1. Why has the rupee fallen against the dollar?
Relevant for GS Prelims & Mains Paper III; Economics
The rupee slumped on Friday to a record closing low of 75.20 against the U.S. dollar as deepening concerns about the economic fallout of the COVID-19 pandemic sent global investors scurrying to dump most assets, especially emerging market holdings, and opt for cash and the relative safety of the greenback.
Why is the Indian currency weakening?
Since the start of the month, overseas investors have dumped Indian equities and debt on a scale not seen since 2013. As on March 20, foreign institutional investors (FIIs) had sold a net ₹95,485 crore, or more than $12 billion, of shares and bonds. This outflow has coincided with the sharp fall in the equity market’s key gauge, the 30-stock S&P BSE Sensex, which has slumped 22% so far in March.
What else is contributing to the fall?
The rupee’s decline in March has been part of a broad trend as most currencies across the globe have weakened against their U.S. counterpart. The dollar index, which gauges the greenback’s strength against a basket of six currencies, has gained almost 4% so far this month. The risk aversion as a result of the pandemic triggered by the global outbreak of COVID-19 has been so intense that it has not spared most perceived safe havens including U.S. Treasuries (government bonds) and significantly even gold. The yellow metal too has been sold by investors looking to hold the most liquid and most fungible of all assets — the U.S. dollar.
What is there for the future?
Given that the increasing possibility of the global economy heading into a recession has been a key driver of the dollar’s appreciation against other currencies, including the rupee, there is clearly more pain ahead for the Indian currency. Add to it the fact that India’s own domestic economy has been struggling to reverse an extended slowdown — with both private consumption and investment by businesses substantially becalmed — and it is hard to see sentiment on the rupee improving appreciably in the short-term.
Point in favour
However, a few offsetting factors offer just a little comfort. For one, India’s foreign exchange reserves are still at a fairly robust level and as on March 13 amounted to a total of almost $482 billion. Armed with this war chest, the Reserve Bank of India (RBI) has stepped in every now and then, both to smooth volatility in the foreign exchange market and to ensure that a sudden shortage of dollar supply does not exacerbate the weakening trend in the rupee. The central bank, in fact, last week provided $2-billion of dollar liquidity through a forex swap on Monday, and is set to provide a similar line on March 23 as well.
Also, the price of oil, which is one the largest contributors to India’s import bill, has dramatically declined this month with Brent crude oil futures having slumped more than 46% to $26.98 as on March 20. With neither Saudi Arabia nor Russia appearing to be in any hurry to de-escalate their price war, and energy demand likely to remain depressed in the foreseeable future on account of the global economic downturn, oil may remain one source of respite for the rupee.
And were the U.S. economy itself to go beyond a recession and possibly head for a massive unemployment featuring depression — if more States join California in enforcing severe movement curbs such as the large coastal State’s statewide “stay-in-place” order to contain the spread of the viral pandemic —the dollar too could become a risky holding.
Still, to complicate matters on the outlook, the RBI is most likely to cut interest rates in the very near future to support the sagging economy at this juncture, a move that could potentially again add to the downward pressure on the rupee.
Source: The Hindu
2. When will a COVID-19 vaccine be ready?
Relevant for GS Prelims & Mains Paper III; Science & Technology
What are vaccines? How are these made?
Vaccines are one of the most effective tools to prevent diseases. A vaccine is a substance that resembles the disease-causing agent (also called pathogen) but does not cause the disease. It trains the body’s immune system to recognise and kill the pathogen, and creates a memory for the future. Vaccines are available to protect us against many life-threatening diseases such as polio, influenza, meningitis, typhoid, tetanus, diphtheria, and certain types of cancers. Vaccines have also been responsible for eradication (or near eradication) of deadly diseases such as smallpox and polio.
There are multiple ways to make vaccines. For a killed vaccine, the pathogen can be grown outside the body, purified and inactivated with chemicals. An example of this is the injectable polio vaccine. Alternatively, the pathogen can be weakened by repeated culture or by genetic means. An example of this would be the oral polio vaccine — the kind used in the ‘Pulse Polio Programme’. One of the proteins on the pathogen surface can also be produced artificially and used to raise immunity. An example of this would be the Hepatitis B vaccine.
What vaccines are being developed against COVID-19?
According to the World Health Organization, over 40 different candidate vaccines for COVID-19 are in development. These include an inactivated vaccine being developed in China (Sinovac) using purified COVID-19 virus killed with formaldehyde (a chemical). A live attenuated vaccine being developed by Codagenix, a U.S.-based company in partnership with the Serum Institute of India (Pune), uses a genetically engineered COVID-19 virus that replicates very poorly. There are multiple other vaccine candidates under development that use DNA, RNA, viral vector and subunit protein platforms.
One vaccine against COVID-19 is already in trials. What is it about?
An experimental COVID-19 vaccine called mRNA-1273 was developed by Moderna, a biotechnology company based in Cambridge, Massachusetts in the U.S. in partnership with the Vaccine Research Center at the National Institutes of Health (NIH), U.S. A Phase 1 study to evaluate its safety and immunogenicity (i.e. ability to raise immune responses) in humans is being conducted by the NIH.
What is the mRNA vaccine?
The genetic blueprint (or code) in living organisms is stored in a double-stranded molecule called DNA (deoxyribonucleic acid), which makes proteins that are responsible for nearly every function in the human body. The conversion of DNA code into proteins requires a single-stranded molecule called the mRNA (messenger ribonucleic acid). In an analogy with computers, one may think of the DNA as the hardware, the mRNA as the software and proteins as the applications.
The mRNA-1273 is a piece of RNA that carries the code to make the COVID-19 virus Spike protein when introduced into cells. This protein present on the virus surface is critical for its entry into cells. Immunity (antibodies) to the Spike protein can block virus entry and its multiplication, and thus ameliorate the disease.
While simple to engineer, mRNA can degrade easily. Therefore, it has to be protected with a coating that can also target it to the cells of choice when injected into the body.
How long does it take to develop a vaccine?
It can take years to develop vaccines — first in laboratories to show proof-of-concept, then developing a manufacturing process to make stable and a highly pure product to be tested in animals and humans, and finally for the market.
The COVID-19 vaccine has been fast-tracked into humans without prior testing in animals. Still, it may take one to two years for the clinical trials to be over. Since there is no guarantee that the mRNA-1273 (or another) vaccine would work, a rich pipeline of over 40 candidates is important.
How much does it cost to develop it? Who funds it?
It takes millions of dollars to develop and test a vaccine. Either for-profit companies or philanthropic foundations and countries cover the costs.
The mRNA-1273 vaccine is supported by the Coalition for Epidemic Preparedness Innovations (CEPI), a not-for-profit grouping of foundations and countries. India is a member of CEPI. Besides mRNA-1273, CEPI has funded the development of at least five other COVID-19 vaccines, with an overall commitment of $23.7 million.
Is a virus needed to develop a vaccine against it?
With modern molecular tools and technologies, isolating a virus is not required to make a vaccine against it. The genetic sequence can be obtained directly from infected patients and this can be converted into proteins using various platform technologies.
This makes it possible to have vaccines ready for hundreds of pathogens that have not yet infected humans, but have the potential to do so in future.
Source: The Hindu
3. Why are only a fraction of cases tested?
Relevant for GS Prelims & Mains Paper III; Science & Technology
With the number of COVID-19 cases accelerating in India, health authorities are now broadening the pool for testing. On Friday night, the Indian Council of Medical Research (ICMR) issued guidelines for a new testing strategy to effectively track COVID-19 cases. The focus remains on finding imported infections and testing their contacts who show symptoms, the new guidelines say all hospitalised patients with severe acute respiratory illness, shortness of breath and having fever and cough will be tested for COVID-19. And asymptomatic direct and high-risk contacts of an infected person should be tested between the fifth day and 14th day of coming into contact with the patient.
How is testing for COVID-19 done?
To rapidly determine whether someone with symptoms of cough, fever and breathlessness is infected, hospital authorities are doing an RT-PCR (real time reverse transcriptase-polymerase chain reaction) test. This process involves collecting a nasal or throat swab from a patient suspected of having the disease. These are two sites (the nose and back of the throat) where the virus can be collected, and the swab picks up the cells where the virus might be. Replication happens in the upper respiratory tract. These are frozen and sent to one of the designated government centres for a result.
A sample is also sent to the National Institute of Virology (NIV) to recheck the diagnosis.
To check for the SARS CoV-2 virus, the sample is passed through a machine, which is part of the diagnostic kit. The RNA, or ribonucleic acid, which is the genetic material of a virus, is isolated from the sample and it is on this that further tests are done.
Based on what is known about the structure of coronaviruses in general and what emerging research about SARS CoV-2 suggests, research organisations around the world have marked out locations on the SARS COV-2 genome that differentiate it from other coronaviruses, particularly SARS-CoV that was identified in China in 2003. On the basis of this, protocols or steps are prescribed for testing agencies to follow to determine the presence of SARS CoV-2. Enter primers and probes. Primers are small pieces of DNA and research laboratories, both private and public, have designed customised primers that bind only to a specific combination of DNA bases. It is the uniqueness of a sequence of DNA bases that differentiates species as well as strains within it.
With an enzyme, the virus’s RNA is converted into DNA and the appropriate primer — like a key that can only open the right lock — zooms into the virus’s genome and amplifies it.
This amplification is necessary as there is an extremely limited amount of the viral genome and detecting it requires that a sufficient amount of the material is synthesised. A fluorescent dye, or the probe, is added during the testing process. The probe only lights up when DNA is detected. When many samples are tested simultaneously, only those with the SARS CoV-2 in them will light up, thus confirming its presence. These tests can yield results within hours and are extremely accurate provided they are appropriately conducted.
What is the Indian Council of Medical Research’s approach to testing?
Currently, testing for SARS-CoV-2 can only be done by 79 laboratories. The ICMR’s approach so far was to focus on those who showed symptoms of the disease and had a travel history from countries with SARS CoV-2 cases; their contacts who show symptoms and symptomatic health-care workers managing patients with ‘severe acute respiratory distress’.
This excluded, as several doctors and critics pointed out, those who may show symptoms but do not have a travel history. On Friday, a committee of experts, mostly from government institutions that advises on testing strategy, led the ICMR to expand these criteria to include all symptomatic health workers, hospitalised patients with severe respiratory illness and a five and 14-day follow-up with close contacts of confirmed cases, even if they do not show symptoms.
What is the cost of the test?
Testing is free but it costs the government ₹4,500 per test. The probes are imported and the ICMR has ordered a million of them. Spending money optimally, is important in the ICMR’s scheme of things. Testing anyone and everybody with symptoms, ICMR officials reckon, would lead to reagents (chemicals used in the process) and probes being ‘wasted’, as according to them, large numbers could test negative. This would, going ahead, make resources scarce if instances of community transmission (when it is no longer possible to trace the contact history of someone who tests positive) are confirmed and infections are widespread. So far, only 10% of the ICMR’s available capacity has been utilised and random sampling (that is testing 20 samples of severe respiratory illness) at 60-odd locations has yielded no positive cases.
Therefore, they surmise, there has been no instance of community transmission as yet. With the blanket ban on international commercial flights from March 22 to March 29, screening of borders and quarantine measures imposed by States and commercial establishments and screening, and then following up with the contacts of positive cases, ICMR officials feel the spread of the infection can be controlled. Testing high-risk groups and broadening the criteria gradually also allow the government to track better, isolate and care for individuals who test positive.
Are there enough supplies of kits?
The ICMR has opened a window for private sector health-care laboratories which have a supply chain of primers, probes and reagents to apply for permission to conduct tests. There are 16 Indian companies which have made their own diagnostic kits but await validation by the NIV, the only designated authority. Most of the kits will be imported and involve licensing deals with multinational companies.
Coronavirus | Two indigenous tests for detection being tested
The ICMR has requested the private laboratories, if and when they are allowed, to offer “tests for free”. As of March 21, 15,701 samples from 14,811 individuals have been tested and 271 have been confirmed positive. Nearly 850 samples that were randomly tested for community transmission have tested negative.
Source: The Hindu
4. Nirbhaya case convicts’ hanging
Relevant for GS Prelims & Mains Paper I; Social Issues
The pre-dawn hangings of four men convicted of the gang rape and murder of a 23-year-old woman may have brought a semblance of closure to her parents, prompting her mother, to say, “Women will now feel safe.” On December 16, 2012, the woman was brutally raped in an empty moving bus in Delhi and she died after battling for her life later that month.
A little over seven years later, the first date of execution was set for January 22, and the convicts tried all legal avenues possible to escape the punishment.
Reforms in rape laws
In 2012, the government of the day, reacting to the clamour on the streets for justice, set up the Justice J.S. Verma Committee to look into rape laws. The report, filed in a month, led to stringent changes through the Criminal Law (Amendment) Act, 2013, but several recommendations were simply not considered, including those relating to marital rape and police reform.
On the imposition of the death penalty, the government went against what the Verma report had suggested — that seeking such a punishment “would be a regressive step in the field of sentencing and reformation”. Now, repeat offenders in rape cases, even those that unlike the Nirbhaya case did not involve murder, can be awarded the death sentence. The Verma Committee had argued instead for rigorous imprisonment of a convict for life.
Imposition of death penalty
It is a fact that sexual crimes against women have not come down since the Delhi case. The death penalty could actually encourage the rapist to kill the victim. Going by data in the National Crime Records Bureau report, released in January 2020, a total of 3.78 lakh cases of crimes against women were recorded across India in 2018 compared to 3.59 lakh in 2017 and 3.38 lakh in 2016. The total number of rape cases in 2018 was pegged at 33,356, of which Madhya Pradesh registered 5,450 rapes, the maximum in 2018. The crime rate per one lakh women population was 58.8 in 2018 compared to 57.9 in 2017. At the end of 2018, 33.6% cases were pending police investigation.
Mindset of society
This raises the key question — what does India need to do to protect its girls and women? It is apparent that laws may have changed, but not mindsets. A society that endorses a preference for the male child has already condemned the girl child to an unequal world.
Until Indian leaders, policy-makers and society shed the gender bias and the thinking that they need to protect women as a question of honour, there will be no stopping crimes such as rape, sexual assault and harassment.
Source: The Hindu
Q. The Coronavirus impact is severe on the economic front. Discuss how the impact has led to severe slide in the value of rupee? (150 words, 10 marks)
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