Relevance IN - Prelims (about foreign exchange + about SDR) + Mains (GS III Economic development)
What's the NEWS

• The country's foreign exchange reserves crossed the $450-billion mark for the first time ever on the back of strong inflows which enabled the central bank to buy dollars from the market, thus checking any sharp appreciation of the rupee.
• India's foreign exchange reserves were at $451.7 billion on December 3, 2019 - an increase of $38.8 billion over end-March 2019
• The rise in foreign exchange reserves will give the central bank the firepower to act against any sharp depreciation of the rupee
• The Reserve Bank has always maintained that it intervenes in the foreign exchange market to curb volatility and does not target a particular level of exchange rate.

• Net foreign direct investment rose to $20.9 billion in the first half of 2019-20 from $17 billion a year ago while net foreign portfolio investment was $8.8 billion in April-November 2019 as against net outflows of $14.9 billion in the same period last year.
• During the taper tantrums of 2013, (or the collective reactionary panic after the U.S. Federal Reserve said it would apply the brakes on its Quantitative Easing programme)
• India's foreign exchange reserves fell to $274.8 billion in September of 2013, prompting the Centre and RBI to unleash measures to attract inflows. It has been a steady rise for the reserves since then, with $175 billion added in the last six years.

• The SDR is an international reserve asset, created by the IMF in 1969 to supplement its member countries' official reserves.
• So far SDR 204.2 billion (equivalent to about US$291 billion) have been allocated to members, including SDR 182.6 billion allocated in 2009 in the wake of the global financial crisis.
• The value of the SDR is based on a basket of five currencies-the U.S. dollar, the euro, the Chinese renminbi, the Japanese yen, and the British pound sterling.
• The SDR was created as a supplementary international reserve asset in the context of the Bretton Woods fixed exchange rate system.
• The collapse of Bretton Woods system in 1973 and the shift of major currencies to floating exchange rate regimes lessened the reliance on the SDR as a global reserve asset.
• Nonetheless, SDR allocations can play a role in providing liquidity and supplementing member countries' official reserves, as was the case with the 2009 allocations totaling SDR 182.6 billion to IMF members amid the global financial crisis.
• The SDR is neither a currency nor a claim on the IMF. Rather, it is a potential claim on the freely usable currencies of IMF members. SDRs can be exchanged for these currencies.
• The SDR was initially defined as equivalent to 0.888671 grams of fine gold-which, at the time, was also equivalent to one U.S. dollar. After the collapse of the Bretton Woods system, the SDR was redefined as a basket of currencies.
• The SDR basket is reviewed every five years, or earlier if warranted, to ensure that the SDR reflects the relative importance of currencies in the world's trading and financial systems.
• The value of the SDR is determined daily based on market exchange rates.
• The reviews are also used to assess the appropriateness of the financial instruments comprising the SDR interest rate (SDRi) basket.
• During the last review concluded in November 2015, the Board decided that the Chinese renminbi (RMB) met the criteria for inclusion in the SDR basket.
• Following this decision, the Chinese RMB joined the US dollar, euro, Japanese yen, and British pound sterling in the SDR basket, effective October 1, 2016.
  
  

• Parliament passed a landmark "The Recycling of Ships Bill 2019'' for Safe and Environmentally Sound Recycling of Ships in India.

• Passing of this Bill is a giant step and historical moment in the Indian Maritime arena and will have far reaching effects in Indian Ship Recycling industry.
• The existing Shipbreaking Code (revised),2013 and the provisions of the Hong Kong Convention, 2009 are dovetailed in this Bill.
• The Bill, upon becoming Act, will ensure environment friendly recycling process of Ships and adequate safety of the yard workers.
• India is a leader in the global ship recycling industry with a share of over 30 per cent of the global market.
• With the enactment of this bill, India will set global standards for safe and sound environmentally-friendly recycling of Ships, as well as ensure adequate safety of the yard workers.
• This bill will pave the way for more global ships to enter into Indian Shipyards for recycling and boost employment and business opportunities
• Ships to be recycled in India will need to obtain a ‘Ready for Recycling Certificate' in accordance with the Hong Kong Convention.

• The bill will harbinger significant increased number of global ships entering into Indian Shipyards for Recycling.
• Recycling of Ships will boost business & employment opportunities and strengthen India's position in the recycling industry.
• It will raise the brand value of our Ships Recycling Yards located at Alang in Gujarat, Mumbai Port, Kolkata Port & Azhikkal in Kerela.
• 10% of country's Secondary steel needs, as an outcome of Recycling of Ships, will be met in an eco-friendly manner.
• Ships Recycling facilities will become compliant to International standards and Ships will be recycled only in such authorised facilities.
• The tremendous growth of business activities will contribute to the country's GDP.

What's the NEWS

• The second phase of NITI Aayog's Atal Innovation Mission (AIM) and Russia's SIRIUS Deep Technology Learning and Innovation Programme 2019 in Sochi comes to an end as 25 Indian students returned with best practices of contemporary innovation and entrepreneurship.

Know! more about SIRIUS

• SIRIUS hosted an eight-day project oriented educational program from 28 November to 8 December 2019.
• It was held in accordance with Memorandum of Understanding signed between AIM and SIRIUS last year.
• All 50 Russian and Indian students shared best contemporary innovation practices with each other under various categories: IT & Data Analysis, Clean Energy, Biotech, Remote Earth Sensing and Drones & Robotics.
• Under ‘IT & Data Analysis', students created a classification of farmland using satellite data and neural network for effective management of crop land.
• Under ‘Clean Energy', students created a carbon free energy system/island where researchers from all over the world can lead research on tech advancement. It can sustain energy requirement of up to 600 people.

Know! more about AIM-SIRIUS

• Indian delegation to Russia described the programme as an amazing experience for 50 Indian and Russian students to interact and present their joint co-innovations to President Putin at the state of the art Sirius Science and Tech Talent Centre, Sochi Russia. AIM would continue to provide students such opportunities to excel
• SIRIUS Innovation Festival held in India last year witnessed a delegation of 10 Russian student innovators and 10 Indian innovators from the best performing Atal Tinkering Labs (ATLs).
  
  

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