DAILY CURRENT AFFAIRS ANALYSIS

14.02.2025

• News 1: Retail Inflation

GS-3 Economy

About The News:                                                 

• India’s retail inflation cooled to a five-month low of 4.31% in January, from 5.22% in December 2024, and 5.1% a year ago.
• The rise in food prices has decelerated for the third successive month to 6%, from 8.4% in the preceding month, but the prices of edible oils and fruits flared up sharply.

Key points for prelims

Retail inflation:

• Retail inflation, also known as consumer price inflation (CPI), is the rate at which prices of consumer goods and services increase over time.
• It’s a key economic indicator that reflects the cost of living and the purchasing power of consumers.

How is retail inflation calculated?

• The Consumer Price Index (CPI) is the primary tool used to calculate retail inflation.
• The CPI measures the average price change in a basket of goods and services purchased by consumers.
• The CPI includes taxes directly associated with the prices of goods and services, but excludes taxes not directly associated with consumption.

What does retail inflation indicate?

• High inflation reduces purchasing power.
• Low inflation may indicate an economic slowdown.
• Central banks closely monitor retail inflation to set monetary policies.
• NEWS 2: India-Middle East-Europe Corridor (IMEC) project

GS-02 International Organisation  

About The News:

• India and France on Wednesday announced that they would continue to work closely to implement the India-Middle East-Europe Corridor (IMEC) project.

Key points for prelims:

India-Middle East-Europe Economic Corridor (IMEC):

• It is a connectivity project that seeks to develop a seamless infrastructure of ports, railways, roads, sea lines, and pipelines to enhance trade among India, the Arabian Peninsula, the Mediterranean region, and Europe.
• It was announced in 2023 on the sidelines of the G20 meeting in New Delhi when a memorandum of understanding (MoU) was signed between the European Union and seven countries, namely India, the US, Saudi Arabia, the United Arab Emirates (UAE), France, Germany, and Italy.
• The IMEC will comprise two separate corridors, the eastern corridor connecting India to the Arabian Gulf and the northern corridor connecting the Gulf to Europe.
• Upon completion, the corridor will have a cost-effective and reliable cross-border railway network, which will be supplemented by the available road transport and maritime routes.
• The corridor will include a shipping route connecting Mumbai and Mundra (Gujarat) with the UAE and a rail network connecting the UAE, Saudi Arabia, and Jordan with the Israeli port of Haifa to reach the shores of the Mediterranean Sea.
• Haifa will then be connected by sea to the port of Piraeus in Greece to eventually be connected to Europe.
• In addition, along the corridor, the countries will also lay the network of electricity grids, optical fiber cable for digital connectivity, and pipeline for the transportation of hydrogen gas.
• It intends to increase efficiency, reduce costs, secure regional supply chains, increase trade accessibility, enhance economic cooperation, generate jobs, and lower greenhouse gas emissions.
• The corridor will be supported by the Partnership for Global Infrastructure and Investment (PGII), a US-led initiative to bridge the infrastructure gap in developing countries.

GS-02 Polity

About the news:

• The Supreme Court on Wednesday shifted the hearing on petitions challenging the legality of a new law, which gives a dominant role to the Union government in the appointment of the Chief Election Commissioner (CEC) and Election Commissioners, to February 19.

Key points for prelims:  

Chief Election Commissioner:

Appointment of the Chief Election Commissioner (CEC) of India:

• The Chief Election Commissioner (CEC) of India is appointed by the President of India under Article 324 of the Constitution.

Selection Process:

• The President appoints the CEC on the recommendation of a selection committee.

Selection Committee:

• Prime Minister of India (Chairperson)
• Leader of the Opposition (or the largest opposition party) in Lok Sabha
• A Union Cabinet Minister nominated by the Prime Minister

Term of Office:

• The CEC serves for a term of six years or until the age of 65, whichever is earlier.

Removal Process:

• The CEC can only be removed by the President through a process similar to the impeachment of a Supreme Court judge.
• Requiring a two-thirds majority in both Houses of Parliament on grounds of proven misbehavior or incapacity.

Mains Questions:

• The India-Middle East-Europe Corridor (IMEC) is seen as a strategic move in global trade and geopolitics. Discuss the significance of IMEC for India’s economic and diplomatic interests. How can it enhance regional cooperation and trade efficiency?