April 2025
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Banking Sector Reforms

Let clear principles prevail in the bailout of Yes Bank

Note4Students

From UPSC perspective, the following things are important :

Prelims level: AT-1 bonds.

Mains level: Paper 3- Issues involved in banking system and resolution process in case of failures.

Context

Resolving bank failure is tough but following a set of principles could achieve a fair and efficient outcome.

Key issues involved in the resolution

  • Challenge in courts: Resolving Yes Bank’s failure is no easy task. Some bondholders are already challenging the restructuring plan of the Reserve Bank of India in court, and seem ready for a long-drawn battle.
  • How much dilution is fair for existing shareholders to take?
  • AT-1 Bonds issue: Should the value of the Additional Tier 1 (AT-1) bonds be written off entirely?
    • As such issues become matters of policy discussion and address, we must not lose sight of some fundamental principles of resolving bank failures.
  • Three of them should be on the top of the list: honour contracts, address market failure and protect systemic stability.

How honouring contracts matter for economy?

  • For efficient outcomes: Honouring contracts is vital for achieving efficient outcomes between contracting parties such as lenders and borrowers, managers and shareholders, and insiders and outsiders.
  • Shying away from entering a contract: If there is uncertainty over this fundamental principle, contracting parties will shy away from entering contracts in the first place.
    • Lenders will be less willing to lend.
    • Prospective minority shareholders will be less keen to buy shares in a company.
  • Impact on allocative efficiency: This will ultimately compromise the economy’s allocative efficiency, or the market’s ability to deploy capital to its best use.

AT-1 bond issue

  • Honouring contract in Yes banks resolution: There are several issues in the application of this principle in Yes Bank’s resolution.
    • The most visible one concerns the decision of writing off its perpetual contingent, or AT-1, bonds.
  • Write off: According to the original agreement, these additional tier-1 (AT-1) bonds are indeed supposed to be written off at a time like this.
    • And this write-off need not happen before the common equity value goes down to zero.
    • The entire idea behind these perpetual contingent bonds is to improve a bank’s capitalization if its common equity value falls below a certain threshold, but does not hit zero.
  • Counter argument: These bondholders and some commentators are arguing that writing off those bonds will be a big blow to India’s bond market.
    • Moral hazard problem: This is just the opposite of the truth. Not writing them off in accordance with the original contract will create a severe moral hazard problem.
    • What incentive would any bondholder have to correctly price and monitor these banks in the future?
    • Market discipline would die a quick death, and the bond market will suffer in the long run.
  • What the resolution process should do? Therefore, the resolution process should honour the contract and write off the entire value of Yes Bank’s AT-1 bonds.

Dealing with critical market failures

  • Second core principle: The second core principle in this resolution should be to tackle some critical market failures that led here.
    • Several observers have pointed out the failure of board oversight, promoter negligence and reckless lending at the bank.
  • Vital market failure in the purchase of AT-1 bonds by retail investors: Indeed, these issues must be addressed. But there seems to be another vital market failure hidden in this crisis: the purchase of AT-1 bonds by retail investors.
  • Why AT-1 bonds are complex? AT-1 bonds are “information-sensitive” instruments, which means that the value of these instruments is extremely sensitive to information on the firm’s fundamentals.
    • Complex financial security: They are very complex financial securities. Understanding the risk and reward associated with these securities and valuing them properly is not an easy task even for the best of market professionals.
    • Retail investors are certainly not suited to buy this product. Still, several of them ended up holding Yes Bank AT-1 bonds in their asset portfolios.
  • Demand deposits and market failure: Banking theory relies on the idea that demand deposits are information-insensitive instruments.
    • Hence, a retail investor can place deposits in a bank without worrying about understanding the real risks borne by it. Government-backed deposit insurance makes deposits even more liquid and riskless.
    • Hence, retail investors should hold regular deposits in a bank, and not complex securities like AT-1 bonds.
    • Where is the market failure involved? If such bonds are sold to them without proper disclosure of the associated risks, then it amounts to a serious market failure.
  • Way forward: This market failure must be corrected.
    • Holding investment advisors to higher standards of fiduciary responsibility is one way of doing so.
    • Prohibiting retail investors from investing in such securities is another critical step to prevent such a market failure.

Way forward to carry out the resolution process

  • Restitution of value to retail investors: Meanwhile, the resolution process could consider partial or full restitution of value to retail investors in Yes Bank’s AT-1 bonds, if these products were indeed mis-sold to them.
  • Large professional investors should be treated differently: But such a rescue must not extend to large professional investors who willingly bought these bonds for higher returns.
    • One mechanism to do this could be to create a separate fund for retail investors with investments capped at a certain point.
    • Or, their AT-1 investments up to a specific limit could be converted into a simple deposit contract. The legal hurdles may be insurmountable.
    • However, in principle, those who mis-sold these products to retail investors should be required to compensate them.
  • Conflict in two principles: Sometimes, these principles can come into direct conflict with each other.
    • If the resolution allows retail investors in those AT-1 bonds to recover their investments, it would go against the “honour the contract” principle, but it would address the “market failure” issue.
  • Ensuring systemic stability: How should we reconcile this conflict? That’s where the third principle comes in: ensuring systemic stability.
    • After all, the regulator’s main objective is to restore the market’s faith in the country’s financial system.
    • While this is not an easy task, protecting the capital and confidence of small investors can go a long way in restoring their faith in the banking system.

Conclusion

Resolving bank distress is never an easy job. But honouring contracts, addressing market failure and ensuring systemic stability can together go a long way in achieving a fair and efficient outcome.

 

 

 

 

 

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Anti Defection Law

Supreme Court Removes Manipur MLA Under The 10th Schedule

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Discretionary powers of the Supreme Court

Mains level: Executie and Judiciary

The Supreme Court has removed a Minister against whom disqualification petitions were pending before the Speaker since 2017.

  • The court invoked its discretionary powers under Art. 142 of the Indian Constitution.

What is Article 142?

  • Article 142 of the Constitution empowers the Supreme Court to pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it.
  • Any decree so passed or orders so made shall be enforceable throughout the territory of India.
  • The phrase ‘necessary for doing complete justice’ encompasses a power of equity which is employed when the strict application of the law is inadequate to produce a just outcome.
  • The power under Article 142 can be exercised when the SC has to decide difficult cases where adequate laws may not exist, or existing laws may not be adequate, in order to deliver complete justice.

Scope and limitations

  • Supreme Court in State of Punjab v Rafiq Masih (2014) has opined that- Article 142 of the Constitution of India is supplementary in nature and cannot supersede the substantive provisions, though they are not limited by the substantive provisions in the statute”.
  • Article 212 of the Constitution bars courts from inquiring into proceedings of the Legislature.
  • In this case, however, prompted by the fact that the Speaker’s conduct has been called into question on several occasions, the court invoked Article 142.

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Parliament – Sessions, Procedures, Motions, Committees etc

What are Supplementary Grants?

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Supplementary grants

Mains level: Various grants in Parliament

Supplementary Grants

Lok Sabha recently held voting on supplementary demands for grants for Jammu and Kashmir and passed the proposals on voice vote.

What are Supplementary Grants?

  • The additional grant required to meet the required expenditure of the government is called Supplementary Grants.
  • When grants, authorised by the Parliament, fall short of the required expenditure, an estimate is presented before the Parliament for Supplementary or Additional grants.
  • These grants are presented and passed by the Parliament before the end of the financial year.
  • When actual expenditure incurred exceeds the approved grants of the Parliament, the Ministry of Finance and Ministry of Railways presents a Demand for Excess Grant.

How it works?

  • The Comptroller and Auditor General of India bring such excesses to the notice of the Parliament.
  • The Public Accounts Committee examines these excesses and gives recommendations to the Parliament.
  • The Demand for Excess Grants is made after the actual expenditure is incurred and is presented to the Parliament after the end of the financial year in which the expenses were made.

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Railway Reforms

[pib] Flexi Fare System

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Flexi Fare System

Mains level: Not Much

During the eight months period from 1st July 2019 to 29th February 2020, approximately 28.93 Lakh berths remained vacant in Rajdhani, Shatabdi and Duronto type trains having Flexi fare.

What is Flexi Fare System?

  • The flexi-fare scheme was introduced by the IRCTC in 2016 for the 142 “premium trains” such as Shatabdi, Rajdhani, and Duronto (now Vande Bharat Exp. as well).
  • Under this dynamic pricing system, the base fare increases by 10% with every 10% of berths sold, with a limit set at 1.5 times the original price.
  • The scheme was applicable to all classes, except AC first class and executive class. The pricing system is still in force.

Reasons for flexi fares:

  1. Indian Railways run about 12900 passenger trains per day and the railways is losing around more than 40% of what they spend on passenger trains.
  2. The trains like Rajdhani are the ones in which the elite class prefers to travel. So, some revenue can be garnered from them.
  3. The cost of service is almost double of what is being charged from the passengers.
  4. Freight business is already very expensive in India as compared to other countries in the world. Therefore, a further increase in this area is not feasible.

Issues with the system

  • After the introduction of Flexi-fares, the railways lost 700,000 passengers in just 11 months while the additional revenue earned as a result of the scheme was ₹ 552 crore.
  • While drawing upon the fundamentals of dynamic pricing, what Indian Railways failed to introduce was a simple principle that Flexi-fares work ways, hikes, and declines.
  • The railways model just focused on increasing fares with no provision for a decrease in price when demand is low.
  • While half of the decision-makers in the Railway Board support it, half of them oppose it stating that what the railways require is an increase in ticket prices across the board.

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

[pib] GreenCo Rating System

Note4Students

From UPSC perspective, the following things are important :

Prelims level: GreenCo Rating System

Mains level: Not Much

 

 

The Union Ministry of Railways has informed about the applications of Greenco Ratings on Workshops and Production Units of Indian Railways.

GreenCo Ratings

  • GreenCo Rating is the “first of its kind in the World” holistic framework that evaluates companies on the environmental friendliness of their activities using life cycle approach.
  • Implementation of GreenCo rating provides leadership and guidance to companies on how to make products, services and operations greener.
  • It is developed by Confederation of Indian Industry’s (CII) Sohrabji Godrej Green Business Centre.
  • It has been acknowledged in India’s Intended Nationally Determined Contribution (INDC) document, submitted to UNFCCC in 2015.
  • GreenCo rating is applicable to both manufacturing facilities and service sector units.
  • The rating is implemented at unit or facility level. The unit or facility has to be in operation for a minimum period of 3 years. In case of new plants/ facilities minimum 2 years operation is required.

Utility

It helps the industrial units in identifying and implementing various possible measures in terms of energy conservation, material conservation, recycling, utilization of renewable energy, GHG reduction, water conservation, solid and liquid waste management, green cover etc.

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Innovations in Sciences, IT, Computers, Robotics and Nanotechnology

[pib] Friction-reducing Nanocomposite Coatings

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Nano-composites and its applications

Mains level: Not Much

A group of scientists at the International Advanced Research Centre for Powder Metallurgy & New Materials (ARCI) have developed a process for size-selective deposition of nanocomposite coatings which can reduce friction of these dynamic systems.

What are Nanocomposites?

  • Nanocomposite coatings are formed by mixing two or more dissimilar materials at nanoscale to improve the physical, chemical and physicochemical properties of the new materials.
  • The scientists have found that nickel tungsten-based coatings with infusion of particular sized Silicon Carbide (SiC) submicron particles using a pulsed electroplating can provide an excellent combination of wear and corrosion resistance.

Applications

  • Many aerospace, defence, automobile, space devices need to reduce friction, wear, and tear to enhance the life of components.
  • Lubricating these dynamic systems add to the cost, complexity, and weight of these systems.
  • The coating could help in reducing the friction of such devices.

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Animal Husbandry, Dairy & Fisheries Sector – Pashudhan Sanjivani, E- Pashudhan Haat, etc

[pib] Potential Fishing Zone (PFZ) Advisories

Note4Students

From UPSC perspective, the following things are important :

Prelims level: PFZ

Mains level: Application based initiaitives by ISRO

The Indian National Centre for Ocean Information Services (INCOIS), Hyderabad has reported that Oceansat Satellite data from ISRO are used to prepare the PFZ advisories on the potential rich fishing areas and provide to the sea faring fishermen in all states.

Potential Fishing Zone (PFZ)

  • This is the first advisory service started by INCOIS. The backbone of this service is the real-time data for ocean color and SST provided by the OCEANSAT and NOAA respectively.
  • This service was started because there was a need to identify the potential fishing zones to help the fishermen to get better catch while they were at the sea.
  • This service was started by the Ministry of Earth Sciences with the help of the Department of Space and several institutions under the Ministry of Agriculture.

How it works?

  • This service makes use of parameters such as sea surface temperature and chlorophyll content provided by NOAA-AVHRR and Oceancolor satellites.
  • Features such as oceanic fronts, Meandering Patterns, Eddies, Rings, Up Welling areas etc. are identified sites for fish accumulation.
  • These features can easily be identified from Sea Surface Temperature and Chlorophyll data.
  • The availability of Chlorophyll from OCEANSAT and MOdDIS has further enriched these advisories in the recent years.
  • Hence, PFZ advisories have helped the fishing community to locate the fishing zones with accuracy.

Special advisories for fisherman

  • Another feature of PFZ service is the generation of species-specific advisory to enable the fishermen folk to distinguish between the exploited and under-exploited species in the potential fishing zones.
  • This enables them to have sustainable fishery management by targeting only the under-exploited species in the fishing zones.
  • This approach enables them to avoid fishing the over-exploited species over and over again.

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Issues related to Economic growth

Triggering a Global Financial Crisis

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much.

Mains level: Paper 3- Suggestions to avoid next global financial crisis.

Context

Although we could not have predicted it, Covid-19 was not the reason, but just the trigger for the ongoing financial crash as all we needed was the proverbial straw to break the finance sector’s back

Economic sudden stop

  • Not just any trigger: Covid-19 was not just any trigger as it gave birth to the concept of the economic “sudden stop.” When the global equity markets dropped on 31 January 2020 following the WHO declaration of the Public Health Emergency of International Concern, El-Erian (2020) warned the investors on 2 February 2020 that they should snap out of the “buy the dip” mentality.
    • Pointing out two vulnerabilities, namely structurally weak global growth and less effective central banks, he introduced the concept of “sudden stop” economic dynamics.
  • What is sudden stop? It can be considered as an abrupt onset of a deep recession.
    • Supply and demand shock: In the case of Covid-19, it is a sudden stop of economic activity resulting in supply and demand shocks to the global economy as major cities in infected countries, more than 100 and counting, are put on lockdown.
    • And, add to that the deepening oil price war between Russia and Saudi Arabia.
  • On 8 March 2020 in New York, the futures markets opened and oil futures (both Brent and WTI) are trading about 21% down, gold is above $1,700 per ounce, and all United States (US) equity index futures are trading about 4% down.
  • Long terms treasury yield at historical lows: What is worse is that with the long-term US Treasury yields at their historical lows (10-year yield below 0.5% and 30-year yield below 1%), the capital markets are frozen (not to mention many oil projects that will go bust at these prices).

Disorderly non-financial private sector debt leading to dire consequences

  • A disorderly global non-financial private sector debt deleveraging, which is likely to lead to deep global debt deflation, followed by a recession (and possibly a depression).
    • Which could result in creating financial and economic instabilities, and further tensions in international relations with dire consequences for emerging and developing countries, not to mention developed countries.
  • Difference in developed and developing countries debts: While in developed and high-income developing countries, the non-financial private sector is more over-indebted, in middle-income and low-income developing countries, the public sector is more over-indebted.
  • Impact on developed economies: Given that the global non-financial private sector debt deleveraging has already started, the public sector debts of the developed and high-income developing countries will also go up and the governments’ ability to rescue their economies will also decline in these countries.
  • Impact on funding for climate change: Furthermore, this will severely constrain the governments’ ability to spend on climate change-related projects to address the potentially catastrophic effects for many years to come, diminishing our hopes to make the necessary investments and innovations to address the now existential climate crisis on time will diminish.
  • The corona factor: The measures we have to take to control the spread of Covid-19 before a cure is found will further challenge the financial system, as people stop earning an income and businesses go bankrupt.

Way forward

  • Three authorities solution: In the suggested framework, there would be three authorities to maintain a deposit account at the central bank in each country
    • 1. A deleveraging authority for leverage reduction.
    • 2. Lastenausgleich (based on German Currency Reforms) authority for capital levies.
    • 3. Climate authority for financing needs in developing national climate plans.
    • These national authorities should be globally coordinated through the appropriate United Nations agencies.
  • Control the three authorities: The Lastenausgleich authority would be under the finance ministry, whereas the deleveraging and climate authorities would be not-for-profit corporations promoted by the government.
  • Capitalisation issue: The government would capitalise the deleveraging and climate authorities by the Treasury-issued zero-coupon perpetual bonds.
  • The deleveraging authority would then sell its equalisation claims to the central bank in exchange for an increased balance in its deposit account at the bank, while the climate authority would wait until the deleveraging concludes.
    • Further, the climate authority would not be allowed to open deposit accounts to its borrowers to ensure that it would be a pure financial intermediary, not a bank.
  • Framework: Assuming that a globally agreed-upon debt reduction percentage that would bring the global non-financial sector leverage well under 100% is determined and that all countries agree to act simultaneously, the framework is as follows
    • (i) the financial institutions comprising the banks and non-bank financial institutions (NBFIs) write down all the loans and debt securities on both sides of their balance sheets by the required percentage;
    • (ii) the deleveraging authority compensates the banks and NBFIs for the loss if any; and
    • (iii) the deleveraging authority pays each qualified resident their allocated amount less than the debt relief if any.
    • If an NBFI gain after the above debt reduction, it should owe equalisation liabilities to the deleveraging authority of its jurisdiction.
    • Note that as all debts mean all debts, public sector debts will also be written down by the same percentage except the official debts of the sovereigns that fall out of the scope of our proposed framework and should be handled by other means.
  • After deleveraging: After deleveraging the balance of the deleveraging authority account at the central bank goes down whereas the total balance of the bank accounts (reserves) at the central bank goes up by the total payment made by the deleveraging authority.
    • Hence, the base money goes up by the total payment of the deleveraging authority.
    • Since NBFIs and residents cannot maintain deposit accounts at the central bank, they have to be paid through a bank which creates deposits for the NBFIs and residents against reserves.
    • Hence, the broad money goes up by the amount of the payment to the NBFIs and residents.
  • Issue of multi-currency balance sheet: One issue is that in many countries, the bank and NBFI balance sheets are multi-currency balance sheets.
    • However, the deleveraging authority payments are in domestic currency, which may create currency risk for some banks and NBFIs.
    • Backed by the central banks, the globally coordinated national deleveraging authorities should stand ready to intervene to avoid potential crises.
  • Condition to spend on climate bonds: The authorities would require their domestic banks and other financial institutions to spend an internationally agreed-upon percentage of their newly found money, if any, after the deleveraging on the interest-bearing, finite-maturity bonds the national climate authorities would issue.
    • Since the promoter of the climate authority is the government, the bonds of the climate authority would have the same credit with the government bonds, and the central bank would accept the climate authority bonds in its open market operations.
  • Climate authority bonds as reserves: Therefore, the climate authority bonds would be the main tool to manage the reserves and deposits created through the equalisation claims.
    • In addition, the climate authority bonds could be used for the greening of the financial system through the investment of foreign exchange reserves of the central banks proposed by the Bank of International Settlements (BIS 2019).
  • Progressive wealth tax collection: Lastly, equipped with a “globally coordinated wealth registry” (Stiglitz et al 2019), the Lastenausgleich authorities would collect progressive wealth taxes from the owners of real and non-debt financial assets for the equalisation of burdens.
    • While a part of these taxes could be used to retire some of the equalisation claims and the corresponding reserves and deposits created in the deleveraging process, another part could be transferred to the climate authorities, and the rest could be spent in the interests of the society.

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Judicial Reforms

The Hidayatullah example

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much.

Mains level: Paper 2- Requirement of cooling off period for accepting the government office post-retirement by the judges to ensure the independence of judiciary.

Context

It has been recently announced that the President has nominated former Chief Justice of India, Ranjan Gogoi, to the Rajya Sabha. However, the time has come for us to ask a difficult question: Should judges stop accepting post-retirement jobs offered by the government, at least for a few years after retiring, because accepting such posts could undermine the independence of the judiciary?

The issue of post-retirement employment of the judges

  • Retirement age of judges: Unlike federal judges in the US, judges in India do not hold office for life. They remain in office until they reach the retirement age — 65 for Supreme Court judges and 62 for high court judges.
  • Protection against arbitrary removal: These judges do not hold their offices at the “pleasure” of the President. In other words, they cannot be arbitrarily removed by the government once they are appointed, and can only be impeached by a supermajority of both houses of Parliament “on the ground of proved misbehaviour or incapacity”.
  • Difficult impeachment process: The impeachment process is a very difficult one and never in the history of independent India has a judge been impeached, though attempts have sometimes been made to do so. Judges, therefore, enjoy security of tenure while holding office, which is essential for maintaining judicial independence.
  • How retirement of judges could undermine judicial independence? The retirement of judges threatens to undermine judicial independence.
    • This is because some judges — not all — are offered post-retirement employment by the government. It is often feared that a judge who is nearing retirement could decide cases in a manner that pleases the government in order to get a favourable post-retirement position.

Not an unprecedented move

  • Former CJI Gogoi is certainly not the first retired judge to be appointed to political office.
  • In 1952, Justice Fazl Ali was appointed the Governor of Orissa, shortly after retiring from the Supreme Court.
  • In 1958, Chief Justice M C Chagla resigned from the Bombay High Court in order to become India’s Ambassador to the US at Prime Minister Nehru’s invitation.
  • In April 1967, Chief Justice Subba Rao resigned from the Supreme Court to contest elections for President.
  • In 1983, Justice Baharul Islam resigned from the Supreme Court to contest as a Congress (I) candidate for a Lok Sabha seat, after ruling in favour of Bihar’s Congress (I) chief minister, Jagannath Mishra, in a controversial case where Mishra had been accused of criminal wrongdoing and misuse of office.
  • In more recent times, Chief Justice P Sathasivam was appointed the Governor of Kerala. There are many other such examples.

Why restrictions about employment were not included in the Constitution?

  • The Constitution provides that a retired Supreme Court judge cannot “plead or act in any court or before any authority within the territory of India”.
  • Constituent assembly debate: In the Constituent Assembly, K T Shah, an economist and advocate, suggested that high court and Supreme Court judges should not take up an executive office with the government, “so that no temptation should be available to a judge for greater emoluments, or greater prestige which would in any way affect his independence as a judge”.
    • However, this suggestion was rejected by B R Ambedkar because he felt that the “judiciary decides cases in which the government has, if at all, the remotest interest, in fact, no interest at all”.
  • Government is the largest litigant in the courts: In Ambedkar’s time, the judiciary was engaged in deciding private disputes and rarely did cases arise between citizens and the government. “Consequently”, said Ambedkar, “the chances of influencing the conduct of a member of the judiciary by the government are very remote”.
    • This reasoning no longer holds today because the government is one of the largest litigants in the courts.

Question of independence of the judiciary

  • The question of constitutional propriety: In the words of India’s first Attorney General, M C Setalvad, all this raises “a question of constitutional propriety” relating to the independence of the judiciary.
  • After all, could the government not use such tactics to reward judges who decide cases in its favour?
  • Public perception of compromised judiciary: Further, if a judge decides highly controversial and contested cases in favour of the government and then accepts a post-retirement job, even if there is no actual quid pro quo, would this not lead to the public perception that the independence of the judiciary is compromised?

Law Commission recommendations

  • In its 14th report in 1958, the Law Commission noted that retired Supreme Court judges used to engage in two kinds of work after retirement:
    • Firstly, “chamber practice” (a term which would, today, mean giving opinions to clients and serving as arbitrators in private disputes).
    • Secondly, “employment in important positions under the government”.
  • The Law Commission frowned upon chamber practice but did not recommend its abolition.
  • Ban on post-retirement government employment: It strongly recommended banning post-retirement government employment for Supreme Court judges because the government was a large litigant in the courts.
    • The Commission’s recommendations were never implemented.

Conclusion

It is about time that we start expecting the judges of our constitutional courts to follow CJI Hidayatullah’s excellent example in which he had accepted government job only after the cooling period of several years.

 

 

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Foreign Policy Watch: India-SAARC Nations

A revival of multilateralism, steered by India

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much.

Mains level: Paper 2- Opportunity for India to assume global leadership in dealing with the COVID-19 pandemic

Context

A leadership role by India in mobilising world collaboration would be in keeping with its traditional activism globally.

Challenges and two aspects associated with it.

  • The COVID-19 pandemic has brought out in sharp relief the compelling reality that has been staring us in the face for the past several years.
  • This reality has two aspects.
  • First aspect: That most challenges confronting the world and likely to confront it in the future are cross-national in character. They respect no national boundaries and are not amenable to national solutions.
  • Second aspect: These challenges are cross-domain in nature, with strong feedback loops.
    • A disruption in one domain often cascades into parallel disruptions in other domains.
    • For example, the use of chemical fertilizers and toxic pesticides may promote food security but have injurious health effects, undermining health security.
    • Whether at the domestic or the international level, these inter-domain linkages need to be understood and inform policy interventions. The UN Sustainable Development Goals (SDGs) reflect this awareness.

Rise in nationalism

  • Need for multilateral approach: The intersection of cross-national and cross-domain challenges demand multilateral approaches.
    • They require empowered international institutions of governance.
    • Underlying these must be a spirit of internationalism and solidarity, a sense of belonging to common humanity.
  • Moving in the reverse direction-Rise of nationalism: Over the past decade and more, the world has been moving in the reverse direction. There has been an upsurge in narrow nationalism, an assertion of parochial interests over the pursuit of shared interests and a fostering of competition among states rather than embracing collaboration.
  • The global challenge of COVID-19: COVID-19 has brought these deepening contradictions into very sharp relief. This is a global challenge which recognises no political boundaries. It is intimately linked to the whole pattern of large-scale and high-density food production and distribution.
  • Health crisis turned into economic crisis: It is a health crisis but is also spawning an economic crisis through disrupting global value chains and creating a simultaneous demand shock. It is a classic cross-national and cross-domain challenge.

How countries are dealing with COVID-19 and possible outcomes

  • No coordination at the international level: But interventions to deal with the COVID-19 crisis are so far almost entirely at the national level, relying on quarantine and social distancing. There is virtually no coordination at the international level.
  • Blame game at the international level: We are also seeing a blame game erupt between China and the United States which does not augur well for international cooperation and leadership.
  • The hopeful outcome of international cooperation: While this is the present state of play, the long-term impact could follow alternative pathways.
    • One, the more hopeful outcome would be for countries to finally realise that there is no option but to move away from nationalistic urges and embrace the logic of international cooperation through revived and strengthened multilateral institutions and processes.
  • The depressing outcome of intense nationalist trends: The other more depressing consequence may be that nationalist trends become more intense, countries begin to build walls around themselves and even existing multilateralism is further weakened.
    • Institutions such as the United Nations and the World Health Organization which are already marginalised may become increasingly irrelevant.
    • There could be a return to autarkic economic and trade policies and an even deeper and more pervasive anti-globalisation sentiment.
  • Depression decade ahead: Unless there is a conscious effort to stem this through a reaffirmation of multilateralism, we are looking at a very depressing decade ahead.
    • This is when the world needs leadership and statesmanship, both in short supply.
  • Contrast with the financial crisis: This is in contrast to the U.S.-led response to the global financial and economic crisis of 2008 when the G-20 summit was born and a coordinated response prevented catastrophic damage to the global economy.

Leadership role for India

  • Is there a role here for India which is a key G-20 country, the world’s fifth-largest economy and with a long tradition of international activism and promotion of rule-based multilateralism?
  • In this context, Prime Minister Narendra Modi’s remarks at the recent Economic Times Global Business Summit are to be welcomed.
    • While speaking of the COVID-19 crisis, he said, “Like today, the world is facing a huge challenge in the form of Corona Virus. Financial institutions have also considered it a big challenge for the financial world. Today, we all have to face this challenge together. We have to be victorious with the power of our resolution of ‘Collaborate to Create’.”
    • He went on to observe that while the world today is “inter-connected, inter-related and also interdependent”, it has “not been able to come on a single platform or frame a Global Agenda, a global goal of how to overcome world poverty, how to end terrorism, how to handle Climate Change issues.”
  • From “Equal distance” to friendship with all: Modi lauded government’s policy of seeking friendship with all countries as contrasted from the earlier policy of non-alignment. He seemed to suggest that non-alignment was a defensive policy which advocated “equal distance from every country”.
    • Now, he claimed, India was still “neutral” — presumably meaning non-alignment — “but not on the basis of distance but on the basis of friendship”.
    • He cited India’s friendship with Iran and Saudi Arabia, and with the U.S. as well as Russia.

India’s foreign policy

  • Non-alignment: Mr Modi may wish to distinguish his foreign policy from that of his predecessors, but what he describes as its “essence” is hardly distinguishable from the basic principles of Indian foreign policy since Nehru.
  • Non-alignment was not defensive: India’s non-alignment was anything but defensive. The international peace-keeping contribution that the Prime Minister referred to has its origins in Nehru’s sense of international responsibility.
  • Friendship with all: India has always professed its desire to have friendly relations with all countries but has been equally firm in safeguarding its interests when these are threatened.
  • Mutually beneficial partnership: India’s non-alignment did not prevent it from forging strong and mutually beneficial partnerships with major countries.
    • The India-Soviet partnership from 1960-1990 is an example just as the current strategic partnership with the U.S. is.
  • Foreign policy rooted in a civilisational sense: The foreign policy of his predecessors had been rooted in India’s civilisational sense, its evolving place in the international system and its own changing capabilities.
    • Their seminal contributions should be acknowledged and built upon rather than proclaim a significant departure.

Move in line with traditional foreign policy

  • The Prime Minister’s plea for global collaboration to deal with a densely interconnected world is in line with India’s traditional foreign policy.
    • Move in keeping with traditional activism on a global scale: A leadership role in mobilising global collaboration, more specifically in fighting COVID-19 would be in keeping with India’s traditional activism on the international stage.
  • Commendable SAARC move: The Prime Minister has shown commendable initiative in convening leaders of the South Asian Association for Regional Cooperation nations for a regional collaborative effort on COVID-19.
    • International initiative: This should be followed by an international initiative, either through the G-20 or through the U.N.

Way forward

  • Reformed and Strengthened U.N. should be India’s agenda: The Prime Minister made no reference to the role of the U.N., the premier multilateral institution, as a global platform for collaborative initiatives. There may have been irritation over remarks by the UN Secretary-General on India’s domestic affairs and the activism displayed by the UN Commissioner for Human Rights on the Citizenship (Amendment) Act controversy.
    • The U.N. Secretary General’s statement on India’s domestic affairs and activism by UN Secretary-General on India’s domestic affairs should not influence India’s long-standing commitment to the U.N. as the only truly inclusive global platform enjoying international legitimacy despite its failings.
    • If one has to look for a “single platform” where a Global Voice could be created, as the Prime Minister suggested, surely a reformed and strengthened U.N. should be on India’s agenda.
  • Opportunity for India in the pandemic: The COVID-19 pandemic presents India with an opportunity to revive multilateralism, become a strong and credible champion of internationalism and assume a leadership role in a world that is adrift. The inspiration for this should come from reaffirming the wellsprings of India’s foreign policy since its Independence rather than seeking to break free.

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Health Sector – UHC, National Health Policy, Family Planning, Health Insurance, etc.

PCR Test for Diagnosis of the COVID-19

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Polymerase Chain Reaction Test

Mains level: Coronovirus outbreak and its mitigation

 

The diagnosis of COVID-19 can be done with the Polymerase Chain Reaction (PCR) Test which is explained as under:

The PCR Test

  • It uses a technique that creates copies of a segment of DNA. ‘Polymerase’ refers to the enzymes that make the copies of DNA.
  • Kary Mullis, the American biochemist who invented the PCR technique, was awarded the Nobel Prize for Chemistry in 1993.
  • The ‘chain reaction’ is how the DNA fragments are copied, exponentially — one is copied into two, the two are copied into four, and so on.
  • However, SARS-COV-2 is a virus made of RNA, which needs to be converted into DNA. For this, the technique includes a process called reverse transcription.
  • A ‘reverse transcriptase’ enzyme converts the RNA into DNA. Copies of the DNA are then made and amplified.
  • A fluorescent DNA binding dye called the “probe” shows the presence of the virus. The test also distinguishes SARS-COV-2 from other viruses.

Various Stages:

1) Collection and transport

  • Testing centre takes swabs from nasal cavities and back of the throat (pharynx), and puts samples in a “virus transport medium”, which contains balanced salts and albumin to prevent the virus from disintegrating.
  • Sample is then transported in cold storage to the testing lab.

2) Extraction of viral RNA

  • Coronaviruses have large single-stranded RNA genomes.
  • Testing lab extracts the RNA from the samples, using commercially available kits.

3) Putting THE RNA in THE PCR mix

  • Extracted RNA is added to a polymerase chain reaction (PCR) mix.
  • This includes the ‘master mix’, which contains a ‘reverse transcriptase’ enzyme that converts the RNA into DNA.
  • Master Mix contains Taq polymerase, the enzyme that creates copies of the DNA, nucleotides, as well as other elements such as magnesium — an ion of which is needed to amplify the DNA.
  • The PCR mix also contains ‘reagents’ such as ‘primers’ and ‘probes’.
  • Primers are particular strands of DNA that are designed to bind with the DNA that is to be copied; probes are used to detect the specific sequence in the DNA sample.
  • Finally, the PCR mix consists of a “housekeeping” gene — a normal human gene (RNAse P) that is used to ensure that samples were properly collected, and RNA extracted.

4) Amplification of the viral DNA

  • Sample, in its PCR mix, is put into tubes or plates, which are then put in a thermal cycler machine that is used to conduct the PCR process.
  • First, the RNA is converted into DNA. Then the process of copying the genes starts.
  • The thermal cycler heats and cools the mixture with the sample, alternating between three temperatures — for melting the DNA to separate the two strands.
  • The thermal cycler runs 30-40 such cycles in order to amplify the DNA to check for the virus.

5) Testing against controls

  • Amplified DNA is tested against a positive control, which usually consists of genes of the virus cloned into plasmid, and a negative control, which is a ‘known’ sample that has tested negative for the virus earlier.
  • RNase P should show amplification, positive control should be positive, negative control should be negative, and then whatever result you get for the specimen, is the correct result.
  • In order for a test to be valid before the result is released, certain ‘validity criteria’ have to be met.
  • If the housekeeping gene (RNase P) is positive, positive control is positive, negative control is negative, and the sample does not show any PCR positive result, the sample is declared negative.
  • If the PCR result is positive, the patient has COVID-19.

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Nuclear Energy

Dumping of Radioactive Nuclear Waste

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Heavy Water

Mains level: Nuclear pollution

In a controversial move, Japan has decided to dump the radioactive heavy water from the Fukushima nuclear power plant into the Sea.  The dumping of nuclear waste is considered to be the easiest way to get rid of it.

What is Heavy Water?

  • Heavy water (deuterium oxide) is a form of water that contains a larger than normal amount of the hydrogen isotope deuterium rather than the common hydrogen that makes up most of the hydrogen in normal water.
  • Heavy water is used in certain types of nuclear reactors, where it acts as a neutron moderator to slow down neutrons.
  • Slowed neutrons are more likely to react with the fissile uranium-235 than with uranium-238 which captures neutrons without fissioning.

Where is Fukushima waste?

  • It is currently being stored in large tanks, but those are expected to be full by 2022.
  • Almost 1.2 million liters of radioactive water from the Fukushima nuclear power plant is to be released into the ocean.
  • The contaminated water has since been used to cool the destroyed reactor blocks to prevent further nuclear meltdowns.

Hazards of the nuclear contamination

  • Radioactive pollution in the ocean has been increasing globally — and not just since the disaster at Fukushima.
  • Radiation levels in the sea off Fukushima were millions of times higher than the government’s limit of 100 Becquerel.
  • A single Becquerel that gets into our body is enough to damage a cell that will eventually become a cancer cell.
  • Even the smallest possible dose, a photon passing through a cell nucleus, carries a cancer risk. Although this risk is extremely small, it is still a risk.

Who else dumped radioactive water into oceans?

The dumping of nuclear waste in drums was banned in 1993 by the London Convention on the Prevention of Marine Pollution. But discharging liquid contaminated with radiation into the ocean is still permitted internationally.

  • The lion’s share of dumped nuclear waste came from Britain and the Soviet Union, figures from the IAEA show.
  • By 1991, the US had dropped more than 90,000 barrels and at least 190,000 cubic meters of radioactive waste in the North Atlantic and Pacific.
  • To this day, around 90% of the radiation in the ocean comes from barrels discarded in the North Atlantic, most of which lie north of Russia or off the coast of Western Europe.

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Parliament – Sessions, Procedures, Motions, Committees etc

Nominated members of Rajya Sabha

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Nominated members in RS

Mains level: Ethical issue involved

Former CJI Ranjan Gogoi has been nominated as a member of Rajya Sabha.

Nominated members in RS

  • As per the Fourth Schedule to the Constitution of India on 26 January 1950, the Rajya Sabha was to consist of 216 members of which 12 members were to be nominated by the President and the remaining 204 elected to represent the States.
  • The present strength, however, is 245 members of whom 233 are representatives of the states and union territories and 12 are nominated by the President.
  • The Rajya Sabha is not subject to dissolution; one-third of its members retire every second year.
  • The 12 nominated members of the Rajya Sabha are persons who are eminent in particular fields, and are well known contributors in the particular field.
  • The nominated members are usually amongst persons having special knowledge or practical experience in literature, science, art and social service.

Constitutional provisions

  • 80(1)(a) of Constitution of India makes provision for the nomination of 12 members to the Rajya Sabha by the President of India in accordance with provisions of Arts.80(3).
  • 80(3) says that the persons to be nominated as members must be possessing special knowledge or practical experience in respect of such matters as the following namely : Literature, science, art and social service.

Earlier CJIs in other Offices

  • Justice Hidayatullah was appointed vice-president nine years after his tenure as CJI ended (1979).
  • Justice Ranganath Mishra was appointed six years after his retirement (1998).
  • Justice Bahraul Islam served as a member of the Rajya Sabha several years before he was elevated to the SC (1983).
  • Justice Subba Rao, who contested for the post of president (and lost to Zakir Hussain) was roundly criticised for the decision at that time.

Issues with CJI’s appointment

  • Late Arun Jaitley cautioned, in 2012, that “pre-retirement judgments are influenced by a desire for a post-retirement job”. Perhaps, those words were never more relevant than they are today.
  • The immediacy and hurried nature of the present appointment, barely four months after Justice Gogoi retired, is bound to give rise to questions about its context.
  • It was a tenure that inspired much scrutiny; a tenure which saw the repeated use of sealed envelopes, the contents of which were known only to the government; a tenure which recorded a significant and frequent number of judgments in favour of the executive.

What were the alternatives?

  • Several appointments to administrative bodies require a cooling-off period for individuals so as to eliminate the possibility or suspicion of a conflict of interest or quid pro quo.
  • Officials who retire from sensitive positions are barred from accepting any other appointment for a period of time, normally two years.
  • These cooling-off periods in posts are premised on the snapping off of the nexus between previous incumbency and new appointment by the interposition of a sufficient time gap.

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River Interlinking

Danube-Oder-Elbe Canal

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Rivers mentioned in the newscard

Mains level: Not Much

 

Environmental organisations from across central and Eastern Europe have criticised a major project intending to link three rivers and provide seamless navigation between three of Europe’s peripheral seas, according to a statement.

Danube-Oder-Elbe Canal

  • For centuries Europe’s rulers have dreamed of construction of a huge Y-shaped canal connecting the Elbe, Oder and Danube rivers, most of which would be on Czech territory.
  • The Canal intends to connect the Danube, Oder and Elbe rivers and thus provide another navigable link from the Black Sea to the North and Baltic Seas.
  • The Main-Danube Canal already provided a navigable connection between the Black Sea and the North Sea.
  • Several hundred kilometres of artificial waterways would have to be built for the canal, according to the statement.
  • Critics have called on the European Commission to ensure that the project be excluded from EU funding, and not be included as part of the Trans-European Transport Network.

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Modern Indian History-Events and Personalities

Persons in news: Sheikh Mujibur Rahman

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Sheikh Mujib and his legacy

Mains level: NA

March 17 is the birth anniversary of Bangabandhu Sheikh Mujibur Rahman (1920-1975), the founding leader of Bangladesh and the country’s first Prime Minister.

Sheikh Mujibur Rahman

Sheikh Mujibur Rahman in 1950.jpg

  • Before joining politics, Rahman studied law and political science in Kolkata and Dhaka and agitated for Indian independence.
  • He is referred to as Sheikh Mujib or simply Mujib, the title ‘Bangabandhu’ meaning ‘friend of Bengal’.
  • In 1949, he joined the Awami League, a political party which advocated greater autonomy for East Pakistan.
  • A popular leader in East Pakistan, Rahman played an important role in the six-point movement and the Anti-Ayub movement.

Role in Bangladesh liberation

  • In 1970, his party secured an absolute majority in the Pakistani general elections; the country’s first, winning more seats than all parties in West Pakistan, including Zulfikar Ali Bhutto’s Pakistan People’s Party.
  • The election results were not honoured; leading to a bloody civil war, and Sheikh Mujib declared Bangladesh’s independence from Pakistan on March 26, 1971.
  • The declaration coincided with a ruthless show of strength by the Pakistani military, in which tanks rolled out on the streets of Dhaka and several students and intellectuals were killed.
  • India under then PM Indira Gandhi provided full support to Rahman and Bangladesh’s independence movement, resulting in the creation of a sovereign government at Dhaka in January 1971.

His legacy

  • Rahman, who had been arrested and taken to West Pakistan, returned to Bangladesh after being freed in January 1972.
  • For the next three years, Rahman held the new country’s prime ministerial post, and became a celebrated icon in India as well, admired for his moving speeches and charismatic personality.
  • On 15 August 1975, Rahman was killed in a military coup along with his wife and three sons, including 10-year-old Sheikh Russel.
  • His daughters, the current Prime Minister Sheikh Hasina and her younger sister Sheikh Rehana, survived as they were abroad at the time.

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Food Procurement and Distribution – PDS & NFSA, Shanta Kumar Committee, FCI restructuring, Buffer stock, etc.

Essential Commodities

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Essential Commodities Act, PSF

Mains level: Read the attached story

The Price Monitoring Division (PMD) in the Department of Consumer Affairs is monitoring the retail and wholesale prices of 22 essential food commodities due to increased panic buying by customers.

Essential Commodities Act

  • The ECA is an act which was established to ensure the delivery of certain commodities or products, the supply of which if obstructed owing to hoarding or black-marketing would affect the normal life of the people.
  • The ECA was enacted in 1955. This includes foodstuff, drugs, fuel (petroleum products) etc.
  • It has since been used by the Government to regulate the production, supply and distribution of a whole host of commodities it declares ‘essential’ in order to make them available to consumers at fair prices.
  • Additionally, the government can also fix the maximum retail price (MRP) of any packaged product that it declares an “essential commodity”.
  • The list of items under the Act includes drugs, fertilizers, pulses and edible oils, and petroleum and petroleum products.
  • The Centre can include new commodities as and when the need arises, and takes them off the list once the situation improves.

How ECA works?

  • If the Centre finds that a certain commodity is in short supply and its price is spiking, it can notify stock-holding limits on it for a specified period.
  • The States act on this notification to specify limits and take steps to ensure that these are adhered to.
  • Anybody trading or dealing in the commodity, be it wholesalers, retailers or even importers are prevented from stockpiling it beyond a certain quantity.
  • A State can, however, choose not to impose any restrictions. But once it does, traders have to immediately sell into the market any stocks held beyond the mandated quantity.
  • This improves supplies and brings down prices. As not all shopkeepers and traders comply, State agencies conduct raids to get everyone to toe the line and the errant are punished.
  • The excess stocks are auctioned or sold through fair price shops.

Ex: The Union Government has brought masks and hand-sanitisers under the ECA to make sure that these products, key for preventing the spread of Covid-19 infection, are available to people at the right price and in the right quality.

What about Food Items?

  • The items covered include rice, wheat, atta, gram dal, arhar dal, moong dal, urad dal, masoor, dal, tea, sugar, salt, Vanaspati, groundnut oil, mustard oil, milk, soya oil, palm oil, sunflower oil, gur, potato, onion and tomato.
  • Based on the deliberations, Government takes various measures from time to time to stabilize prices of essential food items which, inter-alia, include appropriately utilizing trade and fiscal policy instruments like import duty.
  • The govt. can impose stock limits and advise State for effective action against hoarders & black marketers etc. to regulate domestic availability and moderate prices.
  • The government utilizes the buffer of agri-horticultural commodities like pulses, onion, etc. built under Price Stabilization Fund (PSF) to help moderate the volatility in prices.

Back2Basics

Price Stabilization Fund (PSF)

  • The PSF was set up in 2014-15 under the Department of Agriculture, Cooperation & Famers Welfare (DAC&FW) to help regulate the price volatility of important agri-horticultural commodities like onion, potatoes and pulses were also added subsequently.
  • Procurement of these commodities will be undertaken directly from farmers or farmers’ organizations at farm gate/mandi and made available at a more reasonable price to the consumers.
  • Losses incurred, if any, in the operations will be shared between the Centre and the States.
  • PSF provides for advancing interest-free loans to State Governments/ UTs and Central agencies to support their working capital and other expenses they might incur on procurement and distribution interventions for such commodities.
  • The scheme provides for maintaining a strategic buffer of the commodities for subsequent calibrated release to moderate price volatility and discourages hoarding and unscrupulous speculation.
  • The PSF is managed centrally by a Price Stabilization Fund Management Committee (PSFMC) which will approve all proposals from State Governments and Central Agencies.
  • The PSF is maintained as a Central Corpus Fund by Small Farmers Agribusiness Consortium (SFAC), a society promoted by the Ministry of Agriculture for linking agriculture to private businesses and investments and technology.

With inputs from: http://www.arthapedia.in/index.php?title=Price_Stabilisation_Fund_(PSF)

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Women empowerment issues – Jobs,Reservation and education

Count work, not workers

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much.

Mains level: Paper 3- Decline in women's work participation rate and possible causes of it.

Context

India is one of the few countries in the world where women’s work participation rates have fallen sharply — from 29 per cent in 2004-5 to 22 per cent in 2011-12 and to 17 per cent in 2017-18.

What could be the possible explanations for the decline?

  • No consensus among economists: Trying to explain whether women are choosing to focus on domestic responsibilities or whether they are pushed out of the workforce has become a minor industry among economists.
  • Can the quality of data be the explanation? Strangely, the one explanation we have not looked at is whether the declining quality of economic statistics may account for this trend.
    • Our pride in the statistical system built by PC Mahalanobis is so great that we find it unimaginable that it could fail to provide us with reliable employment data.
    • However, as challenges to economic statistics have begun to emerge in such diverse areas as GDP data and consumption expenditure, perhaps it is time to consider the unimaginable.
    • Issue of data collection: Is the decline in women’s labour force participation real or is it a function of the way in which employment data are collected?

Anatomy of the decline in participation rates

  • Driven by rural women: The anatomy of the decline in women’s work participation rates shows that it is driven by rural women.
  • Data of the prime working-age group: In the prime working-age group (25-59)-
    • Urban area data: Urban women’s worker to population ratios (WPR) fell from 28 per cent to 25 per cent between 2004-5 and 2011-12, stagnating at 24 per cent in 2017-18.
    • Rural area data: However, compared to these modest changes, rural women’s WPR declined sharply from 58 per cent to 48 per cent and to 32 per cent over the same period.
  • Among rural women, the largest decline seems to have taken place in women categorised as unpaid family helpers — from 28 per cent in 2004-5 to 12 per cent in 2017-18.
    • This alone accounts for more than half of the decline in women’s WPR. The remaining is largely due to a drop of about 9 percentage points in casual labour.
  • In contrast, women counted as focusing solely on domestic duties increased from 21 per cent to 45 per cent.

What are the explanations for this massive change?

  • Data collection issue: It is the change in our statistical systems that drives these results.
    • Change of workforce collecting data: The questionnaires through which the National Statistical Office (NSO) collects employment data have not changed, but the statistical workforce has, and the surveys that performed reasonably well in the hands of seasoned interviewers are too complex for poorly trained contract data collectors.
  • How data is collected? The National Sample Surveys (NSS) do not have a script that the interviewer reads out. They have schedules that must be completed. The interviewer is trained in concepts to be investigated and then left to fill the schedules to the best of his or her ability.
    • The NSS increasingly relies on contract investigators hired for short periods, who lack
  • Need for redesigning the surveys: Do we need to return to the days of permanent employees or can we design our surveys to overcome errors committed by relatively inexperienced interviewers?
    • A survey design experiment led by Neerad Deshmukh at the NCAER-National Data Innovation Centre provides an intriguing solution.
    • In this experimental survey, interviewers first asked about the primary and secondary activity status of each household member, mimicking the NSS structure.
    • They then asked a series of simple questions that included ones like, “do you cultivate any land?” If yes, “who in your household works on the farm?”
    • Similar questions were asked about livestock ownership and about people caring for the livestock, ownership of petty business and individuals working in these enterprises.
  • What was the result of survey experiment: The results show that the standard NSS-type questions resulted in a WPR of 28 per cent for rural women in the age group 21-59, whereas the detailed activity listing found a WPR of 42 per cent — for the same women.
    • This is an easily implementable module that does not require specialised knowledge on the part of the interviewer.

Identifying the sectors from which women are excludes

  • Missing the identification of sector: In our concern with ostensibly declining women’s work participation, we have missed out on identifying sectors from which women are excluded and more importantly, in which women are included.
  • What data for men indicate? For rural men, ages 25-59, between 2004-5 and 2017-18, casual labour declined by about 6 percentage points.
    • However, this decline is counterbalanced by regular salaried work which increased by 4 percentage points.
    • Thus, it seems likely that men are exchanging precarious employment with higher-quality jobs.
  • What data for women indicate? In contrast, women’s casual work has declined by 9 percentage points while their regular salaried work increased by a mere 1 percentage point.
    • Moreover, the usual route to success, gaining formal education, has little impact on women’s ability to obtain paid work.
  • The explanation for the disparity: Rural men with a secondary level of education have options like working as a postman, driver or mechanic — few such opportunities are open to women.
    • It is not surprising that women with secondary education have only half the work participation rate compared to their uneducated sisters.
  • Takeaway: The focus on employment for women needs to be on creating high-quality employment rather than getting preoccupied with declining employment rates.

Conclusion

It may be time for us to return to the recommendations of ‘Shramshakti: Report of National Commission on Self Employed Women and Women in the Informal Sector’ and develop our data collection processes from the lived experiences of women and count women’s work rather than women workers. Without this, we run the risks of developing misguided policy responses.

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Iran’s Nuclear Program & Western Sanctions

A crisis-hit Iran at the crossroads

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much.

Mains level: Paper 2- Growing difficulties for Iran amid sanctions and cooperation with China and Pakistan, and implications for India.

Context

The coronavirus pandemic creates fresh possibilities for cooperation between the West Asian nation and its neighbours.

Challenges faced by Iran

  • Hardest hit by COVID-19 among the West Asian countries: Iran, the hardest-hit among the West Asian countries in the global pandemic, is on the front line of the battle against the coronavirus that causes the causes coronavirus disease, COVID-19.
  • Healthcare reeling under combined load: With nearly 900 deaths and over 14,000 cases of infection, its health-care system is reeling under the combined effect of the pandemic and American sanctions.
  • Possibility of social unrest resurfacing: The masses thronging the streets some weeks ago may have receded out of fear of both the coronavirus and the wrath of the regime, but there is a possibility of social unrest resurfacing if the government’s response to the spread of the virus is ineffective and shortages are exacerbated.
  • Emergency funding from IMF: Iran has already approached the International Monetary Fund for $5-billion in emergency funding to combat the pandemic.
  • Easing of some sanctions by the US: The U.S. Treasury had announced in end-February that it was lifting some sanctions on the Central Bank of Iran to facilitate humanitarian trade such as the import of testing kits for COVID-19. Clearly, Iran thinks this is inadequate.

Iran’s nuclear policy

  • Iran to resumed nuclear activities: Following the U.S.’s decision to jettison the deal, Iran had announced that it would resume its nuclear activities but had agreed to respect the International Atomic Energy Agency (IAEA) inspections and enhanced monitoring as part of its obligations under the additional protocol.
  • What were the conditions of JCPOA? The JCPOA limited Iran to enrich uranium only up to a 3.67% concentration and its stockpile to 300 kg of UF6 (corresponding to 202.8 kg of U-235), and further capped its centrifuges to no more than 5,060, besides a complete cessation of enrichment at the underground Fordow facility.
    • It also limited Iran’s heavy water stockpile to 130 tonnes.
  • Restriction on enrichment lifted by Iran: Since July 2019, Iran has lifted all restrictions on its stockpiles of enriched uranium and heavy water.
    • It has been enriching uranium to 4.5%, beyond the limit of 3.67%.
    • Moreover, it has removed all caps on centrifuges and recommenced enrichment at the Fordow facility.
    • An increased stockpile of Uranium: As of February 19, Iran’s enriched uranium stockpile totalled 1,020.9 kg, compared to 372.3 kg noted in the IAEA’s report of November 3.
    • IAEA’s second report: In a second report issued on March 3, the IAEA has identified three sites in Iran where the country possibly stored undeclared nuclear material or was conducting nuclear-related activities.
    • The IAEA has sought access to the suspect sites and has also sent questionnaires to Iran but has received no response.
  • Possibility of being on the collision course with the UNSC: The United Kingdom, France and Germany had invoked the JCPOA Dispute Resolution Mechanism (DRM) as early as in January this year.
  • The threat to abandon the NPT: With the next Review Conference of the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) set to take place in New York from April 27 to May 22, 2020, Iran’s threat to abandon the NPT if the European Union takes the matter to the UN Security Council (UNSC) may yet only be bluster, but the failure of the DRM process would certainly put Iran on a collision course with the UNSC.
  • Support from China at UNSC: A sympathetic China, which holds the rotational presidency of the UNSC for March, should diminish that prospect, albeit only temporarily.
  • Possibility of reversing the sanctions: As things stand, the terms of UNSC Resolution 2231, which had removed UN sanctions against Iran in the wake of the JCPOA, are reversible and the sanctions can be easily restored.
    • That eventuality would prove disastrous, compounding Iran’s current woes.
  • Possibility of Iran continuing its nuclear program: While recognising that cocking a snook at the NPT in the run-up to the NPT RevCon and the U.S. presidential elections will invite retribution, Iran may use the global preoccupation with the pandemic to seek a whittling down of sanctions and to continue its nuclear programme.
    • More breathing time amid due to pandemic: In the event that the NPT RevCon is postponed due to the prevailing uncertainty, Iran may yet secure some more breathing time.

Iran’s ties with China and implications for India

  • China- only major country to defy the US sanctions: Meanwhile, the U.S. continues to implement its “maximum pressure policy”. China remains the only major country that continues to defy U.S. sanctions and buy oil from Iran, apart from a small quantum that goes to Syria.
    • The sale of oil to China, however, does little to replenish Iran’s coffers. China is eschewing payments in order to avoid triggering more sanctions against Chinese entities.
  • Trilateral naval exercise: When seen in the context of the trilateral naval exercise between China, Iran and Russia in the Strait of Hormuz in the end of December 2019 codenamed “Marine Security Belt”, these developments suggest a further consolidation of Sino-Iran ties in a region of great importance to India.
    • Inclusion of Pakistan in the exercise: Over time, this could expand into a “Quad” involving China’s “all-weather friend” Pakistan in the Indian Ocean and the northern Arabian Sea, with broader implications for India as well as the “Free and Open” Indo-Pacific.

Conclusion

  • Iran’s foreign policy to remain unchanged: The first round of Iran’s parliamentary elections in February showed that the hardliners are firmly ensconced. The fundamental underpinnings of Iran’s foreign policy are likely to remain unchanged.
  • Possibility of cooperation among neighbours: Yet, the rapid spread of the coronavirus in the region creates fresh possibilities for cooperation between Iran and its neighbours, if regional tensions are relegated to the back-burner.
  • Laudable example by India: Prime Minister Narendra Modi’s initiative to develop a coordinated response to the pandemic in the South Asian Association for Regional Cooperation framework, indeed, sets a laudable example.
  • Much depends on Iran’s willingness: Much though will depend on Iran’s willingness to rein in its regional ambitions and desist from interference in the domestic affairs of others.

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Foreign Policy Watch: India-SAARC Nations

From virtual conferencing to real leadership

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Not much.

Mains level: Paper 2- Need to revive the SAARC to deal with the COVID-19 outbreak

Context

SAARC has become the ‘virtual’ platform through which leaders of the eight countries of our troubled region agreed to work together to combat unarguably the greatest immediate threat to the people: the COVID-19 health pandemic.

Success depends on India

  • The success of the Modi-SAARC initiative will largely depend on India—the dominant power of the region, in every sense.
  • Pakistan’s position may become marginal: Once New Delhi demonstrates that it has the capacity, the political willingness to institutionalise and to lead a mutually beneficial cooperative regime in the region, Pakistan’s “churlish” behaviour will become marginal to SAARC.
    • Various international relations theorists view this as a function of “hegemonic stability”.
  • Much needs to be done: Much more will need to be done by New Delhi to establish that the video conference was not a mere event, but the assertive expression of its new willingness to stabilise the region through cooperative mechanisms, for our common future.
  • Rare opportunity: This is a moment thus of a rare opportunity for India to establish its firm imprimatur over the region, and to secure an abiding partnership for our shared destiny.

The genesis of SAARC

  • SAARC was born at a moment of hope in the 1980s.
  • An initiative by Zia Ur Rehman: The idea was initiated by one of the most inscrutable leaders of the region, General Zia Ur Rehman of Bangladesh, who, met many of the other leaders personally and dispatched special envoys to the capitals of the countries of the region.
    • Dhaka’s persistence resulted in the first summit of the seven leaders of the region in 1985.
    • Afghanistan joined in 2007.
  • Not lived up to expectation: In the nearly 35 years of its existence, even its champions will concede however that SAARC has, to put it euphemistically, not lived up to the promise of its founder.

How the SAARC has performed?

  • The dismal performance in the trade: South Asia is the world’s least integrated region; less than 5% of the trade of SAARC countries is within. A South Asian Free Trade Zone agreed on, in 2006, remains, in reality, a chimera.
  • Moribund state: The last SAARC summit, scheduled to be held in Islamabad in November 2016, was postponed after the terrorist attacks in Uri; none has been held since then, and until Mr. Modi’s initiative, no major meeting had been planned.
  • Marginal in our collective consciousness: A quick look at some of the questions posed in the Lok Sabha and Rajya Sabha on SAARC, in the last years, suggest that Indian MPs seek answers on why India is still a member of SAARC and on the strength of other organisations such as the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) that India is engaged with.
    • Thus SAARC had become almost marginal to our collective consciousness.

The fadeout and revival of SAARC

  • India-Pakistan tension: Clearly, most of the smaller states and external players believe that the India-Pakistan conflict has undermined SAARC.
  • How Pakistan derails the initiatives? Bilateral issues cannot be discussed in SAARC but since the organisation relies on the principle of unanimity for all major decisions, Pakistan has often undermined even the most laudable initiative lest it gives India an advantage.
    • Relative gains by India are more important for Pakistan than the absolute gains it secures for itself.
  • Pakistan’s use of terror: For India, Pakistan’s use of terror as an instrument of foreign policy has made normal business impossible.
  • Need of the revival to deal with the COVID-19: There is no doubt that the impact of COVID-19 will be unprecedented, in terms of those it targets and the way we live. It is too early to judge the consequences , but it will take years for the world to return to the old and familiar.
    • Strategies to cope with this new insidious, scheming and diabolic strain of the coronavirus have to be dynamic and ad hoc.
    • Two principles to deal with the epidemic: Containment and the possible prevention of community transmission are the only two principles that are firmly tested.
    • If community transmission occurs and cannot be contained, the consequences will be calamitous.
  • Time to act together: This is indeed a time for SAARC and the experts of the region to think and act together and India can lead this effort.

Conclusion

It is evident that Mr Modi is an out-of-the-box lateral thinker, especially on foreign policy. More importantly, the tragedy of COVID-19 may provide an opportunity for India to demonstrate its compassionate face to secure a region at peace with itself. India cannot afford to not to harvest this opportunity, after having sowed the seeds of a New South Asia.

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Parliament – Sessions, Procedures, Motions, Committees etc

Speaker vs Governor Tussle

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Discretionary powers of Governor

Mains level: Speaker vs Governor Tussle

With the Supreme Court set to hear on a plea seeking a directive to the government in Madhya Pradesh to take a floor test “within 12 hours”, the spotlight is back on the legal debate on the powers of the Governor and the Speaker under the Constitution.

Primacy to Floor Test

  • Since 2014, the legal-political tussle between the Governor and Speaker has prompted the Supreme Court’s intervention in three major instances — in the Arunachal Pradesh and Uttarakhand cases in 2016 and in the Karnataka case in 2019.
  • In all three cases, the court emphasised the primacy of the floor test.
  • In the Arunachal and Uttarakhand cases, the House was in suspended animation as President’s Rule had been imposed.
  • The Supreme Court ordered that the House be summoned and a floor test held to end the impasse.
  • But Article 212 of the Constitution bars courts from inquiring into proceedings of the Legislature.

Earlier instances

  • Earlier, the Sarkaria Commission had recommended that, if the CM neglects or refuses to summon the Assembly for a floor test, the Governor should summon the Assembly.
  • If the House is adjourned sine die or prorogued without holding a floor test, then all options are open before the Governor.
  • However, when the House is in session, the question of whether the court can direct the Speaker to hold a floor test is yet to be settled.
  • In 1998, in the Jagadambika Pal case, the SC had ordered a composite floor test when the House was in session.
  • However, in that case, there were two claimants to the chief minister’s post.

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