridley turtles.
  • Increased awareness and stricter regulations are essential to protect these vulnerable creatures. Collaborative efforts between government bodies, environmentalists, and local communities are necessary for effective conservation.

India, UAE discuss on implementation of IMEEC

  •  India and the United Arab Emirates (UAE) discussed implementation of the ambitious India-Middle East-Europe Economic Corridor (IMEEC).
  •  Ways to further deepen bilateral relations in areas of energy, connectivity and trade figured prominently at the 15th India-UAE Joint Commission Meeting (JCM) that was co-chaired by Minister of External Affairs S. Jaishankar and his UAE counterpart Sheikh Abdullah bin Zayed Al Nahyan. The meeting was held in New Delhi.
  • The two foreign ministers also deliberated on expanding Strategic Partnership between the two countries in areas of defence, emerging technologies, nuclear energy, polar research, critical minerals and renewable energy.

Highlights of India-Middle East-Europe Economic Corridor

  • The IMEEC was launched on the sidelines of the G20 Summit in September 2023 in Delhi. 
  • The IMEEC envisages a vast road, railroad and shipping networks among India, the Europe, the Middle-East through UAE, Saudi Arabia, Jordan, Israel and the European Union. 

The initiative will consist of two separate corridors:

  • i) Eastern Corridor connecting India to West Asia/Middle East.
  • ii) Northern Corridor connecting West Asia or Middle East to Europe.
  • The IMEEC is expected to stimulate economic development through enhanced connectivity and economic integration between Asia, the Arabian Gulf, and Europe.
  • It will include a railway that, upon completion, will provide a reliable and cost-effective cross-border ship-to-rail transit network to supplement existing maritime and road transport routes.
  •  It will enable transhipment of goods and services to, from, and between India, the UAE, Saudi Arabia, Jordan, Israel, and Europe.
  •  In support of this initiative, the participating countries commit to work collectively and expeditiously to arrange and implement all elements of these new transit routes, and to establish coordinating entities to address the full range of technical, design, financing, legal and relevant regulatory standards.
  •  Along the railway route, the participants intend to enable the laying of cable for electricity and digital connectivity, as well as pipe for clean hydrogen export.
  • This corridor will secure regional supply chains, increase trade accessibility, improve trade facilitation, and support an increased emphasis on environmental, social, and government impacts.
  •  It is expected that the corridor will increase efficiencies, reduce costs, enhance economic unity, generate jobs, and lower greenhouse gas emissions — resulting in a transformative integration of Asia, Europe and the Middle East.

 Rajmarg Saathi

  • The National Highways Authority of India (NHAI) is planning to introduce advanced ‘Rajmarg Saathi’ route patrolling vehicles (RPVs) to enhance highway safety.The RPVs conduct inspection of National Highway stretches to monitor and respond to emergency situations. 
  •  The guidelines for ‘Rajmarg Saathi’ RPVs include detailed specifications related to the use of vehicle, equipment and manpower. 
  •  In the existing RPVs, the rear space is open for keeping instruments and equipment to support in case of emergency situation .However, due to open space, the operators were not able to keep these equipment in a well organised manner, which at times lead to delay in taking prompt action.
  • In order to overcome such a situation, the rear or trunk of RPV has now been replaced by a closed cabinet with dedicated space for different equipment and inventory.The shelves have been created to provide quick and easy access to different equipment during the emergency situations and is a significant upgrade from the earlier RPVs.
  • Additional advanced features of this new RPV shall be provision for dashboard camera equipped with ‘AI video analytics’ to capture and identify cracks and potholes as well as other elements including vehicles, pedestrians, road signs, and other infrastructure assets. 
  •  The data/video footage including road distresses shall be collected on a  weekly basis by NHAI and this road distress data shall be integrated with NHAI One application for more efficient maintenance of roads.To ensure service fitness of the vehicle, the RPV shall be replaced with a new RPV, once it has exceeded run of 3,00,000 km or has been in operation for three years.
  •  Equipped with the advanced communication and safety tools, these vehicles will be useful in minimising traffic disruptions, improving road safety and enhancing overall road user experience along the National Highways. Route patrolling operations play a critical role in maintaining safety, providing incident management and ensuring smooth flow of traffic on National Highways.

National Highways Authority of India (NHAI)

  •  The National Highways Authority of India (NHAI) was set up through an Act of Parliament, namely the National Highways Authority of India Act, 1988. 
  • The NHAI became operational in February 1995. The NHAI is responsible for the development, maintenance and management of the National Highways entrusted to it and for matters related or incidental thereto. 
  •  Its main objective is to ensure that all contract awards and procurements conform to the best industry practices with regard to transparency of process, adoption of bid criteria to ensure healthy competition in award of contracts, implementation of projects conform to best quality requirements and the highway system is maintained to ensure best user comfort and convenience.
  • India has the second largest road network in the world of about 63.32 lakh km. This comprises national highways, expressways, state highways, major district roads, other district roads and village roads.
  •  The national highways have a total length of 1,46,145 km, which in totality serve as the arterial network of the country.
  • Although national highways constitute only about 2 per cent of the road network, it carries 40 per cent of the total road traffic. 

 Rapid expansion of passenger and freight traffic makes it imperative to improve the road network in the country. Accordingly, the government launched major initiatives to upgrade and strengthen National Highways through various phases of National Highways Development Project (NHDP).

Functions of NHAI:

  • i) To develop, maintain and manage National Highways vested in it by the government.
  • ii) To collect fees on National Highways, regulate and control the plying of vehicles on National Highways for its proper management.
  • iii) To develop and provide consultancy and construction services in India and abroad and carry on research activities in relation to the development, maintenance and management of highways or any other facilities there at.
  • iv) To advise the central government on matters relating to highways.
  • v) To assist on such terms and conditions as may be mutually agreed upon, any state government in the formulation and implementation of schemes for highway development.

Novel Technique  for Measuring Black Holes’ Properties

  • Recent advancements in astrophysics have shed light on the enigmatic nature of black holes. A Recent study ,introduces a novel technique to measure black holes’ mass and spin using light echoes.
  • This method leverages the gravitational effects of black holes on light, enhancing our understanding of these cosmic phenomena.
  • Black holes are regions in space with gravitational pulls so strong that nothing can escape from them. They influence their surroundings, including the formation and evolution of galaxies. Their study is crucial for comprehending the universe’s structure.

What Are Light Echoes?

  • Light echoes occur when light emitted from a distant source interacts with a black hole. The gravitational field of the black hole bends the light’s path. Consequently, light can arrive at Earth at different times, creating distinct signals.
  • This phenomenon can be used to gather information about the black hole’s properties.

Gravitational Lensing

  • Gravitational lensing is the bending of light around massive objects like black holes. This effect can lead to the creation of light echoes, which have yet to be directly measured until now. The new study proposes using long-baseline interferometry to detect these echoes.

Long-Baseline Interferometry Explained

  • Long-baseline interferometry involves using two telescopes placed far apart—one on Earth and another in space.
  • This technique allows scientists to capture and analyse the non-simultaneous arrival of light signals.
  • By examining how these signals interfere with each other, researchers can identify light echoes created by black holes.

 M87 Black Hole

  • The study primarily focused on the supermassive black hole in the M87 galaxy. This black hole is particularly interesting due to the bright rings of light surrounding it.
  • The research aims to understand how these rings are influenced by the black hole’s mass and angular momentum.
  • The findings from this study could revolutionise how scientists measure black holes. By providing a clearer signal-to-noise ratio, light echoes offer a more reliable method for determining the properties of these cosmic giants.
  • Additionally, the results align with predictions made by Einstein’s general theory of relativity.

Challenges :

  • While the technique shows promise, technical challenges remain. Building telescopes capable of detecting light echoes at multiple frequencies is complex. However, successful implementation could validate the new method and further confirm the principles of general relativity.
  • Future studies may explore other black holes using this technique. Researchers aim to refine their methods and expand the understanding of black holes and their role in the universe.
  •  This could lead to more deep vital information about the nature of spacetime and gravity.

 

Global Polio Eradication Efforts and Challenges

  • The global battle against polio has seen progress since the World Health Organisation’s call for eradication in 1988. As of 2024, polio remains endemic in only two countries – Pakistan and Afghanistan.
  • Despite this progress, recent detections of poliovirus in wastewater across Europe signal potential risks, underscoring the need for vigilance in vaccination efforts.
  • Polio, or poliomyelitis, is a highly contagious viral disease. The poliovirus primarily spreads via the faecal-oral route. It can lead to paralysis within hours of infection. Approximately one in 200 infections results in irreversible paralysis. Among those paralysed, 5–10% may die due to respiratory failure.
  • Since 1988, the number of polio cases has decreased by over 99%. The world has witnessed the near eradication of one poliovirus strain.
  • However, Pakistan and Afghanistan continue to report regular transmissions. The global health community has made tremendous strides, yet challenges remain.

Recent Findings

  • Recently, poliovirus was detected in wastewater samples from Germany, Spain, and Poland. Although no cases of paralytic disease were reported, these findings serve as a warning. They highlight the importance of maintaining high vaccination coverage to prevent outbreak.
  • Vaccine-derived poliovirus strains can emerge from the weakened virus in oral polio vaccines. If these strains circulate among under-immunised populations, they may revert to a virulent form. This has raised concerns as some countries report detections without corresponding paralytic cases
  • In 2023, vaccination coverage among one-year-olds in Europe reached around 95%.
  • This exceeds the 80% herd immunity threshold. However, in countries like Spain, Germany, and Poland, coverage with three doses ranged from 85% to 93%. Under-immunised groups remain vulnerable, necessitating ongoing vaccination efforts.
  • Humanitarian crises, including conflicts and climate change, disrupt vaccination programmes.
  • As of 2024, 30% of countries have vaccine coverage below 80%. In some areas, coverage plummets to as low as 36%. These challenges threaten to reverse decades of progress in polio eradication.
  • Wastewater surveillance has gained prominence as a tool for early disease detection. It provides valuable vital information about community health.
  • By analysing wastewater, health officials can identify potential outbreaks and take preventive measures. This approach has become increasingly vital in the context of global health.

Way Ahead:

  • Continued efforts are essential to safeguard immunisation programmes. The COVID-19 pandemic has brought into light that viruses do not respect borders.
  • A sustained commitment to vaccination is crucial to prevent polio’s resurgence. The ongoing vigilance and adaptation of strategies are necessary to maintain public health.

WHY THE PARIS AGREEMENT LOOKS MORE FRAGILE THAN EVER

  • A The Paris Agreement was finalized in 2015 to mitigate climate change, has seen limited success and 2024 is likely to be the first year to breach the 1.5-degree Celsius limit.

Concerns :

  • The Paris Agreement, which aimed to limit global warming to 1.5°C above pre-industrial levels, is now being questioned about its effectiveness. 
  • The lack of strong commitments and growing dissatisfaction from developing countries, including small island states, highlight the growing difficulties in addressing climate change through this framework.

 Implications  :

  • Since the Paris Agreement was signed, global CO2 emissions have increased from 49 billion tonnes to 53 billion tonnes. 
  • Global emissions have increased by 8%, while average global temperatures have risen by 1.45°C since pre-industrial levels.
  • This means that the world is rapidly approaching a tipping point, with 2024 expected to be the first year to exceed the critical 1.5°C threshold. 
  • This rapid increase highlights the urgent need for stronger action, as the Paris Agreement''s targets appear increasingly out of reach. 

How the Paris Agreement weakened over time?

  • Unlike the Kyoto Protocol, which imposed specific obligations on developed countries, the Paris Agreement allowed each country to establish its own climate targets. 
  • This "nationally determined" approach reduced pressure on developed countries and resulted in minimal global climate action.
  • One major issue with the Paris Agreement is the financial assistance promised by developed countries.
  • These nations pledged to raise $100 billion per year for climate action in developing countries, but the recent Baku agreement reduced this figure to $300 billion by 2035, far short of the trillions required. 
  • The lack of adequate funding compromises developing countries'' ability to take ambitious climate action, limiting their ability to meet the Paris commitments.

Developing countries, especially small island nations, dissatisfied:

  • Small island nations and other developing countries, which are the most vulnerable to climate change, are dissatisfied with the Paris Agreement because it fails to hold developed countries accountable for their historical emissions and does not provide the necessary financial support for climate action. 
  • These countries are now considering alternative approaches and advocating for clearer definitions of obligations through legal channels such as the International Court of Justice.

Switzerland suspends MFN: What is the clause and its meaning for India?

Switzerland has announced that it will suspend the most favoured nation (MFN) clause in its double taxation avoidance agreement (DTAA) with India, starting from January 1, 2025.

This move will double the withholding tax rate on dividends paid to Indian tax residents to 10 per cent from 5 per cent.

 

The withdrawal of the Most Favoured Nation (MFN) tax clause by Switzerland on Indian companies marks a significant development in international tax relations, with implications for Indian businesses and the broader framework of bilateral treaties

 MFN Clause:

  • The MFN clause in tax treaties ensures that if a country offers more favorable tax rates to a third country through a separate agreement, those concessions automatically apply to the original treaty partner.
  • In the context of the India-Switzerland Double Taxation Avoidance Agreement (DTAA), Indian entities benefited from reduced tax rates of 5% on dividends, which were consistent with concessions given by Switzerland to other countries like the Netherlands or France.

Nestlé Case 2023 in India:

  • The Indian Supreme Court, in a case involving Nestlé, ruled against the automatic applicability of the MFN clause, asserting that such concessions require explicit bilateral agreements rather than unilateral interpretation.
  • Swiss Retaliation:
  • Following this ruling, Switzerland interpreted the decision as a lack of reciprocity in applying the MFN clause.
  • Consequently, Switzerland decided to withdraw the unilateral application of MFN benefits under the DTAA with India, effective January 1, 2025.

Impact on Indian Companies:

  • Effects on Swiss investments in India: Swiss companies that receive dividends from Indian subsidiaries will continue to face a 10 per cent withholding tax, as this tax rate has always applied under the India-Switzerland DTAA.
  • EFTA investments unaffected: Switzerland''s decision is also unlikely to impact investments into India from the European Free Trade Association (EFTA), as these investments are already subject to the 10 per cent withholding tax rate.
  • No change for other DTAA benefits: Indian companies operating in Switzerland will still be able to avail themselves of the other benefits provided under the India-Switzerland DTAA, such as tax relief on royalties and fees for technical services.
  • The withdrawal means that dividends paid by Indian companies operating in Switzerland will now be taxed at a 10% rate instead of the previous 5%.
  • This increases the financial burden on Indian entities with operations or investments in Switzerland.
  • Other countries may follow Switzerland’s lead if they perceive a lack of reciprocity or fairness in their tax treaties with India.
  • Indian companies operating internationally will need to reassess their tax strategies and transfer pricing models to navigate this evolving landscape.
  • Amit Maheshwari of AKM Global highlighted that the decision could set a precedent for other countries, prompting them to re-evaluate their own tax treaties with India.

Way Ahead:

  • India and Switzerland may need to revisit the terms of the DTAA to address concerns and restore mutually beneficial arrangements.
  • Indian companies will need to account for higher tax rates in their financial planning and explore restructuring options to mitigate costs
  • This development could trigger similar actions from other countries dissatisfied with the interpretation and enforcement of MFN provisions, requiring India to recalibrate its approach to tax treaties globall
  • The Swiss withdrawal of the MFN clause reflects the dynamic nature of international tax laws, where interpretations and reciprocity play pivotal roles.
  • While it increases tax liabilities for Indian entities, it also underscores the need for clear, equitable, and mutually agreed treaty provisions to avoid such disputes in the future.

Mission Mausam: India aims to improve forecast accuracy by adding 87 new Doppler weather radars

 

  • Currently, India has 39 operational Doppler weather Radars across nation. With the addition, every region in country will fall under radar network
  • India will add 87 more Doppler Weather Radars (DWRs) by 2026 under Mission Mausam.
  • The Union government informed Parliament that currently, there are only 39 DWRs to cover the entire country.
  • The government stated that Mission Mausam aims to expand the DWR network across India to ensure complete radar coverage and improve the accuracy of weather forecasting
  • Most of the new radars would be S-band and C-band. S-band radars have a radial coverage of 400km, while C-band and X-band radars cover 250km and 100km, respectively. “X-band radars are typically used for studying cloud development and light precipitation, which is why their range is limited, While C-band and S-band radars, on the other hand, will be used more extensively for weather prediction.
  • Currently, of the 39 operational DWRs, 12 are X-band, five are C-band, and 22 are S-band.
  • The data collected from these radars is already being integrated into Numerical Weather Prediction (NWP) models through advanced data assimilation techniques to enhance weather forecasts.
  • Ministry of Science and Technology and Earth Sciences, explained in a reply to an unstarred question in Parliament that recent advances in computing have enabled NWP modelling systems to utilize multiple radar observations with higher spatial and temporal resolution.
  • This capability has improved the accuracy of localized forecasts. “Advanced decision support systems and techniques now generate location-specific forecasts for all types of weather by integrating various inputs, including radar observations.

 

 







POSTED ON 16-12-2024 BY ADMIN
Next previous