What’s in today’s article?

• Background
• FSSAI’s Stand on Sugar Content
• How Processed Sugar is Harmful for Body?
• Way Forward

Background

• A drink like Bournvita has 86.7g of carbohydrates per 100g, with 49.8g being sugar. Out of this sugar, 37.4g is added sugar.
• So, for every 20g serving of Bournvita, you're consuming about 10g of sugar.
• The process used to make Bournvita involves malting, which turns grains into sugar.
• Malting is a technique used to make things like whiskey and malt-based milk drinks.
• When grains germinate, enzymes turn their starch into sugar. Roasting them adds flavour by caramelizing this sugar.

FSSAI’s Stand on Sugar Content

• According to the Food Safety and Standards Authority of India (FSSAI) regulations (2018), a product can only claim to be 'low on sugar' if it has less than 5g of sugar per 100g. If a product meets this criteria, it can be considered 'healthy.'
• However, if products don't meet this standard but still market themselves as 'health drinks' then it's a concern.
• For example, if a child drinks four servings of such a product, they would consume 40 grams of sugar.
• This is more than the World Health Organization's recommended daily limit of 25 grams or six teaspoons of sugar.
• Additionally, many households in India add extra sugar to chocolate-powder drinks, making the sugar intake even higher.

How Processed Sugar is Harmful for Body?

• Sugar can be harmful to the body for several reasons:
• Weight Gain: Consuming too much sugar can lead to weight gain. Sugary foods and drinks are often high in calories but low in nutrients, leading to excess calorie intake.
• Increased Risk of Chronic Diseases: High sugar intake has been linked to an increased risk of chronic diseases such as type 2 diabetes, heart disease, and certain cancers.
• Tooth Decay: Sugar promotes the growth of harmful bacteria in the mouth, which can lead to tooth decay and cavities.
• Insulin Resistance: Overconsumption of sugar can lead to insulin resistance, where the body's cells become less responsive to insulin, increasing the risk of developing type 2 diabetes.
• Elevated Blood Sugar Levels: Consuming large amounts of sugar can cause rapid spikes in blood sugar levels, followed by sharp drops, leading to fluctuations in energy levels and mood swings.
• Liver Overload: When consumed in excess, fructose, a type of sugar, can overload the liver, leading to fatty liver disease and other liver-related problems.
• Addictive Nature: Sugar can be addictive, leading to cravings and overconsumption, making it difficult for individuals to control their intake.
• Nutrient Imbalance: Foods high in sugar often displace nutrient-dense foods in the diet, leading to nutrient imbalances and deficiencies.
• Inflammation: Excessive sugar intake can contribute to inflammation in the body, which is associated with various health problems, including inflammatory conditions and autoimmune diseases.
• Mental Health: Some studies suggest that high sugar intake may be linked to an increased risk of depression, anxiety, and other mental health disorders.
• Overall, while sugar can be enjoyed in moderation as part of a balanced diet, excessive consumption can have detrimental effects on health. It's essential to be mindful of sugar intake and opt for healthier alternatives whenever possible.

Way Forward

• FSSAI’s regulations allow sugar in milk cereal-based foods for infants, but only certain types like lactose and glucose polymers are preferred.
• Sucrose and fructose can only be added if needed, and their total should not exceed 20% of the total carbohydrate content.
  • These regulations need to be reviewed because they allow sugar in infant foods.
• There should be clear regulations defining what is considered 'healthy' and 'unhealthy' for all food and beverage products.

Q1. Is Brown Sugar made from Jaggery?

No, brown sugar and jaggery are not the same. Brown sugar is White sugar + Molasses. Molasses is a thick dark syrup, a by-product of sugar production) Whereas jaggery or gur is an unrefined sugar made by boiling concentrated sugar cane extract until it hardens.

Q2. What is the difference between Jaggery and Sugar?

Jaggery contains iron, fibre, and minerals in addition to calories, in contrast to sugar, which just provides calories and no other nutrients. While jaggery is nutritionally superior to sugar, it is essential to consume it in moderation due to its high-calorie content.

Source: Why are sugary processed foods harmful? | Explained

What’s in today’s article?

• Why in News?
• India’s Effort to Regulate Single-Use Plastic - The Plastic Waste Management Amendment Rules (2021)
• Global Efforts to Eliminate Plastic Pollution
• What’s the Agenda of the Toronto Meeting?
• What are the CSE’s Analysis Highlights?

Why in News?

• Ahead of week-long negotiations (involving 192 countries in Toronto, Canada) on getting the globe to progress on eliminating plastic pollution, India is in favour of “regulating” and not outright eliminating single-use plastic.
• This was highlighted in an analysis by the Centre for Science and Environment (CSE) on various countries’ positions on single-use plastic.

India’s Effort to Regulate Single-Use Plastic - The Plastic Waste Management Amendment Rules (2021)

• In 2022, India brought into effect the Plastic Waste Management Amendment Rules (2021) that banned 19 categories of ‘single-use plastics’.
• These are defined as disposable goods that are made with plastic but are generally use-and-throw after a single use and include -
  • Plastic cups, spoons, earbuds, decorative thermocol,
  • Wrapping or packaging film used to cover sweet boxes and cigarette packets, and
  • Plastic cutlery.
• It, however, doesn’t include plastic bottles - even those less than 200ml - and multi-layered packaging boxes (like in milk cartons).
  • The rationale behind banning certain kinds of plastic and leaving others out derives from a report by an expert committee on single-use plastics constituted by the Department of Chemicals and Petrochemicals.
  • They scored different plastic goods on the basis of their utility and environmental impact. The current ban only addresses about 11% of single-use plastic in India.
  • Moreover, even the single-use plastic items that are banned are not uniformly enforced nationally with several outlets continuing to retail these goods.

Global Efforts to Eliminate Plastic Pollution

• According to the United Nations, 99% of plastics are made from polymers derived from non-renewable hydrocarbons (crude oil and natural gas).
• Plastic production has doubled in the last 20 years and contributes about 3.4% of the total greenhouse gas (GHG) emissions globally.
• The United Nations Environment Assembly (UNEA) passed a resolution to “end plastic pollution” in 2022.
  • An Intergovernmental Negotiating Committee (INC) was set up and tasked to develop a legally binding instrument - a global treaty - to govern plastic production and use across all nations.
  • However, after 3 rounds of extensive discussions and negotiations, and the 4th round about to kick off in Canada, the world seems to be nowhere near an agreement on how to deal with the plastic waste menace.

What’s the Agenda of the Toronto Meeting?

• Of the nearly 17 topics that countries are expected to deliberate upon, one of them involves “problematic and avoidable plastic products including single-use plastics”.
  • This refers to sections of plastics that are likely to harm the environment as well as human health.
• Similar to the position on plastics, there are 16 other issues that deal with the production of polymers - the constituent chemicals of most plastics - waste management, trade, the use of alternative plastics, etc.
• The aim of negotiating countries is to implement global and national measures such as
  • Removing these products from the market,
  • Reducing production through alternate practices or non-plastic substitutes, and
  • Redesigning problematic items to meet criteria for sustainable and safe product design.

What are the CSE’s Analysis Highlights?

• It shows that almost all the oil, gas and plastic producing nations are not keen to reduce production of primary/virgin plastics.
• In fact, a handful of them are strident on making this treaty all about management of plastic waste, instead of that of controlling production.
• It is evident that some member states are weakening the provisions of the draft to protect their economic interests and public health is not a priority for them. For instance,
  • The European Union (EU) has proposed that all countries restrict the making and selling of these categories of plastic.
  • The United States also has a position closer to that of India and suggests that each country draws up its own list of ‘problematic and avoidable’ goods.
• This means, countries’ positions are influenced by the centrality of plastic production to their economy, recycling abilities and waste management capability.
• India has opted for language in the current version of the negotiating document, called a ‘zero draft’.
  • It vouches for “regulating” instead of “not allowing” the production, sale, import and export of problematic and avoidable plastic goods.
  • It has, however, agreed to a “science-based criteria” for identifying such plastics.

 Q.1. What is the United Nations Environment Assembly (UNEA)?

UNEA was created in 2012, as an outcome of the UN Conference on Sustainable Development (Rio+20), held in Brazil. Since its establishment, the Assembly has ushered in a new era of multilateralism with environmental issues.

 Q.2. What is India doing to reduce plastic pollution?

India, like Australia, is aiming to reduce plastic waste by driving innovation. Adopting circular economy design, technologies, and business models will extend the use of plastic materials. It will also drive new industries and jobs in a zero plastic waste economy.

Source: Ahead of U.N. meet, India chooses to ‘regulate’, not ban, single-use plastic

What’s in today’s article?

• Why in News?
• What is the Global Financial Stability Report (GFSR)?
• What is the IMF’s Worry About Inflation?
• What Does it Mean for India?
• What About the Private Credit Market?

Why in News?

• The International Monetary Fund (IMF) released the latest Global Financial Stability Report 2024 (with the central theme - ‘The Last Mile: Financial Vulnerabilities and Risks’).
• It warns about the risks to the global financial system from persistent high inflation, rising lending in the unregulated credit market, and increasing cyber-attacks on financial institutions.

What is the Global Financial Stability Report (GFSR)?

• The GFSR is a semiannual report by the International Monetary Fund (IMF) that assesses the stability of global financial markets and emerging-market financing.
  • It is released twice per year, in April and October.
• It focuses on current market conditions, highlighting systemic issues that could pose a risk to financial stability and sustained market access by emerging market borrowers.
• The Report draws out the financial ramifications of economic imbalances highlighted by the IMF's World Economic Outlook.

What is the IMF’s Worry About Inflation?

• The IMF has flagged rising enthusiasm among investors that the fight against high inflation over the last few years has almost come to an end.
• However, the IMF believes that investor enthusiasm about slowing inflation and a possible cut in interest rates by central banks may be quite premature.
• The fall in inflation has probably stalled in some major advanced and emerging economies where core inflation in the most recent 3 months has been higher than in the previous 3 months.
• The IMF has also warned that geopolitical risks such as the ongoing war in West Asia and Ukraine could affect aggregate supply and lead to higher prices.
  • This might stop central banks from lowering rates anytime soon.

What Does it Mean for India?

• The IMF notes that fund flows into emerging markets have been strong till now due to optimism over central banks easing interest rates.
• In fact, India was the second-largest recipient of foreign capital after the U.S., in the calendar year 2023.
• But things could change quickly if western central banks signal that they could keep interest rates high for a long time.
• This could cause investors to pull money out of emerging markets like India and increase pressure on their currencies.
• The Indian rupee has already been depreciating and traded at a new low of 83.57 against the U.S. dollar last week despite likely intervention by the Reserve Bank of India (RBI).
• A severe outflow of capital if western central banks fail to lower interest rates could cause further depreciation of the rupee and have effects on the country’s financial system.
• In such a scenario, the RBI is likely to defend the rupee by curbing liquidity to raise interest rates, which could cause the economy to slow down.

What About the Private Credit Market?

• The IMF in its report also noted that the growing unregulated private credit market, in which non-bank financial institutions lend to corporate borrowers, is a growing concern.
• The IMF is worried that the borrowers in the private credit market may not be financially sound and noted that many of them do not have current earnings that exceed even their interest costs.
• India has seen the growth of a small private credit market with the rise of Alternative Investment Funds (AIFs).
  • These funds lend money to high-risk borrowers who are not catered to by the traditional banking system and non-bank financial companies.
  • They have also invested in distressed assets that have come up for sale under the Insolvency and Bankruptcy Code (IBC) regime.
  • The SEBI notes that investments made through these funds, although still small, have more than tripled from ₹1.1 lakh crore in 2018-19 to ₹3.4 lakh crore in 2022-23.
  • As financial regulators, both the RBI and SEBI have been noticing this trend and tried to increase scrutiny over these funds.

Q.1. What is the IMF World Economic Outlook (WEO) for India?

According to the IMF's WEO, growth in India is projected to remain strong at 6.8% in 2024 (FY25) and 6.5% in 2025 (FY26), with the robustness reflecting continuing strength in domestic demand and a rising working-age population.

Q.2. What is the Insolvency and Bankruptcy Code (IBC)?

The IBC 2016 is the bankruptcy law of India which seeks to consolidate the existing framework by creating a single law for insolvency and bankruptcy.

Source: What is the outlook on the global economy? | Explained

What’s in today’s article?

• Why in the News?
• Insurance Sector in India
• Challenges of Insurance Sector in India
• FDI in Insurance Sector
• News Summary

Why in the News?

• The Insurance Regulatory and Development Authority of India (IRDAI) has removed the age limit for purchasing health insurance policies, with effect from April 1.

Insurance Sector in India

• India’s Insurance industry is one of the premium sectors experiencing upward growth.
• India is the fifth largest life insurance market in the world's emerging insurance markets, growing at a rate of 32-34% each year.
• The insurance industry of India has 57 insurance companies - 24 are in the life insurance business, while 34 are non-life insurers.
• Among the life insurers, Life Insurance Corporation (LIC) is the sole public sector company. There are six public sector insurers in the non-life insurance segment.
• Regulation:
  • The Insurance Regulatory and Development Authority of India (IRDAI) is the regulatory body that oversees and regulates the insurance sector in India.
  • It ensures that insurance companies comply with regulations, protect policyholders' interests, and maintain the stability of the insurance market.

Challenges of Insurance Sector in India

• The insurance sector in India faces several challenges that impact its growth and development. Some of the key challenges include:
• Low Insurance Penetration and Awareness: Despite the increasing awareness about financial planning, insurance penetration remains low in India. The insurance penetration is only 4 per cent. Many people are still unaware of the importance of insurance and its benefits, leading to a large uninsured population.
• Distribution Challenges: Limited access to insurance products and services in rural and remote areas due to inadequate infrastructure and distribution networks hinders the expansion of the insurance market.
• Regulatory Constraints: While regulations are essential for ensuring consumer protection and market stability, stringent regulatory requirements can sometimes be a barrier for innovation and growth in the insurance sector.
• Fraud and Mis-selling: The insurance sector grapples with issues related to fraud and mis-selling of insurance products. Unscrupulous practices by some agents and intermediaries can erode consumer trust and confidence in insurance products.
• Technological Adaptation: Adopting new technologies and digital platforms to enhance customer experience, streamline operations, and offer innovative products is a challenge for traditional insurance companies.
• Underwriting Risks: Assessing and pricing risks accurately is crucial for the sustainability of insurance companies. Inadequate data and analytics capabilities can lead to mispricing of risks, impacting profitability.
• Competitive Landscape: With the entry of new players, both domestic and foreign, the competitive landscape in the insurance sector has become intense. Established players need to differentiate their offerings and adapt to changing market dynamics to maintain their market share.
• Healthcare Inflation: Rising healthcare costs and increasing prevalence of lifestyle-related diseases pose challenges for health insurance providers in managing claims and maintaining profitability.
• Macro-economic Factors: Economic downturns, inflation, and fluctuations in interest rates can impact investment returns and profitability of insurance companies, affecting their ability to meet policyholder obligations.
• Product Innovation and Customization: Developing customized and innovative insurance products that cater to the diverse needs of consumers while ensuring affordability and profitability is a continuous challenge for insurers.

FDI in Insurance Sector

• The insurance sector has received close to Rs 54,000 crore as foreign direct investment (FDI) in the last 9 years.
• The government increased the permissible FDI limit from 26 per cent in 2014 to 49 per cent in 2015 and then to 74 per cent in 2021.

News Summary

• The Insurance Regulatory and Development Authority of India (IRDAI) has removed the age limit for purchasing health insurance policies, with effect from April 1.
• Previously, only individuals up to 65 years old were eligible for insurance, leaving senior citizens, who often need healthcare the most, without coverage.
• IRDAI’s latest move is aimed at bringing in extended health benefits to the elderly.
• The IRDAI mandates health insurance providers to develop specialised policies catering to senior citizens, and to establish dedicated channels for addressing their claims and grievances.
• Companies are also encouraged to develop tailored products to meet specific age-related requirements, fostering a more inclusive healthcare ecosystem.
• This change will greatly benefit those in need of medical insurance, including children, maternity cases, and senior citizens, ensuring a healthier life for many.

Q1. When was IRDA established?

Following the recommendations of the Malhotra Committee report, in 1999, the Insurance Regulatory and Development Authority (IRDA) was constituted as an autonomous body to regulate and develop the insurance industry. The IRDA was incorporated as a statutory body in April, 2000.

Q2. Is LIC a government company or statutory Corporation?

 The Life Insurance Corporation of India is a statutory Corporation constituted under the LIC Act, 1956.

Source: IRDAI removes age bar for purchasing health insurance

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