14 April 2024 - 20 April 2024

Current Affairs of the Week
(14th April 2024 – 20th April 2024)
TABLE OF CONTENTS
Fertility Levels drop below one in many Asian Nations............................................................................. 2
[pib] Index of Industrial Production (IIP) grows by 5.7% in February, 2024 ............................................... 2
What is Shrinkflation? ............................................................................................................................. 3
Why has India allowed FIIs to invest in its Green Bonds? | Explained ....................................................... 4
India could face ‘Imported Inflation’: Asian Development Bank (ADB) ..................................................... 5
Why have private investments dropped? | Explained .............................................................................. 5
PRADHAN MANTRI UJJWALA YOJANA (PMUY) ......................................................................................... 6
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1
FERTILITY LEVELS DROP BELOW ONE IN MANY ASIAN
NATIONS
Introduction
Many East and Southeast Asian countries are facing a population crisis marked by declining birth rates
and record-low fertility rates. Recently in march, several hospitals in China ceased newborn delivery
services due to dwindling demand.
Total Fertility rate
Total Fertility Rate is a measure used in demography to represent the average number of children that
would be born to a woman over her lifetime.
TFR of Asian countries and India and Comparison with others:

Asian nations, including India, are experiencing fertility levels dropping below one, reflecting various
societal shifts and policies. Family planning measures, exemplified by South Korea and Singapore's strict
policies, contribute to limiting the number of children per couple. Additionally, increased career
opportunities for women, declining marriage rates, and the rising cost of child-rearing deter individuals
from having more children. The ideal fertility rate for population stability, known as the replacement
rate, is 2.1 children per woman.
[PIB] INDEX OF INDUSTRIAL PRODUCTION (IIP) GROWS BY

5.7% IN FEBRUARY, 2024
Introduction
In recent news, India's Index of Industrial Production (IIP) surged by 5.7% in February, up from January's
3.8%, as reported by the Ministry of Statistics and Programme Implementation (MoSPI).
Index of Industrial Production (IIP)

 The IIP tracks overall manufacturing activity across various sectors in an economy.
 It's calculated based on the 2011-2012 base year and published monthly by the Central
Statistical Organisation (CSO), operating under MoSPI.
 The base year was changed to 2011-12 from 2004-05 in the year 2017.
Components of IIP:
 It comprises three main sectors: Manufacturing (77.6%), Mining (14.4%), and Electricity (8%).
 Eight core industries, including electricity, crude oil, coal, cement, steel, refinery products,
natural gas, and fertilizers, comprise nearly 40.27% of the weight of items included in the Index
of Industrial Production (IIP).
2
Basket of products:
There are 6 sub-categories:
1. Primary Goods (consisting of mining, electricity, fuels and fertilisers)
2. Capital Goods (e.g. machinery items)
3. Intermediate Goods (e.g. yarns, chemicals, semi-finished steel items, etc)
4. Infrastructure Goods (e.g. paints, cement, cables, bricks and tiles, rail materials, etc)
5. Consumer Durables (e.g. garments, telephones, passenger vehicles, etc)
6. Consumer Non-durables (e.g. food items, medicines, toiletries, etc)
IIP data uses

 IIP data is utilized by government agencies, such as the Ministry of Finance and the Reserve
Bank of India, along with private firms and analysts, for analytical purposes.
 It also aids in compiling the Gross Value Added (GVA) of the manufacturing sector in the Gross
Domestic Product (GDP) on a quarterly basis
WHAT IS SHRINKFLATION?
Introduction
 As input costs rise, the FMCG sector faces the challenge of shrinkflation, potentially altering
consumer preferences and industry dynamics.
 Shrinkflation is the business practice of reducing product size or quantity while maintaining the
same price point.
Fast-moving consumer goods
 Fast-moving consumer goods, also known as consumer-packaged goods or FMCGs, encompass

a wide range of low-cost products sold quickly, including packaged foods, beverages, and
toiletries.
Causes for Shrinkflation:

 Cost Management: Companies use shrinkflation to manage escalating production costs without
impacting profitability.
 Market Competition: Competitive pressures drive companies to employ shrinkflation to stay
competitive in the market.
Effects of Shrinkflation:
 Consumer Perception: Shrinkflation can lead to negative perceptions of the brand and
decreased customer loyalty.
 Inflation Measurement Accuracy: Shrinkflation complicates accurate inflation measurement as
prices remain unchanged while product quantity decreases.
3
 Limitations: Overuse of shrinkflation can damage brand reputation and consumer trust,
prompting negative reactions.
WHY HAS INDIA ALLOWED FIIS TO INVEST IN ITS GREEN

BONDS? | EXPLAINED
Introduction
 On April 5, the Reserve Bank of India (RBI) granted approval for Foreign Institutional Investors
(FIIs) to invest in the country’s Sovereign Green Bonds (SGrBs), aimed at financing
environmentally sustainable projects.
 These are the investors such as insurance companies, pension funds, and nation-states’
sovereign wealth funds.
Sovereign Green Bonds
 These bonds, issued by governments, fund projects aligned with environmental sustainability
and climate goals, contributing to positive environmental impacts.
Reasons for Allowing FIIs to Invest:

 Attracting Foreign Investments: Allowing FIIs to invest in green bonds attracts foreign capital to
India's green projects.
 Widening Capital Pool: It expands funding sources for India's climate objectives, including
achieving net-zero emissions by 2070 and increasing non-fossil fuel energy shares.
 Meeting Climate Commitments: Aligns with Prime Minister Narendra Modi's pledge to reduce
carbon emissions by 45% and boost renewable energy shares.
 Diversification of Investments: FIIs seek green investment opportunities, driven by regulatory
support, enhancing portfolio diversity.
India’s Sovereign Green Bonds Framework:

 Announced in Union Budget 2022-23, aiming to raise Rs 16,000 crore for green infrastructure.
 Funds are allocated annually for green projects, with bonds issued through Uniform Price
Auctions.
 SGrBs are eligible for Repo Transactions and Statutory Liquidity Ratio investments.
4
INDIA COULD FACE ‘IMPORTED INFLATION’: ASIAN
DEVELOPMENT BANK (ADB)
Introduction
The Asian Development Bank recently issued a warning about India's vulnerability to imported inflation,
citing potential rupee depreciation amid rising interest rates in Western countries.
Imported Inflation
 Imported inflation occurs when the prices of goods and services within a country increase due
to higher costs or prices of imports. Factors such as currency depreciation, elevated import
costs, or international price hikes can contribute to this phenomenon, leading to inflationary
pressures domestically.
Reasons for imported inflation:

 Capital Flows: Increased interest rates in the West attract foreign investors, causing capital
outflows from countries like India and potentially depreciating the rupee. This depreciation
increases import prices.
 Borrowing Costs: Higher international borrowing costs for Indian businesses and the
government may result from raising funds in foreign currency-denominated markets.
 Inflationary Pressures: Capital outflows can depreciate the rupee, leading to imported inflation
as the cost of imported goods rises.
 Trade Competitiveness: Exchange rate fluctuations impact India's trade competitiveness,
affecting exports, imports, and domestic consumption.
WHY HAVE PRIVATE INVESTMENTS DROPPED? |

EXPLAINED
Introduction
The stagnation of private investment, measured by private Gross Fixed Capital Formation (GFCF) as a
percentage of gross domestic product (GDP) at current prices, remains a significant concern for the
Indian economy.
Gross Fixed Capital Formation

 GFCF denotes the growth in fixed capital within an economy, encompassing investments in
assets like buildings and machinery. Private GFCF serves as an indicator of the private sector's
investment inclination, alongside government investment.
Significance of GFCF:
 GFCF plays a crucial role in economic growth and living standard improvement by enhancing
productivity and output.
5
What is the trend seen in private investment in India?
 Pre-liberalization (1950s to early 1990s): Private investment remained relatively stable hovering
around or slightly above 10% of GDP, while public investment steadily increased.
 Liberalization (early 1990s onwards): Economic reforms bolstered private sector confidence,
leading to a notable surge in private investment.
 Post-global financial crisis (late 2000s to present): Despite growth until the global financial
crisis of 2007-08 reaching around 27% of GDP, private investment has witnessed a decline since
around 2011-12, reaching a low of 19.6% of GDP in 2020-21.
PRADHAN MANTRI UJJWALA YOJANA (PMUY)

Introduction:
The Pradhan Mantri Ujjwala Yojana (PMUY) has successfully provided clean cooking fuel to 103.3 million
households in India, as reported by the Petroleum Planning and Analysis Cell. This initiative has
significantly improved the lives of millions by granting access to liquefied petroleum gas (LPG)
connections, thus reducing reliance on traditional solid fuels.
Background:
PMUY, a flagship scheme of the Ministry of Petroleum and Natural Gas, aims to offer clean cooking fuel
and specifically LPG to rural and deprived households, previously dependent on harmful traditional
cooking fuels like firewood and coal. Priority is given to women from marginalized communities,
enhancing their health and empowering them.
Key features of the PMUY:

PMUY focuses on empowering women and safeguarding their health by combating indoor air pollution.
It aims to reduce deaths caused by unclean fuels and provides financial support of ₹1600 per LPG
connection to below poverty line households. The Ujjwala 2.0 extension offers deposit-free LPG
connections, free first refill, and a hotplate to beneficiaries, further advancing the scheme's objectives.
6

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Current Affairs of the Week

(14th April 2024 – 20th April 2024)

Total Fertility rate

TFR of Asian countries and India and Comparison with others:

[PIB] INDEX OF INDUSTRIAL PRODUCTION (IIP) GROWS BY

Index of Industrial Production (IIP)

IIP data uses

Fast-moving consumer goods

 Fast-moving consumer goods, also known as consumer-packaged goods or FMCGs, encompass

Causes for Shrinkflation:

WHY HAS INDIA ALLOWED FIIS TO INVEST IN ITS GREEN

Sovereign Green Bonds

Reasons for Allowing FIIs to Invest:

India’s Sovereign Green Bonds Framework:

Reasons for imported inflation:

WHY HAVE PRIVATE INVESTMENTS DROPPED? |

Gross Fixed Capital Formation

PRADHAN MANTRI UJJWALA YOJANA (PMUY)

Key features of the PMUY:

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