Month: April 2022

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Death Penalty Abolition Debate

Death Penalty

| Governance | Mains Paper 2: Executive & Judiciary,Governance, Transparency & Accountability, Citizens Charters
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Article 21

Mains level: Paper- Examining the death penalty

Context

On April 22, a Bench of the Supreme Court of India, led by Justice U.U. Lalit, decided to critically examine the routine and abrupt way in which trial judges often impose the death penalty on convicts.

Individualistic approach

  • The challenge before the Court in the instant case of Irfan vs State of Madhya Pradesh was to identify the mitigating circumstances and to ensure a convict-centric approach so that the imposition of capital punishment becomes rarer, fairer, and principled.
  • According to the Court, “a ‘one size fit for all’ approach while considering mitigating factors during sentencing should end”.
  • Mitigation expert: The Bench indicated the need for mitigation experts to assist trial courts in reaching a correct conclusion on whether one should be sent to the gallows or not.
  • The Court seemed to think that an individualistic approach that examines the social, economic, emotional, and genetic components that constituted the offender rather than the offence, would go a long way in evolving a just and judicious sentencing policy.
  • An analysis of the possible reasons to avert the death penalty is reflected in a series of recent verdicts such as Lochan Shrivas vs State of Chhattisgarh (2021) and Bhagchandra vs State of Madhya Pradesh (2021).
  • These reasons might include socio-economic backwardness, mental health, heredity, parenting, socialisation, education, etc.

Background of the humane and reformist framework

  • The special reason: According to Section 354(3) in the Code of Criminal Procedure, while imposing the capital punishment, the judge should specify “the special reasons” for doing so.
  • It was in Bachan Singh vs State of Punjab (1980) that the Constitution Bench suggested a humane and reformist framework in the matter.
  • Bachan Singh requires the trial courts not only to examine the gravity of the offence but also the condition and the ‘reformability’ of the accused. 
  • Not unconstitutional: The Court, in Bachan Singh, refused to declare the death penalty as unconstitutional. 
  • It abundantly implied that no person is indubitably ‘irreformable’.
  • It had the effect of practically undoing the death penalty provision, if taken in its letter and spirit.
  • Person-centric approach: This person-centric approach, for its materialisation, needs a different judicial acumen that recognises the convict in her multitudes.

Is the Bachan Singh doctrine followed?

  • The Bachan Singh principle was followed more in its breach than in compliance even by the Supreme Court.
  • In Ravji vs State of Rajasthan (1995), the Supreme Court said that it is the nature of the crime and not the criminal which is germane for deciding the punishment.
  • Several other cases also were decided by ignoring the Bachan Singh doctrine, as noted by the Supreme Court itself in Santhosh Kumar Satishbhushan Bariyar vs State of Maharashtra (2009) and Rajesh Kumar vs State (2011).
  • This egregious judicial error will have to be kept in mind while the Court revisits the issues related to mitigating factors and individual-centered sentencing policy in the Irfan case.
  • Shortcomings of Bachan Sing: Bachan Singh did not, in concrete terms, elaborate on the mitigating factors and the methods to gather them to avert the death penalty.
  • Nor did it explain the issues such as burden of proof and standard of proof in detail.

Issue of misuse and overuse

  • Misuse of sedition provision: The Indian experience shows that whenever the Court tries to dilute the harshness of penal provisions by a balancing approach, instead of striking down the provision, the instrumentalities of the state (including the police, the prosecution and the court) continue to overuse or misuse the provisions.
  • The Supreme Court endorsed the validity of the sedition law (Section 124A of the Indian Penal Code) with a rider that it could be invoked only when there is an incitement to violence.
  • But the state seldom acts based on interpretation of the law. 
  •  Many were booked for the charge of sedition since then for mere words, innocent tweets or harmless jokes.

Social implications

  • Disproportionate effect on the poor: In India, as elsewhere, the poor, rather than the rich, are sent to the gallows.
  • Ineffectiveness of legal assistance: In Williams vs Taylor (2000), the U.S. Supreme Court said that failure of the defence lawyer in highlighting the mitigating factors that could lead to avoidance of capital punishment makes the legal assistance ineffective. 
  • Therefore, it infringes constitutionally guaranteed rights.
  • In the Indian scenario, the legal assistance received by the poor facing serious charges is far from satisfactory.
  • Mitigating factors not placed: And in the matter of sentencing too, the mitigating factors are either not placed before the trial court or not persuaded adequately to convince the trial judge to avoid the death penalty.

Way forward

  • Taking empirical lessons from the fate of Bachan Singh, the Supreme Court may have to now ask the more fundamental question posed and negatived in Bachan Singh — the question of the constitutional validity of death penalty.
  • Comprehensive report: The Court, in the instant case, will have to evolve a legal device for procurement of a comprehensive report dealing with the socio-economic and hereditary backgrounds of the accused from experts in the fields of social work, psychiatry, psychology, anthropology, etc.
  • Violation of Article 21: The Court may have to revisit Bachan Singh itself in so far as it refused to declare the death penalty as violative of the right to life envisaged under Article 21 of the Constitution.
  • Across the world, 108 nations have abolished death penalty in law and 144 countries have done so in law or practice, according to the Amnesty Report of 2021.
  • Judicial errors: In the Indian context, where judgmental error is quite frequent and the quality of adjudication is not ensured, what is required is a judicial abolition of death penalty. 

Conclusion

The present matter will have to be referred to a larger Bench, with a view to rectify the foundational omission in Bachan Singh — of not explicitly declaring capital punishment as unconstitutional.

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Placing semicon diplomacy at the heart of India’s foreign policy

op-ed snap | International Relations | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: Paper 2- Semicon diplomacy

Context

The current decade presents a unique opportunity to India. . India must seize this opportunity and become an attractive alternative destination for semiconductor manufacturing.

Importance of semiconductors

  • Semiconductor chips are the lifeblood of the modern information age.
  • The semiconductor is the cornerstone of all electronic products.
  • They enable electronic products to compute and control actions that simplify our lives.
  • These semiconductor chips are the drivers for ICT development and one of the key reasons for the current flattening of the world

Global cooperation driven by semiconductors

  • The manufacturing cycle of a semiconductor chip from sand to a finished product, sees it change hands approximately 70 times across international borders.
  • Concentrated in few geographies: The semiconductor manufacturing capacities are concentrated in a few geographies.
  • Nearly all leading edge (sub 10nm) semiconductor manufacturing capacity is limited to Taiwan and South Korea, with nearly 92 per cent located in the former.
  • Further, 75 per cent of the semiconductor manufacturing capacity is concentrated in East Asia and China.

Opportunity for India

  • Companies are looking to diversify their supply chain and for alternatives to their bases in China.
  • The chip shortages due to Covid-19 have hit automakers with a revenue loss of $110 bn in 2021.
  • The Russia-Ukraine conflict and its implications for raw material supplies for the semiconductor value chain has also poised chipmakers to invest in strengthening the semicon supply chain.
  • India must seize this opportunity and become an attractive alternative destination for semiconductor manufacturing.
  • The way ahead is conceptualising a semicon diplomacy action plan.
  • Placing semicon diplomacy at the heart of India’s foreign policy is essential both strategically and economically.
  • The multiplier effect on the economy: The establishment of the value chain for semiconductors would ensure a multiplier effect on the entire economy. 
  • National security implications: Semiconductors are used in critical infrastructures such as communication, power transmission etc., that have implications for national security. 
  • Reducing the BoP: Domestic production would be saving forex and reducing the balance of payments, especially vis a vis China.

Way forward: Leveraging Semicon diplomacy

  • One of the ways of leveraging semicon diplomacy is increasing multilateral and bilateral cooperation.
  • Role of Quad: A key institution with immense potential in this regard is the Quad.
  • Australia, being rich in raw materials required for semiconductors, can be an important supplier to fill in India’s deficits.
  • The US and Japan can be leveraged for capacity building and their advanced semiconductor technology in logic and memory segments.
  • Pivot India’s Act East Policy: Considering that the semiconductor manufacturing and testing bases are heavily concentrated in East Asia, the Act East policy provides an opportunity to connect and strengthen ties with key players in the region.
  • Technological exchanges with ASEAN: Frequent technological exchanges between a regional bloc like ASEAN via tracks in forums like the East Asia Summit and the ASEAN regional forum will be beneficial.
  • Collective growth: Attaining self-sufficiency in semiconductor manufacturing can mean collective growth of the South Asian region.
  • India needs to harness its strengths, such as the strong presence of global EMS players, diaspora, world-class design ecosystem, demographic dividend, and use it as a pedestal for global partnerships and outreach.

Conclusion

India’s concept of self-reliance is not an individualistic endeavour but one that encourages growth and prosperity of all, in the spirit of Vasudhaiva Kutumbakam, meaning the entire world is one family. Similarly, we don’t have an option but to be self-reliant in semiconductors.

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Important Judgements In News

Mother Nature a ‘living being’ with legal entity: Madras HC

SC Judgements | Enviro & Biodiversity | Mains Paper 3: Conservation, Environmental Pollution & Degradation, Eia
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Article 21

Mains level: Nature as a living entity

Holding that it is the right time to confer juristic status to ‘Mother Nature’, Justice S. Srimathy of the Madurai Bench of Madras High Court invoked the ‘parens patriae jurisdiction’, and declared ‘Mother Nature’ as a ‘living being’ having the status of a legal entity.

What is the news?

  • The Madras HC observed that ‘Mother Nature’ was accorded the rights akin to fundamental rights, legal rights, constitutional rights for its survival, safety, sustenance and resurgence in order to maintain its status and also to promote its health and well-being.

Legal rights for nature: A backgrounder

  • The movement for legal personhood for the environment and animals began in the 1970s.
  • This concept was articulated by Christopher D. Stone in his thesis, Should Trees Have Standing.
  • In this compelling piece, the author makes an argument for the environment to have independent legal rights, much like what was granted by the judgment of the Uttarakhand High Court in 2017.
  • He highlights how the theory of rights has developed over the years and that many inanimate objects have both rights and legal duties. They can sue and be sued.

What is the case for Madras HC’s personification of nature?

  • The Madras HC has made a personification of nature that focuses on the life-giving and nurturing aspects of nature by embodying it, in the form of the mother.
  • It observed that the court is hereby declaring ‘Mother Nature’ a ‘living being’ having the status of a legal person with all corresponding rights, duties and liabilities of a living person, in order to preserve and conserve it.
  • The State and Central governments are directed to protect ‘Mother Nature’ and take appropriate steps in this regard in all possible ways.

A different course: Ecological Jurisprudence

  • The onset of climate change and the potential mass extinction of species is accompanied by the gradual closing window of opportunity to take meaningful action.
  • Activists around the world are calling for anthropocentric legal and governance systems to be replaced with ecocentric ones.
  • The last 15 years have seen a dramatic increase in the number of laws based on ecological jurisprudence.
  • Ecological jurisprudence is a philosophy that sees nature not as a set of objects to be exploited but as a community of subjects (humans and non-humans) who are connected through interdependent, reciprocal relationships.

India’s typical case

  • In 2017, the Uttarakhand HC ruled (in two separate orders) that the Ganga, the Yamuna, their tributaries, and the glaciers and catchments feeding these rivers in Uttarakhand had rights as a “juristic/legal person/living entity”.
  • In 2018, the same HC ruled that the entire animal kingdom had rights similar to that of a living person (Narayan Dutt Bhatt vs Union of India).
  • In March 2020, the Punjab and Haryana High Court passed an order declaring the Sukhna Lake in Chandigarh city a living entity, with rights equivalent to that of a person.

Beyond Rights

  • Law is a modern human construct. It not only talks in the language of rights and duties that only humans understand but also operationalizes them in a way that can further entrench human-centeredness.
  • In most cases where nature’s rights are recognized in law, they have done so by extending to it the concept of “personhood” in other words, akin to humans and, therefore, having human rights.
  • Hence, any such movement on recognizing the rights of the rest of nature must challenge the fundamental forms of injustices, including capitalism, stateism, anthropocentrism and patriarchy.

Significance of such status

  • These rights-based laws granting legal personhood for nature aim to shift the legal status of the natural world from being human property to living entities in their own right and subjects of law.
  • This guarantees their right to exist, thrive, evolve and maintain their natural cycles.
  • These rights are not conferred by humans; it is a recognition that these rights have always existed.
  • It lays upon humans the duty to act as guardians for the more-than-human world.

Issues of implementation

  • Assuming that these rights are recognised, nature or any of its entity cannot represent itself in a court of law.
  • Moreover there is the issue of custodianship.

What would account for violations?

  • The Uttarakhand court order did not mention what amounted to violation of rights of rivers.
  • In order to be able to truly exercise the rights and implement appropriate redressal, there is a need for a comprehensive definition of the actions that amount to “violation of the rights”.
  • Say, the violation of the rights of rivers may be defined as “any obstruction or impediment that disables the entity from performing its essential ecological functions”.

Restitution and compensation

  • The New Zealand law has an extensive section lending itself to restitutive, restorative and compensatory action.
  • It acknowledged the government’s decisions and actions for more than a century that resulted in the violation of the health of the Whanganui and the rights, culture and well-being of the indigenous people living along the river.
  • Several specific examples were given, including the dismantling of traditional structures for fishing and river use, a hydroelectric project and mining.
  • Such an acknowledgment is a necessary first step towards seeking appropriate restitutive and compensatory measures.

Another question: Bioregional Governance

  • Recognizing river ecosystems or other entities of nature as having rights offers the possibility of managing and governing habitats based on the ecological realities of the region.
  • It brings out the bizarre fact that the human-drawn nation state, and political lines on maps in various parts of the world have created conflict situations or disrupted ancient cultural and ecological flows and relations.
  • We need to begin reimagining governance from a bioregional governance point of view.
  • This would also mean bridging the gap between the customary ways of decision making and the current legal frameworks.
  • There is a need for more imaginative lawyers, activists and judges to help move towards an eco-centric and diverse legal framework.

Way forward

  • There is a need for a comprehensive system to implement and protect their rights.
  • The rights can be safeguarded using the principles of custodianship.
  • The Uttarakhand High Court order named several government functionaries and a couple of independent lawyers as “parents”.
  • An alternative solution is that custodianship or guardianship be given to a body of local communities associated with the river.
  • These communities have traditional or customary rights of the river such as fisherfolk, farmers along the riverbank, and people directly engaged in river-related services.

 

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Civil Services Reforms

What are the rules for resignation and reinstatement of an IAS officer?

| Governance | Mains Paper 2: Civil Service
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Civil Services

Mains level: Resignation and reinstatement of an IAS officer

A decorated Indian Administrative Service (IAS) officer and UPSC CSE topper from 2010, who resigned from the service in protest against the “unabated” killings in Kashmir in 2019, has been reinstated.

What rules apply when an IAS officer chooses to resign?

  • A resignation is a formal intimation in writing by an officer of his/her intention or a proposal to leave the IAS, either immediately or at a specified date in the future.
  • Guidelines of the Department of Personnel, the cadre controlling department for the IAS, say that a resignation has to be clear and unconditional.
  • The resignation of an officer of any of the three All-India Services — IAS, the IPS and IFoS — is governed by Rules 5(1) and 5(1)(A) of the All India Services (Death-cum-Retirement Benefits) Rules, 1958.
  • There are similar rules for resignation of officers belonging to the other central services as well.
  • Resignation from service is entirely different from accepting the government’s Voluntary Retirement Scheme (VRS).

To whom must the resignation of an IAS officer be submitted?

  • An officer serving in a cadre (state) must submit his/her resignation to the chief secretary of the state.
  • An officer who is on central deputation is required to submit his/her resignation to the secretary of the concerned Ministry or Department.
  • The Ministry/Department then forwards the officer’s resignation to the concerned state cadre, along with its comments or recommendations.

What happens after the resignation is submitted?

  • The state checks to see if any dues are outstanding against the officer, as well as the vigilance status of the officer or whether any cases of corruption etc. are pending against him/her.
  • In case there is such a case, the resignation is normally rejected.
  • Before forwarding the resignation to the central government, the concerned state is supposed to send information on the issues of dues and vigilance status, along with its recommendation.
  • The resignation of the officer is considered by the competent authority, i.e., the central government, only after the recommendation of the concerned cadre has been received.
  • The competent authorities are: Minister of State at the DoPT in respect of the IAS, the MHA in respect of the IPS, and the MoEFCC in respect of the Forest Service.
  • Being the minister in charge of the DoPT, the Prime Minister himself takes decisions currently in respect of the IAS.

Under what circumstances is a resignation accepted or rejected?

  • A circular issued by the DoPT on February 15, 1988 regarding resignation says that it is not in the interest of the government to retain an officer who is unwilling to serve.
  • The general rule, therefore, is that the resignation of an officer should be accepted — except in certain circumstances.
  • The references are made regarding the merit of the disciplinary case pending against the Government servant and whether it would be in the public interest to accept the resignation.
  • In some cases, resignations have been rejected because disciplinary cases were pending against officers.
  • In such cases, concurrence of the Central Vigilance Commission (CVC) is obtained.
  • The government also checks whether the concerned officer had executed any time-bond to serve the government.

Is an officer allowed to withdraw a resignation that has already been submitted?

  • Rule 5(1A)(i) of the amended DCRB Rules says the central government may permit an officer to withdraw his/her resignation “in the public interest”.
  • An amendment in the Rules in 2011 states the member is allowed to resume duty as a result of permission to withdraw the resignation is not more than 90 days”.
  • The request for withdrawal of resignation shall NOT be accepted where a member of the Service resigns to be associated with any active politics/ political parties.

And under what circumstances is the withdrawal of an officer’s resignation accepted?

  • The 2011 guidelines say that if a resigned officer resignation sends an intimation in writing withdrawing it before its acceptance by the competent authority, the resignation will be deemed to have been automatically withdrawn.
  • The officer under discussion had resigned on January 9, 2019, but his resignation was not processed.

 

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Climate Change Impact on India and World – International Reports, Key Observations, etc.

What are Heatwaves?

| Enviro & Biodiversity | Mains Paper 1: Climatic Change

India is gripped in the wrath of a long spell of heatwaves that too in the early month of April.

What is a Heatwave and when is it declared?

  • Heatwaves occur over India between March and June.
  • IMD declares a heatwave event when the maximum (day) temperature for a location in the plains crosses 40 degrees Celsius.
  • Over the hills, the threshold temperature is 30 degrees Celsius.

How are they formed?

  • Heatwaves form when high pressure aloft (3,000–7,600 metres) strengthens and remains over a region for several days up to several weeks.
  • This is common in summer (in both Northern and Southern Hemispheres) as the jet stream ‘follows the sun’.
  • On the equator side of the jet stream, in the upper layers of the atmosphere, is the high pressure area.
  • Summertime weather patterns are generally slower to change than in winter. As a result, this upper level high pressure also moves slowly.
  • Under high pressure, the air subsides (sinks) toward the surface, warming and drying adiabatically, inhibiting convection and preventing the formation of clouds.
  • Reduction of clouds increases shortwave radiation reaching the surface.
  • A low pressure at the surface leads to surface wind from lower latitudes that brings warm air, enhancing the warming.
  • Alternatively, the surface winds could blow from the hot continental interior towards the coastal zone, leading to heat waves.

Following criteria are used to declare heatwave:

To declare heatwave, the below criteria should be met at least in 2 stations in a Meteorological subdivision for at least two consecutive days and it will be declared on the second day.

  1. a) Based on Departure from Normal
  • Heat Wave: Departure from normal is 4.5°C to 6.4°C
  • Severe Heat Wave: Departure from normal is >6.4°C
  1. b) Based on Actual Maximum Temperature (for plains only)
  • Heat Wave: When actual maximum temperature ≥ 45°C
  • Severe Heat Wave: When actual maximum temperature ≥47°C

How long can a heatwave spell last?

  • A heatwave spell generally lasts for a minimum of four days. On some occasions, it can extend up to seven or ten days.
  • The longest recorded heatwave spell, in recent years, was between 18 and 31 May 2015.

Impact of Heat Waves:

Heat Strokes: The very high temperatures or humid conditions pose an elevated risk of heat stroke or heat exhaustion.

Older people and people with chronic illness such as heart disease, respiratory disease, and diabetes are more susceptible to heatstroke, as the body’s ability to regulate heat deteriorates with age.

Increased Healthcare Costs: Effects from extreme heat are also associated with increased hospitalisations and emergency room visits, increased deaths from cardio-respiratory and other diseases, mental health issues, adverse pregnancy and birth outcomes, etc.

Lessens Workers’ Productivity: Extreme heat also lessens worker productivity, especially among the more than 1 billion workers who are exposed to high heat on a regular basis. These workers often report reduced work output due to heat stress.

Risk of Wildfires: The heat domes act as fuel to wildfires, which destroys a lot of land area every year in countries like the US.

Prevents Cloud Formation: The condition also prevents clouds from forming, allowing for more radiation from the sun to hit the ground.

Effect on Vegetation: The trapping of heat can also damage crops, dry out vegetation and result in droughts.

Increased Energy Demands: The sweltering heat wave also leads to rise in energy demand, especially electricity, leading to pushing up rates.

Power Related Issues: Heat waves are often high mortality disasters.

Avoiding heat-related disasters depends on the resilience of the electrical grid, which can fail if electricity demand due to air conditioning use exceeds supply.

As a result, there is the double risk of infrastructure failure and health impacts.

  • Initiatives Taken:
    • Global:
      • Global forums dealing with climate change issues—such as the World Health Organization, World Economic Forum, First Global Forum on Heat and Health, and the Global Forum for Environment-OECD—also focus on heat waves by investing in research on health risks of extreme heat, climate and weather information, advice on surviving heat waves, partnerships and capacity building, and communications and outreach.
    • Indian:
      • The National Disaster Management Authority (NDMA) has issued guidelines on dealing with heatwaves.
        • However, India does not recognise heatwaves as a disasterunder its Disaster Management Act (2005).

Way Forward

  • Adopting A More Sensitive Approach: The impact of such excessive heat needs to be understood from the point of view of common people — daily labourers; farmers; traders; fishermen etc.
    • Beyond numbers and graphs that capture the impact of the climate crisis, the human experience of living in oppressive heat needs to be understood by policymakers and measures should be taken accordingly.
  • Cooling Shelters: The government should come out with a policy to deal with the suffering and disability caused by heat extremes in different parts of the country.
    • Water kiosks, staggered outdoor work hours, cool roofs for buildings and homes are certain things that should be put in place immediately.
    • A number of emergency cooling shelters can be opened so that people without domestic air conditioning units can escape the heat.
      • Portable air-conditioning units, along with fans and even ice are also useful.
  • Passive Cooling to Reduce Urban Heat Islands: Passive cooling technology, a widely-used strategy to create naturally ventilated buildings, can be a vital alternative to address the urban heat island for residential and commercial buildings.
    • The IPCC report cites ancient Indian building designs that have used this technology, which could be adapted to modern facilities in the context of global warming.
  • Action Plans Similar to Ahmedabad: As per the IPCC Report, Ahmedabad has shown the way to combat heat extremes by heat-proofing buildings.
    • After the heat action plan was implemented in 2013 in Ahmedabad, heat-related mortality reduced by 30% to 40% over the years. Similar plans like that of Ahmedabad can be implemented in vulnerable regions.
  • Replacing Dark Roofs: A big reason that cities are so much hotter than rural areas is that they are covered by dark roofs, roads and parking lots that absorb and retain heat.
    • One of the long term solutions can be replacing the dark surfaces with lighter and more reflective materials; it will result in a comparatively cooler environment.

 

 

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Government Budgets

Managing the fiscal shock of the Russia-Ukraine conflict

op-ed snap | Economics | Mains Paper 3: Government Budgeting,Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Tax buoyancy

Mains level: Paper 3- Fiscal impact of Russia-Ukraine conflict

Context

The Union Budget 2022-23 received a great deal of attention even before the financial year began due to the Russia-Ukraine conflict, and the consequent rise in inflation. There has been considerable speculation on whether the fiscal targets will be altered due to the evolving conditions.

Estimate of GDP

  •  The critical estimate of GDP growth assumed for this year has certainly changed, with the RBI also adjusting its earlier forecast.
  • However, the budget was conservative to begin with, assuming an 11.1 per cent growth estimate on which its revenue collection targets were based.
  • Given that real GDP growth has been scaled down by the RBI to 7.2 per cent, and as inflation has gone up, on balance, the 11.1 per cent assumption looks tenable.
  • Hence, inflation has been a positive for the government in this respect.

Tax collection

  • Another positive that emerged last year was that overall tax collections were even more buoyant than expected.
  • From the budgeted figure of Rs 22.17 lakh crore, the revised estimates raised the target to Rs 25.16 lakh crore.
  • In comparison, actual collections have turned out to be even higher at Rs 27.07 lakh crore.
  • If this buoyancy is maintained, then the government can expect the 2022-23 target of Rs 27.57 lakh crore to be exceeded by around Rs 2.5 lakh crore (of this, around 30 per cent will go to the states).
  • This additional revenue would ideally flow from enhanced GST collections, corporate tax, and customs.
  • Central to GST collections increasing is private consumption.
  • Today, high inflation erodes the purchasing power of households, which will divert a larger portion of their incomes for necessities that have become expensive.
  • Therefore, there will be uncertainty here. 
  • Corporates did well last year as they did manage to pass on higher input costs to the consumers, especially in the second half of the year.
  • Can they do it for the second time is the question.
  • High growth in trade volumes led to the government raking in higher customs collections. W
  • ith global growth set to slow down in 2022, a similar flow is unlikely.

Excise collection and challenges

  • The government will be watchful of excise collections as it is possible that rising fuel prices will lead to lower consumption.
  • Also, in case crude oil continues on the current path and remains in the region of $100-120/barrel, a call may have to be taken by the government on the excise duty: Once the prices of diesel and petrol remain at a new threshold, there will be a tendency for freight rates to be increased permanently.
  • This will have a secondary impact on inflation. 

Disinvestment challenges

  • On the revenue side, the LIC disinvestment that was to happen last year will materialise this year.
  • The disinvestment has been pushed through for May, but would be of a much lower amount (around Rs 21,000 crore) than envisaged earlier.
  • It will be interesting to see if this would be a part of the Rs 65,000 crore target for this year.

Uncertainty on the expenditure side

  • The biggest concern will be the fertiliser subsidy, which has been a volatile expenditure item.
  • Higher prices of natural gas have meant that fertilisers have been more expensive and so, the budgeted amount of Rs 1.05 lakh crore will have to be revisited.
  • With inflation already high and agriculture expected to be the bright spot again, the government cannot risk ignoring the subsidy element on fertilisers because there can be an impact on farm product prices.
  • The food subsidy will also need to be examined.
  • The present rise in food prices globally has meant that there is a good global market, especially for wheat.
  • Exports for wheat and maize might rise but can distort the procurement process.

Interest rate and its implications for borrowing

  • The budget had assumed that interest rates would be stable.
  • However, conditions have changed quite quickly with bond yields moving up by almost 50 bps for the 10-year G-secs.
  • This will mean that the entire Rs 15.95 lakh crore of gross borrowing will have to be carried out at a higher cost.
  • This can result in an additional Rs 8,000 crore of interest if the 50 basis points increase holds through the year. There could be an upward bias if rates go up further.

Conclusion

The longer the conflict continues the greater will be the impact. While the government has adeptly managed the fiscal numbers in the last couple of years, this year will be particularly challenging considering the nature of the shock.

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Policy Wise: India’s Power Sector

How to shock-proof India’s power sector

| Economics | Mains Paper 3: Infrastructure: Energy, Ports, Roads, Airports, Railways Etc.
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much

Mains level: Paper 3- Reforms in India's power sector

Context

The reports of coal-shortage induced power outages across states continue to pour in.

Reasons for volatility in the power sector

  • Demand-supply mismatch: As economic activity resumed after the Covid-induced lockdowns, the demand-supply mismatch for commodities such as coal widened globally, leading to a surge in prices.
  • Geopolitical factors: Global supply disruptions due to the Russia-Ukraine conflict have sent coal prices touching historical highs.
  • The cost of imported coal in India is expected to be 35 per cent higher in the fiscal year 2022-23 compared to the past year.
  • Sudden rise in energy demand: Even as coal stocks available with state thermal power plants fell, India also witnessed a sudden rise in energy demand in March — the hottest in its recorded history.

Suggestions to make the power sector resilient

  • The Ministry of Power has taken a host of measures to alleviate the crisis.
  • This includes giving directions to ensure maximum production of coal at captive mines, rationing of coal to non-power sectors, and a price cap of Rs 12 per unit on electricity traded on exchanges.
  • But we need to do more to enhance the sector’s resilience to such disruptions from exogenous factors.

1] Create an enabling ecosystem to ensure power plants work efficiently

  • India has about 200 GW of coal-based generation capacity which accounts for nearly 70 per cent of the total electricity generated in the country.
  • However, according to a CEEW assessment, a disproportionate share of generation comes from older inefficient plants, while the newer and efficient ones remain idle for want of favourable coal supply contracts or power purchase agreements.
  • Revisiting fuel allocation and supporting the priority dispatch of efficient plants could help India reduce coal demand by up to 6 per cent of our annual requirement, and set aside more coal for the proverbial rainy day.

2] Smart assessment and management of demand

  •  Enable discoms to undertake smart assessment and management of demand.
  • We have advanced tools for medium- and short-term demand forecasting.
  • However, few discoms have embraced these to inform their procurement decisions.
  • Introducing time-of-day pricing and promoting efficient consumption behaviour would help shave peak demand and avoid panic buying in the market.

3] Empower electricity regulators to help bring down discom losses

  • Despite two decades of sectoral reforms, the aggregate losses of discoms stand at 21 per cent (2019-20).
  • This is reflective of both operational inefficiency and poor recovery of dues from consumers, including those affiliated with state governments and municipal bodies.
  • These losses are also the reason for discoms not being able to pay the generators on time, resulting in payment delays to Coal India, which, in turn, is reluctant to supply coal on request.
  • Infuse payment discipline: Besides the ongoing initiatives like introducing smart meters and network strengthening, empowering regulators would be critical to infuse payment discipline across the supply chain of the electricity sector and to keep cost recovery as a key metric.

Conclusion

Given the country’s development aspirations, India’s power demand is set to rise substantially and become more variable. We need to act now for the long-term resilience of India’s power sector.

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North-East India – Security and Developmental Issues

Status of the Naga Peace Talks

| Polity | Mains Paper 2: Federalism
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Various Naga tribes

Mains level: Naga Peace Process

The annual report of the Ministry of Home Affairs (MHA) released a report on insurgency-related incidents in Nagaland.

It recently said that the Isak-Muivah faction of the National Socialist Council of Nagaland (NSCN-IM) was involved in 44% of insurgency-related incidents in 2020.

Why in news?

  • The Union government had, in 2015, signed a framework agreement with the NSCN-IM to find a solution to the Naga political issue.
  • The negotiations are yet to be concluded.

Who are the Nagas?

  • The term Naga was created by the British for administrative convenience to refer to a group of tribes with similar origins but distinct cultures, dialects, and customs.
  • The Naga tribes are accumulated in Nagaland, Arunachal Pradesh, Manipur, and Myanmar.

Why did the Naga insurgency begin?

  • Residing in the Naga hills of Assam during the advent of the British and the annexation of Assam in 1820, the Nagas did not consider themselves a part of British India.
  • The British adopted a way of governance over the Nagas that involved keeping in place their traditional ways of life, customs, and laws while putting British administrators at the top.
  • At the time of the withdrawal of the British, insecurity grew among the Naga tribes about the future of their cultural autonomy after India’s independence.
  • This was accompanied by the fear of the entry of “plains people” or “outsiders” into their territory.

Do you know?

In a memorandum to the Simon Commission in 1929, representatives of Naga tribes demanded that Nagas be left free after Independence and not be included in the Indian Union.

Collective actions of the Nagas

  • Above mentioned factors gave rise to the formation of the Naga Hills District Tribal Council in 1945, which was renamed the Naga National Council (NNC) in 1946.
  • Amid uncertainties over the post-independence future of the Nagas, a section of the NNC, led by Naga leader A.Z. Phizo declared the independence of the Nagas on August 14, 1947.
  • The underground insurgency began in the early 1950s when Mr. Phizo founded the Naga Federal Government (NFG) and its armed wing, the Naga Federal Army (NFA).

Outcome of the then insurgency

  • The Central Government sent the armed forces into Naga areas to curb the insurgency.
  • It imposed the contentious Armed Forces Special Powers Act (AFSPA) which is still in place in parts of Nagaland.
  • The Nagas, led by Mr. Phizo, demanding an independent state outside of India, boycotted the 1952 and 1957 general elections and armed clashes grew.
  • Unlike other groups in the north east which were accepting some form of autonomy under the Constitution, Nagas rejected this in favour of sovereignty.

Negotiations with the govt

  • Some leaders among the NNC formed their own group to hold discussions with the government, leading to the formation of the State of Nagaland in 1963.
  • This, however, did not satisfy many in the NNC and NFG, who, following years of negotiations with the government, eventually signed the Shillong Accord of 1975, agreeing to surrender arms and accept the Constitution.

When did the NSCN come into the picture?

  • This signing of the Shillong Accord was not agreeable with many top leaders of the NNC and those operating from Myanmar.
  • A/c to them, the agreement did not address the issue of Naga sovereignty and coerced them to accept the Constitution.
  • Three NNC rebel leaders, formed the National Socialist Council Of Nagaland (NSCN) to continue the armed movement for ‘independence’.

Again split in NSCN

  • In 1988, after years of infighting and violent clashes along tribal lines and over the main cause of the movement, the NSCN split into two factions.
  • One, led by Mr. Muiwah and Swu called the NSCN-IM and the other, led by Mr. Khaplang called the NSCN-K.
  • The NSCN-IM demanded and continues to demand for ‘Greater Nagaland’ or Nagalim.
  • It wants to extend Nagaland’s borders by including Naga-dominated areas in the neighbouring States of Assam, Manipur and Arunachal Pradesh.
  • The NSCN-IM has now grown to become the most powerful insurgent group, also playing a role in the creation of smaller groups in other States.

Where do the peace talks stand now?

  • In 1997, the Government of India got the NSCN-IM to sign a ceasefire agreement to begin the holding of talks with the aim of signing a Naga Peace Accord.
  • After this ceasefire, there have been over a hundred rounds of talks spanning over 24 years between the Centre and the insurgent group, while a solution is still awaited.

Issues of contention

  • Independence celebration: Nagas across Nagaland, Manipur, Assam and Arunachal Pradesh celebrate August 14 as Independence Day. According to Naga historians, Gandhi agreed that the Nagas would celebrate their independence a day ahead of India, on August 14, 1947.
  • Naga flag: In the Naga narrative, passed down generations by word of mouth, the Naga flag was not designed by a mortal but is of divine origin.
  • Secessionist tendencies: A large section of the Nagas still holds dear the idea of the Naga identity and their tribal roots.

Way ahead

  • The Naga struggle claimed thousands of lives over decades and devastated countless homes, all over the idea of a sovereign Naga nation.
  • If the NSCN (I-M) accedes to economic and political packages alone, without a separate flag and constitution, it remains to be seen whether it will be seen as a solution, or as a defeat.

 

Also read,

[Burning Issue] Naga Peace Talks

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Foreign Policy Watch: India-China

What is China’s Global Security Initiative?

IOCR | International Relations | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India
Note4Students

From UPSC perspective, the following things are important :

Prelims level: GSI

Mains level: Chinese counter to Western Indo-Pacific strategy

Chinese President Xi Jinping last week proposed a “Global Security Initiative” to promote security for all in the globe.

What is Global Security Initiative?

  • Conceived as a global public good, the initiative seeks to promote world peace and stability by fostering equity and justice among nations.
  • To do this, Xi defined his proposal in six areas:
  1. Stay committed to the vision of common, comprehensive, cooperative and sustainable security, and work together to maintain world peace and security;
  2. Stay committed to respecting the sovereignty and territorial integrity of all countries, uphold non-interference in internal affairs, and respect the independent choices of development paths and social systems made by people in different countries;
  3. Stay committed to abiding by the purposes and principles of the UN Charter, reject the Cold War mentality, oppose unilateralism, and say no to group politics and bloc confrontation;
  4. Stay committed to taking the legitimate security concerns of all countries seriously, uphold the principle of indivisible security, build a balanced, effective and sustainable security architecture, and oppose the pursuit of one’s own security at the cost of others’ security;
  5. Stay committed to peacefully resolving differences and disputes between countries through dialogue and consultation, support all efforts conducive to the peaceful settlement of crises, reject double standards, and oppose the wanton use of unilateral sanctions and long-arm jurisdiction;
  6. Stay committed to maintaining security in both traditional and non-traditional domains, and work together on regional disputes and global challenges such as terrorism, climate change, cybersecurity, and biosecurity.

It is quite ironic that China has never adhered to any of the above-stated lofty principles and now is preaching them to the world.

Key propositions made by Xi

  • China opposes the wanton use of unilateral sanctions and long-arm jurisdiction, appearing to refer to Western sanctions.
  • He said “some countries” were “eager to engage in exclusive ‘small circles’ and ‘small groups’”, terms Chinese officials have used previously to describe the Quad and the AUKUS (Australia-U.K.-U.S.) security pact.
  • He firmly opposed the use of the ‘Indo-Pacific’ strategy to divide the region and create a ‘new Cold War’, and the use of military alliances to put together an ‘Asian version of NATO’.
  • According to him, China upholds true spirit of multilateralism.

A critical assessment of Xi’s speech

  • The idea of a world-encompassing security mechanism sounds like what China’s ancient emperors might have proposed.
  • Diplomats are under pressure to dissect the meaning but are having a hard time: Xi’s speech contained only abstract Chinese words and idioms.
  • One thing is very clear, China always comes out with an excessively large framework that nobody objects to.
  • The idea is that even if countries don’t agree wholeheartedly, at least they can’t fully oppose it.

Conclusion

  • Chinese criticism of unilateralism, hegemony and double standards is usually aimed at the U.S.
  • Xi envisions a gradually weakening America replaced by a multipolar world in which China is a major player.

 

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Armed Forces (Special Powers) Act

Keen on lifting AFSPA from NE: PM

| Security Issues | Mains Paper 3: External State & Non-State Actors: Challenges To Internal Security.
Note4Students

From UPSC perspective, the following things are important :

Prelims level: AFSPA

Mains level: Improvement in security conditions in NE

The PM informed that AFSPA could be withdrawn partially from Assam, Manipur and Nagaland (from April 1) due to peaceful conditions since 2014.

What is the news?

  • The AFSPA will now be applicable fully only in 31 districts and partially in 12 districts of four states in the Northeast Assam, Nagaland, Manipur and Arunachal Pradesh.
  • These four states together comprise 90 districts.
  • The AFSPA was completely withdrawn in Meghalaya in 2018, Tripura in 2015 and Mizoram in the 1980s.

Immediate reasons for withdrawal

  • The Northeast has lived under the shadow of AFSPA for nearly 60 years, creating a feeling of alienation from the rest of the country.
  • The move is expected to help demilitarise the region; it will lift restrictions of movements through check points and frisking of residents.
  • Years of AFSPA regime has had psychological consequences, trauma and alienation of the people.

AFSPA: A Backgrounder

  • The AFSPA, 1958 came into force in the context of insurgency in the North-eastern States decades ago.
  • It provides “special power” to the Armed Forces applies to the Army, the Air Force and the Central Paramilitary forces etc.
  • It has been long contested debate whether the “special powers” granted under AFSPA gives total immunity to the armed forces for any action taken by them.

Armed Forces (Special Powers) Act, 1958

  • Armed Forces Special Powers Act, to put it simply, gives armed forces the power to maintain public order in “disturbed areas.”
  • AFSPA gives armed forces the authority use force or even open fire after giving due warning if they feel a person is in contravention of the law.
  • The Act further provides that if “reasonable suspicion exists”, the armed forces can also arrest a person without warrant; enter or search premises without a warrant; and ban the possession of firearms.

What are the Special Powers?

The ‘special powers’ which are spelt out under Section 4 provide that:

(a) Power to use force, including opening fire, even to the extent of causing death if prohibitory orders banning assembly of five or more persons or carrying arms and weapons, etc are in force in the disturbed area;

(b) Power to destroy structures used as hide-outs, training camps, or as a place from which attacks are or likely to be launched, etc;

(c) Power to arrest without warrant and to use force for the purpose;

(d) Power to enter and search premises without a warrant to make arrest or recovery of hostages, arms and ammunition and stolen property etc.

What are the Disturbed Areas?

  • A disturbed area is one that is declared by notification under Section 3 of the AFSPA.
  • As per Section 3, it can be invoked in places where “the use of armed forces in aid of the civil power is necessary”.

Who can declare/notify such areas?

  • The Central Government or the Governor of the State or administrator of the Union Territory can declare the whole or part of the State or Union Territory as a disturbed area.
  • A suitable notification would have to be made in the Official Gazette.

Presently active ‘Disturbed Areas’

  • AFSPA is currently in force in Assam, Nagaland, Manipur, 3 districts of Arunachal Pradesh, and areas falling within the jurisdiction of 8 police stations in Arunachal Pradesh bordering Assam.
  • In Jammu and Kashmir, a separate law Armed Forces (Jammu and Kashmir) Special Powers Act, 1990 has been in force.

AFSPA: Is it a License to Kill?

While the operation of the Section has been controversial in itself, it has attracted much criticism when actions have resulted in the death of civilians.

  • Power to kill: Section 4 of the Act granted officers the authority to “take any action” even to the extent to cause the death.
  • Protection against prosecution: This power is further bolstered by Section 6 which provides that legal can be instituted against the officer, except with the previous sanction of the Central Government.

Supreme Court’s Observations over AFSPA

  • These extra-judicial killings became the attention of the Supreme Court in 2016.
  • It clarified that the bar under Section 6 would not grant “total immunity” to the officers against any probe into their alleged excesses.
  • The judgment noted that if any death was unjustified, there is no blanket immunity available to the perpetrator(s) of the offense.
  • The Court further noted that if an offense is committed even by Army personnel, there is no concept of absolute immunity from trial by the criminal court constituted under the CrPC.

Constitutionality of AFSPA

  • Attempts have been made to examine the constitutionality of the Act on the grounds that it is contravention to the:
  1. Right to Life and Personal Liberty (Article 21) and
  2. Federal structure of the Constitution since law and order is a State subject

Recommendations to repeal AFSPA

(1) Justice B.P. Jeevan Reddy Commission

  • The 2004 Committee headed by Justice B.P. Jeevan Reddy, the content of which has never officially been revealed by the Government, recommended that AFSPA be repealed.
  • Additionally, it recommended that appropriate provisions be inserted in the Unlawful Activities Prevention Act, 1967 (UAPA) instead.
  • It also recommended that the UAPA be modified to clearly specify the powers of the armed forces and paramilitary forces and grievance cells should be set up in each district where the armed forces are deployed.

(2) ARC II

  • The Administrative Reforms Commission in its 5th Report on ‘Public Order’ had also recommended that AFSPA be repealed.
  • It recommended adding a new chapter to be added to the Unlawful Activities Prevention Act, 1967.
  • However, the recommendation was considered first and then rejected.

Other issues with AFSPA

(1) Sexual Misconduct by Armed Forces

  • The issue of violation of human rights by actions of armed forces came under the consideration of the Committee on Amendments to Criminal Law (popularly known as Justice Verma Committee) set up in 2012.
  • It observed that- in conflict zones, legal protection for women was neglected.

(2) Autocracy

  • The reality is that there is no evidence of any action being taken against any officer of the armed forces or paramilitary forces for their excesses.

Caution given by the Supreme Court

A July 2016 judgment authored by Justice Madan B. Lokur in Extra Judicial Execution Victim Families Association quoted the “Ten Commandments” issued by the Chief of the Army Staff for operations in disturbed areas:

  1. Definite circumstances: The “power to cause death is relatable to maintenance of public order in a disturbed area and is to be exercised under definite circumstances”.
  2. Declaration preconditions: These preconditions include a declaration by a high-level authority that an area is “disturbed”.
  3. Due warning: The officer concerned decides to use deadly force on the opinion that it is “necessary” to maintain public order. But he has to give “due warning” first.
  4. No arbitrary action: The persons against whom the action was taken by the armed forces should have been “acting in contravention of any law or order for the time being in force in the disturbed area”.
  5. Minimal use of force: The armed forces must use only the “minimal force required for effective action against the person/persons acting in contravention of the prohibitory order.”
  6. Empathy with perpetrators: The court said that: the people you are dealing with are your own countrymen. All your conduct must be dictated by this one significant consideration.
  7. People friendliness: The court underscored how the Commandments insist that “operations must be people-friendly, using minimum force and avoiding collateral damage – restrain must be the key”.
  8. Good intelligence: It added that “good intelligence is the key to success”.
  9. Compassion: It exhorted personnel to “be compassionate, help the people and win their hearts and minds. Employ all resources under your command to improve their living conditions”.
  10. Upholding Dharma (Duty): The judgment ended with the final Commandment to “uphold Dharma and take pride in your country and the Army”.

Conclusion

  • Despite demands by civil society groups and human rights activities, none of the recommendations have not been implemented to date.

 

 

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Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy, etc.

ECGC to seek RBI nod for payment in forex to exporters

Prelims Only | Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: ECGS

Mains level: Export promotion schemes in India

ECGC Ltd., the government enterprise that provides export credit insurance, will soon approach the Reserve Bank of India for approval to deal in foreign currency for the benefit of exporters.

What is ECGC?

  • ECGC is an acronym for Export Credit Guarantee Corporation of India Ltd.
  • It is a government owned export credit provider.
  • It is under the ownership of Ministry of Commerce and Industry and is based in Mumbai.
  • It provides export credit insurance support to Indian exporters.
  • Its topmost official is designated as Chairman and Managing Director who is a central government civil servant under ITS cadre.
  • The GoI had initially set up Export Risks Insurance Corporation (ERIC) in July 1957.
  • It was transformed into Export Credit and Guarantee Corporation Limited (ECGC) in 1964 and to Export Credit Guarantee Corporation of India in 1983.

Functions of ECGC

  • ECGC provides a range of credit risk insurance covers to exporters against loss in export of goods and services as well.
  • It offers guarantees to banks and financial institutions to enable exporters to obtain better facilities from them.
  • It provides Overseas Investment Insurance to Indian companies investing in joint ventures abroad in the form of equity or loan and advances.

Facilities by ECGC

  • It offers insurance protection to exporters against payment risks.
  • It provides guidance in export-related activities.
  • It makes available information on different countries with its own credit ratings.
  • It makes it easy to obtain export finance from banks/financial institutions.
  • It assists exporters in recovering bad debt.
  • It provides information on the creditworthiness of overseas buyers.

Why need export credit insurance?

  • Payments for exports are open to risks even at the best of times.
  • The risks have assumed large proportions today due to the far-reaching political and economic changes that are sweeping the world.
  • An outbreak of war or civil war may block or delay payment for goods exported. Ex. Ukraine War.
  • Economic difficulties or balance of payment problems may lead a country to impose restrictions on either import of certain goods or on transfer of payments for goods imported. Ex. Sri Lankan Crisis.
  • In addition, the exporters have to face commercial risks of insolvency or protracted the default of buyers.
  • Export credit insurance is designed to protect exporters from the consequences of the payment risks, both political and commercial, and to enable them to expand their overseas business without fear of loss.

 

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Industrial Sector Updates – Industrial Policy, Ease of Doing Business, etc.

[pib] MSME Sustainable (ZED) Certification Scheme

Schemes | Economics | Mains Paper 3: Effects Of Liberalization On The Economy, Changes In Industrial Policy and their effects on Industrial Growth
Note4Students

From UPSC perspective, the following things are important :

Prelims level: MSME ZED Certification Scheme

Mains level: Boost for MSMEs

The  Union Ministry for Micro, Small and Medium Enterprises has launched the MSME Sustainable (ZED) Certification Scheme.

MSME Sustainable (ZED) Certification Scheme

  • This Scheme is an extensive drive to enable and facilitate MSMEs adopt Zero Defect Zero Effect (ZED) practices.
  • It aims motivate and incentivize them for ZED Certification while also encouraging them to become MSME Champions.
  • Through the ZED Certification, MSMEs can reduce wastages substantially, increase productivity, enhance environmental consciousness, save energy, optimally use natural resources, expand their markets, etc.

Components of the scheme

  • Under the Scheme, MSMEs will get subsidy as per the following structure, on the cost of ZED certification:
  1. Micro Enterprises: 80%
  2. Small Enterprises: 60%
  3. Medium Enterprises: 50%
  • There will be an additional subsidy of 10% for the MSMEs owned by Women/SC/ST Entrepreneurs OR MSMEs in NER/Himalayan/LWE/Island territories/aspirational districts.
  • In addition to above, there will be an additional subsidy of 5% for MSMEs which are also a part of the SFURTI OR Micro & Small Enterprises – Cluster Development Programme (MSE-CDP) of the Ministry.
  • Further, a limited purpose joining reward of Rs. 10,000/- will be offered to each MSME once they take the ZED Pledge.

Back2Basics: Zero Defect Zero Effect Scheme

  • Launched in 2016 by the Ministry of MSME, the ZED scheme is an integrated and comprehensive certification system.
  • The scheme accounts for productivity, quality, pollution mitigation, energy efficiency, financial status, human resource and technological depth including design and IPR in both products and processes.
  • Its mission is to develop and implement the ‘ZED’ culture in India based on the principles of Zero Defect & Zero Effect.
  • ZED principles include:
  1. Zero Defect: Zero non-conformance or non-compliance
  2. Zero Effect: Zero wastage, liquid discharge, solid waste; zero pollution

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Tribes in News

Tribes in news: Hattis of Himachal Pradesh

Prelims Only | Polity | Mains Paper 2: Indian Constitution - historical underpinnings, evolution, features, amendments, significant provisions and basic structure
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Hatti tribe and its culture

Mains level: Not Much

The Centre is set to consider the Himachal Pradesh government’s request for inclusion of the Hatti community in the list of Scheduled Tribes in the state.

Who are the Hattis?

  • The Hattis are a close-knit community who got their name from their tradition of selling homegrown vegetables, crops, meat and wool etc. at small markets called ‘haat’ in towns.
  • The Hatti community, whose men generally don a distinctive white headgear during ceremonies, is cut off from Sirmaur by two rivers called Giri and Tons.
  • Tons divides it from the Jaunsar Bawar area of Uttarakhand.
  • The Hattis who live in the trans-Giri area and Jaunsar Bawar in Uttarakhand were once part of the royal estate of Sirmaur until Jaunsar Bawar’s separation in 1815.
  • Due to topographical disadvantages, the Hattis living in the Kamrau, Sangrah, and Shilliai areas lag behind in education and employment.

Societal norms of Hattis

  • The Hattis are governed by a traditional council called Khumbli, which like the khaps of Haryana, decide community matters.
  • The Khumbli’s power has remained unchallenged despite the establishment of the panchayati raj system.
  • The two clans have similar traditions, and inter-marriages are commonplace.
  • There is a fairly rigid caste system among the Hattis — the Bhat and Khash are the upper castes, while the Badhois are below them.
  • Inter-caste marriages have traditionally remained a strict no-no.

Who are Paharis?

  • The proposal called for the inclusion of the “Paddari tribe”, “Koli” and “Gadda Brahman” communities to be included on the ST list of J&K.
  • The suggestion for the inclusion had come from the commission set up for socially and educationally backward classes in the UT.
  • The J&K delimitation commission has reserved six of the nine Assembly segments in the Pir Panjal Valley for STs.

Back2Basics: Scheduled Tribes

The above Article also provides for listing of scheduled tribes State/Union Territory wise and not on an all India basis.

  • The term ‘Scheduled Tribes’ first appeared in the Constitution of India.
  • Article 366 (25) defined scheduled tribes as “such tribes or tribal communities or parts of or groups within such tribes or tribal communities as are deemed under Article 342 to be Scheduled Tribes for the purposes of this constitution”.
  • Article 342 prescribes procedure to be followed in the matter of specification of scheduled tribes.

How are STs notified?

  • As per the current procedure, each proposal for the scheduling of a new community as ST has to originate from the relevant State Government.
  • It is then sent to the Ministry of Tribal Affairs, which sends it to the Office of the Registrar General of India (RGI).
  • Once approved by the Office of the RGI, it is sent to the National Commission for Scheduled Tribes (NCST), and only after its approval is it sent to the Cabinet.

Status of STs in India

  • The Census 2011 has revealed that there are said to be 705 ethnic groups notified as Scheduled Tribes (STs).
  • Over 10 crore Indians are notified as STs, of which 1.04 crore live in urban areas.
  • The STs constitute 8.6% of the population and 11.3% of the rural population.

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Primary and Secondary Education – RTE, Education Policy, SEQI, RMSA, Committee Reports, etc.

The post-pandemic world needs better public schools

op-ed snap | Governance | Mains Paper 2: Health & Education
Note4Students

From UPSC perspective, the following things are important :

Prelims level: RTE

Mains level: Paper 2- Importance of better public schools

Context

The pandemic has thrown a harsh light on the vulnerabilities and challenges faced by the world in education. There is an immense learning gap due to existing inequalities.

Need for investment in learning systems

  • In India, we have to accept that unless we mobilise learning resources and institutions at the government level, the divides will continue to expand and learners will continue to fall between the cracks.
  • Systems have to be put into place to find a variety of methods to equip all learners — privileged, poor, middle-class and alternatively-abled.
  •  The challenge is about returning to school.
  • In wealthier nations, schools have always been the first to open and last to close and citizens have benefited from the public school system.
  • In India, across states, there is a sense of despair due to unemployment and lack of financial resources, which has snowballed due to the pandemic, resulting in greater inequality.
  • Sending children to school, as opposed to keeping them at home, is a huge financial investment, particularly in the private school system.
  • Parents have refrained from sending their children back to school due to a lack of funds.

Viewing education through government school lens

  • The big shift that we as a nation have to make is viewing education through a government school lens.
  • This will only take place if states provide the opportunity for free, compulsory, neighbourhood education.
  • Radical reforms have to be implemented to restructure government schools and ensure quality.
  • The government, both at the Centre and in the states, should build good-quality primary, middle and high schools and provide facilities that the best private schools have to offer.
  • Online learning is not the way forward: We are subsumed by the myth that technology has expanded potential.
  • The concern is that online learning will create greater inequality, not only in the global South but even in the most well-resourced corners of the planet.
  • Online learning is not the way forward.
  • The UNESCO’s International Commission on the Futures of Education states in its report, “the core commitments that should always be remembered are public education and common good”.
  • It says, “This is not the time to step back and weaken these principles but rather to affirm and reinforce them.”
  • We must take the opportunity to protect and advance public education.
  • We cannot allow the government health system and government education to be opposed to one another. Their synergies must overlap

Conclusion

Public education is crucial to societies, communities and individual lives. It is the only thing that will enable us to live with dignity and purpose.

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Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc

Tackling the inflation

op-ed snap | Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Core inflation

Mains level: Paper 3- Inflation challenge

Context

Expectations that commodity and oil prices would cool down in 2022 as the pandemic ebbed were belied by the Russia-Ukraine conflict, which exacerbated existing pressures. Fresh lockdowns in China are also extending the pandemic-induced supply-chain bottlenecks.

Challenges for central banks

  • Systemically important central banks that viewed the consistent uptick in inflation as transitory — caused by post-pandemic supply shocks — are now finding it hard to bottle the genie.
  • Inflation in the time of weak growth: What central banks like even less is having to deal with rising inflation in times of weak growth.
  • Because the primary tool they have to fight it — the interest rate hike — can be recessionary.

Inflation in India

  • CPI inflation averaged 6.3 per cent in the January-March 2022, above the RBI’s target range of 2-6 per cent.
  • The RBI forecasts inflation for April-June at 6.3 per cent.
  • One more quarter over the 6 per cent mark, and the central bank would owe the government an explanation.
  • Factors driving inflation: Fiscal 2021-In fiscal 2021, inflationary pressures came largely from food and, to some extent, core which excludes fuel and food.
  • Fiscal 2022- In fiscal 2022, crude prices hardened to emerge as the new driver. Core inflation firmed up further.
  • But the drop in food inflation offset this, so overall inflation was lower at 5.5 per cent compared with 6.2 per cent the previous year.

Understanding inflation in fiscal 2023

  • What makes this fiscal worrying is, all three-fule, food and core are firmly pointing in the same direction — up.
  • Fuel inflation, in double digits for a year now, shows no signs of easing.
  • Energy prices have risen sharply across the board — from crude oil to coal and natural gas.
  • The cut in excise duties on petrol and diesel in November 2021 is insufficient to bring down fuel inflation, in the event crude prices stay above $90 per barrel this fiscal.
  • Food inflation: Food is the most volatile component and biggest mover of CPI inflation, given that it occupies 39 per cent weight in the average consumption basket.  
  • On the positive side, India looks set to enjoy a fourth successive year of normal monsoon and still has good buffer stocks of rice and wheat.
  • What is certain, though, is the rising cost of food production.
  • Prices of fertilisers, pesticides, diesel and animal feed are all surging.
  • Already pricey edible oils are set to get even costlier, with Indonesia’s recent ban on refined palm oil exports adding pressure.
  • No wonder then, food inflation is expected to rise.
  • Core inflation: Core inflation, a barometer of demand pressures, will continue to climb despite an environment of weak demand due to the persistence of supply shocks.
  • For producers, the bump-up in international prices across energy and metal commodities since the war has brought more pain.
  • But a weak and uneven demand recovery means producers had limited ability to pass on cost pressures to consumers.
  • Such pass-through has been partial, at best.
  • For most goods, CPI inflation has been much lower than the corresponding WPI last fiscal.
  • The pattern of recovery is also uneven across different segments, with contact-intensive services lagging formal manufacturing.
  • But contact-based services will catch up sooner or later, as restrictions become a thing of the past.
  • The last time we saw such broad-basing of inflationary pressures was after the Global Financial Crisis.
  • The difference this time around is consumer demand, which remains weak and will limit the extent of pass-through.

Conclusion

Forecasting inflation in such uncertain times is fraught with risk. The RBI has predicted ~5.7 per cent consumer inflation this fiscal, while professional forecasters see it at 5.6 per cent. The odds currently favour a higher inflation print, and a rate hike in June.

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Foreign Policy Watch: India-Pakistan

In news: Balochistan Freedom Movement

| International Relations | Mains Paper 2: India & Its Neighborhood - Relations
Note4Students

From UPSC perspective, the following things are important :

Prelims level: NA

Mains level: Baloch Freedom Movement

The Baloch Liberation Army (BLA), one of the most prominent militant groups operating against Pakistani, has claimed a suicidal attack on Chinese citizens in Karachi.

Who are the BLA fighters?

  • The BLA announced itself in 2005 with a rocket attack on a paramilitary camp in Balochistan Kohlu during a visit by then President Pervez Musharraf.
  • It is a nationalist militant group that has been waging an insurgency for Baloch self-determination and a separate homeland for the Baloch people.

Rise of Baloch nationalism

  • While the BLA’s armed insurgency is about two decades old, demands of Baloch nationalists for political autonomy and threats of secession date back to 1947.
  • The Khan of Kalat (who claimed sovereignty over the four princely states of Kalat, Lasbela, Kharan and Makran) held out for independence, and the Pakistan Army forced his accession in March 1948.
  • Between 1973 and 1977, the Zulfikar Ali Bhutto-led government sent in the Pakistan Army to crush a leftist guerilla war inspired by the liberation of Bangladesh.
  • The tribal sardars of Balochistan, who had been at the forefront of Baloch nationalism, and were co-opted by the state in the late 1970s, grew rebellious again.
  • The insurgency gathered momentum from 2006, after the Pakistan Army killed the Bugti sardar, Nawab Akbar Khan Bugti, who had been also been a chief minister and governor of the province.

Why it is gaining momentum now?

  • The Pakistan Army’s operations against Baloch nationalists over the last two decades have seen hundreds of disappearances, and other alleged human rights violations.
  • Baloch nationalists also see the sudden influx of jihadist groups in the province as a move by the Pakistan security establishment to counter their nationalist demands.
  • In 2012, the US Congress convened a hearing on Balochistan and supported the demand for a free Baloch land.
  • In a significant shift in policy, back then in 2016, PM Modi had made a reference to the Baloch freedom struggle in his Independence Day speech.

Why Balochistan matters?

  • Balochistan borders Afghanistan and Iran.
  • The people are mostly tribal with secular principles and are admirers of ties with India.
  • With gas, oil, copper and gold deposits, it is the most resource-rich of Pakistan’s four provinces.
  • It makes up half of Pakistan’s area, but has only 3.6% of its population.
  • Pakistan alleges that the insurgency is backed by India.
  • This is the region where a former Indian Navy officer Kulbhushan Jadhav was abducted from Iran and charged for espionage supporting Baloch activism in Pakistan.
  • Many Baloch activists had been seeking asylum and has applied for Indian citizenship. New Delhi neither confirmed nor deny the reports.

Why did BLA target the Chinese now?

  • The BLA claimed it attacks Chinese nationals because Beijing ignored warnings not to enter deals and agreements regarding Balochistan before the province had been “liberated”.
  • Baloch people see China-Pakistan Economic Corridor (CPEC) as neo-colonist move against their sovereignty.
  • Among China’s major projects in Balochistan is the port of Gwadar, strategically located near the Strait of Hormuz – a crucial oil shipping route in the Arabian Sea.
  • The security of its nationals in Pakistan has become a major issue for Beijing, especially since it launched the CPEC.
  • Such attacks has literally stalled the work in progress of CPEC projects making it a sheer failure.

Significance of recent events

  • It is rare that the BLA deployed female suicide bombers. Recent attack was done by a highly educated lady and mother of two.
  • This is also the first time that a non-jihadist ethno-nationalist group has deployed a woman suicide bomber in the manner of Sri Lanka’s LTTE.
  • According to security experts familiar with the Baloch insurgency, it marks a worsening security situation in Pakistan.
  • As the training camps are alleged by Pakistan to be in Afghanistan, the incident may also be a pointer to Pakistan’s loss of control over the Talibans.

 

 

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Labour, Jobs and Employment – Harmonization of labour laws, gender gap, unemployment, etc.

State of (un)employment in India

DOMR | Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Labour force participation rate (LFPR)

Mains level: Unemployment in India

Data from the Centre for Monitoring Indian Economy (CMIE) shows that India’s labour force participation rate (LFPR) has fallen to just 40% from an already low 47% in 2016.

What is LFPR?

  • Before understanding LFPR, we need to define the labour force itself.
  • According to the CMIE, the labour force consists of persons who are of age 15 years or older, and belong to either of the following two categories:
  1. are employed
  2. are unemployed and are willing to work and are actively looking for a job
  • There is a crucial commonality between the two categories — they both have people “demanding” jobs.
  • This demand is what LFPR refers to. While those in category 1 succeed in getting a job, those in category 2 fail to do so.
  • Thus, the LFPR essentially is the percentage of the working-age (15 years or older) population that is asking for a job; it represents the “demand” for jobs in an economy.
  • It includes those who are employed and those who are unemployed.
  • The Unemployment Rate (UER), which is routinely quoted in the news, is nothing but the number of unemployed (category 2) as a proportion of the labour force.

What is the significance of LFPR in India?

  • Typically, it is expected that the LFPR will remain largely stable.
  • As such, any analysis of unemployment in an economy can be done just by looking at the UER.
  • But, in India, the LFPR is not only lower than in the rest of the world but also falling. This, in turn, affects the UER because LFPR is the base (the denominator) on which UER is calculated.
  • The world over, LFPR is around 60%. In India, it has been sliding over the last 10 years and has shrunk from 47% in 2016 to just 40% as of December 2021.
  • This shrinkage implies that merely looking at UER will under-report the stress of unemployment in India.
  • Recent trend suggests that not only that more than half of India’s population in the working-age group is deciding to sit out of the job market, but also that this proportion of people is increasing.

How is it under-reported?

  • Imagine that there are just 100 people in the working-age group but only 60 ask for jobs — that is, the LFPR is 60% — and of these 60 people, 6 did not get a job. This would imply a UER of 10%.
  • Now imagine a scenario when the LFPR has fallen to 40% and, as such, only 40 people are demanding work. And of these 40, only 2 people fail to get a job.
  • The UER would have fallen to 5% and it might appear that the economy is doing better on the jobs front but the truth is starkly different.
  • The truth is that beyond the 2 who are unemployed, a total of 20 people have stopped demanding work.
  • Typically, this happens when people in the working-age get disheartened from not finding work.

So, what is the correct way to assess India’s unemployment stress?

  • When LFPR is falling as steadily and as sharply as it has done in India’s case, it is better to track another variable: the Employment Rate (ER).
  • The ER refers to the total number of employed people as a percentage of the working-age population.
  • By using the working-age population as the base and looking at the number of people with jobs, the ER captures the fall in LFPR to better represent the stress in the labour market.

ER trends in India

  • If one looks at the ER data (Chart 1), it becomes clear that while India’s working-age population has been increasing each year, the percentage of people with jobs has been coming down sharply.
  • Looking at the absolute numbers makes the stress even more clear.
  • In December 2021, India had 107.9 crore people in the working age group and of these, only 40.4 crore had a job (an ER of 37.4%).
  • Compare this with December 2016 when India had 95.9 crore in the working-age group and 41.2 crore with jobs (ER 43%).
  • In five years, while the total working-age population has gone up by 12 crore, the number of people with jobs has gone down by 80 lakh.

Why is India’s LFPR so low?

  • The main reason for India’s LFPR being low is the abysmally low level of female LFPR.
  • According to CMIE data, as of December 2021, while the male LFPR was 67.4%, the female LFPR was as low as 9.4%.
  • In other words, less than one in 10 working-age women in India are even demanding work.
  • Even if one sources data from the World Bank, India’s female labour force participation rate is around 25% when the global average is 47%.

Why do so few women demand work?

  • One reason is essentially about the working conditions — such as law and order, efficient public transportation, violence against women, societal norms etc — being far from conducive for women to seek work.
  • The other has to do with correctly measuring women’s contribution to the economy.
  • There are methodological issues in formally capturing women’s contribution to the economy since a lot of women in India are exclusively involved within their own homes.
  • Lastly, it is also a question of adequate job opportunities for women.

How do people who leave the labour force survive?

  • Households with more than one working member often witness this phenomenon.
  • The fall in the LFPR since 2016 has been accompanied by a fall in the proportion of households where more than one person is employed.
  • The fall in LFPR has largely been the result of the additional person employed in a typical household losing a job.

 

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Freedom of Speech – Defamation, Sedition, etc.

SC Ruling on Sedition Law

SC Judgements | Polity | Mains Paper 2: Indian Constitution - historical underpinnings, evolution, features, amendments, significant provisions and basic structure
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Section 124A IPC

Mains level: Sedition law and Free speech

The Supreme Court has fixed May 5 for final hearing of the petitions challenging the constitutionality of the sedition law and made it clear that it will not brook any delay in the form of requests for adjournment.

What is the Sedition Law?

  • Section 124A of the Indian Penal Code lays down the punishment for sedition. The IPC was enacted in 1860, under the British Raj.
  • The then British government in India feared that religious preachers on the Indian subcontinent would wage a war against the government.
  • Particularly after the successful suppression of the Wahabi/Waliullah Movement by the British, the need was felt for such law.
  • Throughout the Raj, this section was used to suppress activists in favor of national independence, including Tilak and Mahatma Gandhi, both of whom were found guilty and imprisoned.

What is Sedition?

  • The Section 124A defines sedition as:

An offence committed when “any person by words, either spoken or written, or by signs, or by visible representation, or otherwise, brings or attempts to bring into hatred or contempt, or excites or attempts to excite disaffection towards the government established by law in India”.

  • Disaffection includes disloyalty and all feelings of enmity.
  • However, comments without exciting or attempting to excite hatred, contempt or disaffection, will not constitute an offense.
  • Sedition is a non-bailable offense.
  • Punishment under Section 124A ranges from imprisonment up to three years to a life term with/without a fine.

Sedition as a cognizable offense

  • Sedition was made a cognizable offense for the first time in history in India during the tenure of Prime Minister Indira Gandhi in 1973, that is, arrest without a warrant was now permissible.
  • In 1962 the Supreme Court of India interpreted the section to apply only if there is, say, “incitement to violence” or “overthrowing a democratically elected government through violent means”.

Is it constitutionally valid?

  • Violative of FRs: Two high courts had found it unconstitutional after Independence, as it violated the freedom of speech and expression.
  • Reasonable restrictions: The Constitution was amended to include ‘public order’ as one of the ‘reasonable restrictions’ on which free speech could be abridged by law.
  • Kedar Nath Case: Thereafter, the Supreme Court, in Kedar Nath Singh v. State of Bihar (1962) upheld its validity.
  • Limited use: At the same time, it limited its application to acts that involve “intention or tendency to create disorder” or incitement to violence.
  • Strong criticism doesn’t amount to sedition: Thus, even strongly worded remarks, as long as they do not excite disloyalty and enmity, or incite violence, are not an offence under this section.

Why the controversy now?

  • Frequent use: In recent times, the resort to this section is seen as disturbingly frequent.
  • Curbing dissent: Activists, cartoonists and intellectuals have been arrested under this section, drawing criticism from liberals that it is being used to suppress dissent and silence critics.
  • Misuse for propaganda: Authorities and the police who invoke this section defend the measure as a necessary step to prevent public disorder and anti-national activities.
  • Irrelevance: Many of them have also been detained under the National Security Act and UAPA.

What is being debated about it?

  • Demand for its scrapping: Liberals and rights activists have been demanding the scrapping of Section 124A.
  • Provision is outdated: It is argued that the provision is “overbroad”, i.e., it defines the offence in wide terms threatening the liberty of citizens.
  • Various calls for its reconsideration: The Law Commission has also called for a reconsideration of the section.
  • Tyranny of the law: It has pointed that Britain abolished it more than a decade ago and raised the question of whether a provision introduced by the British to put down the freedom struggle should continue to be law in India.
  • Doctrine of severability: Some argue that a presumption of constitutionality does not apply to pre-constitutional laws as those laws have been made by foreign legislature or bodies.

Way forward

  • India is the largest democracy in the world and the right to free speech and expression is an essential ingredient of democracy.
  • The sedition law should not be abolished as some measures are needed to check communal violence & insurgency activities like Naxals.
  • The definition of sedition should be narrowed down, to include only the issues pertaining to the territorial integrity of India as well as the sovereignty of the country.
  • Section 124A should not be misused as a tool to curb free speech.

 

Try answering this PYQ:

Q.With reference to Rowlatt Satyagraha, which of the following statements is/are correct?

  1. The Rowlatt Act was based on the recommendations of the ‘Sedition Committee’.
  2. In Rowlatt Satyagraha, Gandhiji tried to utilize the Home Rule League.
  3. Demonstrations against the arrival of Simon Commission coincided with Rowlatt Satyagraha.

Select the correct answer using the code given below:

(a) 1 only

(b) 1 and 2 only

(c) 2 and 3 only

(d) 1, 2 and 3

 

Post your answers here.

Also read

[Burning Issue] Should sedition law be scrapped?

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Oil and Gas Sector – HELP, Open Acreage Policy, etc.

State Taxes on Fuels

| Economics | Mains Paper 3: Indian Economy
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Taxes on fuels

Mains level: Fuel price hikes and related inflation

PM has said that fuel prices were too high in some States ruled by other parties and they were not passing on the benefits of the Centre’s excise duty cut to the people.

Why are states reluctant?

  • The reluctance to reduce excise duty and VAT on fuel stems from the fact that it constitutes an important source of revenue for both the Union government and the states.
  • Excise duty on fuel makes up about 18.4 per cent of Centre’s gross tax revenues.
  • Petroleum and alcohol, on an average, account for 25-35 per cent of the own tax revenue of states

Present taxation of Fuels

What is Excise Duty?

  • Excise duty is a form of tax imposed on goods for their production, licensing and sale.
  • It is the opposite of Customs duty in sense that it applies to goods manufactured domestically in the country, while Customs is levied on those coming from outside of the country.
  • At the central level, excise duty earlier used to be levied as Central Excise Duty, Additional Excise Duty, etc.
  • Excise duty was levied on manufactured goods and levied at the time of removal of goods, while GST is levied on the supply of goods and services.

Purview of excise duty

  • The GST introduction in July 2017 subsumed many types of excise duty.
  • Today, excise duty applies only on petroleum and liquor.
  • Alcohol does not come under the purview of GST as exclusion mandated by constitutional provision.
  • States levy taxes on alcohol according to the same practice as was prevalent before the rollout of GST.
  • After GST was introduced, excise duty was replaced by central GST because excise was levied by the central government.
  • The revenue generated from CGST goes to the central government.

Types of excise duty in India

Before GST, there were three kinds of excise duties in India.

(1) Basic Excise Duty

  • Basic excise duty is also known as the Central Value Added Tax (CENVAT).
  • This category of excise duty was levied on goods that were classified under the first schedule of the Central Excise Tariff Act, 1985.
  • This duty applied on all goods except salt.

(2) Additional Excise Duty

  • Additional excise duty was levied on goods of high importance, under the Additional Excise under Additional Duties of Excise (Goods of Special Importance) Act, 1957.
  • This duty was levied on some special category of goods.

(3) Special Excise Duty

  • This type of excise duty was levied on special goods classified under the Second Schedule to the Central Excise Tariff Act, 1985.
  • Presently the central excise duty comprises of a Basic Excise Duty, Special Additional Excise Duty and Additional Excise Duty (Road and Infrastructure Cess) on auto fuels.

Present taxation of Fuels

  • Currently, taxes on petroleum products are levied by both the Centre and the states.
  • While the Centre levies excise duty, states levy value-added tax (VAT).
  • For instance, VAT on petroleum products is as high as 40% in Maharashtra, contributing over ₹25,000 crores annually.
  • By being able to levy VAT on these products, the state governments have control over their revenues.
  • When a national GST subsumed central taxes such as excise duty and state levies like VAT on July 1, 2017, five petroleum goods – petrol, diesel, ATF, natural gas and crude oil – were kept out of its purview.

 

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Fertilizer Sector reforms – NBS, bio-fertilizers, Neem coating, etc.

Centre enhances Subsidy for Non-Urea Fertilizers

| Economics | Mains Paper 3: Agriculture and related issues
Note4Students

From UPSC perspective, the following things are important :

Prelims level: Fertilizers subsidy

Mains level: Read the attached story

With urea and fertilizer prices shooting up in the wake of Russia’s invasion of Ukraine, the Union Cabinet approved an enhancement in subsidies on non-urea fertilisers for the upcoming Kharif crop, to ₹60,939 crore.

What is the news?

  • The government fixes the retail price of urea and subsidises producers based on the difference between costs and the fixed selling price.
  • It pays a subsidy to non-urea fertiliser makers on the basis of nutrient-based rates.
  • The increase in the prices of Di-ammonium phosphate (DAP) and its raw material is in the range of about 80%.

Fertilizer Subsidy in India

  • Subsidy as a concept originated during the Green Revolution of the 1970s-80s.
  • Fertiliser subsidy is purchasing by the farmer at a price below MRP (Maximum Retail Price), that is, below the usual demand-and-supply-rate, or regular production and import cost.

How is the subsidy paid and who gets it?

  • The subsidy goes to fertiliser companies, although its ultimate beneficiary is the farmer who pays MRPs less than the market-determined rates.
  • From March 2018, a new so-called direct benefit transfer (DBT) system was introduced, wherein subsidy payment to the companies would happen only after actual sales to farmers by retailers.
  • With the DBT system, each retailer — there is over 2.3 lakh of them across India — now has a point-of-sale (PoS) machine linked to the Department of Fertilizers’ e-Urvarak DBT portal.

How does this system work?

  • A popular example of how this system works is that of the neem coated urea fertiliser.
  • Its MRP (Maximum Retail Price) is fixed by the government at Rs. 5922.22 per tonne.
  • The average cost of domestic production is at Rs 17,000 per tonne. The difference is footed by the centre in the form of subsidy.
  • This fertiliser has high Nitrogen content and is cheaper than usual fertilizers.
  • While this may be perceived as a good thing, excess of Nitrogen can disrupt the NPK (Nitrogen, Phosphorus and Potassium) balance in the soil.

What about non-urea fertilizers?

  • The non-urea fertiliser is decontrolled or fixed by the companies.
  • The non- urea fertilizers are further divided into two parts, DAP (Diammonium Phosphate) and MOP (Muriate of Phosphate).
  • The government pays a flat per tonne subsidy to maintain the nutrition content of the soil, and ensure other fertilizers are economical to use.

Issues with such subsidies

  • A flawed subsidy policy is harmful not just for the farmer, but to the environment as well.
  • Indian soil has low Nitrogen use efficiency, which is the main constituent of Urea.
  • Consequently, excess usage contaminates groundwater.
  • The bulk of urea applied to the soil is lost as NH3 (Ammonia) and Nitrogen Oxides. The WHO has prescribed limits been breached by Punjab, Haryana and Rajasthan.
  • For human beings, “blue baby syndrome” is a common side ailment caused by Nitrate contaminated water.

Try answering this PYQ:

Q.What are the advantages of fertigation in agriculture? (CSP 2020)

1.Controlling the alkalinity of irrigation water is possible.
2. Efficient application of Rock Phosphate and all other phosphatic fertilizers is possible.
3. Increased availability of nutrients to plants is possible.
4. Reduction in the leaching of chemical nutrients is possible.

Select the correct answer using the code given below:
(a) 1, 2 and 3 only

(b) 1,2 and 4 only

(c) 1,3 and 4 only

(d) 2, 3 and 4 only

 

Post your answers here.

 

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