Prelims Focus 3rd April 2025

NITI-NCAER Portal

In News: Finance Minister Nirmala Sitharaman released the “NITI NCAER States Economic Forum” portal.

• • Portal Launch: Developed by NITI Aayog and National Council of Applied Economic Research (NCAER).
  • Purpose: The portal will act as a research hub, provide a historical and real-time records evaluation to track state development, become aware of trends, and assist formulate proof based guidelines for development.

• Main Components:

• • State Reports: Summarizes macro and fiscal information of 28 states, masking demography, economic structure, and fiscal indicators.
  • Data Repository: Provides access to a whole database categorised throughout five verticals: Demography, Economic Structure, Fiscal, Health, and Education.
  • State Fiscal and Economic Dashboard: Offers graphical representations of key financial variables and brief access to statistics through summary tables.
  • Research and Commentary: Includes vast studies on nation price range and fiscal policy at each state and national levels.

Government Securities

In News: The Reserve Bank of India introduced the injection of ₹80,000 crore by buying government securities mentioning “evolving liquidity conditions.”

• • It is a tradeable tool issued by the Central Government or the State Governments. 
  • It acknowledges the Government’s debt duty.
  • Such securities are quick term (normally known as treasury bills, with authentic maturities of less than 12 months) or long term (typically called Government bonds or dated securities with maturity of 12 months or more).

• Scenario In India 

• • In India, the Central Government issues both, treasury bills and bonds or dated securities while the State Governments issue most effective bonds or dated securities, which might be referred to as the State Development Loans (SDLs).
  •  G-Secs convey almost no risk of default and, as a result, are called risk -free gilt-edged instruments.
  • RBI acts as the debt supervisor for the Centre and the States.

Light Fishing Threatens India’s Coastal Ecosystems

In News: Light fishing, an illegal practice in India, poses a significant threat to the country’s coastal ecosystems and traditional fishing communities. 

• It involves using high-intensity artificial lights to attract fish and squid, leading to indiscriminate capture, including juveniles, which depletes fish stocks and disrupts marine food chains. 
• This method also damages coral reefs and affects biodiversity, particularly vulnerable species like squid that play a crucial role in the marine ecosystem. 
• Despite being banned under the National Policy on Marine Fisheries (2017), weak enforcement has allowed light fishing to persist, especially in states like Andhra Pradesh, Kerala, and Maharashtra. 
• Mechanized trawlers using powerful lights create unfair competition for artisanal fishers, intensifying social tensions while exacerbating ecological degradation. 
• Urgent measures are needed to strengthen enforcement, promote sustainable fishing practices, and protect India’s rich marine biodiversity.

Open Market Operations (OMO)

In News: The Reserve Bank of India (RBI) concluded the financial year 2024-25 with the highest open market operations (OMO) in four years. 

• Open Market Operations (OMO) are a crucial monetary policy tool used by central banks to manage liquidity in the financial system. 
• They involve the purchase or sale of government securities and other financial assets in the open market. 

This process helps central banks regulate the money supply, influence interest rates, and maintain economic stability.

Key Objectives of OMO

• Liquidity Management: Central banks use OMOs to inject liquidity into the system by buying securities or absorb excess liquidity by selling them. This helps maintain stable financial conditions and ensures smoother credit flow.
• Interest Rate Control: By adjusting the money supply, OMOs can influence short-term interest rates, which in turn affect long-term rates and foreign exchange rates.
• Economic Stabilization: OMOs are used to combat inflation by reducing money supply when inflationary pressures rise, or to stimulate economic growth by increasing liquidity during downturns.

Download as PDF