COVID REPORT

25th April, 2020:

FINANCE
 No plan to ease fiscal deficit targets -The 15th Finance Commission held
meeting with its Advisory Council

The Members of the Advisory Council discussed the impact of the COVID-19 pandemic
and the national lockdown on the Indian economy.
The Fifteenth Finance Commission (XVFC) had online meetings with its Advisory
Council on 23-24 April 2020. The meeting was chaired by N. K. Singh, Chairman
XVFC, and was attended by all members and senior officials of the Commission.
Despite the strain on government finances due to the COVID-19 pandemic, there is no
credible proposal to amend the legislation meant to control the fiscal deficit.
While presenting the Union Budget in February, the Finance Minister had invoked the Fiscal
Responsibility and Budget Management Act’s escape clause to relax the fiscal deficit target
for 2020-21 by 0.5% percentage points to 3.5% of the GDP. If the government wishes to
increase spending further in light of the current crisis, as many economists have
recommended, it may need to amend the Act.
Highlights:
♦ The Members of the Advisory Council discussed the impact of the COVID-19
pandemic and the national lockdown on the Indian economy. 
♦ The officials discussed the impact of the pandemic on financial institutions and business
enterprises and the loss of global demand for Indian products because of a steep global
recession. 
♦ Discussions on measures to restore the supplies of intermediates and cash flows and the
demand for output. 
♦ Small scale enterprises were cash-starved even prior to the onset of COVID-19. 
♦ The Council devised a support mechanism to help the activity levels and cash flows to
overcome the economic issues caused by the COVID-19 pandemic.
♦ Currently, the activity levels and cash flows are affected, it is important that a support
mechanism is devised to help them overcome this problem. 
♦ To help Non-banking financial companies (NBFCs) which are also affected by the
slowdown, the commission planned to deepen the NPAs in the financial sector and introduce
measures to guarantee help. 
♦ The council planned to seek Reserve Bank of India's (RBI) help to ensure that financial
institutions are well-capitalized. 
♦ The finances of the Central and State Governments will be given adequate provision to
largely help governments to manage cash-flow mismatches. It aims to ensure that the State
governments get access to adequate funds to undertake their fight against the pandemic. 
♦ The Council decided to support the revival of activity in different States which will be at a
varied pace

 Inference: Noting that the lockdown’s impact on public finances will be significant,
with a large shortfall in tax and other revenues, a support mechanism for cash-starved
small enterprises needs to be a top priority.
 Sources: Online News - (The Hindu), (The Economic Times).
 UNCTAD cancels USD 1 trillion debts owed by developing countries
UNCTAD has cancelled over $1 trillion debt owed by developing countries amid the
COVID-19 pandemic.

Highlights:

♦ UNCTAD report stated that over 64 low-income countries currently spend more on debt
service than their health systems. For developing countries debt has become inevitable,
especially due to the COVID-19 pandemic.
♦ UNCTAD estimated financing and liquidity requirements due to the pandemic sums up to
at least $2.5 trillion.
♦ The high-income developing nations have debt service obligations of between $2 to $2.3
trillion in 2020 and 2021. Also, the UNCTAD stated that the middle and low-income
countries have debt service obligations of $700 billion to $1.1 trillion.
♦ Earlier, the G20 countries allocated $8 trillion into a stimulus for their own economies. The
G20 nations agreed to suspend the bilateral debt service payments by the world's poorest
countries until the end of 2020.

 Inference: Over 64 low-income countries spend more on debts than their health
systems. They are now struggling with growing debt burden to plummet prices of oil,
weakening of local currencies and exports. On the other hand, they have COVID-19
crisis to address health issues.
 Sources: Online News - (The Hindu)

SCIENCE AND TECHNOLOGY

 SCTIMST develops Chitra Magna, an innovative RNA extraction kit
Chitra Magna can be used to extract high purity RNA from patient samples not only for
LAMP testing but also for the RT-PCR test.
 Sree Chitra Tirunal Institute for Medical Sciences and Technology (SCTIMST) has
developed Chitra Magna, an innovative RNA extraction kit, innovative technology for
isolating RNA from swabs for COVID-19 tests.

Chitra Magna:
SARS-COV-2, the causative virus of COVID-19 pandemic, is an RNA virus. It is a long
single-stranded polymeric substance present in all living cells that carries the genetic
information of the organism necessary for life. One of the critical steps in detecting this virus
is by confirming the presence of the RNA of the virus in the sample taken from the throat or
nose. The sample collected is transported under specified conditions in a viral transport
medium to the testing laboratory.

 Inference: The indigenously developed and manufactured RNA extraction kit

would reduce the nation’s dependence on imported kits which are expensive and
bring down the cost of COVID-19 testing.
 Sources: Online News - (The Hindu)

 CSIR-NBRI scientist develops herbal decongestant spray on mask to

protect from suffocation
 This formulation helps in clearing the windpipe and congestion by removing the mucus or
cough leading to ease of breathing.
Scientists at CSIR-National Botanical Research Institute (NBRI), Lucknow, have
developed a herbal decongestant spray. This comes when the need for face masks rises to
prevent corona infection. The spray will address breathing and congestion in the respiratory
system which is caused by wearing a mask for a long time.
Breathing problem due to wearing a face mask:
The main reason for the problem is the accumulation of carbon dioxide and humidity in the
inner cavity of the mask. When a person breathes in, this goes back to the lungs again.
Repetition of this process over a period of time causes discomfort in breathing and
congestion.

 Inference: The NBRI will soon transfer the technology of this inhaler for
commercial production so that it can be produced on a large scale and sent to the
frontline warriors fighting against covid-19 pandemic.
 Sources: Online News (The Hindu), (The Times of India)

POLITICS
 Reshuffle likely in key departments
 More than 7 secretaries are scheduled to superannuate this month. The Union
government is expected to appoint secretaries in key departments and effect a reshuffle in the
Central administration as more than seven secretaries are scheduled to superannuate this
month. Among those schedules to retire include Health Secretary Preety Sudan and
Economic Affairs Secretary Atanu Chakraborty, both in key positions in the midst of
COVID-19 pandemic that has massively hit the economy.

 Inference: There is some possibility of extension to see continuity in both crucial

posts i.e. Health Secretary and Economic Affairs Secretary.
 Sources: Online News - (The Hindu), (The Times of India)

CONSUMER AFFAIRS
 Food grain stock will last till next March, says FCI chief D.V Prasad
 The stock of food grains available with the Food Corporation of India is “comfortable” to
manage the situation till March next year, but it would be an exaggeration to hold that the
stock is “far in excess” of the buffer stock requirement, which should include additional
allocation, according to D.V. Prasad, Chairman and Managing Director of the FCI.

 Inference: The norms have been determined, considering normal situations and
they essentially provide for any production shortfalls. However, a pandemic, as we
are witnessing today, is a different situation and it may demand a revision of the
existing norms in view of the additional allocation of food grains.
 Sources: Online News - (The Hindu)

TRANSPORTATION
 Chidambaram asks government to facilitate travel of migrant workers
 Former Finance Minister P. Chidambaram on Friday asked the government to facilitate
the travel of migrant workers to their hometowns under strict conditions of health and
safety.
In a series of tweets, Mr. Chidambaram cautioned the government that the desire of the
people to be among their own could not be ‘suppressed for long in the name of a lockdown’.
  Inference: The overwhelming mood and desire among migrant persons (and their
families) to go back to their home states, to join their families, and to be among their
own language-speaking people is an overpowering desire cannot be hindered or
supressed.
 Sources: Online News - (The Hindu)

26th April, 2020:

CONSUMER AFFAIRS
 Only 15% of poor households have received 1 kg of pulses promised for
April
Unmilled pulses, non-availability of trucks and labour major problems- Only 15% of
poor households have received the one kg of pulses promised for April under the Centre’s
COVID-19 welfare package, according to an analysis of the government agency data. Of the
1.96 lakh tonnes of pulses that should have been given to more than 19 crore households this
month, only 30,000 tonnes have been distributed so far, according to the Consumer Affairs
Department.
Distribution is likely to speed up by the first week of May, with delays caused by the fact
that the government only stores Unmilled pulses in its godowns, and has had to start a
massive milling operation before delivering them to ration shops.

 Inference: All States already distribute rice and wheat through a well-established
Public Distribution System, with grain provided from a network of the FCI
warehouses, distribution of the promised extra grain began early in April. However,
the distribution to more than 19 crore families was stalled by several hurdles. In a
number of States, efforts are being made to distribute the pulse ration for all three
months in May itself.
 Sources: Online News (The Hindu)

27th April, 2020:

BANKING AND FINANCE SECTOR
 RBI announced Rs.50,000 crore liquidity for Mutual Funds
The Reserve Bank of India (RBI) announced Rs.50,000 crore liquidity support for Mutual
Funds (MFs) on 27 April 2020. It approved the funds under the special liquidity facility
scheme effective from 27 April. RBI's move comes after Franklin Templeton's decision to
close 6 debt funds and put redemptions on hold indefinitely.
Highlights:
♦ Under this move, the RBI will conduct repo operations of 90 days tenor at the fixed repo
rate. The facility will be on-tap and open-ended, and banks can submit their bids to avail
funding on any day from 27 April- 1 May.
♦ The funds availed under the scheme can be used by banks exclusively for meeting the
liquidity requirements of MFs by extending loans, and undertaking the outright purchase of
and/or repo against the collateral of investment-grade corporate bonds, commercial papers
(CPS), debentures and certificates of Deposit (CDs) held by MFs.
♦ The move by the Central Bank will increase confidence among investors.
♦ RBI has also added liquidity support that can be availed under the scheme which would be
eligible to be classified as held to maturity (HTM), even in excess of 25% of the total
investment that is permitted in the HTM portfolio.
♦ Exposures under this facility will not apply under the Large Exposure Framework (LEF).
The face value of securities kept in the HTM category will not be reckoned for computation
of adjusted non-food bank credit (ANBC) for the purpose of determining priority sector
targets.
♦ The support extended to MFs under the Special Liquidity Facility for Mutual Funds (SLF-
MF) shall be exempted from banks' capital market exposure limits.

 Inference: Heightened volatility in capital markets in reaction to coronavirus has

imposed liquidity strains on mutual funds which have intensified in the wake of
redemption pressures related to closure of some debt MFs and potential contagious
effects there from.
 Source: Online News - (The Hindu), (The Economic Times)
SCIENCE AND TECHNOLOGY
 Team led by IIT-Bombay student develops Ruhdaar, a low-cost
mechanical ventilator

The ventilator can be used to control the basic parameters such as tidal volume,
Breaths per Minute, and Inspiratory: Expiratory Ratio
A team from the Indian Institutes of Technology (IIT)-Bombay, NIT Srinagar
and Islamic University of Science & Technology (IUST), Awantipora, Pulwama,
Jammu and Kashmir have developed "Ruhdaar" a low-cost ventilator using locally
available materials. This invention will solve the problem of the ventilator, which is the
primary requirement to treat COVID-19 patients, as the high-end ventilators used in
hospitals cost in lakhs of rupees.
Ruhdaar:
 ♦ Ruhdaar provides necessary functionalities that can provide adequate breathing support
necessary to save the life of a critically ill COVID-19 patient.
♦ The prototype cost around Rs.10,000, which can get reduced during mass production.
♦ The ventilator can be used to control the basic parameters such as tidal volume,
Breaths per Minute, and Inspiratory: Expiratory Ratio.
♦ It can also monitor pressure continuously during its operation.

 Inference: The team tried many designs including a design developed by them.
The team tried many designs including a design developed by Massachusetts Institute
of Technology, USA. The final design of the ventilator uses advanced software.
 Source: Online News - (The Hindu), (The Times of India)

POLITICS
 Amit Shah supervising anti-virus fight

Status report
says Home Ministry has taken effective and proactive actions. A status report
filed by the government in the Supreme Court said Union Home Minister Amit Shah is
personally supervising the implementation of directives and advisories issued by his ministry
in the fight against COVID-19. The report, which is the second one filed in court in
connection with a petition filed by advocate Alakh Alok Srivastava, said the Home Ministry
has taken “immediate, timely, effective and proactive actions almost on a daily basis”. The
case is scheduled to be heard on April 27.

 Inference: Private broadcasters have taken proactive steps to engage with people at
large and four entertainment channels have been made free to air to meet the
entertainment needs of house-bound people. The Civil Aviation Ministry has started
‘Lifeline Udaan’ to transport essential medical cargo. Over 180 flights have flown
over 1.6 lakh km carrying 258 tons of medical cargo.
 Source: Online News - (The Hindu)

INDUSTRY
 Inference: The government has allowed factories outside Covid-19 hotspots to start
operations last week, but automakers have yet to restart their plants as they are
waiting for the ecosystem of suppliers, dealers and financiers also to open for
business. Even if the shutdown ends in early May, in the best-case scenario they
would be able to start even partial production only by mid-May, said an industry
executive.
 Sources: Online News (The Economic Times)