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Blockchain Technology

What is Blockchain ?

The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.
Information on the blockchain is always shared and continually reconciled. The record that Blockchain keeps are easily accessable and public. Just like a shared document on Google but a legal one. Meaning Blockchain Technology stores blocks of information across networks, it cannot be controlled by one network alone, it has no single point of failure.

How it works ?

Tax-GDP Ratio (Blast from the Past)

Tax-GDP ratio is an important parameter of changing structure of government revenues and taxation. Economic Growth Rate is the rate at which a nation’s Gross Domestic product (GDP) changes/grows from one year to another. A decrease in tax-GDP ratio would result when the tax revenues grow at a slower rate than the GDP of a country. Thus, an increase in tax-GDP ratio decreases the rate of economic growth.
When income is not equitably distributed, a small section of the society tends to pocket a big chunk of national income. A lower tax-GDP ratio means lower tax revenues to government. Tax revenues to government means equitable distribution of national income.

Rising Global Inequality – New Perspective


Central aspect of Globalization – Careful documentation of knowledge & legal tools needed to combine the property rights of seemingly useless single assets (eg. electronic parts, legal rights of production ) into complex wholes (eg. Iphone) and appropriate the surplus value they generate.

How Globalization is generating wealth for the wealthy?

  • No central repository of the world, where local entrepreneurial talents and legal rights to assets of the citizens, could be accessed by world economies.
  • Thus, majority of population is not effectively able to participate in their national economic growth, let alone world development.
  • So, lack of consolidated documented knowledge is fuelling the inequality.
  • Thus, anti-globalisation movement of closing national borders won’t garner any success.

Legal Lag :

  • Legislation drafted to govern Globalization are disconnected from ground realities & local implementers.
  • But, experience in Japan, U.S. and Europe show that straightforward legal approach is not the best way to go.

Fixing the Knowledge chain:

  • Translating the language of legal chain into digital language.
  • Institute for Liberty & Democracy (ILD) with support from Silicon Valley in their research, clearly determined, IT and block-chain can bring Globalization at door-step.

Democratisation of Laws is the way forward.

Books, Study Material and Strategy for Prelims and Mains (Economics)

Economics is a core subject which is essential to understand various topics of other subjects and current affairs. There are relevant 2 parts for UPSC-

  1. Basic Micro and Macro Economics (By basic I really meant basic)
  2. Indian Economy


  • Notes from for basics (I have pdf of most of the articles published by Mrunal sir till 2015. Download it from here. After that he switched to videos so you can see them on Youtube.)
  • Indian Economy from GKtoday Economics Module. (Very good, Indian Economy made simple)
  • Indian Economy by Sanjive Verma (Good book for Mains)
  • Videos by
  • Some topics from and
  • Micro and Macro Economics NCERTs (Some topics suggested by
  • For Current Affairs Mrunal and Vision IAS is essential.
  • For Economic Survey, follow, again, Mrunal Vidoes. You can also opt for gist by Vision IAS. You can also read it by yourself but it is not that important to spend too much time on it. Even after this if you want to read it, try to grasp the basic of every chapter.


  • The basic economics by either NCERTs or by Mrunal sir, should be completed.
  • Then move to Indian Economy.
  • Then do old question papers.
  • Then do mocks. Mock tests by Erudition IAS are awesome to clear basics and Current Affairs.
  • For Prelims revision of basics and doing mocks is enough.
  • For Mains, as we have seen, only Current Affairs based questions are important. For that you can do Erudition IAS notes for Mains and Vision IAS monthly magazine.


The Marginal Cost of Funds Based Lending Rate (MCLR)

The marginal cost of funds based lending rate (MCLR) refers to the minimum interest rate of a bank below which it cannot lend, except in some cases allowed by the RBI. The MCLR methodology for fixing interest rates for advances was introduced by the Reserve Bank of India with effect from April 1, 2016. This new methodology replaces the base rate system introduced in July 2010.

Existing loans and credit limits linked to the Base Rate or Benchmark Prime Lending Rate (BPLR) would continue till repayment or renewal.

Reasons for introducing MCLR

RBI decided to shift from base rate to MCLR because the rates based on marginal cost of funds are more sensitive to changes in the policy rates. Prior to MCLR system, different banks were following different methodology for calculation of base rate – that is either on the basis of average cost of funds or marginal cost of funds or blended cost of funds. Thus, MCLR aims-

  1. To improve the transmission of policy rates into the lending rates of banks.
  2. To bring transparency in the methodology
  3. To enable banks to become more competitive

Stagflation, Disinflation, Reflation etc.

Stagflation is persistent high inflation combined with high unemployment and stagnant demand in a country’s economy.

Disinflation reduction in the rate of inflation.

Deflation reduction of the general level of prices in an economy. Inflation in minus.

Reflation is the act of stimulating the economy by increasing the money supply or by reducing taxes, seeking to bring the economy (specifically price level) back up to the long-term trend, following a dip in the business cycle.

Skewflation refers to inflation in some commodities, deflation in others.

Recession a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.

International Multilateral Banks and Institutions (Part 1)

1. Asian Infrastructure Investment Bank
  • The Asian Infrastructure Investment Bank (AIIB) is an international financial institution that aims to support the building of infrastructure in the Asia-Pacificregion. The AIIB has a total of 57 members including 37 regional and 20 non-regional prospective founding members. The bank was proposed by China in 2013.
  • HQ at Beijing, China.
  • Presently AIIB will lend in US dollars rather than China’s currency, the renminbi, and its official language will be English.
  • India, Pakistan and Russia are members.
  • Major economies that did not become members include the G7/G8 members United States, Japan and Canada.
  • China has largest voting share (26.06%) followed by India (7.51) then Russia (5.92%).
  • Authorized capital is of 100 billion US dollars.
  • Its regional members (Asian) will be the holding around 75 percent of shares i.e. they will be majority shareholders.

2. New Development Bank (BRICS Bank)

  • The New Development Bank (NDB), formerly referred to as the BRICS Development Bank, is a multilateral development bank established by the BRICS states (Brazil, Russia, India, China and South Africa).
  • According to the Agreement on the NDB, “the Bank shall support public or private projects through loans, guarantees, equity participation and other financial instruments.”
  • The initial authorized capital of the bank is $100 billion $.
  • The initial subscribed capital of the NDB is $50 bln divided into paid-in shares ($10 bln) and callable shares ($40 bln).
  • The bank is headquartered in Shanghai, China. The first regional office of the NDB will be opened in Johannesburg, South Africa.
  • K. V. Kamath was appointed as the President of the bank.
  • The primary objectives of the NDB should be to achieve three zeros by 2050: zero poverty, zero unemployment, and zero net carbon emissions.
3. The Asian Development Bank (ADB)
  • The Asian Development Bank (ADB) is a regional development bank established on 19 December 1966, which is headquartered in Manila, Philippines, to promote social and economic development in Asia. The bank admits the members of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) and non-regional developed countries.
  • ADB now has 67 members, of which 48 are from within Asia and the Pacific and 19 outside.
  • The ADB was modeled closely on the World Bank, and has a similar weighted voting system where votes are distributed in proportion with members’ capital subscriptions.
  • ADB is an official United Nations Observer.
  • At the end of 2014, Japan holds the largest proportion of shares at 15.7%, United States holds 15.6%, China holds 6.5%, India holds 6.4%, and Australia holds 5.8%.
  • ADB funded Rural Roads Sector II Investment Program in India.
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