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Daily Current Affairs 12.03.2021 (Covaxin, HongKong, QUAD)

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1. Covaxin off clinical trial mode

Indigenous vaccine cleared for emergency use, amid a surge in COVID-19 cases

India’s indigenous COVID-19 vaccine Covaxin, from Hyderabad-based Bharat Biotech, has been taken off the clinical trial mode and is now authorised for emergency use on a par with Oxford-AstraZeneca’s Covishield, NITI Aayog’s member (health) V.K. Paul said on Thursday.

While congratulating the scientific community on the achievement, Dr. Paul cautioned that the COVID pandemic is not over and that people should not lower their guard.

“The surge in COVID cases in Maharashtra is a serious matter. This surge has two lessons — don’t take the virus for granted and if we have to remain COVID-free, then we need to follow COVID-appropriate behaviour and avail ourselves of the vaccines,” Dr. Paul said at a Health Ministry press conference.

Delhi-NCR surge

He added that Delhi-NCR was also seeing a rise in COVID cases and that people need to be watchful.

Speaking about Maharashtra, Director-General of the Indian Council of Medical Research Balram Bhargava said the State had shown a worrisome trend and added that the mutant strain had not been found to be responsible for the surge in cases.

“This is related to reduced testing, tracking, inappropriate COVID behaviour and large congregations,” Dr. Bhargava said.

Eight of the top 10 districts in terms of active COVID-19 cases are in Maharashtra. Health secretary Rajesh Bhushan said Pune with 18,474 cases topped the list, followed by Nagpur (12,724), Thane (10,460), Mumbai (9,973), Bengaluru Urban (5,526), Ernakulam (5,430), Amravati (MH) (5,259), Jalgaon (5,029), Nashik (4,525) and Aurangabad (4,354).

Price lowered

Mr. Bhushan said the government “has also re-negotiated the price of the COVID-19 vaccine being bought from the Serum Institute of India (SII). The price of Covishield, developed by AstraZeneca and the Oxford University and manufactured by SII … has been reduced from ₹200 per dose (without tax) to substantially lower,” he said. However, he did not give any details about this benefit being passed on to the beneficiaries of the vaccine.

In his presentation, the Health Secretary said India was seeing a rise in the number of active cases after touching its lowest mark in mid-February. Haryana, Gujarat, Madhya Pradesh, Punjab and Maharashtra were registering a rise, while Kerala, Uttar Pradesh and West Bengal were among those showing a decline.

The Ministry’s data also noted that the daily new COVID deaths, which was 159 on January 22, came down to 90 on February 13, and had been moving upwards in the past 24 hours, registering 126 deaths on Thursday.

Clinical Trial

  • A clinical trial is a systematic study to generate data for discovering or verifying the clinical and pharmacological profile (including pharmacodynamic and pharmacokinetic) or adverse effects of a new drug on humans.
  • Phases of Clinical Trials:
    • Clinical trials are carried out in four phases.
    • Phase I or clinical pharmacology trials or “first in man” study: This is the first time where the new drug is administered to a small number, a minimum of 2 healthy, informed volunteers for each dose under the close supervision of a doctor.
      • The purpose is to determine whether the new compound is tolerated by the patient’s body and behaves in the predicted way.
    • Phase II or exploratory trials: During this phase, the medicine is administered to a group of approximately 10-12 informed patients in 3 to 4 centers to determine its effect and also to check for any unacceptable side effects.
    • Phase III or confirmatory trials: Purpose is to obtain sufficient evidence about the efficacy and safety of the drug in a larger number of patients, generally in comparison with a standard drug and/or a placebo as appropriate. In this phase, the group is between 1000-3000 subjects.
    • Phase IV trials or post-marketing phase: Phase of surveillance after the medicine is made available to doctors, who start prescribing it. The effects are monitored on thousands of patients to help identify any unforeseen side effects.
    • Regulatory Mechanism in India:
      • Clinical trials in India are governed by the following acts: Drugs and Cosmetics Act, 1940, Medical Council of India Act, 1956 and Central Council for Indian Medicine Act, 1970.
      • Prerequisites of conducting a clinical trial in India are:
        • Permission from the Drugs Controller General, India (DCGI).
        • Approval from the respective Ethics Committee where the study is planned.
        • Mandatory registration on the The Indian Council of Medical Research (ICMR) maintained website.
Central Drugs Standard Control Organisation (CDSCO) CDSCO is under Directorate General of Health Services, Ministry of Health & Family Welfare, Government of India is the National Regulatory Authority (NRA) of India.The Drugs & Cosmetics Act, 1940 and Rules 1945 have entrusted various responsibilities to central & state regulators for regulation of drugs & cosmetics.Under the Drugs and Cosmetics Act, CDSCO is responsible for approval of Drugs, Conduct of Clinical Trials.Further CDSCO along with state regulators, is jointly responsible for grant of licenses of certain specialized categories of critical Drugs such as blood and blood products, I. V. Fluids, Vaccine etc.

2. U.S. curbs could hit Quad’s vaccine aims

Restrictions on exports could dent alliance’s push to speed global vaccinations, counter China’s moves

The U.S.-backed Quad alliance aims to invest in India’s pharmaceutical capacity as it looks to ramp up COVID vaccine output, but U.S. curbs on exports of key materials could hamper that effort, sources say.

The alliance, grouping the United States, Japan, Australia and India, wants to expand global vaccinations and in turn counter China’s growing vaccine diplomacy in Southeast Asia and worldwide. India is the world’s biggest vaccine maker.

India to seek assurance

As the alliance’s first virtual summit kicks off on Friday, one key assurance that India will be seeking is for an easing of export curbs, said two sources briefed on the issue.

The White House said last week it had used the U.S. Defence Production Act — which prevents export of materials to prioritise local production — to help drugmaker Merck make Johnson & Johnson’s COVID-19 vaccine.

“India’s seeking both raw materials and investments from Quad partners and once this aspect is resolved, then the Quad alliance can start large-scale distribution starting in Southeast Asian countries,” said one Indian government source.

Earlier this week Reuters reported that the U.S. and Japan would help fund Indian firms manufacturing vaccines for U.S. drugmakers Novavax Inc. and J&J.

Some of the additional supplies from India will go to Southeast Asia as China pushes its vaccines to supply Indonesia, Philippines and others in the region.

Filters and bags

But the Serum Institute of India (SII), the world’s biggest vaccine maker, has said it is worried the U.S. ban on exports of materials like filters and bags, keeping them for U.S. companies, could limit production, especially of the Novavax shot that it was set to start making next month.

“The ramp-up and scaling of Novavax production could take a sharp hit, and if restrictions persist this could down the road also slow the ramp-up of Covishield,” said a source close to the matter, referring to the Oxford/AstraZeneca vaccine that SII is also licensed to produce.

SII did not respond to a request for comment.

U.S. officials did not immediately respond to requests for comment. India’s foreign ministry had no immediate comment.

Limitations to production of the Novavax and Covishield shots risk hurting the GAVI/WHO COVAX initiative that is heavily reliant on those two vaccines as it shares inoculations with poorer countries.

India and the Vaccination Drive

  • India began the “World’s Largest Vaccination Program” on January 16, 2021.
  • The Prime Minister of India said that India is entering a decisive phase of vaccination in the fight against COVID-19, with the approval of two made-in-India COVID-19 vaccines.
    • The PM has also said that two vaccines are more cost-effective than any other in the world and that India’s vaccine production & delivery capacity will be used to help all humanity in fighting this crisis.

Key Points

  • It is India’s first ever adult vaccination drive.
  • The Drug Controller General of India (DCGI) has granted the emergency-use approval for two indigenous vaccines: COVISHIELD by Serum Institute of India and COVAXIN by Bharat Biotech.
    • The two vaccines are found to be safe and no major side effects are expected. However, little pain or redness in the skin can be observed.
    • The vaccines have gone through preclinical animal experiments on animals like rabbits, mice and hamsters followed by non-human primates.
    • Out of the two vaccines, Covaxin is an inactivated vaccine whereas Covishield is a live vaccine.
  • In the first phase of vaccination, the first 3 crore people to be vaccinated include the healthcare workers and frontline workers.
    • The cost of vaccination of these people will be borne by the government.
Live and Inactivated Vaccines Live Vaccines: They use a weakened (or attenuated) form of the germ that causes a disease.Because these vaccines are so similar to the natural infection that they help prevent, they create a strong and long-lasting immune response.Note: As they contain a small amount of the weakened live virus, people with weakened immune systems, long-term health problems, or people who’ve had an organ transplant should not be given these vaccines without any prior consultation with the healthcare provider.Inactivated vaccine: Active pathogens are grown in large numbers and then killed either by a chemical or heat. Although the pathogen is killed, or made to lose its reproduction capacity, various parts of the pathogen are intact. E.g The antigen (the chemical structure) that is recognised by the immune system is left unimpaired.As the pathogen is dead, it cannot reproduce nor cause even a mild disease. Thus, it is safe to administer to even people with lesser immunity, like the old and those who have comorbidity.

India and Vaccines

  • At present 80-90% of the world’s whole Measles vaccine is provided by India.
    • India supplies all the Rubella vaccines to South America.
  • The indigenous developed meningococcal vaccine of India is supplied to the entire Sub-Saharan Africa.
    • Meningococcal meningitis is caused by Neisseria meningitidis bacteria. It is a serious infection of the thin lining that surrounds the brain and spinal cord.
  • The indigenous rotavirus vaccine is going to 16 countries in the world.
  • Various novel vaccines have been introduced by India, such as the world’s first subunit rabies vaccine. It has been approved by the Drug Controller General of India.
    • Subunit vaccines are composed of protein or glycoprotein components of a pathogen that are capable of inducing a protective immune response and may be produced by conventional biochemical or recombinant DNA technologies.

Government Strategy For Smooth and Effective Drive

  • Preparatory measures: The key preparatory aspects that have been undertaken include the physical infrastructure, human resources and training of the vaccinators.
    • The digital aspect: The government has launched the Co-WIN application for the registration of the citizens and to generate digital certificates of vaccination.
  • Community participation: Besides preparatory aspects, the community participation has also been emphasised by the Prime Minister. He has urged all to come forward and help in eliminating vaccine hesitancy.
  • Beneficiary identification: Separate templates have been developed for the healthcare workers and the frontline workers.
    • People above the age of 50 who have comorbidities will be the next to be vaccinated.
    • Aadhar will also be used for the beneficiary identification.

Steps need to be taken

  • Spreading awareness: Leaders, influential people and healthcare workers who will be vaccinated need to come forward and help spreading awareness about the vaccine.
  • Effective collaboration: Effective and decentralised implementation with the collaboration of centre, state, communities and health care workers.
  • Proper training: Ensuring proper training of vaccinators and adopting measures to maintain temperature of vaccines.
  • Monitoring: Keeping watch of any side effects that may arise due to vaccines and adopting measures to be used in an emergency for such situations.
The Co-WIN Application To monitor the inoculation drive and track the listed beneficiaries for vaccination on a real-time basis, the central government has developed Covid Vaccine Intelligence Network or Co-WIN application.Co-WIN will facilitate real time information of vaccine stocks and storage temperature during the COVID-19 vaccination drive.The app will be used as a back-end software during COVID-19 vaccination drive, starting from Saturday.The self-registration module of Co-WIN App has not been released yet.

Challenges

  • Vaccine hesitancy: Either they are common people, or the frontline workers, vaccine hesitancy, if exists, it may obstruct the smooth implementation of the vaccination drive.
    • If the healthcare workers are hesitant about getting vaccinated, it will not create a good impact among common people as they are the role model for the people who will be vaccinated next.
    • There is uncertainty and suspicion about the side effects of the vaccine.
  • Issues with the Co-WIN App: Issues such as loss of internet connectivity are expected to be faced in the app, which could cause problems while tracking the vaccine stocks, or in the updation of data of the beneficiaries.
  • Lack of experience: The Covid-19 Vaccination drive is India’s first ever large scale immunisation programme. There is a lack of experience due to which the chances of mistakes are likely to happen.
  • Vaccine wastage: Each vaccine vial contains 10 doses and must be used within 4 hours of opening. This could lead to vaccine wastage.

3. Govt. owning bad bank is more capital efficient’

Set-up may lower credit charges: BofA

Amid confusing reports about the control of the proposed bad bank, a brokerage has called for government ownership, saying state-funding was more capital efficient apart from speeding up implementation and also lowering the credit costs for the banks.

The government owning the proposed bad bank would not only be more capital efficient but also not impact the fiscal numbers, as otherwise, it would have to keep on recapitalising the state-owned lenders as they would be the biggest beneficiaries of the proposed bad bank, Bank of America Securities India said in a report. Again, such a set-up could lower the credit charge on banks to a fifth in the worst-case scenario from the 100% now, the report added.

As of March 2020, the gross non-performing loans of banks stood at 2.8% or ₹2,89,500 crore, which is 1.3% of the GDP, according to the report. This would go up to 13.5% by this September, a two-decade high, given the impact of the pandemic on the companies and banks, according to the Reserve Bank of India.

What is the difference between Bank fraud and Non-Performing Assets (NPA’s)?

Non-Performing Assets is not a new problem faced by banks. Hence there have been continuous efforts on the part of the Government of India and the Reserve Bank of India (RBI), over the years to tackle the problem of Non-Performing Assets. There is a difference between bank fraud  and NPA:

Bank fraud is a criminal offense, Non-Performing Assets is a loan or advance wherein interest or installments of principal remain overdue for a period of 90 days.

As per the Reserve Bank of India (RBI), an asset becomes non-performing when it stops to generate income for the bank. The Non-Performing Assets in Public Banks are valued at approximately $ 62 Billion, which represents 90% of total NPA in India.

What were the reasons behind the rise of Non-Performing Assets in India?

  1. In the period from 2004 to 2009, there was a huge growth in the economy, which led to firms taking bank loans very aggressively.
  2. Most of the investment was in infrastructure sectors like roads, power, aviation, steel
  3. Laxity in lending norms by the banks, without analysing the financial health of the companies and their credit ratings
  4. The banning of mining projects, delay in environment permit, led to a rise in prices of raw materials and a big gap in demand and supply thereby affecting the power, steel, and iron industries. This affected the capacity of the companies to repay the loans to banks which resulted in Non-Performing Assets (NPA).

NPA (Non-Performing Assets) – 3 Classifications

Based on different parameters the Non-Performing Assets are classified into different types.

The below table gives the different classification of Non-Performing Assets:

Classification of Non-Performing Assets (NPA)Criteria
Substandard AssetsThese are the assets which have remained NPA for a period of less than or equal to 12 months
Doubtful AssetsIf the asset is in the substandard category for a period of 12 months
Loss AssetsThese assets are of little value, it can no longer continue as a bankable asset, there could be some recovery value.

What are the impacts of Non-Performing Assets (NPA)

  1. Banks won’t have sufficient funds for other development projects which will impact the economy
  2. To maintain a profit margin, banks will be forced to increase interest rates.
  3. Due to the curb in further investments, it may lead to the rise of unemployment.

Measures to control Non-Performing Assets (NPA) – Government of India and RBI

As the Non-Performing Assets is not a new phenomenon, there have been many efforts on the part of the Government of India and RBI to sort out the problem.

Below table gives the list of measures taken to control Non-Performing Assets (NPA)

MeasuresDetails
Debt Recovery Tribunal (DRT) – 2013It was set up to reduce the time required for settling cases Governed by Recovery of Debt due to Banks and Financial Institutions Act, 1993 Insufficient numbers, hence cases are pending for longer durations.
Credit Information Bureau (2000)This step is to prevent NPA’s by sharing of information on wilful defaulters
ARC (Asset Reconstruction Companies)Recovering value from stressed loans bypassing courts which was a time-consuming process.
Corporate Debt Restructuring (2005)Reduce the burden of debts on the company by giving more time to the company to payback as well as decreasing the rates along with it
5:25 Rule (2014)This is also called Flexible Restructuring of Long Term Project Loans to Infrastructure and Core Industries This involves refinancing of long term projects
Joint Lenders Forum (2014)It is done to avoid a situation where a loan is taken from one bank to repay the loans in other banks
Mission Indradhanush (2015)It is the most comprehensive reforms undertaken to improve the functioning of the Public Sector Banks, by using the ABCDEFG formula.
Strategic Debt Restructuring (SDR) – 2015Corporates who have taken loans from banks if they are unable to repay, then the banks can convert part or complete loans into equity shares
Asset Quality Review (2015)This is a kind of preventive measure, involving early identification of assets which could turn out to be stressed at a later stage.
Insolvency and Bankruptcy Code (2016)One-stop process for solving insolvencies. Aims to protect small investors.

4. China overhauls Hong Kong’s poll system

Beijing-appointed politicians will have a greater say in running the city’s politics

Ananth Krishnan

China on Thursday passed sweeping changes for Hong Kong’s electoral system that will give Beijing-appointed politicians a greater say in running the Special Administration Region (SAR), marking the biggest change since the handover in 1997.

The National People’s Congress (NPC), the Communist Party-controlled legislature, approved “to improve” Hong Kong’s electoral system as it ended its week-long session, with President Xi Jinping and 2,894 other delegates supporting the move. One abstained and none opposed the change, which was passed with thunderous applause from the Party-appointed delegates to the NPC in Beijing.

At the heart of the new proposal is a move to give Beijing-appointed politicians greater power in running the HKSAR’s politics, through a newly expanded Election Committee of 1,500 members.

The NPC said the move was to ensure that “the electoral system should conform to the policy of ‘one country, two systems’, meet the realities in the HKSAR and serve to ensure that Hong Kong is administered by people who love the country and love Hong Kong”. The idea to “ensure the administration of Hong Kong by Hong Kong people with patriots as the main body” was described by Beijing as a response to the 2019 pro-democracy protests that roiled the city and called for universal suffrage.

Wang Chen, vice chairman of the NPC Standing Committee, said the new move was to plug “clear loopholes and deficiencies, which the anti-China, destabilising elements jumped on to take into their hands the power to administer the HKSAR”.

More legislators

Currently, only half of the 70 members of Hong Kong’s Legislative Council (LegCo) are directly elected and the rest are nominated. With this change, the number of LegCo members will be increased to 90, with the additional members also nominated, thereby reducing the share of elected representatives.

The expanded Election Committee will be composed of 1,500 members, up from 1,200 previously, with the new members set to include the Beijing-nominated Hong Kong members of the NPC (the legislature) and the Chinese People’s Political Consultative Conference (the political advisory body or upper house). The Election Committee, as previously, will be responsible for electing the Chief Executive, and will also choose some of the members of LegCo.

The selection of “patriots” will be ensured by the setting up of a new candidate qualification review committee, which the NPC said “shall be responsible for reviewing and confirming the qualifications of candidates for the Election Committee members, the Chief Executive, and the LegCo members”.

The new electoral system is the second significant change in the administration of the HKSAR since the 2019 protests, with a national security law passed last year that lists penalties for “secession” and “subversion” and, in the view of Hong Kong’s pro-democracy parties, has eroded the political freedoms that distinguished Hong Kong from the mainland under the “one country, two systems” model.

Background of Hongkong Issue

  • Until 1997, Hong Kong was ruled by Britain as a colony but then returned to China. Under the “one country, two systems” arrangement, it has some autonomy, and its people more rights.
  • The bill was withdrawn in September but demonstrations continue and now demand full democracy and an inquiry into police actions.
  • Clashes between police and activists have become increasingly violent, with police firing live bullets and protesters attacking officers and throwing petrol bombs.
  • The extradition bill which triggered the first protest was introduced in April. It would have allowed for criminal suspects to be extradited to mainland China under certain circumstances.
  • Opponents said this risked exposing Hongkongers to unfair trials and violent treatment. They also argued the bill would give China greater influence over Hong Kong and could be used to target activists and journalists.
  • Hundreds of thousands of people took to the streets. After weeks of protests, leader Carrie Lam eventually said the bill would be suspended indefinitely.

How did the protests escalate?

  • Protesters feared the bill could be revived, so demonstrations continued, calling for it to be withdrawn completely.
  • By then clashes between police and protesters had become more frequent and violent.
  • In September, the bill was finally withdrawn, but protesters said this was “too little, too late”.
  • On 1 October, while China was celebrating 70 years of Communist Party rule, Hong Kong experienced one of its most “violent and chaotic days”.
  • In November, a standoff between police and students barricaded on the campus of Hong Kong’s Polytechnic University became another defining moment.
  • Later that month, the territory held local council elections that were seen as a barometer of public opinion.
  • The vote saw a landslide victory for the pro-democracy movement, with 17 of the 18 councils now controlled by pro-democracy councillors.

What do the protesters want?

The cultural and economic differences are widely considered as a primary cause of the conflict between Hong Kong and mainland China The differences between Hong Kong people and mainlanders, such as language, as well as the significant growth in number of mainland visitors, have caused tension.

Some protesters have adopted the motto: “Five demands, not one less!” These are:

  • For the protests not to be characterised as a “riot”
  • Amnesty for arrested protesters
  • An independent inquiry into alleged police brutality
  • Implementation of complete universal suffrage The fifth demand, the withdrawal of the bill, has already been met. Protests supporting the Hong Kong movement have spread across the globe, with rallies taking place in the UK, France, US, Canada and Australia.
  • In many cases, people supporting the demonstrators were confronted by pro-Beijing rallies. Chinese president Xi Jinping has warned against separatism, saying any attempt to divide China would end in “bodies smashed and bones ground to powder”.

What is Hong Kong’s status?

  • It was a British colony for more than 150 years – part of it, Hong Kong Island, was ceded to the UK after a war in 1842. Later, China also leased the rest of Hong Kong – the New Territories – to the British for 99 years.
  • It became a busy trading port, and its economy took off in the 1950s as it became a manufacturing hub.
  • The territory was also popular with migrants and dissidents fleeing instability, poverty or persecution in mainland China.
  • Then, in the early 1980s, as the deadline for the 99-year-lease approached, Britain and China began talks on the future of Hong Kong – with the communist government in China arguing that all of Hong Kong should be returned to Chinese rule.
  • The two sides signed a treaty in 1984 that would see Hong Kong return to China in 1997, under the principle of “one country, two systems”.
  • This meant that while becoming part of one country with China, Hong Kong would enjoy “a high degree of autonomy, except in foreign and defence affairs” for 50 years.
  • As a result, Hong Kong has its own legal system and borders, and rights including freedom of assembly, free speech and freedom of the press are protected.
  • For example, it is one of the few places in Chinese territory where people can commemorate the 1989 Tiananmen Square crackdown, where the military opened fire on unarmed protesters in Beijing.
  • It has its own judiciary and a separate legal system from mainland China. Those rights include freedom of assembly and freedom of speech.
  • But those freedoms – the Basic Law – expire in 2047 and it is not clear what Hong Kong’s status will then be.

India’s stand:-

  • As a likely consequence of ongoing border tensions with China, India waded into the controversy over the new Chinese security law in Hong Kong, stating that it hoped the “relevant parties” would address the concerns “properly, seriously and objectively”.
  • China’s parliament passed national security legislation for Hong Kong, which would override local laws and give sweeping powers to security agencies. It allows for a new national security agency, which will not be under the jurisdiction of the local government.
  • Further, the law provides for Chinese mainland authorities to have jurisdiction in cases involving foreign countries or involving national security. It also allows for the crimes of secession, subversion, terrorism and collusion with foreign forces to be punishable by up to life imprisonment.
  • The new legislation comes after Hong Kong has been rocked by anti-Beijing protests since June 2019, with citizens angry over the rising influence of China, contrary to the ‘one country, two systems’ concept” adopted when China took control of the former British colony in 1997.
  • India’s statement was made not by the foreign ministry in Delhi, but by its representative at the ongoing session of the UN Human Rights Council in Geneva.
  • Its 1st time India will taking stand over One China Policy for making diplomatic pressure on China.

5. PM to attend first Quad Summit today

Access to COVID-19 vaccines, cooperation on technology, and climate change are on the top of the agenda as Prime Minister Narendra Modi will join U.S. President Joseph Biden, Australian PM Scott Morrison and Japanese PM Yoshihide Suga for a virtual summit of the Quadrilateral Framework (Quad) on Friday — the first time leaders of the Indo-Pacific grouping are meeting.

The meeting is also one of Mr. Biden’s first multilateral engagements, which the White House said denoted the importance of the U.S.’s cooperation with “allies and partners in the Indo Pacific”.

The Quad meeting, that China has referred to as an “Indo-Pacific NATO”, will be watched most closely for signals on how the grouping will deal with the challenge from Beijing’s recent moves in the Pacific as well as at the Line of Actual Control in Ladakh.

Also of interest is whether the four leaders will issue a joint statement at the end of the meeting, which would be another first, as all Quad engagements thus far have come out with four separate readouts indicating differences in their positions.

Ahead of the summit, U.S. Secretary of State Antony Blinken, who will visit Japan and South Korea next week, said he expected to “see something on vaccines” as an outcome of the summit meeting, expected to begin at 7 p.m. IST on Friday.

In the Quad ministerial summit in February, the four countries had discussed the need for international cooperation to ensure equitable access to vaccines, especially in developing countries.

India, the world’s largest manufacturer of vaccines, that has already shipped out more than 48 million doses worldwide, is expected to request Quad investment to scale up its outreach further.

In addition, India would like to see Western countries, led by the U.S., dilute their opposition to its proposal at the World Trade Organisation to waive Trade Related Intellectual Property (TRIPS) guidelines, so that more vaccines can be produced generically.

Quad

  • Quadrilateral Security Dialogue (Quad) is the informal strategic dialogue between India, USA, Japan and Australia with a shared objective to ensure and support a “free, open and prosperous” Indo-Pacific region.
  • The idea of Quad was first mooted by Japanese Prime Minister Shinzo Abe in 2007. However, the idea couldn’t move ahead with Australia pulling out of it, apparently due to Chinese pressure.
  • In December 2012, Shinzo Abe again floated the concept of Asia’s “Democratic Security Diamond” involving Australia, India, Japan and the US to safeguard the maritime commons from the Indian Ocean to the western Pacific.
  • In November 2017, India, the US, Australia and Japan gave shape to the long-pending “Quad” Coalition to develop a new strategy to keep the critical sea routes in the Indo-Pacific free of any influence (especially China).

Quad Nations and China

  • USA: USA had followed a policy to contain China’s increasing influence in East Asia. Therefore, USA sees the coalition as an opportunity to regain its influence in the Indo-Pacific region.
    • The US has described China, along with Russia, as a strategic rival in its National Security Strategy, National Defence Strategy and the Pentagon’s report on Indo-Pacific Strategy.
  • Australia: Australia is concerned about China’s growing interest in its land, infrastructure and politics, and influence on its universities.
    • Taking into account its overwhelming economic dependence on China for prosperity, Australia has continued its commitment to a Comprehensive Strategic Partnership with China.
  • Japan: In the last decade, Japan has expressed concerns related to China’s territorial transgression in the region.
    • Trade volume with China remains the key lifeline to the Japanese economy, where net exports contributed exactly one-third of Japan’s economic growth since the beginning of 2017.
      • Therefore, considering its importance, Japan is balancing its economic needs and territorial concerns with China
    • Japan has also agreed to involve in the Belt and Road Initiative by participating in infrastructure programs in third country. In this way, Japan can mitigate Chinese influence in those countries while improving relations with China.
  • India: In recent years, China’s violation of international norms, particularly its construction of military facilities on reclaimed islands in the South China Sea, and its growing military and economic power, pose a strategic challenge to India.
    • Considering China’s strategic importance, India is carefully balancing China on one hand and the US on the other, by remaining committed to strategic autonomy to China, which has generally proved reassuring to China.
    • India has also not permitted Australia to participate in Malabar Trilateral Maritime exercises between India, US and Japan, concerned about what message it would send to China, which is wary of the exercise.
    • The recent Mamallapuram summit between President Xi Jinping and PM Modi is a positive development, valued by both sides as key to giving strategic guidance to stakeholders on both sides.

Challenges

  • China’s Territorial Claims: China claims that it has historical ownership over nearly the entire region of South China Sea, which gives it the right to manufacture islands. However, the International Court of Arbitration rejected the claim in 2016.
  • China’s Closeness to ASEAN: The ASEAN countries also have a well-knit relationship with China. The Regional Cooperation Economic Partnership (RCEP) is a recent example of China’s increasing influence over ASEAN nations.
  • Economic Power of China: Considering the economic might of China and the dependence of Quad nations like Japan and Australia on China, the Quad nations cannot afford to have strained relations with it.
  • Convergence among Quad Nations: The nations in the Quad grouping have different aspirations, aims at balancing their own interest. Therefore, coherence in the vision of Quad nation as a grouping is absent.

6. Editorial-1: Working towards climate justice in a non-ideal world

New Delhi has to leverage its green commitment to ensure carbon and policy space for its developmental aspirations

The election of Joe Biden as U.S. President has catapulted climate change to the top of the global agenda, allowing him to keep his promise to “lead a major diplomatic push” to increase global climate ambition. This also works well for him in rebuilding the trans-Atlantic alliance apart from keeping at bay the domestic fissures from a tenuous hold of the Democrats in the U.S. Congress while being resolute on climate change. It is also in line with the legacy ambitions of his team, led by former U.S. Secretary of State, John Kerry (and now Special Presidential Envoy for Climate), with many of them being old climate warriors, some even from the days of the U.S. President, Bill Clinton.

The U.S.’s moves

Interestingly, the U.S. is not just striding back to the Obama signature achievement of the Paris Accord with its voluntary commitments but also to the Bush days. This is, perhaps, best evidenced by the presidential call to reconvene the Major Economies Forum (MEF) starting with a Leaders’ Climate Summit in April this year.

The MEF, which was first convened in March 2009, originated in the Bush-era U.S. efforts to rope in major emitters.

It was also to push a way forward on climate change without heed to the principle of differentiated responsibilities and recognition of historical responsibilities, which are rightly hallowed principles of the climate discourse given the decades of staying power of greenhouse gases (GHGs) in the atmosphere. The serious unwillingness of emerging economies to be labelled “major emitters” saw the meeting retitled “Major Economies Meeting” given the clear link between GDP and GHG. While the meeting’s purport was not hidden, the retitling provided a feel-great and one from which retraction was not possible for the emerging economies.

Stern message, border levies

This time the push appears to have come to shove, with all countries being told to commit to net zero (GHG emissions) by 2050 with credible plans to ensure meeting this domestic target. Indeed, the Chinese, who posited themselves as reaching there by 2060, have been sternly told to be there a decade earlier.

Taking a cue from the new U.S. Administration, the UN Secretary-General has even called on countries to declare national climate emergencies apart from building a coalition for a carbon-neutral world by 2050. As of today, countries representing around 65% of global CO2 emissions have already agreed to this. The UN Secretary-General would like this figure to reach 90% within 2021.

These plans and their implementation will, undoubtedly, be subject to international reviews and verification. Not said as yet, but non-compliance may not be just naming and shaming. Historical responsibilities and differentiation, obviously, have no place in this discourse; but neither does the level of development. India, with its huge population and now one of the world’s largest economies, can easily be in the crosshairs of such a discourse no matter its extraordinarily small carbon footprint in per-capita terms and huge development imperatives.

Adding to the challenges of this proposed global goal is the distinct possibility of the EU imposing carbon border levies on those who do not take on high carbon cut-down targets and do so unilaterally if there is no global agreement. While as of now the U.S. Administration appears ambivalent on these border levies, the possibility of their coming around cannot be ruled out. In such a scenario, World Trade Organization rules that presently exclude the use of tariffs on environmental grounds will certainly get modified.

A fund pay-in idea

The issue of money, especially the lack of it, is a perennial one in the climate discourse. In this context, Raghuram Rajan has recently put forward a proposal for India to consider — it calls on countries to pay into a global fund amounts based on their carbon emissions over and above the global per-capita average of five tons. This obviously disincentives coal in a big way while incentivising renewables. Those above the global average would pay, while those below would receive the monies. While this would suggest a certain equity, it may be unacceptable to the developed countries even though Mr. Rajan has gone along with the drumbeat to forget historical responsibility.

As far as India is concerned, for starters such a proposal may appear attractive as India today has per capita CO2 emission of only 2 tons and is a global record setter in pushing renewables. But will real politics allow a major economy to benefit from such fund flows or indeed even be the recipient of any form of concessional climate finance? Unlikely.

Moreover, the long-term implications of such a proposal in a setting of a sharply growing economy and reliance on coal-produced electricity for several decades require examination in detail, quite apart from factoring in the twists and turns that negotiations could give to such an idea. And then, of course, there are alternatives such as emission trading.

Furthermore, the proposal focuses on current and future emissions, and in keeping with the contract and converge approach, allows practical considerations to trump fairness by not only giving a short shrift to historical responsibility but also denying priority access to the remaining carbon space for developing countries. In that sense, it double penalises them while giving developed countries a certain free pass. Here it bears noting that more than 75% of the carbon space available to humankind to keep global temperature rises to 1.5° C has already been taken up by the developed world and China.

Climate negotiations are not just about the environment and human well-being or even energy, but are also about global governance, and will henceforth be pursued with a vigour which requires India to carefully calibrate its approach including on the economic and political fronts. Climate justice is an imperative for India, which needs to leverage its green and pro-nature commitment to ensure carbon and policy space for its developmental and global aspirations. India’s diplomatic and negotiating efforts must be quickly geared to that end.

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