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  • 10-06-2021

Fast Tracking Freight in India: NITI Aayog, RMI and RMI India’s new report (GS Paper 3 Indian Economy) 


NITI Aayog, RMI and RMI India’s new report, Fast Tracking Freight in India: A Roadmap for Clean and Cost-Effective Goods Transport, presents key opportunities for India to reduce its logistics costs.

Freight Transport Demand

Due to the rising demand for goods and services, freight transport demand is expected to grow rapidly in the future. 

While freight transport is essential to economic development, it is plagued by high logistics costs and contributes to rising CO2 emissions and air pollution in cities.

Key Finding of the report

According to the report, India has the potential to:

Reduce its logistics cost by 4% of GDP

Achieve 10 gigatonnes of cumulative CO2 emissions savings between 2020 and 2050

Reduce nitrogen oxide (NOx) and particulate matter (PM) emissions by 35% and 28%, respectively, until 2050

Freight transportation is a critical backbone of India’s growing economy, and now more than ever, it’s important to make this transport system more cost-effective, efficient, and cleaner. 

Efficient freight transport will also play an essential role in realising the benefits of existing government initiatives such as Make in India, Aatmanirbhar Bharat, and Digital India.

As India’s freight activity grows five-fold by 2050 and about 400 million citizens move to cities, a whole system transformation can help uplift the freight sector.

This transformation will be defined by tapping into opportunities such as efficient rail-based transport, the optimisation of logistics and supply chains, and shift to electric and other clean-fuel vehicles. 

These solutions can help India save ₹311 lakh crore cumulatively over the next three decades.

The report outlines solutions for the freight sector related to policy, technology, market, business models and infrastructure development. 

The recommendations include increasing the rail network’s capacity, promoting intermodal transport, improving warehousing and trucking practices, policy measures and pilot projects for clean technology adoption, and stricter fuel economy standards.

When successfully deployed at scale, the proposed solutions can help India establish itself as a leader in logistics innovation and efficiency in the Asia–Pacific region and beyond.

Source: PIB

Fast Tracking Freight in India NITI Aayog, RMI and RMI India’s new report eg classes


Legalisation of Bitcoin in El Salvador (Editorial GS Paper 3 IT & Computers)


Recently El Salvador, a small coastal country in Central America, became the first in the world to make Bitcoin, a digital currency, legal. 

The El Salvador Parliament approved the move by a supermajority of 62 out of 84. 

Not a precedent for monetary policy

The development in El Salvador changes little in terms of Indian monetary calculations around cryptocurrencies.  

The dynamic underpinning the whole move is that El Salvador has no monetary policy of its own and hence, no local currency to protect. 

The country was officially ‘dollarized’ in 2001 and runs on the monetary policy of the US Federal Reserve.

What is relevant to monetary thinking, however, is that the move in El Salvador is in part motivated by loose and expansionary Federal Reserve policy. 

While banks in the US received liquidity with the stimulus, El Salvador did not but lost purchasing power instead. 

The official bill proposal stated explicitly that central banks are increasingly taking actions that may cause harm to the economic stability of El Salvador and in order to mitigate the negative impact of central banks, it becomes necessary to authorize the circulation of a digital currency with a supply that cannot be controlled by any central bank and is only altered in accord with objective and calculable criteria, i.e, Bitcoin.

Not merely currency but technology

The overall use of Bitcoin appears less motivated by its use as a currency and much more by the image and investment boost this could give the country towards innovation. 

The move into Bitcoin ties in with larger efforts to revive a stalling economy and bring back growth into the country post-Covid. 

El Salvador had set up in 2020 a Trust Fund to support in its Covid recovery efforts. 

Interestingly, this same Trust Fund will house a $150 million national fund that will be used to buy and sell Bitcoin.

The potential shift in remittances

One implication that is relevant to India is the impact this could have on remittances. 

Remittances make up close to 20% of El Salavador’s GDP with flows approximating $6 billion annually. 

Many citizens lack a bank account and digital banking has low penetration. 

In this scenario, there are multiple intermediaries in the remittance chain who take cuts of as high as 20%. 

The impact Bitcoin has on these remittance inflows would be worth monitoring for India, which is home to the largest remittance market in the world. 

Although there might not be many lessons from a monetary policy perspective but efficiency, anti money-laundering and other aspects could be closely monitored.


The implication of this move for money laundering is unclear at the moment. 

Currently El Salvador is not considered deficient under the FATF money laundering requirements. 

However, with large-scale cryptocurrency inflows and outflows, it would be expected that El Salvador would comply with the 2019 FATF guidance on Virtual Currencies which mandates multiple KYC requirements on cryptocurrency activity. 

It is unclear if these are in place in El Salvador or would be put in place. 

It could be that the country faces challenges on this front unless there is a rapid push to put in place the necessary oversight measures.

Takeaways for India

The overall takeaway for India from the El Salvador case is not in the monetary sense at all but as an example of how far countries are willing to go to attract what they believe is the ultimate prize – innovators and entrepreneurs working on this emerging sector. 

This is the wealth that India has in spades and has barely protected with policy. 

While deliberations continue in India on the monetary and financial regulations around cryptocurrency, it is important that attention be paid to incentives for India’s developers working on key innovations in the space.

Source: Indian Express

Legalisation of Bitcoin in El Salvador eg classes


What is Kerala’s Smart Kitchen project? (GS Paper 2 Government Schemes)


The Kerala government’s revised budget for the current fiscal has announced the introduction of a Smart Kitchen project, which is meant to modernise kitchens and ease the difficulty faced by homemakers in household chores.

The budget presented by Finance Minister has set apart an amount of Rs 5 crore for the initial phase of the scheme, which would be implemented through the Kerala State Financial Enterprises (KSFE), a state-run chit fund and lending firm.

Smart Kitchen project

Under the scheme, KSFE would give soft loans to women from all walks of life for purchasing household gadgets or equipment. 

The cost of household equipment can be repaid as instalments within a particular period. 

The interest of the loan/cost would be equally shared among the beneficiary, local self-government body and the state government. 

To implement the scheme, KSFE would start smart kitchen chits.

What is the idea behind the project?

The LDF government’s previous budgets have been known for gender budgeting. 

The outlay for women-oriented schemes was Rs 760 crore in 2016-17, forming 4 per cent of the plan outlay. 

In the budget for 2021-22, this outlay grew to Rs 1,347 crore, forming 6.54 per cent of the plan share.

The government believes that for better participation of women in labour, the burden on household chores has to be reduced.

By enhancing mechanisation in kitchens, women participation in labour could be increased. Hence, the Smart Kitchen project was proposed.

Source: Indian Express

What is Kerala’s Smart Kitchen project eg classes


Glacier melting in Hindu Kush Himalayan mountain ranges (GS Paper 3 Environment)


Hindu Kush Himalayan mountain ranges could lose up to two-third of its ice by 2100, according to UNDP.

About Hindu Kush Himalayan (HKH) mountain ranges

The HKH region, often referred to as the ‘Third Pole’, is spread over 3,500 square kilometres across eight countries including India, Nepal and China. 

It contains the world’s third-largest storage of frozen water after the Antarctica and Arctic.

Over 240 million people live in the region’s mountains; 1.7 billion live in the river basins downstream, while food grown in these basins reaches three billion people.  

The glaciers feed at least 10 major river systems, which have bearings on agricultural activities, drinking water and hydroelectricity production in the region.

Future Challenges

A 2019 assessment by the International Centre for Integrated Mountain Development (ICIMOD), a regional intergovernmental body, said the HKH region  continue to warm through 21st century even if the world was able to limit global warming at the agreed 1.5 degrees Celsius.

In the future, even if global warming is kept to 1.5 degrees C above the pre-industrialisation levels, warming in the HKH region is likely be at least 0.3 degrees C higher, and in the northwest Himalaya and Karakoram at least 0.7 degrees C higher.

Causes for the Melting of Glaciers

The UNDP report added that the melting is driven by larger anthropogenic modifications of the atmosphere. 

The HKH region lies downwind from some of the most heavily polluted places on Earth. 

This threatens agriculture, climate as well as monsoon patterns.

Report Recommendation

The report recommended shifting away from fossil fuel use in energy, transport, and other sectors, while changing diets and agricultural practices to move to net-zero emissions of greenhouse gases. 

The countries in the region need to reduce emissions of black carbon and other air pollutants as well.


The report said in the best-case scenarios, High Mountain Asia (the Asian mountain ranges surrounding the Tibetan Plateau) will lose a substantial part of its cryosphere in the next decades and thus a substantial part of its water storage abilities. 

This will lead to increased water stress in high mountain areas.

A cryosphere comprises portions of Earth’s surface where water is in solid form, including sea ice, lake ice, river ice, snow cover, glaciers, ice caps, ice sheets, etc.


The report suggested policies and actions to address the needs of key stakeholders affected by water stress, which include:

Farmers will need support to design and invest in locally-appropriate water storage solutions, or to shift to agricultural practices that consume less water

Designs of new hydropower plants and grids will need to take into account the changing climate and water availability.

Data and information, capacity-building and early warning systems and infrastructure design will need to do be improved. This calls for sufficient funding and large-scale coordination.

Source: Down To Earth

Glacier melting in Hindu Kush Himalayan mountain ranges