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Daily Prelims Test – 28_January 2021

Consider the following Statements regardingSecured Overnight Financing RateIt is used for long-term borrowing of cash in the US Treasury repo markets.It is a benchmark interest rate for dollar-denominated derivatives and loans that is replacing the London interbank offered rateWhich of the statement(s) given above is/are correct?

1 only

2 only

Both 1 and 2

Neither 1 nor 2

Answer: (b) 2 only

Explanation:

In NEWS: Banks in India ready for transition, but the world still loves Libor

Banks in India are ready to delink their foreign-exchange loans from London Interbank Offered Rate (Libor) to an alternative reference rate, but the international markets are still happily continuing with the old benchmark. The Libor era comes to an end in 2021, and banks across the globe will have to shift to an alternative rate.

Secured Overnight Financing Rate (SOFR) and Sterling Overnight Interbank Average Rate (SONIA) are the two popular alternatives, but internationally, only a few swap deals are linked to them.

State Bank of India (SBI) has executed two inter-bank short term money market deals with pricing linked to SOFR (Secured Overnight Financing Rate).

About Secured Overnight Financing Rate

SOFR is a measure of the cost of borrowing cash (short term ) on an overnight basis in the US Treasury repo markets

SOFR was selected by the Alternative Reference Rates Committee (ARRC) chaired by the New York Federal Reserve in 2017. . Hence statement 1 is correct

It is a benchmark interest rate for dollar-denominated derivatives and loans.

It is based on transactions in the Treasury repurchase market. Hence statement 2 is correct

Similar to a mortgage rate, SOFR is a secured borrowing rate in the sense that collateral is provided to borrow cash.

It is seen as preferable to London interbank offered rate (LIBOR) since it is based on data from observable transactions rather than on estimated borrowing rates.

Source: BS, TH


Consider the following Statements regardingProtection of Children from Sexual Offences (POCSO) Act, 2012

The Act defines a child as any person below eighteen years of age

People who traffic children for sexual purposes are also punishable under the act.

All sexual offences under the POCSO Act have minimum sentence except offence of sexual harassment.

Which of the statement(s) given above is/are correct?

  1. 1 and 3 only
  2. 2 and 3 only
  3. 1 and 2 only
  4. 1,2 and 3

Answer: (d) 1,2 and 3

Explanation:

In NEWS: Explained: In Bombay HC verdict on sexual assault, the issue of mandatory minimum sentencing

  • The Bombay High Court has acquitted a man of sexual assault charges under the Prevention of Children from Sexual Offences (POCSO) Act for groping a child, and instead convicted him under the Indian Penal Code (IPC) for a lesser offence
  • A man was accused of attracting the 12-year-old girl to his house on the pretext of giving guava and outraging her modesty.
  • The HC said that the allegation was not serious enough for the greater punishment prescribed under the law.

What is a mandatory minimum sentence?

  • Section 8 of the POCSO Act carries a sentence of rigorous imprisonment of three to five years. However, imposing the minimum sentence is mandatory. Where a statute has prescribed a minimum sentence, courts do not have the discretion to pass lighter sentences irrespective of any specific circumstances that the case or the convict might present.
  • Minimum sentences have been prescribed for all sexual offences under the POCSO Act barring the offence of sexual harassment. Hence statement 3 is correct
  • A mandatory sentence is prescribed to underline the seriousness of the offence, and is often claimed to act as a deterrent to crime. In 2013, criminal law reforms introduced in the aftermath of the 2012 Delhi gangrape prescribed mandatory minimum sentences for criminal use of force and outraging the modesty of a woman, among other charges.
  • Mandatory minimum sentences are also prescribed in some cases to remove the scope for arbitrariness by judges using their discretion.

What are the criticisms of mandatory sentencing?

  • It led to the fewer conviction rate because when judges feel that punishment for the offence is harsh, they prefer to acquit the accused.
  • According to the experts, mandatory sentencing doesn’t remove discretion, it merely shifts the discretion from judiciary to the police.

About Protection of Children from Sexual Offences (POCSO) Act, 2012

  • The Act is gender neutral and regards the best interests and welfare of the child as a matter of paramount importance at every stage so as to ensure the healthy physical, emotional, intellectual and social development of the child.
  • The Act defines a child as any person below eighteen years of age, and regards the bestinterests and well-being of the child as being of paramount importance at every stage, to ensure the healthy physical, emotional, intellectual and social development of the child. Hence statement 1 is correct
  • It defines different forms of sexual abuse, including penetrative and non-penetrative assault, as well as sexual harassment and pornography, and deems a sexual assault to be “aggravated” under certain circumstances, such as when the abused child is mentally ill or when the abuse is committed by a person in a position of trust or authority vis-à-vis the child, like a family member, police officer, teacher, or doctor.
  • People who traffic children for sexual purposes are also punishable under the provisions relatingto abetment in the Act. The Act prescribes stringent punishment graded as per the gravity of the offence, with a maximum term of rigorous imprisonment for life, and fine. Hence statement 2 is correct
  • It defines “child pornography” as any visual depiction of sexually explicit conduct involving a child which include photograph, video, digital or computer generated image indistinguishable from an actual child, and image created, adapted, or modified, but appear to depict a child;’

Source: https://indianexpress.com/article/explained/in-bombay-high-court-verdict-on-sexual-assault-the-issue-of-mandatory-minimum-sentencing-7162861/


Consider the following Statements regardingInternational Energy Agency

It has 30 member nations and only OECD nations are given membership to the IEA

It is a Paris-based autonomous intergovernmental organisation established in the framework of the Organisation for Economic Co-operation and Development

Which of the statement(s) given above is/are correct?

  1. 1 only
  2. 2 only
  3. Both 1 and 2
  4. Neither 1 nor 2

Answer: (c) Both 1 and 2

Explanation:

In NEWS: India signs framework for Strategic Partnership with International Energy Agency members to enhance global energy security

  • India and International Energy Agency members have signed the framework for Strategic Partnership to strengthen mutual trust and cooperation and enhance global energy security, stability and sustainability.
  • This partnership will lead to an extensive exchange of knowledge and would be a stepping stone towards India becoming a full member of the International Energy Agency
  • The International Energy Agency Secretariat will be responsible for implementation of the cooperative activities in India and for facilitating discussion between IEA Members and India to further develop the Strategic Partnership

About International Energy Agency

  • The International Energy Agency (IEA) is a grouping of major oil-importing countries which was created in 1974 by the members of the Organization for Economic Cooperation and Development (OECD) at Paris, France, following the Arab oil embargo of 1973 which had resulted in a dramatic rise in oil prices. Hence statement 2 is correct
  • It was established with a broad mandate on energy security and other issues about energy policy cooperation among the member countries.
  • Long term supply, information transparency, the security of supply, international energy relations, research and development were its focal points.
  • It has 30 member nations and only OECD nations are given membership to the IEA. All the OECD member states except for Chile, Iceland, Israel, Mexico and Slovenia are members of IEA.  Hence statement 1 is correct
  • India became an Associate Member of IEA in 2017 while Mexico became the 30th member of IEA in 2018
  • The International Energy Agency was established with an objective to coordinate the response of the participating states to the world energy crisis along with developing a mechanism for oil-sharing for use during supply difficulties.
  • IEA mainly focuses on its energy policies which include economic development, energy security and environmental protection.
  • IEA has a major role to play in providing information related to the international oil market and taking action against any physical disruptions in the supply of oil.

Source: http://newsonair.com/News?title=India-signs-framework-for-Strategic-Partnership-with-International-Energy-Agency-members-to-enhance-global-energy-security&id=408738


Consider the following Statements regardingPermanent Court of Arbitration

India is a party of the PCA

It is not a court and does not have permanent judges.

It was the first permanent intergovernmental organization that provided a forum for the resolution of international disputes through arbitration and other peaceful means.

Which of the statement(s) given above is/are correct?

  1. 3 only
  2. 2 and 3 only
  3. 1 and 3 only
  4. 1,2 and 3

Answer: (d) 1,2 and 3

Explanation:

In NEWS: Cairn threatens Indian asset seizures abroad in tax case

  • Recently, a three-member tribunal at the Permanent Court of Arbitration (PCA) at The Hague ruled in favour of Cairn Energy PLC of the U.K and awarded $1.2 billion in damages against India in the retrospective taxation case.
  • In the latest development, Cairn Energy Plc has threatened that, unless the government resolves the issue, it may be forced to begin attaching Indian assets including bank accounts in different world capitals.
  • In a letter to the Indian High Commission in London Cairn’s top leadership has said that the necessary preparations have been made for the verdict to be enforced against Indian assets in jurisdictions around the world if India failed to discuss paying the amount awarded.
  • The assets already under consideration could include Embassy bank accounts, non-diplomatic premises, Air India planes and state-owned ships in several places including the U.K., Holland, France, Canada and the U.S.

About Permanent Court of Arbitration

  • PCA is an intergovernmental organization established by treaty at the First Hague Peace Conference, Netherland in 1899. It is not a court in the traditional sense, but a permanent framework for arbitral tribunals constituted to resolve specific disputes.
  • PCA seeks to facilitate arbitration and other forms of dispute resolution involving various combinations of states, state entities, international organizations and private parties.
  • It was the first permanent intergovernmental organization that provided a forum for the resolution of international disputes through arbitration and other peaceful Hence statement 3 is correct
  • It is not a court and does not have permanent judges. The PCA is a permanent bureaucracy that assists temporary tribunals to resolve disputes among states (and similar entities), intergovernmental organizations, or even private parties arising out of international agreements. Hence statement 2 is correct
  • India is a party of the PCA according to the HagueConvention on 1899. Hence statement 1 is correct
  • The PCA also administers cases under the arbitration rules of the UNCITRAL.

Source: https://www.thehindu.com/business/Industry/cairn-threatens-indian-asset-seizures-abroad-in-tax-case/article33669711.ece


Consider the following Statements regardingManufactured sand

It is a substitute of river sand for concrete construction.

It is produced from hard granite stone by crushing.

It does not contain organic and soluble compounds

Which of the statement(s) given above is/are correct?

  1. 1 only
  2. 2 and 3 only
  3. 3 only
  4. 1,2 and 3

Answer: (d) 1, 2 and 3

Explanation:

In NEWS: Gehlot govt. brings M-sand policy for construction works

  • The Rajasthan government has brought a policy on manufactured sand (M-sand), giving industry status to the units producing it for construction work and reducing the dependence on bajri (riverbed sand).
  • The policy will enable the investors to set up M-sand units by utilising the incentives offered by the State government.
  • It will also help in environmental protection and generate faith among the public in the efficacy of M-sand for construction works.
  • The policy would help create employment opportunities through new units and resolve the issue of huge quantities of waste generated in the mining areas.

About manufactured sand

  • M-sand is a substitute of river sand for concrete constructionHence statement 1 is correct
  • Manufactured sand is produced from hard granite stone by crushing. Hence statement 2 is correct
  • The crushed sand is of cubical shape with grounded edges, washed and graded to as a construction material.
  • The size of manufactured sand (M-Sand) is less than 4.75mm.
  • Manufactured sand is an alternative for river sand.
  • Due to fast growing construction industry, the demand for sand has increased tremendously, causing deficiency of suitable river sand in most part of the word.
  • Due to the depletion of good quality river sand for the use of construction, the use of manufactured sand has been increased.
  • Another reason for use of M-Sand is its availability and transportation cost.
  • Since manufactured sand can be crushed from hard granite rocks, it can be readily available at the nearby place, reducing the cost of transportation from far-off river sand bed.
  • Thus, the cost of construction can be controlled by the use of manufactured sand as an alternative material for construction.
  • It does not contain organic and soluble compounds that affect the setting timeand properties of cement, thus the required strength of concrete can be maintained. Hence statement 3 is correct
  • The other advantage of using M-Sand is, it can be dust free, the sizes of m-sand can be controlled easily so that it meets the required grading for the given construction.
  • Usage of M-sand prevents dredging of river beds to get river sand which may lead to environmental disaster like ground water depletion, water scarcity.

Source: https://www.thehindu.com/news/national/other-states/gehlot-govt-brings-m-sand-policy-for-construction-works/article33670743.ece


Consider the following Statements regardingWildlife Crime Control Bureau

It is a statutory multi-disciplinary body established under the Ministry of Environment and Forests

Under the Wild Life (Protection) Act 1972, it is mandated to collect intelligence related to organized wildlife crime activities.

Which of the statement(s) given above is/are correct?

  1. 1 only
  2. 2 only
  3. Both 1 and 2
  4. Neither 1 nor 2

Answer: (c) Both 1 and 2

Explanation:

In NEWS: Elephant calf rescued from dug well in West Bengal

Wildlife Crime Control Bureau(WCCB) and Barasat Forest Range have rescued a live pangolin in Kolkata.

About Wildlife Crime Control Bureau

  • Wildlife Crime Control Bureau is a statutory multi-disciplinary body established by the Government of India under the Ministry of Environment and Forests, to combat organized wildlife crime in the country. The Bureau has its headquarter in New Delhi and five regional offices at Delhi, Kolkata, Mumbai, Chennai and Jabalpur. Hence statement 1 is correct
  • It also assists and advises the Customs authorities in inspection of the consignments of flora & fauna as per the provisions of Wild Life Protection Act, CITES, and EXIM Policy governing such an item.
  • It also assists and advises the Customs authorities in inspection of the consignments of flora & fauna as per the provisions of Wild Life Protection Act, CITES, and EXIM Policy governing such an item.
  • Under Section 38 (Z) of the Wild Life (Protection) Act, 1972, it is mandated to:
  • Collect intelligence related to organized wildlife crime activities. And to circulate it to the States and other enforcement agencies for immediate actions, to catch the criminals. Hence statement 2 is correct
  • Establish a centralized wildlife crime data bank.
  • Coordinates with foreign authorities and international organization to facilitate universal action on wildlife crimes.
  • Build capacity of the wildlife crime enforcement agencies for scientific and professional investigation into wildlife crimes.
  • Assist State Governments to ensure success in prosecutions related to wildlife crimes.
  • Advise the Government of India on issues relating to wildlife crimes having national and international ramifications, relevant policy, and laws.

Source: https://www.thehindu.com/news/cities/kolkata/elephant-calf-rescued-from-dug-well-in-west-bengal/article33666949.ece


Consider the following Statements regardingBio coal

It is a new carbon neutral solid biofuel made from organic waste.

It is produced by processing dry biomass under the oxygen-free conditions at high temperatures

Which of the statement(s) given above is/are correct?

  1. 1 only
  2. 2 only
  3. Both 1 and 2
  4. Neither 1 nor 2

Answer: (c) Both 1 and 2

Explanation:

  • The Yogi Adityanath-led UP government has set up its first bio-coal production unit in Risia of Bahraich district which has successfully completed the trial-run of manufacturing fuel briquette pellet from agricultural waste.
  • Bio coal is a carbon-neutral fuel that can replace fossil coal in industrial processes. It is produced within the process of Biogreen pyrolysis and carbonization of raw biomassperformed within controlled temperature and residence time conditions.  Hence statement 1 and 2 is correct
  • Thermal conversion of biomass, which is done under the oxygen-free conditions process, allows to remove volatile organic compounds and cellulose components from the feedstock and create a uniform, solid biofuel with characteristics similar to the ones in fossil coal.
  • Biocoal can offer a sustainable and fossil-free alternative for industries such as metallurgy, where using raw biomass as a reducing agent in blast furnace would normally not be possible because of the biomass high moisture content, low fixed carbon and high contents of volatile matter and oxygen.

Source: ANI


Sigur Plateau , which was in news recently is located in

1)Nagaland

2)Tamil Nadu

3)Punjab

4)Jammu and Kashmir

Answer: (b) Tamil Nadu

Explanation:

In NEWS: Conservationist joins SC panel on elephant corridor case

  • The Supreme Court on January 27 appointed conservationist Nandita Hazarika as Member of a Technical Committee constituted by it on October 14 last year to hear complaints by land owners against the action taken by the Nilgris Collector, which included sealing of their buildings and allegations about the “arbitrary variance in acreage of the elephant corridor.”
  • On October 14, the top court upheld the Tamil Nadu government’s authority to notify an ‘elephant corridor’ and protect the migratory path of the animals through the Nilgiri biosphere reserve. The reserve is the largest protected forest area in India, spanning across Tamil Nadu, Karnataka and Kerala.
  • The corridor is situated in the ecologically fragile Sigur plateau, which connects the Western and the Eastern Ghats and sustains elephant populations and their genetic diversity. It hasthe Nilgiri Hills on its southwestern side and the Moyar River Valley on its north-eastern side. The elephants cross the plateau in search of food and water. Hence option (b) is correct

Source: https://www.thehindu.com/news/national/conservationist-joins-sc-panel-on-elephant-corridor-case/article33678554.ece


Consider the following Statements

It is a statutory body to ensure quality of all textiles and textile products for domestic and export markets.

The Chairman of this Committee is Textile Minister

Which of the statement(s) given above is/are correct?

  1. 1 only
  2. 2 only
  3. Both 1 and 2
  4. Neither 1 nor 2

Answer: (a) 1 only

Explanation:

In NEWS: Textiles Committee of Ministry of Textiles signs MoU with Nissenken Quality Evaluation Centre, Japan

  • The Textiles Committee of the Ministry of Textiles has signed a Memorandum of Understanding- MoU with Nissenken Quality Evaluation Centre, Japan to boost export of Textile and Apparel to Japanese market.
  • The objective of the MoU is to provide required support to textile’s trade and industry for ensuring quality as per the requirement of Japanese buyers  through Testing, Inspection & Conformity Assessment.
  • It is expected that the MoU will strengthen the bilateral trade by enhancing India’s export of Textile and Apparels (T&A) to Japan, which is the third largest export destination of the world.

About Textiles Committee

  • The Textiles Committee is a statutory body established in 1963 through an Act of Parliamentand is under the administrative control of the Ministry of Textiles. Hence statement 1 is correct
  • It has been formed to ensure the quality of textiles and textile machinery both for internal consumption and export purpose.
  • It is tasked with the functions of establishing laboratories for the testing of textiles and textile machinery. It provides for their inspection and examination.
  • The Chairman of the Committee is nominated by the Government. Hence statement 2 is incorrect

Source: http://newsonair.com/Main-News-Details.aspx?id=408746


A decrease in tax to GDP ratio of a country indicates which of the following?

Slowing economic growth rate

Less equitable distribution of national income

Select the correct answer using the codes given below.

  1. 1 only
  2. 2 only
  3. Both 1and 2
  4. Neither 1 nor 2

Answer: (d) Neither 1 nor 2

Explanation:

  • For the tax/GDP ratio to decrease either the tax collection should decrease or GDP should increase. Now considering the first statement if the GDP collection might or might not necessarily increase with a slow growth rate. Hence this option is ruled out. Increase in indirect tax collection may lead to less equality in income distribution but the same cannot be said for increase in direct tax collection. Hence, even this option can be ruled out.