Non-Performing Assets (NPAs) are loans or advances where the borrower has failed to make interest or principal repayments for over 90 days. Such assets cease to generate income for banks, impacting their profitability and financial health.

To address the NPA challenge, the Government of India and the Reserve Bank of India (RBI) have implemented several measures:

1. Debt Recovery Tribunals (DRTs): Established to expedite the recovery of bad loans by providing a specialized mechanism for banks and financial institutions to resolve disputes with defaulting borrowers.
2. Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002: This legislation allows banks to auction properties of defaulters to recover loans without court intervention, streamlining the recovery process.
3. Mission Indradhanush: Launched to revamp public sector banks, this initiative focuses on governance reforms, accountability, and capitalization to strengthen banks’ financial positions and reduce NPAs.
4. Asset Quality Review (AQR): Initiated by the RBI in 2015, AQR aimed to identify stressed assets and ensure transparent recognition of NPAs, prompting banks to clean up their balance sheets.
5. Bank Consolidation: The government has merged several public sector banks to create stronger institutions with enhanced capital bases, improving their ability to manage NPAs effectively.

These initiatives reflect a comprehensive approach to managing and mitigating NPAs, thereby promoting a healthier banking sector in India.

Inflation targeting is a monetary policy framework where a central bank sets a specific inflation rate as its goal for the medium term and publicly announces this target. The primary objective is to maintain price stability, which in turn fosters economic stability and growth. Central banks adjust monetary policies, such as interest rates, to keep inflation around the predetermined target. Raising interest rates can help cool an overheating economy and reduce inflation, while lowering rates can stimulate the economy and increase inflation when it is below the target.

In India, the Reserve Bank of India (RBI) adopted the Flexible Inflation Targeting (FIT) framework in 2016. This framework was established through an amendment to the Reserve Bank of India Act, 1934, providing a statutory basis for inflation targeting. Under the FIT framework, the Government of India, in consultation with the RBI, sets the inflation target. The current target is to maintain Consumer Price Index (CPI) inflation at 4%, with a tolerance band of ±2%, allowing for fluctuations between 2% and 6%.

The FIT framework enhances transparency and accountability in monetary policy. By clearly communicating the inflation target, the RBI aims to anchor public expectations, thereby reducing uncertainty and promoting economic stability. The RBI regularly reviews and adjusts its policies to address inflationary pressures, ensuring that inflation remains within the specified band.

India’s potential to generate 180,000 MW of ocean thermal energy remains largely untapped due to several challenges.

Challenges:

• High Capital Costs: Establishing Ocean Thermal Energy Conversion (OTEC) plants requires significant initial investment, particularly for constructing infrastructure capable of withstanding marine environments.
• Technological Limitations: OTEC technology is still in developmental stages, with limited large-scale implementations worldwide, leading to uncertainties in efficiency and reliability.
• Environmental Concerns: Potential impacts on marine ecosystems, such as thermal pollution and disruption of local biodiversity, pose environmental challenges.
• Logistical Issues: Transmitting generated power from offshore facilities to the mainland involves complex logistical considerations.

Proposed Solutions:

• Research and Development (R&D): Investing in R&D can enhance the efficiency and cost-effectiveness of OTEC technology. Collaborations between government agencies, research institutions, and private sector entities can drive innovation and address technical challenges.
• Pilot Projects: Implementing pilot projects can provide valuable insights into operational challenges and environmental impacts, paving the way for larger-scale deployments.
• Environmental Impact Assessments (EIAs): Conducting thorough EIAs can help in understanding and mitigating potential ecological disruptions, ensuring sustainable development of OTEC facilities.
• Policy Support and Incentives: Government policies that provide financial incentives, subsidies, or tax benefits can attract investments and reduce the economic burden associated with the high initial costs of OTEC projects.
• Infrastructure Development: Developing robust infrastructure capable of withstanding marine environments and efficient power transmission systems is crucial for the successful implementation of OTEC technology.

By addressing these challenges through coordinated efforts, India can harness its vast ocean thermal energy potential, contributing to sustainable and renewable energy goals.

Money serves four primary functions in an economy:

1. Medium of Exchange: Money facilitates transactions by eliminating the complexities of barter systems, where a direct exchange of goods requires a mutual coincidence of wants. This streamlines trade and commerce, making economic activities more efficient.
2. Unit of Account: As a standard numerical unit, money provides a consistent measure for pricing goods and services, simplifying value comparison and accounting processes.
3. Store of Value: Money allows individuals to preserve purchasing power for future use, enabling savings and deferred consumption. Its durability and widespread acceptance make it a reliable means to store wealth over time.
4. Standard of Deferred Payment: Money serves as an accepted method for settling debts payable in the future, facilitating credit transactions and financial agreements.

Compared to other assets, money offers distinct advantages:

• Liquidity: Money is the most liquid asset, readily convertible into goods and services without loss of value, unlike assets such as real estate or commodities, which may require time and incur costs to sell.
• Divisibility: Money can be divided into smaller units, allowing precise transactions and catering to various pricing needs, a feature not always possible with other assets.
• Portability: Money is easy to transport and transfer, facilitating transactions across different locations, whereas physical assets can be cumbersome to move.
• Acceptability: Money is universally recognized and accepted within an economy, ensuring its utility in all transactions, unlike other assets that may not be widely accepted as payment.

These characteristics make money indispensable in facilitating economic activities and promoting efficient resource allocation.

A chemical disaster involves the unintended release of hazardous substances, causing harm to human health and the environment. In India, the Bhopal Gas Tragedy of 1984 is a notable example, where a methyl isocyanate leak resulted in thousands of deaths.

Challenges in Managing Chemical Disasters:

• Aging Infrastructure: Outdated facilities increase the risk of accidents.
• Human Error: Non-compliance with safety protocols often leads to mishaps.
• Inadequate Emergency Response: Lack of trained personnel and equipment hampers effective disaster management.

Potential Solutions:

• Modernize Infrastructure: Upgrade facilities to meet current safety standards.
• Enhance Training: Regularly train staff in safety procedures and emergency response.
• Strengthen Regulations: Enforce strict compliance with safety laws to prevent accidents.

Implementing these measures can significantly reduce the risk of chemical disasters in India.