Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 3- Significance of quarterly GDP estimates and revision.
Context
As the third-quarter GDP was marginally higher than the second-quarter figure of 4.5% many concluded that the economic slowdown witnessed during the last six quarters has “bottomed out”. Has it?
What closer examination of data reveal?
- Estimates revised upwards: A closer reading reveals that the latest data release has revised the estimates of the first two quarters of the current year (2019-2020) upwards to 5.6% and 5.1%, from the earlier figures of 5% and 4.5%, respectively.
- What the revision mean? The upward revisions have, perhaps unwittingly, changed the interpretation of the current year’s Q3 estimate: the slowdown has continued, not bottomed out; hence, there is no economic revival in sight as of now.
Competing views of the performance
- The question therefore is why did the current year’s Q1 and Q2 GDP estimates get revised upwards?
- The answer is this was simply because the corresponding figures for the previous year (2018-2019) got revised downwards.
- The question over the revision process: Many viewed the revision of last year’s estimates as evidence of lack of credibility of the NSO’s revision process.
- Questions over the veracity of data: Such doubts are well taken, given the long-standing debate and unresolved disputes on the veracity of GDP figures put out since 2015, when the statistical office released the new series of National Accounts with 2011-2012 as base year.
Why the GDP estimates undergo revisions?
- Lags in data: As there are lags and unanticipated delays in obtaining the primary data, the GDP estimates undergo several revisions everywhere (except in China).
- GDP is a statistical construct, prepared using many bits of quantitative information on an economy’s production, consumption and incomes.
- How frequently is data revised? GDP estimates are revised five times in India over nearly three years.
- The initial two rounds, the advanced estimates, are prepared mainly using high-frequency proxy indicators followed by three rounds based on data obtained from various sectors.
Quarterly GDP estimates and issues with it
- Since 1999, quarterly GDP estimates are being prepared, as per the International Monetary Fund (IMF)’s data dissemination standards.
- Subpar quality: Their quality is subpar as the primary data needed quarterly are mostly lacking.
- Why quality is subpar? Nearly one-half of India’s GDP originates in the unorganised sector (including agriculture), whose output is not easily amenable to direct estimation every quarter, given the informal nature of production and employment.
- Hence, the estimates are obtained as ratios, proportions and projections of the annual GDP estimates.
- Quarterly estimates are extrapolations: In general terms, quarterly estimates of GDP are extrapolations of annual series of GDP. The estimates of GVA by industry are compiled by extrapolating value of output or value-added with relevant indicators.
Way forward
- Little ground to question the present revisions: There were considerable variations at the sectoral estimates after the revision, which probably contained more noise than information. For now, there is little ground to question the revised estimates based on the publicly available information.
- Slowdown not bottomed out: If we accept the latest data, it is clear, though in an alarming way, that there has been an undeniable decline in the GDP growth rate over seven consecutive quarters, from 7.1% in Q1 of 2018-2019 to 4.7% in Q3 of 2019-2020.
- Considering that physical indicators of production, such as the official index of infrastructure output, or monthly automotive sales, continue to show an unambiguous deceleration, the economic slowdown has apparently not bottomed-out.
- More seriously, the quarterly GDP deceleration comes over and above the annual GDP growth slowdown for four years now: from 8.3% in 2016-17 to 5% in 2019-20 (as per the second advance estimate).
- Limited primary information: India’s quarterly GDP estimates have limited primary information in them. Their revisions are largely extrapolations and projections of the annual figures. Hence, one should be cautious in reading too much into the specific numbers.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 3- Revision and estimates of GDP data.
Context
The latest GDP data witnessed significant revisions that have gone largely unnoticed.
The GDP data revision and its criticism
- Revisions an act of due diligence: In the last few years there has been a lot of noise regarding the data revisions.
- The need for closer examination: While part of revision requires closer examination, we must be fair to our statistical system as such revisions are, in large part, due diligence and happen globally.
- Schedule of NSO estimates
- First estimate: The NSO releases the first estimates of any fiscal year in January.
- Revises the January’s first estimates in February.
- And then again in May.
- Simultaneous revision in February: Simultaneously, it revises the previous year estimates in February, alongside the February data release.
- Suspicion of statistically protecting the 5% growth: The primary criticism, with the current year’s fiscal data, is that the revisions in February for 2019-20 and the 4th revision in 2018-19 are almost identical, implying that the sanctity of 5 per cent growth was statistically protected.
Examining the criticism purely on the data
- Precedence of 1st and 2nd quarter revision: There is precedence to the first and second quarter revisions for the current financial year that happen in February.
- For example, while in the current fiscal, the cumulative downward revision was close to Rs 30,000 crore.
- In FY19, there was even a greater upward revision of roughly Rs 86,000 crore in February.
- Is there precedence of such large first-time revisions? Yes, there has been since 2014-15. In 2018-19, the first-time data was revised by a sharp Rs 1.43 lakh crore, while in 2017-18, it was revised by an even larger Rs 1.69 lakh crore.
- Revision in the same direction: The simultaneous revisions are mostly in the same direction, though different in magnitude, and hence it is unfair to say that the 2018-19 data was revised downwards to protect the 2019-20 numbers.
What was the problem?
- Uncertainty: The problem has been that the global and domestic uncertainties in 2017-18 and 2018-19 have been so swift that it has been virtually impossible to predict the outcome initially.
- While in 2017-18, the final estimates were progressively higher.
- In 2018-19, while the interim estimates were higher, they were drastically scaled-down later as the impact of the NBFC crisis began to unfold.
- The US example: The US Fed had also missed the possibility of the US economy bouncing back in 2018 on the back of tax cuts when in 2015 it had projected the economy to expand by only 2 per cent, only to change it to 3 per cent in 2018 (almost at par with scale of revisions in India).
Why such unconditional biases arise?
- Asymmetric loss function: It is common for such unconditional bias to arise due to the fact that the statistical reporting agency produces releases according to an asymmetric loss function.
- For example, there may be a preference for an optimistic/pessimistic release in the first stage, followed by a more pessimistic/optimistic one in the later stage.
- Cost factor: Intuitively, one might argue that the cost of a downward readjustment of the preliminary data is higher than the cost of an upward adjustment.
- This asymmetric loss function is not so relevant at the reporting stage but at the forecasting stage.
- Interpreting the data revision: A statistical reporting agency like the NSO simply does not have all the data at hand and has to forecast the values of the yet to be collecting data.
- It is at that moment that the asymmetric loss function comes into play.
- So, we must be careful about interpreting data revisions by the NSO by attributing ulterior motives as we more often tend to do.
India lagging in the use of data analysis
- Unlike countries across the world, India is still significantly lagging in its use of data analysis.
- Methodologies based on thin surveys: Some of the current methodologies of data collection is based mostly on thin surveys.
- Not supported by the data in public domain: It is also not supported by data available in the public domain that are more comprehensive, less biased and real-time in nature, based on digital footprints.
- The end result is that we end up publishing survey results that are misleading.
Way forward
- Development of big data and AI bases ecosystem: We must develop an ecosystem that is high quality, timely and accessible.
- Big data and artificial intelligence are key elements in such a process.
- Big data helps acquire real-time information at a granular level and makes data more accessible, scalable and fine-tuned.
- Use of payment data: The use of payments data can also help track economic activity, as is being done in Italy.
- Different aggregates of the payment system in Italy, jointly with other indicators, are usually adopted in GDP forecasting and can provide additional information content.
Conclusion
To be fair to both the RBI and the NSO, the volatility of oil prices and structural changes in the economy make the forecasting of inflation and GDP a difficult job indeed. However, we should supplement our existing measurement practices with “big data” to make our statistical system more comprehensive and robust.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Solar Cycle, Sunspots, Solar Dynamo
Mains level: Read the attached story
The sunspots identified by researchers from IISER Kolkata herald the start of a new solar cycle called Cycle 25.
What are Sunspots?
- Sunspots are temporary phenomena on the Sun’s photosphere that appear as spots darker than the surrounding areas. They are relatively cooler spots on the Sun’s surface.
- They are regions of reduced surface temperature caused by concentrations of magnetic field flux that inhibit convection.
- Sunspots usually appear in pairs of opposite magnetic polarity with a leader and a follower.
What is Solar Cycle?
- From our safe distance of about 148 million km, the Sun appears to be sedate and constant. However, huge solar flares and coronal mass ejections spew material from its surface into outer space.
- They originate from sunspots, an important phenomenon that people have been following for hundreds of years. They originate deep within the Sun and become visible when they pop out.
- Their number is not constant but shows a minimum and then rises up to a maximum and then falls again in what is called the solar cycle.
- Every 11 years or so, the Sun’s magnetic field completely flips. This means that the Sun’s north and south poles switch places. Then it takes about another 11 years for the Sun’s north and south poles to flip back again.
- So far, astronomers have documented 24 such cycles, the last one ended in 2019.
How do they occur?
- Given the high temperatures in the Sun, matter exists there in the form of plasma, where the electrons are stripped away from the nuclei.
- The Sun is made of hot ionized plasma whose motions generate magnetic fields in the solar interior by harnessing the energy of the plasma flows.
- This mechanism is known as the solar dynamo mechanism (or magnetohydrodynamic dynamo mechanism).
- Simply stated, it is a process by which kinetic energy of plasma motions is converted to magnetic energy, which generates the magnetised sunspots, giving rise to the solar cycle..
- Because of the nature of the solar dynamo, the part of its magnetic field that gives rise to sunspots reverses direction when it moves from one solar cycle to another.
- This can be inferred by observing when the relative orientation of the sunspot pairs flips.
Features
- The solar cycle affects activity on the surface of the Sun, such as sunspots which are caused by the Sun’s magnetic fields. As the magnetic fields change, so does the amount of activity on the Sun’s surface.
- One way to track the solar cycle is by counting the number of sunspots.
- The beginning of a solar cycle is a solar minimum, or when the Sun has the least sunspots. Over time, solar activity—and the number of sunspots—increases.
- The middle of the solar cycle is the solar maximum, or when the Sun has the most sunspots. As the cycle ends, it fades back to the solar minimum and then a new cycle begins.
- Giant eruptions on the Sun, such as solar flares and coronal mass ejections, also increase during the solar cycle. These eruptions send powerful bursts of energy and material into space.
Impacts of Solar Cycle
- This activity has effects on Earth. For example, eruptions can cause lights in the sky, called aurora, or impact radio communications. Extreme eruptions can even affect electricity grids on Earth.
- Solar activity can affect satellite electronics and limit their lifetime.
- Radiation can be dangerous for astronauts who do work on the outside of the International Space Station.
- Forecasting of the solar cycle can help scientists protect our radio communications on Earth, and help keep satellites and astronauts safe.
Start of cycle 25
- Following a weakening trend in activity over the last few cycles, there were predictions that the Sun would go silent into a grand minimum in activity, with the disappearance of cycles.
- However, a team from IISER Kolkata has shown that there are signs that cycle 25 has just begun.
- They used the data from the instrument Helioseismic and Magnetic Imager aboard NASA’s space-based Solar Dynamics Observatory for their calculations.
Why is this so important to us on earth?
- After all the sunspots look small and are hardly even visible to us. Contrary to this, sunspot activity may be correlated with climate on earth.
- In the period between 1645 and 1715, sun spot activity had come to a halt on the Sun – a phenomenon referred to as the Maunder minimum.
- This coincided with extremely cold weather globally. So sunspots may have a relevance to climate on earth.
- Such links are tenuous, but definitely solar activity affects space weather, which can have an impact on space-based satellites, GPS, power grids and so on.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Role of RBI coping bank failures
Mains level: Read the attached story
On the advice of the Reserve Bank of India (RBI), the government imposed a moratorium on Yes Bank with effect from 6 p.m. on March 5 up to April 3. This has created a furore among the account holders of the bank.
What restrictions did RBI put?
- The RBI superseded the private sector lender’s board and appointed as an administrator.
- Under the moratorium, deposit withdrawals have been capped at ₹50,000.
- Within 24 hours, the RBI proposed a reconstruction scheme under which SBI could take a maximum 49% stake in the restructured capital of the bank.
Why was it imposed?
- The RBI cited a steady decline in Yes Bank’s financial position mainly due to the lender’s inability to raise adequate capital to make provisions for potential non-performing assets.
- This failing resulted in downgrades by credit rating agencies, which in turn made capital raising even more difficult — a vicious cycle that further worsened its financials.
- This apart there were serious lapses in corporate governance.
- The bank has also experienced serious governance issues and practices in the recent years which have led to steady decline of the bank.
When did it all start?
- As on March 31, 2014, the bank’s loan book was ₹55,633 crore and deposits were ₹74,192 crore.
- Since then the loan book expanded fourfold to ₹2,24,505 crore while deposit growth failed to keep pace and increased less than three times to ₹2,09,497 crore.
- Asset quality also worsened during the period with gross non-performing assets sharply rising from 0.31% as on March 31, 2014, to 7.39% at the end of September 2019.
- The exponential growth at Yes Bank during that period also came under the regulator’s scanner.
- The lender has substantial exposure to several troubled borrowers including the IL&FS.
What will be the likely impact on depositors?
- While deposit withdrawals have been capped at ₹50,000, there are exceptions under which a higher amount can be withdrawn, with the permission of the RBI.
- The RBI can allow a customer to withdraw more than ₹50,000 under the following conditions:
- in connection with the medical treatment of the depositor or any person actually dependent on the depositor;
- towards the cost of higher education of the depositor or any person actually dependent on him for education in India or outside India;
- to pay obligatory expenses in connection with marriage or other ceremonies of the depositor or his/her children or of any other person actually dependent upon depositor;
- or any other unavoidable emergency.
- The total withdrawal should, however, not exceed ₹5 lakh or the actual balance in the account, whichever is lower.
What about deposit insurance?
- In case Yes Bank goes belly up for any reason, depositors will not lose all their money since deposits up to ₹5 lakh are covered under deposit insurance.
- While the deposit insurance cover was ₹1 lakh till recently, this was increased to ₹5 lakh in the aftermath of the crisis at the Punjab and Maharashtra Cooperative (PMC) Bank Limited.
- Finance Minister has announced the increase in deposit insurance in this year’s Budget.
What do such bank failures imply?
- While the government and the regulator have asserted that the problem is solely related to this particular bank, the latest developments spotlight the governance risks in India’s banking sector.
- There is a risk that the already poor operating environment for the banking sector could suffer further impairment if the government’s efforts to tackle problems in the bank fail to provide reassurance to depositors and investors.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Right of an accused to be defended
Mains level: Professional ethics for Lawyers (Paper IV)
Recently the Karnataka High Court observed that it is unethical and illegal for lawyers to pass resolutions against representing accused in court. This is not the first time that bar associations have passed such resolutions, despite a Supreme Court ruling that these are “against all norms of the Constitution, the statute and professional ethics”.
What does the Constitution say about the right of an accused to be defended?
- Article 22(1) gives the fundamental right to every person not to be denied the right to be defended by a legal practitioner of his or her choice.
- Article 14 provides for equality before the law and equal protection of the laws within the territory of India.
- Article 39A, part of the DPSP, states that equal opportunity to secure justice must not be denied to any citizen by reason of economic or other disabilities, and provides for free legal aid.
What has the Supreme Court said about such resolutions by bar associations?
- The Supreme Court referred to writer Thomas Paine, who had been tried for treason in England in 1792.
- Thomas Erskine, Attorney General for the Prince of Wales, was warned of dismissal if he defended Paine, but still took up the brief, saying: “… If the advocate refuses to defend from what he may think of the charge or of the defence, he assumes the character of the Judge…”
- The Supreme Court cited other historical examples of accused being defended — revolutionaries against British rule; alleged assailants of Mahatma Gandhi and Indira Gandhi; Nazi war criminals at the Nuremberg trials.
A matter of professional ethics
- The Supreme Court ruled that such resolutions are wholly illegal, against all traditions of the bar and against professional ethics.
- Every person however wicked, criminal, perverted or repulsive he may be regarded by society has a right to be defended in a court of law and correspondingly and it is the duty of the lawyer to defend him.
- It said such resolutions were against all norms of the Constitution, the statute and professional ethics, called these a disgrace to the legal community, and declared them null and void.
How are the professional ethics of lawyers defined?
- The Bar Council of India has Rules on Professional Standards, part of the Standards of Professional Conduct and Etiquette to be followed by lawyers under the Advocates Act.
- An advocate is bound to accept any brief in the courts or tribunals, at a fee consistent with his standing at the Bar and the nature of the case.
- The Rules provide for a lawyer refusing to accept a particular brief in “special circumstances”.
- Last year, The Uttarakhand HC clarified that these special circumstances refer to an individual advocate who may choose not to appear in a particular case, but who cannot be prohibited from defending an accused by any threat of removal of his membership of the bar association.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not Much
Mains level: Need for electoral reforms
The Election Commission of India (ECI) is considering a series of new reforms proposed by working groups it set up in 2019. Some of them are:
- New voting methods,
- Capping the campaign expenditure of political parties,
- Online registration of new voters at 17 years and
- Ending social media campaigning 48 hours before polling among the recommendations
Various suggested reforms
Voters registration
- Among the recommendations being considered is replacing all the forms for various voter services, including registration of new voter and change of address, with one single form.
- Multiple numbers of forms create confusion and affect the efficiency in the process. It is now proposed to have a unified and simplified form for all services to voters.
- Another recommendation was to start online registration facilities at the school or college-level for all prospective voters at 17 years of age so they can be enrolled in the electoral roll as soon as they become eligible at 18.
- The ECI also recommended four cut-off dates in a year to enroll as a voter. Currently, January 1 is the qualifying date so those who turn 18 after that date are not eligible to vote the whole year.
- The ECI has proposed January 1, April 1, July 1 and October 1 as the qualifying dates, while the Law Ministry has suggested two dates — January 1 and July 1.
Electronic voter cards
- The ECI also proposed to give out electronic versions of the voter ID card — EPIC — for convenience of voters.
- Though not specifying the method, one of the recommendations was to look at the “possibility and feasibility of different voting methods”.
- The IIT-Madras was working on a prototype for an Aadhaar-linked remote voting system for the ECI.
- The Commission has already implemented one-way online transfer of postal ballots for service and implemented the same for the whole country in 2019.
- It has been seen that approximately 30% of electors are not able to participate in elections for various reasons.
- Some of them, as assessed in a report on facilities of domestic migrants may poll to the category of migrants who continue to remain voters at their previous locations.
Expenditure and campaigning
- For political parties, the recommendations included online nomination of candidates and a cap on the spending allowed by parties.
- Currently, individual candidates are allowed a limited expenditure on campaigning.
- Another recommendation was to impose a “silence period of 48 hours” before polling on social media and print media.
- Campaigning on electronic media in the last 48 hours before polling is prohibited currently.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: SAWEN, TRAFFIC, Red Panda
Mains level: Not Much
/cdn.vox-cdn.com/uploads/chorus_image/image/49388585/16071828377_85109fdee4_o.0.0.jpg)
According to a report by the TRAFFIC report, there has been a considerable reduction in the poaching of Red Panda (ailurus fulgens). The report also recommended trans-boundary law enforcement co-operation through the use of multi-government platforms like SAWEN (South Asia Wildlife Enforcement Network).
Red Panda
IUCN Red List Status: Endangered
- The red panda (Ailurus fulgens) is a mammal native to the eastern Himalayas and southwestern China.
- Its wild population is estimated at fewer than 10,000 mature individuals and continues to decline due to habitat loss and fragmentation, poaching, and inbreeding depression.
- Despite its name, it is not closely related to the giant panda
- The animal has been hunted for meat and fur, besides illegal capture for the pet trade.
- An estimated 14,500 animals are left in the wild across Nepal, Bhutan, India, China and Myanmar.
- About 5,000-6,000 red pandas are estimated to be present in four Indian states – Arunachal Pradesh, Meghalaya, Sikkim and West Bengal.
- The diminishing habitat is a major threat to the species which is a very selective feeder and survives on selected species of bamboos.
About South Asia Wildlife Enforcement Network (SAWEN)
- SAWEN is a Regional network is comprised of eight countries in South Asia: Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.
- It aims at working as a strong regional intergovernmental body for combating wildlife crime by attempting common goals and approaches for combating illegal trade in the region.
- The South Asia region is very vulnerable to illegal traffic and wildlife crimes due to the presence of precious biodiversity and large markets as well as traffic routes for wildlife products in the south East Asian region.
- The collaboration in harmonizing as well as enforcing the wildlife protection in the region is considered very important for effective conservation of such precious biodiversity.
- India adopted the Statute of the SAWEN and became its formal member in 2016.
Back2Basics
TRAFFIC
- The TRAFFIC, the Wildlife Trade Monitoring Network, is a leading non-governmental organisation working on wildlife trade in the context of both biodiversity conservation and sustainable development.
- It is a joint program of World Wildlife Fund (WWF) and the IUCN.
- It aims to ensure that trade in wild plants and animals is not a threat to the conservation of nature.
- The TRAFFIC is governed by the TRAFFIC Committee, a steering group composed of members of TRAFFIC’s partner organizations, WWF and IUCN.
- TRAFFIC also works in close co-operation with the Secretariat of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Marakkars
Mains level: Various conquests during colonial expansion
The big-budget Malayalam film Marakkar: The Lion of the Arabian Sea is set to be released. It is a war film depicting the heroics of the Marakkar clan, whose leaders were naval chieftains of the Zamorin of Calicut during the 16th and 17th centuries.
Who were the Marakkars?
- By some accounts, they were of Arab origin and had migrated from Tunisia to Panthalayani near Koyilandy in present-day Kozhikode, and later moved to the region around present-day Kottakkal and Thikkodi near Payyoli.
- By other accounts, the Marakkars were descendants of affluent businessman from the Cochin kingdom who migrated later to Calicut.
- Historians say the name ‘Marakkar’ could have originated from maram or marakkalam, meaning ship, as these families lived along the coast and used ships.
- Alternatively, it could have originated from the Arabic word markaba, meaning those who migrated via ships.
- The Marakkars were mostly Muslims, but in some parts, they have been found to be Hindus as well.
What was the war against the Portuguese about?
- The Zamorin, Samoothiri in Malayalam, was the title given to rulers of the Calicut kingdom on the Malabar coast.
- Faced with invading Portuguese ships, the Zamorin reached out to the Marakkars to defend the coast. The Marakkars fought against Portuguese invaders for nearly a century.
- They were led in succession by four Marakkars, chief admirals who were appointed by the Zamorin with the title of Kunjali.
- Related by bloodline, they were Kuttyali Marakkar (Kunjali Marakkar I, appointed in 1507), Kutty Pokker (Kunjali Marakkar II), Pathu Marakkar (Kunjali Marakkar III) and Muhammad Ali Marakkar (Kunjali Marakkar IV, appointed in 1595).
- Their strategy was similar to guerrilla warfare. The Portuguese had massive ships which could not make easy manoeuvres in the sea.
- The Marakkars used small ships which could easily surround the Portuguese ships, enabling the fighters to attack at will.
Who is depicted the ‘Lion of the Arabian Sea’?
- Kunjali Marakkar IV earned his reputation with his fierce onslaught on Portuguese ships, the favours he gave those who fought against the Portuguese, and his efforts to strengthen the fort at Kottakkal.
- When he took charge in 1595, relations between the Zamorin and the Marakkars were deteriorating.
- The Zamorin was feeling threatened by Kunjali Marakkar IV’s popularity, and by reports (said to be spread by the Portuguese) that he was planning to create a Muslim empire.
- In 1597, the Zamorin signed a peace treaty with the Portuguese and attacked Kottakkal fort. For months, the Marakkars resisted the attack by the Zamorin’s Nair soldiers and the Portuguese fleet.
- Eventually, as Portugal sent more forces and the Zamorin mounted his effort, Marakkar surrendered to the Zamorin on the assurance that their lives would be spared. But the Portuguese violated the terms, arrested him, took him to Goa and beheaded him.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 1- Empowerment of women is necessary to achieve the aim of $5 trillion economy.
The role of women in developing a knowledge economy
Context
Indian economic success requires scientific skills that can foster a knowledge economy, the emergence of which depends on how gender-balanced the workforce is.
Half the scientific potential squandered
- The requirement of the skilled workforce: A rapidly growing India requires a highly skilled technical workforce that is crucial for developing a knowledge economy.
- Unfortunately, half the scientific potential of India—women in science—is squandered.
- Women make up only 14% of the 280,000 scientists, engineers, and technologists in research and development institutions across the country, according to a recent study.
- Several barriers in careers: Today, fewer women apply for or hold key scientific positions as several barriers prevent them from progressing in their careers, in comparison with their male counterparts.
Several unacknowledged factors that disadvantage women
- There is widespread frustration experienced by women, who find it difficult if not impossible to fulfil their scientific potential.
- Even today, several factors that disadvantage women are not acknowledged widely enough.
- What are the difficulties faced by women: Peer-reviewed research reports have indicated that women-
- Scientists earn less.
- Have less prestige within departments.
- Have less lab space.
- Are offered inadequate jobs on graduating with science degrees and have more teaching responsibilities.
- They also face greater difficulty in receiving grants and therefore apply for fewer grants in the first place.
- Imperative to tackle issues: It is imperative to tackle these issues with vigour if India is to take its rightful place among developed nations.
Lack of informal networks
- Women tend to lack access to informal networks that provide opportunities to work in high-profile projects.
- Which include attending conferences abroad or on-the-job opportunities.
- How it affects them? They lack the work experience that would enable them to rise up the ranks and provide access to the wide range of developmental models that could build the credibility they need to advance.
Importance of mentor
- Performance assessment is now an integral part of an organization’s performance management systems, implemented as companies move away from the age-old concepts of training and skill development.
- How mentors matters? Mentors often help build confidence as well as professional identity in protégés and offer access to developmental opportunities, allowing individuals to demonstrate their ability and gain trust.
- Mentors keep information channels open and provide feedback on performance in crucial times.
- It has been noted that almost every successful woman has had a mentor at some time.
How organizations work culture matters?
- Unepathetic culture: Organizations often define success by the willingness of their employee to work for long hours and prioritize work over everything else—a “live to work” ideal, generally regarded as more masculine.
- Group membership as criteria leads to discrimination: When women feel selected or assessed on the basis of group membership rather than their work record and abilities, they experience gender discrimination.
- Women feel that an unempathetic culture is one of the most significant barriers to their advancement.
- Gender bias as a major career obstacle: A study highlighted that only 3% of women surveyed regarded family responsibilities as their most serious career obstacle, while 50% cited gender bias.
- Only 7% of female employees surveyed reported leaving the organization for family reasons, whereas 73% reported leaving because they saw limited opportunities.
- Quit rate: The quit rates for women were significantly lower in organizations that provided better training and promotion opportunities.
- The need for the employee-friendly policies: In recent years, we have witnessed an increase in the number of women with children who participate in the country’s paid workforce.
- An organization’s culture has a significant impact on those who work within it.
- Unfortunately, not many organizations have revised their work policies or employee expectations to enable women to strike a balance between their work and family responsibilities.
- Flexible policies: For instance, the internet and telecom revolutions have enabled organizations to introduce employee-friendly policies such as Flexi-work hours and work-from-home that have significantly transformed workplace practices.
Way forward
- Need for the realisation of the full potential of women: Science needs the best scientists, and a knowledge economy needs a gender-balanced workforce. This can only be attained by realizing the full potential of women.
- Reach out to young girls: Apart from being wasteful and unjust, the under-representation of women in science threatens the goal of achieving excellence in the field. To tackle this, we must set an ambitious target of reaching out to 1 million young girls each year and encourage them to take up science and make a difference.
- Convention of women: A national convention of women in science must be held annually, with a specific focus on discussing and building general awareness around the major challenges that women face.
Conclusion
We must mobilize all our resources if India aims to be a $5 trillion economy. The gender imbalance in science and technology is a looming challenge and threatens to weaken our country’s competitive economic position. By addressing these concerns, we can empower and motivate more women to join scientific fields, unlock India’s full potential, and develop the country to become a knowledge economy.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Read the attached story
Mains level: Issues in land acquisition and dispensing fair compensation
- The Supreme Court reaffirmed its February 2018 ruling on Section 24 on land acquisition compensation awards given by a three-judge bench led by Justice Arun Mishra in the Indore Development Authority.
- It also has overruled an earlier co-ordinate Bench ruling in the Pune Municipal Corporation case of 2014 under the Right to Fair Compensation and Transparency in the Act of 2013.
What is the provision and why it needed interpretation?
- The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act 2013 (2013 Act) replaced the Land Acquisition Act, 1894 (1894 Act).
- The new Act provides for higher compensation to those deprived of land by the government for both public and private sector projects.
- It also mandates consent of a majority of land-owners, and contains provisions for rehabilitation and resettlement.
- Under Section 24(2) land acquisition made under the old law of 1894 lapses if the award of compensation had been made five years before the new Act came into force, but has not been paid.
- In such cases, the process will have to be gone through afresh under the new Act, which mandates higher compensation.
Issue over compensation
- There are cases in which farmers and other land-owners have refused the compensation, leading to delay in the government taking possession.
- In this situation, the compensation amount is deposited in the government treasury. According to one interpretation, if this is done, the acquisition process is saved.
- Then again, others contend that such cases will fall under the new Act because compensation has not been paid to the land-owners, and the lapsing clause in Section 24 should be applied.
- If, through interpretation, a long-pending land acquisition process is closed under the old law and fresh acquisition proceedings started under the new one, the land-owners stand to benefit, but project proponents will have to pay higher compensation.
- Therefore, the provision concerned is often a subject of litigation.
What happened in the case before the Supreme Court?
- On January 24, 2014 the court ruled that the acquisition of a piece of land had “lapsed” because the compensation awarded had neither been paid to the landowners/persons interested nor deposited in the court.
- The deposit of the compensation amount in the government treasury was held to be “of no avail” as it was not equivalent to the compensation being “paid”.
- Based on this judgment, subsequent cases were decided on the same principle: acquisition that had taken place earlier than five years before the new Act commenced would lapse if compensation amount was not paid to the land-owners or, in cases in which the owners refused to accept compensation, deposited in court.
How was this precedent dealt with in another case in 2018?
- The same question arose in Indore Development Authority vs. Shailendra. Another Bench did not accept the earlier Bench’s view.
- On February 8, 2018, the majority, consisting of the first two judges, ruled that the acquisition would not lapse merely because the compensation amount was not deposited in court, but was instead deposited in the treasury.
- It ruled that the past practice of more than a century, under which the amount was deposited in the treasury, was not taken into account by the earlier Bench.
- Some provisions and orders that allowed this practice were not placed before that Bench. Further, the land acquisition in that particular case had been quashed by a High Court in 2008.
- Since it was not a subsisting process, the question under Section 24(2), whether the acquisition lapsed because of non-payment of compensation or non-deposit in the court, did not arise at all.
- On these grounds, Justice Mishra and Justice Goel overruled the earlier judgment and held that it was per incuriam, that is a verdict passed in disregard of law and, therefore, wrong.
What does the controversy mean for land-owners and project proponents?
- A ruling that old acquisitions lapse for non-deposit of compensation will be more beneficial to land-owners and farmers as they stand to get higher compensation and rehabilitation and resettlement measures.
- On the other hand, project proponents feel such an interpretation would mean that those who refused to take compensation, even after it had been fixed and the money deposited in the government treasury, would be taking advantage of their own wrong.
Present ruling
On Acquisition
- The provision said that in such cases if the physical possession has not been taken “or” the compensation is not paid, the acquisition proceeding is “deemed to have lapsed”.
- The court held that a land acquisition proceeding under Section 24(2) would only lapse if the authorities have neither taken physical possession nor paid the compensation due to the landowner for five or more years prior to January 1, 2014.
- For this an “or” in the Section was “interpreted” as an “and”.
- Further, the Bench held that Section 24(2) of the Act of 2013 does not give rise to a new cause of action to question the legality of concluded proceedings of land acquisition.
On compensation
- The government if it so wishes would have to initiate “fresh acquisition proceedings” under the new Act of 2013 which provides for “fair-compensation”.
- The judgment however said compensation would be considered paid if the amount is put in the Treasury.
- There was no obligation that the amount should be deposited in the court in order to sustain the land acquisition proceedings under the 2013 Act.
- Thus there is no lapse if possession has been taken and compensation has not been paid. Similarly, there is no lapse if compensation has been paid and possession not taken of the land.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: FCRA
Mains level: Issues with foreign funding
The Central government cannot brand an organisation ‘political’ and deprive it of its right to receive foreign funds for using “legitimate forms of dissent” like bandh, hartal, road roko or jail ‘bharo’ to aid a public cause, the Supreme Court held.
Why such Judgement?
- The verdict came on a petition filed by Indian Social Action Forum challenging certain provisions of the Foreign Contribution Regulation Act (FCRA), 2010 and the Foreign Contribution (Regulation) Rules of 2011.
- Both of these confer the Centre with “unguided and uncanalised power” to brand organisations ‘political’ and shut down their access to foreign funds.
- The FCRA 2010 prohibited acceptance and utilization of foreign contribution or foreign hospitality for any activities detrimental to the national interest, it the court said.
- The FCRA and its Rules allowed the government to indulge in its whims and fancies to deprive organisations of their foreign contributions.
- The terms used in the statute like ‘political objectives’, ‘political activities’, ‘political interests’ and ‘political action’ had no clarity.
Issues with FCRA
- The provisions under challenge before the court included Section 5 (1) of the FCRA.
- This provision allowed the Centre a free hand to decide whether a seemingly non-political organisation was actually political in nature. INSAF argued that Section 5(1) was vague and thus unconstitutional.
- The Delhi High Court, which INSAF approached first, said the provision was “expansive” and not vague. The Supreme Court agreed with the High Court.
- The next provision under the microscope was Section 5(4) of the FCRA.
- INSAF said the provision did not exactly identify the authority before which an organisation could represent its grievance. But the apex court dismissed this contention.
- INSAF had also challenged the various clauses of Rule 3 of the 2011 Rules. This provision identified the various types of ‘political’ activities for which/organisations whose foreign funding could be stopped by the government.
Foreign funds are permissible for non-political organizations
- Any organisation which supports the cause of a group of citizens agitating for their rights without a political goal or objective cannot be penalized by being declared as an organisation of a political nature.
- But the foreign funding pipeline could be cut if an organisation took recourse to these forms of protest to score a political goal, the court said.
- It struck a similar balance in the cases of organisations of farmers, workers, students, youth based on caste, community, religion, language, etc.
- It said their foreign funding could continue as long as these organisations worked for the “social and political welfare of society” and not to further “political interests”.
What about Political Organizations?
- The court wholesomely agreed that organisations with avowed political objectives in its memorandum of association or bye laws cannot be permitted access to foreign funds.
- Such organisations were clearly of a “political nature,” it concluded.
Why regulate foreign funding?
- The purpose for which the statute prevents organisations of a political nature from receiving foreign funds is to ensure that the administration is not influenced by foreign funds.
- Prohibition from receiving foreign aid, either directly or indirectly, by those who are involved in active politics is to ensure that the values of a sovereign democratic republic are protected.
- On the other hand, such of those voluntary organisations which have absolutely no connection with either party politics or active politics cannot be denied access to foreign contributions.
Back2Basics
FCRA
- Government of India enacted the Foreign Contribution (Regulation) Act (FCRA) in the year 1976 with an objective of regulating the acceptance and utilization of foreign contribution.
- The act was majorly modified in 2010 with several amendments because many NGOs were found using illegal use of foreign funding.
- It is a consolidating act whose scope is to regulate the acceptance and utilisation of foreign contribution or foreign hospitality by certain individuals or associations or companies.
- It aims to prohibit funding for any activities detrimental to the national interest and for matters connected therewith.
- In 2016 license of about 20,000 NGOs were cancelled after reviewing their work.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: IOC
Mains level: Indian ocean security
India was accepted as an observer in the Indian Ocean Commission getting a seat at the table of the organization that handles maritime governance in the western Indian Ocean.
Indian Ocean Commission
- The Indian Ocean Commission is an intergovernmental organization that was created in 1982 at Port Louis, Mauritius and institutionalized in 1984 by the Victoria Agreement in Seychelles.
- The COI is composed of five African Indian Ocean nations: Comoros, Madagascar, Mauritius, Réunion (an overseas region of France), and Seychelles.
- These five islands share geographic proximity, historical and demographic relationships, natural resources and common development issues.
Aims and Objectives of IOC
- COI’s principal mission is to strengthen the ties of friendship between the countries and to be a platform of solidarity for the entire population of the African Indian Ocean region.
- COI’s mission also includes development, through projects related to sustainability for the region, aimed at protecting the region, improving the living conditions of the populations and preserving the various natural resources that the countries depend on.
- Being an organisation regrouping only island states, the COI has usually championed the cause of small island states in regional and international fora.
India and IOC
- India’s entry is a consequence of its deepening strategic partnership with France as well as its expanding ties with the Vanilla Islands.
- India had made the application to be an observer. The IOC has four observers — China, EU, Malta and International Organisation of La Francophonie (OIF).
Significance
- For India, the importance of joining this organization lies in several things.
- First, India will get an official foothold in a premier regional institution in the western Indian Ocean, boosting engagement with islands in this part of the Indian Ocean.
- These island nations are increasingly important for India’s strategic outreach as part of its Indo-Pacific policy.
- This move would enhance ties with France which is the strong global power in the western Indian Ocean.
- It lends depth to India’s SAGAR (security and growth for all in the region) policy unveiled by PM Modi in 2015.
- The move, India hopes, would lead to greater security cooperation with countries in East Africa.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: N95 Masks
Mains level: Coronovirus outbreak
In a new mandate to curb unnecessary demand, the Maharashtra Food and Drug Administration said that chemists cannot sell N95 masks without a doctor’s prescription. The FDA also warned that serious action would be taken against those who are found selling masks at high prices or hoarding them.
Why such a move?
- Personal Protective Equipment (PPE) kits and N95 masks are being sold at very high prices in medical shops. The State has received many complaints about the same.
- It has also been found that many are making bulk purchases and hording PPE kits and N95 masks.
- Since the COVID-19 outbreak in China, shortage of PPE gear and masks has been reported from across the world.
- While the Indian government has currently banned exports of N95 masks, the manufacturers are focussed on making other surgical marks to get good returns from exports.
N95 mask
- A disposable N95 mask (respirator) is a safety device that covers the nose and mouth and helps protect the wearer from breathing in some hazardous substances.
- An N95 respirator is designed to achieve a very close facial fit and very efficient filtration of airborne particles.
- The ‘N95’ designation means that when subjected to careful testing, the respirator blocks at least 95 percent of very small (0.3 micron) test particles.
- If properly fitted, the filtration capabilities of N95 respirators exceed those of face masks. However, even a properly fitted N95 respirator does not completely eliminate the risk of illness or death.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Amrit Kaur
Mains level: Not Much
Former PM Indira Gandhi and freedom fighter Rajkumari Amrit Kaur are mentioned in TIME magazine’s list of the 100 most powerful women who defined the last century in a new project that aims to feature those women who were “often overshadowed”.
Who was Amrit Kaur?
- Amrit Kaur was the first woman in independent India who joined the Cabinet as the Health Minister and remained in that position for 10 years.
- Born into the Kapurthala royal family, she was educated in Oxford and returned to India in 1918, and began to be drawn towards the work and teachings of MK Gandhi.
Her contributions
- Before taking up the position of a Health Minister, Kaur was Mahatma Gandhi’s secretary.
- During these 10 years, she founded the Indian Council for Child Welfare.
- She also laid the foundation of the All India Institute of Medical Sciences (AIIMS) and Lady Irwin College in Delhi in the following years.
- Apart from joining the nationalist freedom struggle, Kaur also began work on a number of other social and political issues such as the purdah system, child marriage and the Devadasi system.
- She passed away in 1964, at the age of 75.
Role in the freedom struggle
- In 1936, hoping that more women would join the freedom struggle, Gandhiji invited her.
- In the following years, as Kaur started interacting with other freedom fighters such as Gopal Krishna Gokhale and Mahatma Gandhi, she gave up her princely comforts and began to discipline herself by responding to the Gandhian call.
- When the civil disobedience movement took off in the 1930s, Kaur dedicated her life to it.
- Kaur was jailed after the Quit India movement and carried to the jail a spinning wheel, the Bhagwat Gita and the Bible.
- Further, while Kaur advocated for equality, she was not in favour of reservations for women and believed that universal adult franchise would open the doors for women to enter into the legislative and administrative institutions of the country.
- In light of this, she believed that there was no place left for reservation of seats.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Gaura Devi and her contributions in Chipko Movement
Mains level: Chipko Movement
Union HRD Minister along with senior women officers of the Ministry planted a sapling in memory of Gaura Devi, Chipko Activist in New Delhi.
Gaura Devi
- Gaura Devi was born in 1925 in a village named Lata in the state of Uttarakhand. She moved to a nearby village named Reni by the Alaknanda River.
- She was elected to lead the Mahila Mangal Dal (Women’s Welfare Association) in the wake of the Chipko movement. The organization worked on the protection of community forests.
Her contributions in Chipko Movement
- Gaura Devi came to notice in 1974 when she was told that local loggers were cutting the trees.
- The men of Reni village had been tricked out of the village by news that the government was going to pay out compensation for land used by the army.
- She challenged the men to shoot her instead of cutting down the trees and she described the forest with her maika (mother’s house).
- They managed to halt their work by hugging the trees despite the abuse of the armed loggers.
- They kept guard of the trees that night and over the next three or four days other villages and villagers joined the action. The loggers left leaving the trees.
Impact
- After this incident, the Uttar Pradesh Government established a committee of experts to investigate the issue of felling of trees, and the lumber company withdrew its men from Reni.
- The committee stated that the Reni forest was an ecologically sensitive area and that no trees should be felled there.
- Thereafter the government of Uttar Pradesh placed a 10-year ban on all tree-felling in an area of over 1150 km².
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Qubit, Quantum Entanglement
Mains level: Quantum Computing and its applications
Researchers from Raman Research Institute (RRI), an autonomous institution under the Dept. of Science & Technology, have devised a new test for fairness of quantum coin or ‘qubit’ using entanglement theory. The Qubit is the basic unit of information in a quantum computer.
Entanglement Theory
- It is a special type of correlation that exists in the quantum world with no classical counterpart.
- The researchers from RRI made use of this quantum resource to arrive at a test for fairness of a quantum coin (a qubit).
- Their strategy, which makes use of entanglement, enables better discrimination between quantum states. Such advantage is valuable in quantum sensors.
- This work is a significant contribution to the domain of quantum state discrimination, which is an essential aspect of quantum information science.
- It brings out the crucial role of entanglement in improving our ability to discriminate quantum states.
- In this work the researchers concretely implemented the theoretical idea on the simulation facility of the IBM quantum computer.
Quantum coins
- By repeated trials, one can determine the fairness of a classical coin with a confidence which grows with the number of trials.
- A quantum coin can be in a superposition of heads and tails.
- Given a string of qubits representing a series of trials, one can measure them individually and determine the state with a certain confidence.
- The team has shown that there is an improved strategy which measures the qubits after entangling them, which leads to a greater confidence.
Significance
- This is a significant contribution to quantum state discrimination, an essential aspect of quantum information science which is expected to influence quantum sensing.
- The domain of Quantum Information and Quantum Computing Technology is a growing area of research which is expected to influence Data Processing, which in turn, plays a central role in our lives in this Information Age.
- For instance, bank transactions, online shopping and so on crucially depend on the efficiency of information transfer.
- Thus the recent work on quantum state discrimination is expected to be valuable in people’s lives in the current era.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 2- Changing India-Iran relations.
Context
The CAA and violence in Delhi have started to take its toll on India’s secular foreign policy.
The US and other’s reaction to the situation in India
- Trump visit to India: President Trump referred to India as a democracy which was peaceful and tolerant. He lauded freedom, rule of law, liberty and protection of human dignity, adding graphically that where India had the holy Ganges, it also had the Golden Temple and Jama Masjid.
- Assurance to the critics at home: He thereby cleverly reassured critics at home, especially in the US Congress, that he was not ignoring the values the two great democracies shared.
- However, as the situation in Delhi spun into violence the next day, in an untutored media interaction at the US ambassador’s residence, he ducked questions about the CAA or Delhi riots, nonchalantly remarking it was “up to India” to deal with it.
- This may have brought comfort to the Indian government but the world at large differed.
- Response from the other countries: Delhi had already exchanged angry words with Malaysia, Turkey and even Indonesia over their varied critique of India’s handling of its Muslim minority when Iran joined the issue.
Iran’s response to violence in India
- Condemnation by foreign ministers: Iranian Foreign Minister Javad Zarif condemned the “wave of organised violence against Indian Muslims”, adding that “Iran has been a friend of India”.
- India’s foreign ministry summoned the Iranian ambassador to protest the inappropriateness of the minister’s remark.
- The reaction by the Iranian Supreme Leader: Soon after, Supreme Leader Ali Khamenei found the time, in the middle of the COVID-19 outbreak, to excoriate the Indian government.
- Adding insult to injury, he appended #IndianMuslimsInDanger.
- No reaction on China problems: A facile response, can be that Iran is being hypocritical as it has not expressed remorse over the Chinese repression of Uyghurs.
- The difference in India’s importance to China: China is a veto-wielding member of the UN Security Council, which also sustains the Iranian economy despite US sanctions. On the other hand, India has a Shia population second only to that of Iran.
Relations with Iran
- Two consulates in India: There are two Iranian consulates in India in Hyderabad and Mumbai. Iran seeks the third one in Lucknow.
- Qom also hosts many Shia students, particularly from the Kargil region.
- Historic links between the two countries: After Humanyun’s exile in Iran (1530-40) before recovering the Indian throne, the Persian language and culture fired the cultural renaissance at the Mughal court.
- Religio-cultural heritage importance: India is important for Iran for its religio-cultural heritage, unlike China, which is needed for transactional and strategic reasons.
- Two interrelated questions flow from this reasoning:
- 1. What is Iran’s importance for India and the trajectory of India-Iran relations over the last two decades?
- 2. And why is Iran adopting this sharp tone over what the Indian government argues is an internal matter?
- Convergence in the relations: The closest India-Iran strategic convergence began in the 1990s, particularly after Kabul fell to the Taliban in 1996. These ties blossomed under reformist Iranian President Mohammad Khatami and Indian Prime Minister Atal Bihari Vajpayee.
- Tehran Declaration: In 2001, the two signed the Teheran Declaration. Khatami in his opening remarks said that Iran always admired India’s secular credentials and Vajpayee had maintained that tradition.
- In 2003, Khatami was the chief guest at India’s Republic Day and a New Delhi Declaration was issued.
- Deterioration in relations and impact of India-US relation: The relationship began to slip as Iran’s clandestine nuclear programme and assistance from Pakistan’s rogue scientist A Q Khan was uncovered in mid-2003.
- Impact of India-US closeness: Concomitantly, India was drawing closer to the US and negotiating a nuclear cooperation agreement.
- The US used the nuclear issue to cause a cleavage as Indian and Iranian interests began seriously diverging.
- Taliban factor: In any case, the Taliban had been ejected from Afghanistan and US troops literally surrounded Iran, having in 2003 overthrown Saddam Hussein. Geo-strategy trumped diplomacy.
The US-Iran relation cycle
- The nuclear deal with Iran: Iran-US relations also went through a cycle, with President Barack Obama recalibrating US policy towards the Gulf and West Asia.
- Countering ISIS: Calculating that without Iran, ISIS could not be countered, the US in 2015 endorsed the nuclear deal that P-5 and Germany negotiated to end the nuclear stand-off.
- Missing warmth of the 1990s: Although India-Iran relations after that returned to near normal as most US sanctions were lifted, the warmth of the 1990s was missing.
- Iran was now beginning to extend its influence and role across Iraq and West Asia.
- Maximum Pressure strategy of the US: President Donald Trump in 2016 reversed US policy and since then “maximum pressure” has been applied on Iran via tightened sanctions.
- India’s engagement with Saudi Arabia and UAE: PM Modi also moved more forthrightly to engage Saudi Arabia and the UAE.
- The fallout of the US strategy reversal: A fallout of the US policy reversal has been an exacerbation of not only the Shia-Sunni split but a Sunni-Sunni split as Qatar and Turkey are with Iran.
Changing polity and increasing influence in the neighbourhood
- Conservatives elected to power: In Iran’s parliamentary election on February 28, extremely conservative members have been elected, the moderates having been vetoed by the Guardians Council earlier.
- Turnout was a low 43 per cent, due partly to fear of the coronavirus.
- Increasing influence in the neighbourhood: Iran is even more isolated, though determined to resist US demands, due to communications being curtailed due to the virus.
- Relations with the Taliban: It has good working relations with the Taliban and converging interests to see that US troops exit the region.
- The friendly government in Baghdad: Iran is battling to ensure a friendly government in Baghdad, despite the killing of Major General Qasem Soleimani, by keeping militias aligned to it in play.
Conclusion
- Perception of India: Khamenei’s tweet reflects the perception that India is in the US-Saudi-Emirati corner and of little use as long as Trump is president.
- Growing closeness Abu Dhabi, Riyadh and Ahmedabad would have led Iran to this conclusion.
- Leveraging India’s dependence: In the Islamic world, Iran by publicly defending Indian Muslims embarrasses the silent Saudis.
- It also calculates that India needs access to Afghanistan through Chabahar to assist the Ghani government or influence developments there.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 3- Is expansionary monetary policy enough to deal with the impact of COVID-19?
Context
Central banks the world over are devising the strategies to deal with the impact of COVID-19 on their economies.
How the Central banks are responding?
- US Fed’s response: The huge 50 basis points cut in rates by the U.S. Federal Reserve to lift economic sentiment hit by COVID-19 has disrupted central banking worldwide.
- Pressure on other Central banks to follow suits: Even as analysts debate whether a monetary policy response is a right strategy, central banks across the world are feeling the pressure to follow suit to the largest rate cut by the Fed since 2008.
- How banks are responding? Central banks of Australia and Malaysia have cut rates already while others such as the Bank of Japan, Bank of England and the European Central Bank are contemplating joining the caravan.
How the RBI is responding?
- First line of economic defence: With monetary policy turning out to be thede facto first line of economic defence against the ill-effects of the virus, the focus in India has turned to the Reserve Bank of India’s response.
- Hope of rate cut: Yields on 10-year government securities fell by as much as 0.12% in the hope of a rate cut by the RBI and they stayed soft.
- But what are the central bank’s options?
- No unilateral rate adjustment: Unlike other countries, the legal framework in India after the setting up of the Monetary Policy Committee (MPC) is such that the RBI cannot unilaterally adjust rates.
- The MPC will have to meet and deliberate on the situation before the call to cut rates is taken and such a call will have to be based on an assessment of inflation in the economy.
Is a rate cut the right response?
- Impact of the virus on the supply side: The first-order impact on the global economy of the spreading virus is a disruption to trade and to global supply chains.
- With China being the factory of the world, the clampdown in that country has already disrupted supplies of products ranging from cell phone components to bulk drugs and auto components.
- Factory lines across the world could freeze as supply chains get disrupted.
- Limits of Monetary policy to deal with the supply-side problem: Monetary policy is excellent to address demand shocks but is a blunt tool when it comes to addressing supply-side issues.
- Where to spend? People may be encouraged to spend more due to a rate cut but what will they spend on if products go scarce, travel convulses and public spaces such as movie theatres and malls become no-go areas?
- The rate cut will boost the sentiments only: A rate cut can, at best, help to boost sentiment but that again will be transient as the market’s reaction after the Fed rate cut proves.
- Expansionary monetary policy cannot improve the situation: The Swedish central bank’s deputy governor Anna Breman has rightly questioned the logic of a rate cut as a response to the coronavirus impact pointing out that an expansionary monetary policy cannot improve the situation.
- How the RBI might respond? The sentiment being what it is, the RBI may find itself under increasing pressure to act. Given the MPC constraint, it may well choose to do what it did in the February monetary policy– unleash other weapons in its armoury to give the same effect as a rate cut.
- Thus, we may well see the central bank announcing another tranche of long-term repo operation, akin to the ₹1 lakh crore that it announced in February.
- That will mean that banks will gain access to three-year funds at the repo rate of 5.15%, much lower than the market rate.
- And then, there’s Operation Twist which the RBI employed to good effect in December, softening rates at the long end of the yield curve.
Would any of these measures yield any response?
- Doubtful results: It’s doubtful if any of these measures can address the hit to economic growth. The virus has undoubtedly surfaced at a very wrong time for the Indian economy which is showing hesitant signs of a return to growth.
- Which sectors will be impacted the most? The impact will be felt on more than one front. Industries such as pharmaceuticals, electronics and automobiles could be headed for trouble given their high dependence on Chinese inputs.
- Government’s response: While the government is said to be formulating a response, including the possibility of airlifting supplies, the practicality of this solution needs to be watched as also its impact on costs for the industries concerned.
Impact on exports and offsetting factor of oil import
- The biggest problem: The bigger problem could be from a fall in exports, which accounts for 20% of the GDP.
- Which exporters would feel the heat? If the developed world tips into recession due to the virus, exporters of products ranging from petroleum and textiles to leather and gems and jewellery will feel the heat.
- Oil offset due to fall in oil prices: The offsetting factor, of course, will be a lower oil import bill due to the sharp fall in oil prices. This may also have a benevolent effect on inflation.
- But there will be other headaches for the central bank if the developed world embarks on monetary expansion. The RBI will be faced with the challenge of staunching inflows of hot money coming in search of the higher returns available in India.
Conclusion
- Hot money concern for RBI: There will be other headaches for the central bank if the developed world embarks on monetary expansion. The RBI will be faced with the challenge of staunching inflows of hot money coming in search of the higher returns available in India.
- Opportunity in the crisis: As with every crisis, there’s also an opportunity here. Economic growth is bound to suffer in the short-term but there could be long-term spin-offs if domestic industry and government get their acts right.
- Supply chains can be localised through fresh investments and India can bid to be an alternative to China in the global value chain.
- India can be an option to China for global supply chain: The COVID-19 crisis has only underlined in red the lesson that global corporations learnt when trade war broke out between the U.S. and China- the global supply chain needs alternative options to China. India is eminently qualified to assume that role. If only our policymakers and industrialists rise up to the challenge.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 2- India-US relations.
Context
President Trump’s visit had the right optics. Attention must now turn to India-US priority areas.
What were the mutual gains and highlights of the visit?
- Security: Homeland Security is an American expression. For us to own it shows our concerns on cross-border sponsored terrorism.
- Nuclear technology: Our nuclear VVER power plant technologies are state of the art and of Russian and French design.
- Fast breeder: Good, but one more is better. We are well on the way to the fast breeder on the thorium route and these nuclear turbines are an essential step.
- Unlimited thorium: We don’t have much uranium but unlimited thorium, so in the long run, apart from solar, this is the energy future.
- Insurance obstacle resolved: Obviously, the insurance obstacle, as to who will bear the cost of insurance against disaster damage, which the Americans were raising earlier, has been resolved.
- We have to build nuclear power to provide the initial feedstock for the thorium-based reactors.
- No progress on trade pact: There are obviously differences between the two nations on the trade pact.
- There is “progress”, but otherwise, we don’t know the way forward. Since the event was Ahmedabad-based, Amul is invading America and dairying is real politics.
- US concerns over Kashmir issue: The US concern on Kashmir and minority rights is real.
- If the largest foreign office establishment in the world is raising issues through their chief, let’s not bury our head in the sand.
- Our defence minister expressing sadness at former chief ministers of Jammu and Kashmir being in detention was a gesture to the US President’s stand on pursuing solutions.
- The bipartisan foreign policy of India shifting: The Americans generally rally behind the President on foreign policy.
- We are more advanced now and have kicked a bipartisan approach to foreign affairs.
- Seven decades of a bipartisan policy are thrown away without a word in explanation.
Challenges to the rights in India
- Every right is tampered with. Your religion, your identity in a country that never questioned it, you name it, it’s in question.
- Multiple identity cards not accepted: The Aadhaar card, passport, ration card, election card are not enough. One office doesn’t accept another’s card, even if they carry the same information.
- A study on a ration card and election cards: A study funded by the Canadian IDRC showed the poor only keep under lock and key the ration and election cards. One saves them from starvation, the other gives them dignity. At least once every five years, the mightiest knock at their door. We must not destroy, we must build.
Conclusion
There are obviously differences between the two nations on the trade pact. But apart from trade, there are many areas the cooperation on which can benefit both the countries.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Not much.
Mains level: Paper 3- Dealing with the trinity of social disharmony, economic slowdown and and global health epidemic.
Context
India faces imminent danger from the trinity of social disharmony, economic slowdown and a global health epidemic.
Social disharmony
- Violence in Capital: Delhi has been subjected to extreme violence over the past few weeks. We have lost nearly 50 of our fellow Indians for no reason. Several hundred people have suffered injuries.
- Communal tensions have been stoked and flames of religious intolerance fanned by unruly sections of our society, including the political class.
- University campuses, public places and private homes are bearing the brunt of communal outbursts of violence.
- Institutions of law and order have abandoned their dharma to protect citizens. Institutions of justice and the fourth pillar of democracy, the media, have also failed us.
Impact of social disharmony on the economy
- Exacerbating the economy: At a time when our economy is floundering, the impact of such social unrest will only exacerbate the economic slowdown.
- Lack of investment by the private sector: It is now well accepted that the scourge of India’s economy currently is the lack of new investment by the private sector.
- Investors, industrialists and entrepreneurs are unwilling to undertake new projects and have lost their risk appetite.
- Increase in fears and risk aversion: Social disruptions and communal tensions only compound investors’ fears and risk aversion.
- Social harmony, the bedrock of economic development, is now under peril.
- When policy tweaks stop to matter: No amount of tweaking of tax rates, showering of corporate incentives or goading will propel Indian or foreign businesses to invest, when the risk of eruption of sudden violence in one’s neighbourhood looms large.
- How the vicious cycle works: Lack of investment means a lack of jobs and incomes, which, in turn, means a lack of consumption and demand in the economy.
- A lack of demand will only further suppress private investments. This is the vicious cycle that our economy is stuck in.
Impact of COVID-19 on the economy
- Global reactions: Nations across the world have sprung into action to contain the impact of this epidemic. China is walling off major cities and public places. Italy is shutting down schools. America has embarked aggressively both to quarantine people as well as hasten research efforts to find a cure.
- Many other nations have announced various measures to address this issue.
- What India can learn? India too must act swiftly and announce a mission-critical team that will be tasked with addressing the issue. There could be some best practices we can adopt from other nations.
Bringing in reforms to address the problems
- The government must quickly embark on a three-point plan.
- First, it should focus all energies and efforts on containing the COVID-19 threat and prepare adequately.
- Two, it should withdraw or amend the Citizenship Act, end the toxic social climate and foster national unity.
- Three, it should put together a detailed and meticulous fiscal stimulus plan to boost consumption demand and revive the economy.
Turning a moment of deep crisis into a moment of great opportunity
- The past instance of turning crisis into an opportunity: In 1991, India and the world faced a similar grave economic crisis, with a balance of payments crisis in India and a global recession caused by rising oil prices due to the Gulf War.
- But India was able to successfully turn this into an opportunity to reinvigorate the economy through drastic reforms.
- Turning the present crisis into an opportunity: Similarly, the virus contagion and the slowing down of China can potentially open up an opportunity for India to unleash second-generation reforms to become a larger player in the global economy and vastly improve prosperity levels for hundreds of millions of Indians.
- To achieve that, we must first rise above divisive ideology, petty politics and respect institutional salience.
Conclusion
The India that we know and cherish is slipping away fast. Wilfully stoked communal tensions, gross economic mismanagement and an external health shock are threatening to derail India’s progress and standing. It is time to confront the harsh reality of the grave risks we face as a nation and address them squarely and sufficiently.
Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024
Attend Now