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Daily Current Affairs – 2020

Topic: For Prelims and Mains

Reserve Tranche

17thJune, 2020

What is the Reserve Tranche?

The reserve tranche is a segment of an International Monetary Fund member country’s quota that is accessible without fees or economic reform conditions.

  • Initially, member nations’ reserve tranches are 25% of their quota, but this position can change according to any lending that the IMF does with its holdings of the member’s currency.
  • The reserve tranches that countries hold with the IMF are considered their facilities of first resort, meaning they will tap into them before seeking a formal credit tranche that charges interest.

The reserve tranche position (RTP) is portion of the required quota of currency that each International Monetary Fund (IMF) member country must provide to the IMF that can be utilized for its own purposes without a service fee.

The reserve tranche portion of the quota can be accessed by the member nation at any time.

  • SDR = Special Drawing Rights are Forex reserve assets with IMF which helps a member country to access foreign currency it needs.

The amount of SDR with IMF for any member country depends upon its contribution to IMF vis a vis its QUOTA.

So Quotas are basically the quantum of SDR a member country can hold.

  • Quotas are assigned by IMF according to the relative size of its GDP (50%), Openness (30%), economic variability (15%) and International reserves (5%).

It is these contributions from the member countries which form the funds of IMF that it gives as loans.

A member country pays to IMF by giving 25% (of Quota) in terms of specified foreign currency or SDR and 75% in its own currency.

Illegal wild life Trade

Why in news? The Ministry of Environment Forest and Climate Change (MOEFCC) has issued an advisory saying people importing “exotic live species” will have to make a voluntary disclosure.

 New Advisory issued includes:

  • According to the advisory, the phrase “exotic live species” includes “animals named under the Appendices I, II and III of the Convention of International Trade in Endangered Species of Wild Fauna and Flora”.
  • It does not include species from the Schedules of the Wildlife (Protection) Act 1972.
  • This will create a process where all imports will be screened.
  • As of now, the imports are being made through the Director-General of Foreign Trade and State Forest departments are not kept in the loop.
  • For new “exotic live species”, the importer should obtain a no-objection certificate from the Chief Wildlife Warden (CWLW) of the State.
  • For existing species, stocks shall be declared by the owner/ holder (stock, as on 1 January 2020) to the Chief Wildlife Warden (CWLW) of the concerned State or UT.

 Need for such an advisory

  • Many exotic species of birds, reptiles and amphibians are imported into India for commercial purposes.
  • Some of the most sought after exotic species in India are Ball python, Scarlet Macaw, sea turtles, sugar glider (Petaurus breviceps), marmoset and grey African parrots.
  • These imports were happening through the Director-General of Foreign Trade (DGFT), but they were beyond the purview of the forest departments and the chief wildlife wardens weren’t aware of them.
  • Wildlife experts have long been asking for stringent laws and guidelines to document and regulate numbers of exotic species being kept as pets by individuals and breeders in India.

 Significance:

  • The move comes as the outbreak of coronavirus (COVID-19) has raised global concern about illegal wildlife trade and zoonotic diseases.
  • Often these species are illegally trafficked into the country to avoid lengthy documentation and scrutiny.

 Issues with guidelines:

  • Matters such as the spread of invasive species as well as zoonotic diseases had not been taken care of in the advisory.
  • There is a growing domestic trade in exotic species of wildlife that is unfortunately not listed under the various appendices of CITES (such as sugar gliders, corn snakes).
  • Hence limiting the scope of the latest advisory to only those species covered under CITES drastically limits the scope of the advisory itself.
  • It does not have the force of law and could potentially incentivize illegal trade by offering a long amnesty period.

 

About the CITES:

  • CITES stands for the Convention on International Trade in Endangered Species of Wild Fauna and Flora.
  • It is as an international agreement aimed at ensuring “that international trade in specimens of wild animals and plants does not threaten their survival”.
  • It was drafted after a resolution was adopted at a meeting of the members of the International Union for Conservation of Nature (IUCN) in 1963.
  • It entered into force on July 1, 1975, and now has 183 parties.
  • The Convention is legally binding on the Parties in the sense that they are committed to implementing it; however, it does not take the place of national laws.

India is a signatory to and has also ratified CITES convention in 1976.

Facts for Prelims

Kuril Island:

News: US authorities have put out tsunami warnings after an earthquake

has struck Russia’s Kuril Islands.

Facts:

  • Kuril Islands is a volcanic archipelago which extends from the

Japanese island of Hokkaido to the southern tip of Russia’s

Kamchatka Peninsula.

  • It separates the Sea of Okhotsk from the north Pacific Ocean.
  • It forms part of the ‘Pacific Ring of Fire.
  • Its sovereignty is contested by Russia and Japan. The Islands are currently under Russian administration.

 

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