From UPSC perspective, the following things are important :
Prelims level: Green carbon fee
Mains level: Sustainable development
Context
According to NITI Aayog, “600 million people in India face high to extreme water stress with nearly 70% of water being contaminated; India is placed at 120th amongst 122 countries in the water quality index”.
The latest global environmental ranking by Yale and Columbia Universities puts India at the bottom among 180 countries.
What is development?
Economic development means different things to different people. On a broad scale, anything a community does to foster and create a healthy economy can fall under the auspice of economic development.
What is sustainability?
The integration of environmental health, social equity and economic vitality in order to create thriving, healthy, diverse and resilient communities for this generation and generations to come. The practice of sustainability recognizes how these issues are interconnected and requires a systems approach and an acknowledgement of complexity.
Sustainability is the balance between the environment, equity, and economy.
What sustainability do for us?
Sustainable practices support ecological, human, and economic health and vitality.
Sustainability presumes that resources are finite, and should be used conservatively and wisely with a view to long-term priorities and consequences of the ways in which resources are used.
In simplest terms, sustainability is about our children and our grandchildren, and the world we will leave them.
Definition of carrying capacity of earth
Carrying capacity: Carrying capacity is the maximum number of a species an environment can support indefinitely. Every species has a carrying capacity, even humans. The species population size is limited by environmental factors like adequate food, shelter, water, and mates. If these needs are not met, the population will decrease until the resource rebounds.
Mother earth has reached its carrying capacity now
No species has altered the Earth’s natural landscape the way humans have.
Global climate change, mass extinction, and overexploitation of our global commons are all examples of the ways in which humans have altered the natural landscape.
Our growing population, coupled with rising affluence and per capita impact, is driving our planet closer to its tipping point.
With population expected to reach 5 billion by 2050, many wonder if our natural resources can keep up with our growing demands.
Enrich your mains answer with this
8 Billion dreams, ambitions, aspirations and only one earth to support them all . Human population, now nearing 8 billion, cannot continue to grow indefinitely. There are limits to the life-sustaining resources earth can provide us. In other words, there is a carrying capacity for human life on our planet.
Development vs environment issues
Unemployment: For India, the national context is shaped by high youth unemployment, millions more entering the workforce each year, and a country hungry for substantial investments in hard infrastructure to industrialise and urbanise.
Growth with low emission footprint: India’s economic growth in the last three decades, led by growth in the services sector, has come at a significantly lower emissions footprint.
Infrastructure: But in the coming decades, India will have to move to an investment-led and manufacturing-intensive growth model to create job opportunities and create entirely new cities and infrastructure to accommodate and connect an increasingly urban population.
Why a Carbon Fee and Dividend is Imperative
It is clear that we will soon pass the limit on carbon emissions, because it requires decades to replace fossil fuel energy infrastructure with carbon-neutral and carbon negative energies.
What could India do to pursue an industrialization pathway that is climate-compatible?
A coherent national transition strategy is important in a global context where industrialised countries are discussing the imposition of carbon border taxes while failing to provide developing countries the necessary carbon space to grow or the finance and technological assistance necessary to decarbonise.
What India needs is an overarching green industrialisation strategy that combines laws, policy instruments, and new or reformed implementing institutions to steer its decentralised economic activities to become climate-friendly and resilient.
Case study for value addition
Bhutan: Bhutan remains, for example, the first and only carbon-negative country in the world, and they have also recently prevented the COVID-19 pandemic from overwhelming its population, with only one Bhutanese citizen passing away from the virus to date.
Way forward
India should set its pace based on its ability to capitalise on the opportunities to create wealth through green industrialisation.
Mains question
Do you think mother earth has reached its carrying capacity? Discuss this in context of development vs environment debate.
op-ed snap | Polity | Mains Paper 2: Indian Constitution - historical underpinnings, evolution, features, amendments, significant provisions and basic structure
Note4Students
From UPSC perspective, the following things are important :
Prelims level: Article 44
Mains level: Paper 2- Uniform civil code issue
Context
The Portuguese Civil Code of 1867, the so-called “common civil code” of Goa, is in the news again. A 28-member parliamentary standing committee recently visited the state to study it in the context of the demand for a uniform civil code.
Background
Long before the arrival of the British imperialists in India, the Portuguese had occupied certain territories in the coastal regions with its capital in Cochin, later shifted to Goa.
They did not interfere with the local customs relating to family relations and framed, in the mid-19th century, three separate codes of religion-based customary laws of Goa, Daman and Diu.
The three codes were formally enforced as the law by royal decrees issued by the King of Portugal.
The Portuguese Civil Code of 1867 was extended to Goa, Daman and Diu by a royal decree of November 18, 1869, declaring that the code would apply to the natives subject to the local usages and customs “so far as they are not inconsistent with morality or public order”.
In 1910, the Portuguese parliament enacted two civil marriage and divorce decrees and, in 1946, a canonical marriage decree for Catholics.
All of these too were extended to Goa, Daman and Diu.
The family law applied by the Portuguese, both at home and in the occupied Indian territories, was thus not a uniform code but a loose conglomeration of civil and religious laws.
After Indian independence
Fourteen years after the advent of Independence, Goa and its affiliated territories were liberated and turned into a Union Territory (UT) under central rule.
The Goa, Daman and Diu Administration Act of 1962 declared that all laws in force in these territories before their liberation would continue to be in force “until amended or repealed by a competent legislature or other competent authority” (Section 5).
None of the pre-liberation family laws was, however, amended or repealed.
Nor was any central law on family rights, including the four Hindu law Acts of 1955-56, extended to any of the three territories.
In 1987, the Goa, Daman and Diu Reorganisation Act made Goa a full-fledged state with its own legislative assembly and left Daman and Diu as a UT.
Twenty-five years later, the Goa state legislature enacted the Succession, Special Notaries and Inventory Proceedings Act, amending certain provisions, mainly procedural, of the 155-year old civil code.
In 2019, the UT of Daman and Diu was merged with another such territory – Dadra and Nagar Haveli (also ruled in the past by Portugal) — to form a single UT under central rule.
As laid down in Section 17 of the unifying Act, this development did not in any way change the family law system prevailing in either of these places since their liberation from foreign rule.
Need for uniform civil code
The law ministry has told the concerned standing committee of Parliament that the Portuguese civil code and its later amendments as in force in Goa may — if required — be duly reviewed.
Uniform civil code: What has been said now by the law ministry about Goa is in the context of implementing the constitutional directive of Article 44 for a uniform civil code for the citizens throughout the territory of India.
However, while the 21st Law Commission had already given its opinion against the feasibility and need of such a code at this juncture
In recent months, the ministry has told Parliament about its reference on this issue to the Law Commission.
There is no justification for retaining over a century-old archaic law, 75 years after the independence of India.
Hindu law Acts of 1955-56 governing four religious communities in the rest of the country needs to be extended to the same communities in Goa, Daman and Diu.
Conclusion
The ministry has now reportedly told the parliamentary committee that enacting a uniform civil code would be possible only when a “sizeable majority” of the people seeks such a change.
Senior scientist Nallathamby Kalaiselvi was appointed the director general of the Council of Scientific and Industrial Research (CSIR), on Saturday, August 6, 2022. This makes her the first woman to head the largest research and development organisation in India, which runs 38 laboratories and institutes, 39 outreach centres, and three innovation centres.
What is CSIR?
The Council of Scientific and Industrial Research, abbreviated as CSIR, was established by the Government of India in September 1942 as an autonomous body that has emerged as the largest research and development organisation in India.
CSIR covers a wide spectrum of science and technology – from oceanography, geophysics, chemicals, drugs, genomics, biotechnology and nanotechnology to mining, aeronautics, instrumentation, environmental engineering and information technology.
Who established it?
Dr Shanti Swarup Bhatnagar
He was the Founder Director (and later first Director-General) of CSIR who is credited with establishing twelve national laboratories. He played a significant role in the building of post-independent Science and Technology infrastructure and in the formulation of India’s S & T policies
CSIR’s Vision
“Pursue science which strives for global impact, technology that enables innovation – driven industry and nurture trans-disciplinary leadership thereby catalyzing inclusive economic development for the people of India”
Why CSIR is important?
Innovation: Regarding intellectual property, the CSIR has over 2971 patents filed internationally with 1592 patents filed in India. Since its inception in 1942 over 14000 patents have been granted worldwide. It was awarded the National Intellectual Property Award in 2018 by the India Patent Office.
Pandemic handling: CSIR identified the unmet needs, assessed its strengths and capabilities for addressing the pandemic and adopted a multi-pronged strategy of working on diagnostics, surveillance, drugs, hospital assistive devices, personal protective equipment and supply chain and logistics. This strategy is now beginning to yield exciting solutions.
Contribution of CSIR
Strategic Sector
Head-Up-Display (HUD) In high-tech areas, CSIR-NAL made significant contribution by developing indigenous Head-Up- display(HUD) for Indian Light Combat Aircraft, Tejas. HUD aids the pilot in flying the aircraft and in critical flight maneuvers including weapon aiming.
Design and Development of Indigenous Gyrotron: Addressing the challenges of technology denial:Design and development of indigenous gyrotron for nuclear fusion reactor has been accomplished.
Energy & Environment
Solar Tree: On July 22nda solar tree designed by CSIR- CMERI lab in Durgapur was launched which occupies minimum space to produce clean power.
Wax Deoiling Technology:Technology developed for recovery of wax developed in collaboration with Engineers India Limited (EIL) and Numaligarh Refinery Ltd., (NRL). Country’s largest wax producing (50,000 metric ton) plant has been commissioned at NRL with investment of over Rs 600 crore.
Value added Agriculture
Medicinal and Aromatic Plants:Enhanced cultivation of Medicinal and Aromatic Plants in the country brought about through development of new varieties and agro-technologies.
Samba Mahsuri Rice Variety – Bacterial Blight Resistant:CSIR has in collaboration with DRR (ICAR) and DBT part funding developed an improved bacterial blight resistant Samba Mahsuri variety.
Rice Cultivar (Muktashree) for Arsenic Contaminated Areas:A rice variety has been developed which restricts assimilation of Arsenic within permissible limit. The variety has been released to farmers of West Bengal.
White-fly resistant Cotton variety:Developed a transgenic cotton line which is resistant to whiteflies. It is expected to render it commercially cultivable in 10 years, after due regulatory clearances.
Healthcare
JD Vaccine for Farm Animals:Vaccine developed and commercialized for Johne’s disease affecting Sheep, Goat, Cow and Buffalo so as to immunize them and increase milk and meat production.
Plasma Gelsolin Diagnostic Kit for Premature Births, and Sepsis related Deaths:A new kit is being developed to diagnose pre-mature birth and sepsis.
Genomics and other omics technologies for Enabling Medical Decision – GOMED: Genetic diseases, though are individually rare, cumulatively affect a large number of individuals. A programme called GOMED (Genomics and other omics technologies for Enabling Medical Decision) has been developed by the CSIR which provides a platform of disease genomics to solve clinical problems.
Food & Nutrition
Ksheer-scanner: The Ksheer Scanner, a new technological invention by CSIR-CEERI detects the level of milk adulteration and adulterants in 45 seconds at the cost of 10 paise,
Double-Fortified Salt:Salt fortified with iodine and iron having improved properties developed and tested for addressing anaemia in people. To be launched in the market soon.
Anti-obesity DAG Oil:Oil enriched with Diacylglycerol (DAG) instead of conventional triacylglycerol (TAG) developed. To be launched in the market soon.
Water
Aquifer Mapping of Water Scarce Areas: Heliborne transient electromagnetic and surface magnetic technique based aquifer mapping carried out in six different geological locations in Rajasthan (2), Bihar, Karnataka, Maharashtra and Tamil Nadu.
Understanding the Special Properties of the Ganga Water:Assessment of Water Quality & Sediment Analysis of Ganga from different parts being done.
Some of the challenges faced for sustainable growth of R&D in India are
Low research professionals: India has an estimated full-time equivalent R&D professional strength of only 150 professionals per million, compared to that of other countries.
Low investment: Indian research is mostly skewed towards basic research and lacks in application oriented R&D. The vast majority of organizations would rather go for quick acquisition of technology rather than invest in internal R&D.
IPR enforcement: Inadequate enforcement of intellectual property rights (IPR). While India has improved its IPR regime, the protection of intellectual property remains weak in some areas owing to inadequate laws and ineffective enforcement.
Some positive suggestions to improve innovation
Embrace technology: Technologies, such as machine learning, can be used to improve R&D decision-making. Documents need to be filed throughout the R&D process, for example, and the process could be automated to free up employees to do more complex tasks.
Invest in innovation hubs: Companies that invest in innovation hubs expand talent and relationships with local universities and startups can support a two-way learning process and faster innovation cycles.
Promoting startups: Most radical innovations are coming from startups and more of them are needed. Tilting higher education towards science and encouraging more students to take degrees in science-based subjects can provide the people needed for R&D.
Conclusion
India is a strong contender in the field of Global R&D. For India to derive maximum growth and sustainability of R&D, its R&D fundamentals have to be strong and excellent.
Mains question
Q.Culture of innovation is needed in national growth in this context discuss what is IPR regime? How CSIR has helped to consolidate it?
From UPSC perspective, the following things are important :
Prelims level: National Open Access Registry (NOAR):
Mains level: UDAY,RDSS
Context
The Andhra Pradesh (A.P.) power distribution companies (DISCOMs) subscribed to the Late Payment Surcharge (LPS) scheme introduced by the Central government to reduce their liability to generators in a phased manner over the next 12 months.
What are discoms?
Power distribution companies collect payments from consumers against their energy supplies (purchased from generators) to provide necessary cash flows to the generation and transmission sectors to operate.
What is UDAY scheme?
Ujjwal DISCOM Assurance Yojana is the financial turnaround and revival package for electricity distribution companies of India initiated by the Government of India with the intent to find a permanent solution to the financial mess that the power distribution is in.
What is The Revamped Distribution Sector Scheme (RDSS)?
The revamped power distribution sector scheme aims to: Improve operational efficiencies, financial sustainability of discoms and power departments. Provide financial assistance to discoms. Modernise and strengthen distribution infrastructure. Improve reliability and quality of supply to the end consumers.
Low performance of Discoms
1) On the basis of AT&C losses
A key metric to measure the performance of discoms is AT&C losses.
The UDAY scheme had envisaged bringing down these losses to 15 per cent by 2019.
However, as per data on the UDAY dashboard, the AT&C losses currently stand at 21.7 per cent at the all-India level.
In the case of the low-income north and central-eastern states — Uttar Pradesh, Bihar, Jharkhand and Chhattisgarh — the losses are considerably higher.
2) On the basis of cost and revenue per unit
On another metric — the gap between discoms costs and revenues — the difference, supposed to have been eliminated by now, stands at Rs 0.49 per unit in the absence of regular and commensurate tariff hikes.
For the high-income southern states of Tamil Nadu, Andhra Pradesh, and Telangana, this gap between costs and revenues is significantly higher.
What are the factors responsible for inefficiencies?
1) Electrification push without cost restructuring
The government’s push for ensuring electrification of all have contributed to greater inefficiency.
To support higher levels of electrification, cost structures need to be reworked, and the distribution network would need to be augmented — in the absence of all this, losses are bound to rise.
2) Economic fallout of the pandemic
With demand from industrial and commercial users falling, revenue from this stream, which is used to cross-subsidise other consumers, has declined, exacerbating the stress on discom finances.
A turnaround in the economy will provide some relief, but will not form the basis of a sustained improvement in finances.
3) Lack of consumer data and metering
Even six years after UDAY was launched, various levels in the distribution chain — the feeder, the distribution transformer (DT) and the consumer — have not been fully metered.
As a result, it is difficult to ascertain the level in the chain where losses are occurring.
Other than discoms in metros like Delhi and Mumbai, there is also limited data on which consumer is attached to which DT.
This lack of data makes it difficult to isolate and identify loss-making areas and take corrective action.
4) No tariff hike
The continuing absence of political consensus at the state level to raise tariffs or to bring down AT&C losses signal a lack of resolve to tackle the issues plaguing the sector.
Suggestions to improve the situation
Single discom: One of the solution centres around a national power distribution company.
Financial adjustment: Another option is to deduct discom dues, owed to both public and private power generating companies, from state balances with the RBI forcing states to take the necessary steps to fix discom finances.
National Open Access Registry (NOAR): NOAR is a centralized online platform through which the short-term open access to the inter-state transmission system is being managed in India.
Promote privatization: Since in an earlier policy statement the government had mentioned that privatization of discoms is to be promoted, it would make sense to consider this transitional support as a catalyst.
Provide transitional financial support: An alternate approach that could be considered by the Centre (in lieu of such assistance schemes) is providing only transitional financial support to all discoms, which are privatized under the private-public partnership mode.
Conclusion
Continuously subsidising discoms for their AT&C losses (operational inefficiencies), and for not supplying power at commensurate tariffs to low-income households and agricultural customers (for political considerations) will become fiscally untenable.
Mains question
Q.There is growing demand for one nation one grid in this context Discuss the problems faced by various discoms. Suggest some robust solutions to address these problems sustainably.
From UPSC perspective, the following things are important :
Prelims level: Public sector enterprise
Mains level: Challenges of public sector undertakings
Context
Seventy-five years ago, India’s first Prime Minister Pandit Jawaharlal Nehru made these remarks in his stirring speech on India attaining freedom at midnight: “The achievement we celebrate today is but a step, an opening of opportunity, to the greater triumphs and achievements that await us. Are we brave enough and wise enough to grasp this opportunity and accept the challenge of the future?”
Nehru’s vision for India
Nehru’s vision of India was anchored in a set of ideas such as democracy, secularism, inclusive economic growth, free press and non-alignment in international affairs and also in institutions that would lay the foundation for India’s future growth.
Leadership of Nehru after independence
In 1947, Nehru, as Prime Minister, inherited an India that was politically shattered, socially divided and emotionally devastated. Yet, with restraint and self-confidence, he steered the country through those turbulent times and laid out the vision of a modern, progressive nation that quietly earned the respect of the global community.
Temple of modern India
The Bhakra-Nangal Dam: The Bhakra-Nangal Dam project is a series of multi-purpose dams that were among the earliest river valley developments schemes undertaken by the government of India after independence. The project, though, had been conceived long before independence.
Bhilai Steel Plant: Bhilai, located in Chhattisgarh, was home to massive iron-ore deposits at Dalli Rajhara. Taking this into consideration, the government of India and the USSR entered into an agreement which was signed on March 2nd 1955, at New Delhi.
Bhabha Atomic Research Centre: The Atomic Energy Establishment, Trombay (AEET), was started by the government of India on January 3rd 1954 with the intention of consolidating all research and development activities for nuclear reactors and technology under the Atomic Energy Commission.
Indian Council of Agricultural Research (ICAR): to support indigenous scientists like Boshi Sen, who is credited with producing hybrid maize and irradiated wheat mutant.
Relevance of these institutions
Economic Development:Economic development mainly depends upon industrial development. Heavy & basic industries like iron & steel, shipping, mining, etc. are required for supplying raw materials to small industries.
Regional Development:Private sector usually neglect backward area. But public sector organizations set up their units in economically backward areas. By this public sector removes regional imbalance & brings regional development.
Employment:Various public sectors operating in India needs lot of manpower & this provide employment to unlimited individuals according to their education, experience & abilities.
Service Motive: Public sector organizations are working with the only motive of providing public utility services to society at large irrespective of profit.
Sound Infrastructure:Rapid industrial growth in a country needs sound infrastructure. Infrastructural industries require huge capital for construction of Roads, Railways, Electricity & many such industries. Private sector is unable to have such huge capital & that also without any high return but public sector can easily afford to provide all infrastructural facilities.
Some challenges they face today
Inefficient Management: It has been found that these enterprises are managed by public savants. They are not professionally qualified nor experts in the management of industrial enterprises.
Lack of Efficiency: They are not run on commercial principles. Their main motto is social welfare, not profit earning.
Lack of Innovations: Innovations are essential for economic development. Public enterprise lacks it due to monopoly or lack of competition. The private sector is always busy with innovating new techniques, new production methods, etc. For the purpose of cost reduction and profit maximization.
Some suggestions to address the challenges
Sound business principles: The enterprise should be run on sound business principles. There should be focus on improving efficiency in all functional areas. Policies, systems and procedures should be modified with the aim of making the enterprise flexible, efficient and profitable.
Autonomy: Public enterprises should have considerable autonomy in their functioning. Authority should be delegated and they should have the freedom to take decisions. Autonomy would ensure that decisions are taken at the right time and growth opportunities utilized in the best possible manner.
Freedom from political interference: Many public enterprises are considered to be the kingdoms of politicians. They are run to suit the needs and requirements of the ruling party.
Conclusion
Today, opinions are divided about the iconic leader. While Nehru always had his critiques even back in the day, a significant section of the masses despise the dynasty politics of the Congress that ensued after his passing in 1964.
However, his contributions to India’s freedom, and as a Prime Minister to his country are acknowledged by people both within and outside India. His shortcomings do not take away from the legacy he cemented as a propagator for freedom, and as the free nation’s first Prime Minister.
Mains question
Assess the Nehruvian legacy of public sector. Do you think they are still relevant today? While discussing challenges they face what suggestion will you give to improve their performance.
While India celebrates its 75th year of Independence, it also celebrates 60 years of diplomatic relations with the European Union (EU).
A cooperation agreement signed in 1994 took the bilateral relationship beyond trade and economic cooperation.
Definition
Relations between the European Union and the Republic of India are currently defined by the 1994 EU–India Cooperation Agreement. The EU is a significant trade partner for India and the two sides have been attempting to negotiate a free trade deal since 2007.
Common roadmap and shared vision
The road map highlights engagement across five domains: foreign policy and security cooperation; trade and economy; sustainable modernisation partnership; global governance; and people-to-people relations.
Brief history
India-EU relations date to the early 1960s, with India being amongst the first countries to establish diplomatic relations with the European Economic Community.
At the 5th India-EU Summit at The Hague in 2004, the relationship was upgraded to a ‘Strategic Partnership’.
The two sides adopted a Joint Action Plan in 2005 (which was reviewed in 2008) that provided for strengthening dialogue and consultation mechanisms in the political and economic spheres, enhancing trade and investment, and bringing peoples and cultures together.
What is strategic partnership?
A ‘strategic partnership’, as the term suggests, involves a shared understanding between the two or more states involved on the nature of threats in the environment and the place of their collective power in helping mitigate the threats.
Why they are important?
As the world’s two largest democracies, the EU and India share a commitment to protecting and promoting human rights, a rules-based global order, effective multilateralism, sustainable development and open trade.
Significance
[A] Political Partnership
The Joint Political Statement signed in 1993, opened the way for annual ministerial meetings and a broad political dialogue.
The Cooperation Agreement signed in 1994 took the bilateral relationship beyond trade and economic cooperation.
A multi-tiered institutional architecture of cooperation has since been created, presided over by the India-EU Summit since 2000.
Today EU stands as a major reference for India’s legislative process in the field of Data security and privacy.
[B] Economic Ties
Bilateral trade: The EU is India’s largest trading partner, while India is the EU’s 9th largest trading partner. It is the second-largest destination for Indian exports after the United States.
Investment: The EU’s share in foreign investment inflows to India has more than doubled from 8% to 18% in the last decade. This makes the EU an important foreign investor in India.
Preferential treatment: India is the benefactor of the unilateral preferential tariffs under the EU Generalised Scheme of Preferences (GSP).
Energy: Both sides have finalised civil nuclear cooperation agreement after 13 years of negotiations called as the European Atomic Energy Community (EURATOM). It involves collaboration in the civil nuclear energy sector.
Development cooperation:Over €150 million worth of projects by EU are currently ongoing in India. European Investment Bank (EIB) is providing loans for Lucknow, Bangalore, and Pune Metro Projects.
[C] Defence & Security
EU and India have instituted several mechanisms for greater cooperation on pressing security challenges like counterterrorism, maritime security, and nuclear non-proliferation.
Information Fusion Centre – Indian Ocean Region in New Delhi (IFC-IOR) has recently been linked-up with the Maritime Security Centre – Horn of Africa (MSC-HOA) established by the EU Naval Force (NAVFOR).
[D] Climate Change
EU and India also underline their highest political commitment to theeffective implementation of the Paris Agreementand the UNFCCC despite US withdrawing from the same.
India-EU Clean Energy and Climate Partnership was agreed at the 2016 Summit – to promote access to and disseminate clean energy and climate friendly technologies and encourage R&D.
Energy cooperation is now ongoing on a broad range of energy issues, like smart grids, energy efficiency, offshore wind and solar infrastructure, and research and innovation.
EU and India also cooperate closely on the Clean Ganga initiative and deal with other water-related challenges in coordinated manner.
Both have official mechanisms in fields such as Digital Communications, 5G technology, Biotechnology, artificial intelligence etc.
ISRO has a long-standing cooperation with the European Union, since 1970s. It has contributed towards the EU’s satellite navigation system Galileo.
Future scope
Trade figures and Investments: Bilateral trade between the two surpassed $116 billion in 2021-22. The EU is India’s second largest trading partner after the U.S., and the second largest destination for Indian exports.
Job creation: There are 6,000 European companies in the country that directly and indirectly create 6.7 million jobs.
Green strategic partnership: between India and Denmark aims to address climate change, biodiversity loss and pollution, and the India-Nordic Summit focused on green technologies and industry transformation that are vital for sustainable and inclusive growth.
Energy security: Energy serves as an important aspect of the relationship between India and the EU. Given the impacts of climate change, this aspect has become extremely crucial today. Both entities have been pursuing cooperation for the joint development of clean energy.
Political cooperation: India and the EU may benefit from increasing cooperation in the resolution of issues such as terrorism and radicalization, cyber-security, coordinating on certain key and relevant aspects of foreign policy, and other humanitarian issues.
International support: It is crucial that Europe recognize India as a partner for peace that is committed to human rights, both regionally and internationally.
Challenges before them
Deadlock over BTIA: The negotiations for a Broad-based Bilateral Trade and Investment Agreement (BTIA) were held between 2007 to 2013 but have remained dormant/suspended since then.
Export hurdles: Indian demands for ‘Data secure’ status (important for India’s IT sector) to ease norms on temporary movement of skilled workers, relaxation of Sanitary and Phytosanitary (SPS), etc. stands largely ignored.
Trade imbalance: This heavily leans towards China. India accounts for only 1.9% of EU total trade in goods in 2019, well behind China (13.8%).
Brexit altercations: In the longer term of balancing of global powers, a smaller Europe without the key military and economic force UK, is much weaker in the wake of an ambitious China and an increasingly protectionist US.
EU primarily remains a trade bloc: This has resulted in a lack of substantive agreements on matters such as regional security and connectivity.
Undue references to sovereign concerns: The European Parliament was critical of both the Indian government’s decision to scrap Jammu and Kashmir’s special status in 2019 and the Citizenship (Amendment) Act.
China’s influence: EU’s affinity lies with China. This is because of its high dependence on the Chinese market. It is a major partner in China’s Belt and Road Initiative (BRI).
Ukrainian war: EAM S. Jaishankar’s witty reply about EU’s oil import from Russia has not been welcomed across the EU. It still expects India to criticize Russia.
EU’s interests in India
Reducing dependence on China: It is necessary for both sides as it is making them highly vulnerable to Chinese aggression.
Western lobby: EU acknowledges its supply chain’s vulnerability, the risk posed by overdependence on China, and the need to strengthen the global community of democracies.
Healthcare: The on-going pandemic has shown the need for cooperation in global health. India and the EU have called for a reform of the World Health Organisation (WHO).
Perception of India as a huge market: EU still largely perceives India as huge market rather than a partner.
Promotion of multilateralism: Both sides are facing issues related to US-China trade war and uncertainty of the US’ policies. They have common interest in avoiding a bipolarised world and developing a rules-based order.
India’s stakes in EU
Global leadership vacuum: Retreat of the U.S. from global leadership has provided opportunities for EU- India cooperation and trilateral dialogues with countries in the Middle Fast, Central Asia, and Africa.
Chinese Aggression: China’s increasing presence in Eurasia and South Asia is creating similar security, political and economic concerns for Europe and India.
Fall of the conventional global order: Trade war, crumbling WTO and break down of TPP etc. has made EU understand the economic importance of India.
BREXIT: Brexit is pushing India to look for new ‘gateways’ to Europe, as its traditional partner leaves the union. A renewed trade and political cooperation are the need of the hour.
Conformity over Indo-Pacific: The Indo-Pacific is the main conduit for global trade and energy flows. Rule-based Indo-pacific is of everyone’s interest with EU no exception.
Way forward
A close bilateral relation between India and the EU has far-reaching economic, political and strategic implications on the crisis-driven international order.
Both sides should realise this potential and must further the growth of the bilateral ties with a strong political will.
As highlighted by EU strategy on India 2018, India-EU should take their relations beyond “trade lens”, recognizing their important geopolitical, strategic convergences.
India can pursue EU countries to engage in Indo-pacific narrative, geo-economically if not from security prism.
Mains question
What do you understand by the term strategic partnership? India and EU are celebrating 60 years of diplomatic relations trace their journey with significance and challenges in their ties.
B2BASICS
About European Union (EU)
The EU is a political and economic union of 27 member states that are located primarily in Europe.
The union and EU citizenship were established when the Maastricht Treaty came into force in 1993.
The EU grew out of a desire to strengthen international economic and political co-operation on the European continent in the wake of World War II.
It has often been described as a sui generis political entity (without precedent or comparison) with the characteristics of either a federation or confederation.
The eurozone consists of all countries that use the euro as official currency. All EU members pledge to convert to the euro, but only 19 have done so as of 2022.
Members of the EU
Through successive enlargements, the European Union has grown from the six founding states (Belgium, France, West Germany, Italy, Luxembourg, and the Netherlands) to 27 members.
This entails a partial delegation of sovereignty to the institutions in return for representation within those institutions, a practice often referred to as “pooling of sovereignty“.
In the 2016 ‘Brexit’ referendum, the UK voted to leave the EU. The UK officially left the EU in 2020
Mains question
What do you understand by the term strategic partnership? India and EU are celebrating 60 years of diplomatic relations trace their journey with significance and challenges in their ties.
From UPSC perspective, the following things are important :
Prelims level: NA
Mains level: Inclusive growth, Social justice
Context
Key findings of the World Inequality Report 2022 related to India: National Income: In India, the top 10% and top 1% hold respectively 57% and 22% of total national income.
What is inclusive growth?
Organization for Economic Co-operation and Development (OECD) defines Inclusive growth as the economic growth that is distributed fairly across society and creates opportunities for all. It refers to ‘broad-based’, ‘shared’, and ‘pro-poor growth’.
What is social justice?
Social justice is the view that everyone deserves equal economic, political and social rights and opportunities. Social workers aim to open the doors of access and opportunity for everyone, particularly those in greatest need.
Meaning of Inclusiveness
Inclusiveness is a concept that encompasses equity, equality of opportunity, and protection in market and employment transitions and is, therefore, an essential ingredient of any successful growth strategy.
Need of inclusive growth
Complete development: India is the 7th largest by area and 2nd by population and 12th largest economy at market exchange rate. Yet, India is away from the development.
Income inequality: Low agriculture growth, low quality employment growth, low human development, rural-urban divides, gender and social inequalities, and regional disparities etc. are the problems for the nation.
Human development: Reducing poverty and inequality and increasing economic growth are the main aim of the country through inclusive growth.
Need of social justice
Equality: We should shift from equality of outcomes to equality of opportunities.
Peace and Order: If the majority disregards smaller sections in the community, it drives them to rebellion.
Dignity: To ensure life to be meaningful and liveable with human dignity.
Mitigate Sufferings: It is a dynamic device to mitigate the sufferings of the poor, weak Dalits, tribal and deprived sections of the society.
Human Resources: It will help in the conservation of human resource by provision of health and education facilities.
Freedom to form political, economic or religious institutions: It will help to eradicate the challenges of caste system, untouchability and other discrimination in the society.
Challenges before inclusive growth and social justice
Wage Gap: When it comes to wages in the workplace, there is a noticeable differentiation between men and women. According to the American Association of University Women (AAUW), in 2018, the gender pay gap from men and women for the same job was 82 percent. Stated simply, women make 82 percent of what men make doing the same work. This can be further broken down into a pay gap for minority men and women.
LGBTQ Oppression: When it comes to oppression and human rights, individuals of the Lesbian, Gay, Bisexual, Transsexual and Queer (LGBTQ) community face several forms of social injustice and oppression. For example, same sex marriages are outlawed in some states and countries. Additionally, transsexual students often face discrimination and bullying within school settings.
Education System: Globally, steps are being made to close the education gap between male and female students. However, there are still several areas around the world where girls may never set foot into a classroom at all. UNESCO notes that more than nine million girls never go to school, compared to only six million boys in areas of Africa.
Child Welfare: Social workers and human rights activists are working tirelessly to combat issues relating to children and their welfare. Despite their efforts, there are still several problems children face that are harmful to their health and mental wellbeing.
Forced Child Labour: Laws are in place around the world to ensure a safe work environment for children. These laws were drafted from historically harsh and dangerous working conditions for children. While many would like to believe that child labour is a thing of the past, it persists in some areas around the globe.
Child Abuse and Neglect: Thousands of children globally are being neglected. They’re also being physically, sexually and emotionally abused. The World Health Organization (WHO) reports that as many as a quarter of adults have been abused as children. This abuse has both social and economic impacts that include mental health problems.
Government measures to address this challenge
SETU(Self Employment and Talent Utilization)
Skill India
Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)
Pradhan Mantri Jan Dhan Yojana
MUDRA (Micro Units Development and Refinance Agency)Bank
Way forward
Equality of opportunity is the core of inclusive growth, and the inclusive growth emphasises to create employment and other development opportunities through rapid and sustained economic growth, and to promote social justice and the equality of sharing of growth results by reducing and eliminating inequality of opportunity.
Mains question
Explain the term inclusive growth in brief. How we can achieve social justice through inclusive growth?
From UPSC perspective, the following things are important :
Prelims level: NA
Mains level: India's demographic dividend
Context
India’s biggest strength is its ‘demographic dividend’ and people need to fully leverage it to fast-track the country’s progress in various sectors
Why in news
The 2022 edition of the World Population Prospects (WPP) of the United Nations has projected that India may surpass China as the world’s most populous country next year.
The report estimates that India will have a population of 1.66 billion in 2050, ahead of China’s 1.317 billion around that time.
What is demographic dividend?
Demographic dividend, as defined by the United Nations Population Fund, is “the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population is larger than the non-working-age share of the population”.
Current status for India
India entered the demographic dividend opportunity window in 2005-06 and will remain there till 2055-56.
This is the period when the working age ratio is equal to or more than 150% and the dependency ratio is equal to or lower than 66.7%, generally taken as the cut-off for the demographic dividend window.
How India can leverage this dividend
(1) Investment in right direction
Investments in human and physical infrastructure will need to be scaled up dramatically to promote entrepreneurship and create jobs.
Investment in education is crucial for ensuring that working-age people are prepared for the demands of the economy.
Increase spending on health
Increase investments in Research and Development
(2) Absorption of labour into productive employment
Promote entrepreneurship and job creation
Service sector like tourism, logistics should be promoted
Skill development of the working-age population so that they can turn out to be productive for the country’s economy
Challenges in reaping this
Drastic quality improvement: India’s challenge is to create conditions for faster growth of productive jobs outside of agriculture, especially in the organized manufacturing and in services.
Severe shortages: India currently faces a severe shortage of well trained, skilled workers. Large sections of the educated workforce have little or no job skills, making them largely Unemployable.
Dismal health sector: A closer look implies various factors such as poor health which although obvious, play a major role in the poor performance of working population.
Socio economic dimensions: The status of institutions in India regarding caste discrimination, gender inequalities, widening income gap between the rich and the poor, religious differences, inefficient and slow legal system- all contribute to the poor standard of living of the masses.
Government steps
National Skill Development Corporation (NSDC): incorporated on 31st July, 2008, is a first-of-its-kind Public Private Partnership (PPP) in India set up to facilitate the development and upgrading of the skills of the growing Indian workforce through skill training programs.
National Skill Development Agency: Currently, skill development efforts are spread across approximately20 separate ministries, 35 State Governments and Union Territories and the private sector.
National Skill Certification and Money Reward Scheme: encouragement is given for skill development for youth by providing monetary rewards for successful completion of approved training programs.
Way forward
Strategies exist to exploit the demographic window of opportunity that India has today, but they need to be adopted and implemented.
The dreams of huge income flow and resultant economic growth due to demographic dividend could be realized only when we inculcate the required skills in the work force to make it as competent as its counterparts in the developed world.
Important data for mains
India’s working-age population has numerically outstripped its non-working age population.
India’s total fertility rate (TFR) has declined from 2.2 in 2015-16 to 2.0 in 2019-21, indicating the significant progress of population control measures, revealed the report of the fifth round of the National Family Health Survey (NFHS-5).
TheTFR is the average number of children born to a woman in her lifetime.
Mains question
Q. Do you think the right has come that India should adopt moving away policy from population control towards reaping its demographic dividends? Critically examine.
From UPSC perspective, the following things are important :
Prelims level: Malimath Committee
Mains level: Police reforms due in India
Context
There is a widely shared view that the All India Services, which provided the ‘steel frame’ of governance in a democratic India, particularly on the police front, are failing to deliver.
This is because of the declining decision-making ability of its officers, their smugness arising from notions of total employment security, and the inadequacy of parameters used for evaluating their performance.
Anti-corruption bureau Was Constituted To Shield Corrupt Politicians, Officers From Lokayukta: Karnataka High Court
Role of Police
Law enforcement: The basic role of the police is to function as a law enforcement agency and render impartial service to law, without any heed to wishes, indications or desires expressed by the government which either come in conflict with or do not conform to the provisions contained in the constitution or laws.
Service delivery: The police should have duly recognised service-oriented role in providing relief to people in distress situations. They should be trained and equipped to perform the service oriented functions.
Issues with police institution
Public relationship: The police-public relations relationship, which is crucial to effective policing, is troubled by a severe lack of confidence.
Public perception towards police: Most people believe police to be abusive and also believe that police personnel misuse their power in order to bring order to society.
Police Accountability: Police priorities are constantly changed at the request of political leaders. This obstructs police officers’ ability to make professional decisions
Overburdened force and vacancies: A high percentage of vacancies in police departments exacerbates an already-existing problem of overworked officers. Given India’s low police strength per lakh population in comparison to international standards, each police officer is also responsible for a huge group of people.
Infrastructure: The weapons used by lower police forces are obsolete and cannot match modern weaponry used by anti-social elements.
Custodial Death: There are many cases on custodial death means Death by torture/pressure in police/judicial custody.
The dilemmas and challenges:
(1) The Ubiquitous infrastructure (2) Explosion of police tasks (3) Dis-functionalism of rural police (4) Anomalous personnel system (5) The colossal ignorance of either side (6) The fragility of the equipment (7) The paradox of para militarism (8) Non-development to policing
Steps taken till now
Establishment of a Central Police Committee:
A Central Police Committee to look after the functions of consultancy and monitoring be
Created because an expert agency is required by the Central Government and the State
Security Commissions to advise them on matters relating to:
(i) Police Organisation and police reforms of a general nature;
(ii) Central grants and loans to the State Police Forces for their modernisation and Development; and
(iii) Budgetary allotments to State Police Forces.
Enactment of a Model Police Act:
The Police Act of 1861 replaced by a new Police Act, which not only changes the
System of superintendence and control over the police but also enlarges the role of the
Police to make it function as an agency which promotes the rule of law in the country and
Renders impartial service to the community.
The Prime Minister’s call for making the police a SMART force: standing for a force which is:
Strict and Sensitive,
Modern and Mobile,
Alert and Accountable,
Reliable and Responsive,
Tech-savvy and trained.
Malimath committee:
Government had set up (November, 2000) a Committee under the Chairmanship
of Justice V.S. Malimath , a former Chief Justice of the Karnataka and Kerala High
Courts to consider and recommend measures for revamping the Criminal Justice System.
Key recommendations :
Strengthening of training infrastructure, forensic
Science laboratory and Finger Print Bureau,
Enactment of the new Police Act,
Setting up of Central Law Enforcement agency to take care of federal crimes
Separation of the investigation wing from the law and order wing in the police stations,
Improvement in the investigation by creating more posts.
Some suggestions for better policing:
Screen for Implicit Bias and Aggression: State legislatures should pass legislation that requires current and prospective police officers to undergo mandatory implicit bias testing
Focus on Collaborative Approaches to Policing: Police departments should rely upon collaborative approaches that respect the dignity of individuals within the community; focus on problem-solving; and are generally more community centered and build community trust.
Encourage Consistent Monitoring and Screening: Police departments should create early warning systems for detecting patterns of behaviour, such as complaints filed against officers or personal hardships like divorce, which indicate potential vulnerabilities for the officer and the department.
Use Video Recording to Promote Accountability: Legislatures should require that police interrogations be electronically recorded “during the time in which a reasonable person in the subject’s position would consider themselves to be in custody and a law enforcement officer’s questioning is likely to elicit incriminating responses.
Increase the use of special prosecutors in police misconduct investigations
Enhancing the collection of data on fatalities involving police
Conclusion
India is the target of an ever-growing list of terrorist groups, insurgent forces and criminal networks.
Even petty criminals are now in possession of hi-tech gadgets that allow them better access and reduce their chances of being caught.
In such an environment, the need for skill and competency up-gradation of the police force is a sine qua non.
Q. What is smart policing? Considering the rise in custodial deaths give some suggestions to improve criminal justice delivery system in India.
From UPSC perspective, the following things are important :
Prelims level: UNSC
Mains level: Paper 2- India-Switzerland relations
Context
Two countries will commemorate next year the 75th anniversary of the signing in New Delhi of the 1948 Treaty of Friendship.
Cooperation between two countries in various area
Switzerland and Indian partners are collaborating on digital transformation, sustainability, health, life sciences, medtech, infrastructure, cleantech, fintech, blockchain, AI and robotics.
Innovation and investment continue to be the primary drivers of our bilateral relations.
With over 330 Swiss companies, Switzerland is the 12th largest investor in India.
About 100 Swiss companies manufacture locally and support the Make in India initiative.
Trade talks between Switzerland (European Free Trade Association EFTA) and India are high on the priority list.
Digitalisation is emerging as a relatively new area of engagement with enormous potential for Switzerland and India.
Switzerland plays a leading role in researching new technologies and is home to many innovative and world-leading technology companies.
As one of the most innovative countries of the world, Switzerland seeks to engage with India, the leader of the Industry 4.0 revolution, in areas ranging from digital governance to digital self-determination.
Switzerland in UNSC as non-permanent member
Switzerland was elected to the United Nations Security Council as a non-permanent member for the first time this year in June.
Convergence in priorities at Security Council: There are convergences in Swiss and Indian priorities at the UN Security Council.
Switzerland, like India, is committed to a robust and effective multilateral system.
In the Security Council, Switzerland will do everything possible to ensure sustainable peace.
Many years ago, from 1971 to 1976, Switzerland represented India’s interests in Pakistan and vice versa.
In the Security Council, Switzerland will focus on the protection of civilians and on international humanitarian law.
Impact of climate change on security: Switzerland will also address climate change and its impact on security.
Reforms of Security Council: Switzerland desires effective UN institutions.
India has been advocating for a reform of the Security Council.
Switzerland’s fourth priority in 2023 and 2024 will be to contribute to improving the United Nations Security Council’s effectiveness towards greater transparency and accountability.
Conclusion
Two countries can together contribute to global good. This engagement is a result of not only our shared priorities, but also our shared democratic values and foreign policy independence.
From UPSC perspective, the following things are important :
Prelims level: Not much
Mains level: Paper 2- Disruptions in legislatures
Context
The inability of Parliament to transact any business and the lack of serious deliberation must be a matter of grave concern for all.
Purpose of deliberative democracy
In a deliberative democracy, Parliament works as a special purpose vehicle for the legislative scrutiny of bills, grievance redressal and debate on policies and related governance issues.
Its failure to transact business is a sad commentary on three aspects — Members of Parliament, the presiding officers as well as the rules and regulations that define the functioning of both Houses.
How disruption affects Member of Parliaments
For any parliamentarian, it is extremely disappointing to be unable to speak in the House for which he or she has — in most cases —given notice and come prepared.
And when this happens too often, their enthusiasm decreases.
Impact on quality of debate: In such a situation, members are often tempted to make a popular intervention than a substantive one.
This certainly impacts the quality of debates negatively.
Challenges for presiding officer
For the presiding officers too, preventing disruptions is a serious challenge.
Perhaps presiding officers can emulate the courts of law.
Use of in-camera proceedings: Like in courts, the presiding officers need to consider conducting in-camera proceedings in their chambers to insulate at least the Zero Hour and Question Hour from getting washed out.
While the House remains force-adjourned, presiding officers can order in-camera hearing of questions of MPs and replies of ministers.
Zero Hour submissions could also be dealt with similarly.
Some tweaking of existing rules and regulations may facilitate this.
Issues with media coverage of Parliamentary proceedings
In any polity, systems work effectively when wrongdoers are punished and rule-abiding people are rewarded.
What happens currently is exactly the opposite, especially in the context of coverage of parliamentary proceedings in mainstream media.
The space allocated for parliamentary proceedings in both, print and electronic media is shrinking fast.
Rarely does one finds adequate coverage of Question Hour or Zero Hour compared to the past.
Debates on bills are also subject to brief and sketchy reporting.
Although disruptions have become common, they continue to get reported without fail and disruptors often bask in the media limelight.
As against this, those who make a reasonably good speech — well argued and supported by statistics, examples or case studies — rarely get adequate attention.
This too hampers the interest of parliamentarians.
It is high time we rise above the temptations of this tendency and think seriously about systemic reforms.
Conclusion
As the Parliament of independent India enters the eighth decade of its history and prepares to enter a new, more well-equipped and modern Parliament House, it is the right time to think about how we can add value to our deliberative democracy.
From UPSC perspective, the following things are important :
Prelims level: Not much
Mains level: Paper 3- Use of technology to curb illegal mining
Context
While laws and monitoring have been made stringent for the mining of major minerals consequent to the unearthing of several related scams across the country, the fact is that rampant and illegal mining of minor minerals continues unabated.
What are minor minerals?
“Minor minerals” means building stones, gravel, ordinary clay, ordinary sand other than sand used for prescribed purposes, and any other mineral which the Central Government may, by notification in the Official Gazette, declare to be a minor mineral;
Regulation exclusively by States: Unlike major minerals, the regulatory and administrative powers to frame rules, prescribe rates of royalty, mineral concessions, enforcement, etc. are entrusted exclusively to the State governments.
The Environment Impact Assessment (EIA) Notifications of 1994 and 2006 made environmental clearance compulsory for mining in areas more than or equal to five hectares.
The EIA was amended in 2016 which made environmental clearance mandatory for mining in areas less than five hectares, including minor minerals.
The amendment also provided for the setting up of a District Environment Impact Assessment Authority (EIAA) and a District Expert Appraisal Committee (EAC).
The problem of illegal mining of minor minerals
The United Nations Environment Programme, in 2019, ranked India and China as the top two countries where illegal sand mining has led to sweeping environmental degradation.
No comprehensive assessment: Despite this, there is no comprehensive assessment available to evaluate the scale of sand mining in India.
Damage to the environment: Regional studies such as those by the Centre for Science and Environment of the Yamuna riverbed in Uttar Pradesh have observed that increasing demand for soil has severely affected soil formation and the soil holding ability of the land, leading to a loss in marine life, an increase in flood frequency, droughts, and also degradation of water quality.
Loss to exchequer: It is not just damage to the environment. Illegal mining causes copious losses to the state exchequer.
A State-wide review of the reasons behind non-compliance suggests a malfunction of governance due to weak institutions, a scarcity of state resources to ensure enforcement, poorly drafted regulatory provisions, inadequate monitoring and evaluation mechanisms, and excessive litigation that dampens state administrative capacity.
Way forward: Use of technology
Use of satellite imagery: Satellite imagery can be used to monitor the volume of extraction and also check the mining process.
Recently, the NGT directed some States to use satellite imagery to monitor the volume of sand extraction and transportation from the riverbeds.
Drones, IoT and blockchain: Additionally, drones, the internet of things (IoT) and blockchain technology can be leveraged to monitor mechanisms by using Global Positioning System, radar and Radio Frequency (RF) Locator.
State governments such as Gujarat and judicial directions such as the High Court of Madras have employed some of these technologies to check illegal sand mining.
Conclusion
Protecting minor minerals requires investment in production and consumption measurement and also monitoring and planning tools. To this end, technology has to be used to provide a sustainable solution.
From UPSC perspective, the following things are important :
Prelims level: Credit growth in India
Mains level: Paper 3- India's banking sector
Context
The RBI’s latest Financial Stability Report (FSR) has given the banking system a reasonably clean bill of health. It’s a significant achievement, considering the stress of the previous decade, the shock of the pandemic and the associated slowdown of the economy.
Two indicators of banking system’s progress
1] Reduced NPAs: Successive waves of recapitalisation have given banks enough resources to write off most of their bad loans.
As a result, they have been able to bring down their gross NPAs (non-performing loans) from 11 per cent of total advances in 2017-18 to 5.9 per cent in 2021-22.
Even after these large write-offs, most banks retain comfortable levels of capital.
2] Credit growth doubled: During the decade when banks were under stress, non-food bank credit growth had been declining, reaching just 6 per cent in 2020, its lowest point in six decades.
Since then, credit growth has nearly doubled.
Concerns
Role of credit in supporting GDP growth: The problem is that very little of this credit is going to large-scale industry or for financing investment.
Reluctance of banks to provide credit to industry: Over the last decade, banks have increasingly shifted away from providing credit to industry, favouring instead lending to consumers.
This trend is continuing — in the year ending March 2022, consumer loans grew at 13 per cent, whereas loans to industry grew at just 8 per cent.
Banks favoring MSMEs in industry loans: Bulk of the industry loans has been extended to the smaller firms (MSMEs), which benefitted from the credit guarantee scheme offered by the government in the wake of the pandemic.
Reduced lending to private sector investment: A related problem is that there has been little lending for private sector investment.
Over the last one year, bank lending to infrastructure has grown by 9 per cent, up from 3 per cent in 2020, but this was fuelled mainly by public sector capital expenditure.
Why is there so little lending for investment by large firms?
Demand side reason: On the demand side, private sector investment has been sluggish for nearly a decade.
The boom-and-bust of the mid-2000s had saddled firms with excess capacity, giving them little reason to expand their production facilities.
In addition, the global financial crisis had shown the dangers of ambitious expansion supported by excessive borrowing, leading firms to conclude that it would be prudent to scale back their plans and instead focus on reducing their debts.
Supply side reason: On the supply side, banks have learned similar lessons.
During the period 2004-2009, rapid GDP growth in the Indian economy was fuelled by an unprecedented lending boom.
Subsequently, many of those loans turned bad, leading to high levels of NPAs on bank balance sheets.
As a result of these financial problems, banks for a decade were unable to extend much in the way of credit.
Challenges
On the positive side, firms seem to have finally used up much of their spare capacity.
Fundamental problems not resolved: But on the negative side, the fundamental problems that led to the difficulties of the past decade still have not been resolved.
No framework for risk reduction: There is still no framework that will reduce the risk of private sector investment in infrastructure, certainly not in the critical and highly troubled power sector.
Nor is there any reassurance for the banks that if problems do develop, they can be resolved expeditiously, since the Insolvency and Bankruptcy Code has been plagued by delays and other problems.
Way forward
We need deep structural reforms — to the infrastructure framework, the resolution process, and indeed, in the risk management processes at the banks themselves.
In the event that these reforms do not materialise, there may continue to be shortfalls in credit, investment, and ultimately in economic recovery and growth.
Conclusion
A healthy balance sheet of the banking sector is a necessary but not a sufficient condition for economic growth. The important question is whether banks and firms will once again be willing to take on the risk of investment in industry and infrastructure.
From UPSC perspective, the following things are important :
Prelims level: MEITY
Mains level: Paper 2- Need for data protection law
Context
The Minister for the Ministry of Electronics and IT withdrew the Personal Data Protection Bill, 2019. The reasons for the withdrawal were circulated in a note to MPs, which stated that,“considering the report of the JPC (Joint Parliamentary Committee), a comprehensive legal framework is being worked upon…”.
Background of Personal Data Protection Bill
An expert committee headed by Justice (retd) A P Shah recommended in October, 2012,“a detailed framework that serves as the conceptual foundation for the Privacy Act”.
This did not come to fruition, with proposals buried by 2014 due to objections from the intelligence establishment on surveillance reforms.
While petitions on the constitutionality of Aadhaar and the right to privacy were pending before the Supreme Court, the Union government constituted an expert group headed by Justice (retd) B N Srikrishna in July, 2017.
In August, a nine-judge bench unanimously pronounced the Puttaswamy judgment that reaffirmed the fundamental right to privacy for the autonomy, dignity and liberty for every Indian.
Justice D Y Chandrachud, who authored the majority opinion, noted the formation of the Srikrishna Committee as a positive obligation on the government to enact a law for informational privacy.
In December 2019, government introduced the Personal Data Protection Bill, 2019 in Parliament.
The draft law was referred to a JPC of 30 MPs that submitted a report after two years.
With the withdrawal in Parliament on August 3, it almost seems institutional processes, in which all three branches of government worked for years, are being jettisoned in favour of “a comprehensive legal framework”.
Issues with reasons given for withdrawal of the Bill
The JPC has nowhere suggested a withdrawal in favour of a “comprehensive legal framework”.
The proper course was to consider the JPC’s recommendations including the dissent notes and expert analysis, redraft and introduce a new Data Protection Bill.
Compliance burden concern of government: With the government setting the goal of a one trillion dollar digital economy, fears of a compliance burden can impede innovation and growth.
Date protection is needed for innovation: Here, detailed reasoning is available in the Srikrishna Committee’s report as well as a growing international consensus suggesting that next-generation innovation in technology needs data protection.
Regulatory intervention will improve business practices requiring engineering decisions that focus on user trust.
Imperfections in law argument: With the imperfections within the Personal Data Protection Bill, 2019 and even the JPC report, there exists a reasonable argument that if passed into law, it may institutionalise bad privacy practices.
Such a line of reasoning fails to recognise that institutional memory develops through reasonable due diligence and experience.
Legislative foresight is limited and no law is perfect, which is why there exist parliamentary amendments and judicial review.
Conclusion
Today, there is a relentless pace of digitisation that relies on gathering personal data in all spheres of our lives. All of this is done in a legal vacuum without any oversight or remedy. This underscores the urgent need for data protection law.
From UPSC perspective, the following things are important :
Prelims level: Not much
Mains level: Paper 3- Population dividend
Context
The UN report, World Population Prospects 2022, forecasts that the world’s population will touch eight billion this year and rise to 9.8 billion in 2050. What is of immediate interest to India is that its population will surpass China’s by 2023 and continue to surge.
India’s potential workforce and growth as projected by consulting firms
Deloitte’s Deloitte Insights (September 2017) expects “India’s potential workforce to rise from 885 million to “1.08 billion people over the next two decades from today”, and “remain above a billion people for half a century,” betting that “these new workers will be much better trained and educated,” than their existing counterparts.
McKinsey & Company’s report, ‘India at Turning Point’ (August 2020), believes the “trends such as digitisation and automation, shifting supply chains, urbanisation, rising incomes and demographic shifts, and a greater focus on sustainability, health, and safety are accelerating” to “create $2.5 trillion of economic value in 2030 and support 112 million jobs, or about 30% of the non-farm workforce in 2030.”
Four pillarsIn its May 14, 2022 issue, The Economist had this to say about India, “As the pandemic recedes, four pillars are clearly visible that will support growth in the next decade. The four pillars are:
1) The forging of a single national market.
2) An expansion of industry owing to the renewable-energy shift and a move in supply chains away from China,
3) Continued pre-eminence in IT.
4) High-tech welfare safety-net for the hundreds of millions left behind by all this.
The Financial Times in an article, ‘Demographics: Indian workers are not ready to seize the baton’, believes that India’s bad infrastructure and poorly skilled workforce will impede its growth.
Comparing India’s preparedness with China’s in 1970s
China is enduring an ongoing population implosion, which by 2050, will leave it with only 1.3 billion people, of whom 500 million will be past the age of 60.
India’s population, by contrast, would have peaked at 1.7 billion, of whom only 330 million will be 60 years or older.
Simply put, India is getting a demographic dividend that will last nearly 30 years.
There is so much going on for India today compared to China, the only country it can be reasonably compared to.
It is still a young country and in a much better position to transform itself compared to China of the 1970s.
It is still an open society where mass protest matters and produces results.
Indians have not been traumatised as Chinese were at the time of Mao Zedong’s death.
IT backbone: The IT technologies now available in India, and most importantly the Internet they run on have matured exponentially.
Many things right from video conferencing to instantaneous payments and satellite imaging are getting better and cheaper by the day.
Better administrative system: Creaky and inadequate as they are, India’s administrative systems manage to deliver and its infrastructure is in far better shape today than it was for China at the start of its reforms.
No rural urban divide: India does not have a Hukou system which in China tethers rural folk to rural parts creating a deep divide between a small and prosperous urban China and a much larger, very deprived rural China.
Way forward for India
To wring the best out of its demographic dividend, India needs to invest massively in quality school and higher education as well as healthcare across India on an unprecedented scale, literally in trillions of rupees between now and 2050 when it would have reached the apogee of its population growth.
Conclusion
India must seize the moment and not be incremental in its approach. Given the will it can initiate and see through a transformation that will stun the world, even more than China’s has so far.
From UPSC perspective, the following things are important :
Prelims level: Not much
Mains level: Paper 2- Taiwan issue
Context
The US House of Representatives Speaker Nancy Pelosi visited Taiwan evoking strong protest from China.
Brief history of China-Taiwan Tensions
Taiwan is an island about 160 km off the coast of southeastern China, opposite the Chinese cities of Fuzhou, Quanzhou, and Xiamen.
It was administered by the imperial Qing dynasty, but its control passed to the Japanese in 1895.
After the defeat of Japan in World War II, the island passed back into Chinese hands.
After the communists led by Mao Zedong won the civil war in mainland China, Chiang Kai-shek, the leader of the nationalist Kuomintang party, fled to Taiwan in 1949.
Chiang Kai-shek set up the government of the Republic of China on the island, and remained President until 1975.
Beijing has never recognised the existence of Taiwan as an independent political entity, arguing that it was always a Chinese province.
The US and One-China Principle
With the shifting geopolitics of the Cold War, the PRC and the U.S. were forced to come together in the 1970s to counter the growing influence of the USSR.
This led to the US-China rapprochement demonstrated by the historic visit of then US President Richard Nixon to PRC in 1972.
The same year, the PRC displaced ROC as the official representative of the Chinese nation at the UN.
Diplomatic relations with the PRC became possible only if countries abided by its “One China Principle” — recognizing PRC and not the ROC as China.
Why does China have a problem with Pelosi visiting Taiwan?
For China, the presence of a senior American figure in Taiwan would indicate some kind of US support for Taiwan’s independence.
This move severely undermined China’s perception of sovereignty and territorial integrity.
China’s reaction
Increased military exercises around Taiwa : Military exercises around Taiwan have been expanded, with Chinese aircraft intruding more frequently across the informal median line which defines the zone of operations on each side.
Increased naval presence: Chinese naval ships are cruising within the Taiwan Straits and around the island itself.
Economic sanctions have been announced, prohibiting imports of a whole range of foodstuffs from Taiwan.
One item which will be left out is semi-conductors, a critical import for a range of Chinese high-tech industries.
Taiwanese firms like the Taiwan Semi-Conductor Manufacturing Company (TSMC) are world leaders in the most sophisticated brands of chips imported by a large number of countries.
The main target of China’s escalating response will be Taiwan.
Taiwan is indeed caught in the crossfire between China and the US and being a proxy in a fight between giants.
Implications for East Asia and South East Asia
Forced into making a choice: Just as Taiwan is caught in a crossfire between the US and China, so are the East Asian and South East Asian countries.
Prefer US military presence: They feel reassured by the considerable US military presence deployed in the region and tacitly support its Indo-Pacific strategy.
Strong economic ties with China: However, their economic and commercial interests are bound ever tighter with the large and growing Chinese economy.
This having it both ways strategy is beginning to fray at the edges with the escalating tensions between the US and China.
Most do not wish to be forced into making a choice.
What should be India’s approach?
Advantageous for India: In one sense, China’s preoccupation with its eastern ocean flank of the Yellow Sea, the Taiwan Strait and the South China Sea is good for India.
It diminishes Chinese attention toward the Indian Ocean, India’s primary security theatre.
Adhere to One China Policy: Prudence demands that India hew closely to its consistent one China policy even while maintaining and even expanding non-official relations with Taiwan.
For the US, Japan and Australia, members of the Quad, Taiwan is a key component of the Indo-Pacific strategy.
It is not for India.
Conclusion
One should use the opportunity to expand India’s naval capabilities and maritime profile in this theatre before the Chinese begin to look to our extended neighbourhood with renewed interest and energy.
From UPSC perspective, the following things are important :
Prelims level: Finance Commission
Mains level: Paper 2- Freebies issue
Context
Concern over ‘freebies’ in Indian politics has recently been expressed by those in the highest offices in the country.
Issue of irrational freebies
Challenge in defining freebies: There is often confusion on what constitutes ‘freebies’, with a number of services that the Government provides to meet its constitutional obligations towards citizens also being clubbed in this category.
Distortion of electoral process: A Bench headed by the Chief Justice of India recently heard a public interest litigation in which the petitioner argued against the promise of ‘irrational freebies’ by claiming that these distort the electoral process.
The bench asked the Central government to take a stand on the need to control the announcement of ‘freebies’ by political parties during election campaigns.
The Court also suggested that the Finance Commission could be involved to look into the matter and propose solutions.
The basic argument is that these are a waste of resources and place a burden on already stressed fiscal resources.
Discussions on ‘freebies’ not only include the free distribution of what may be considered ‘club goods’ such as televisions but also welfare schemes such as free or subsidised rations under the Public Distribution System (PDS) and work provided through the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
Can we term foodgrain distribution under PDS as freebies?
It ensures food security: Subsidised foodgrains distributed under the PDS not only contribute to ensuring basic food security but also act as an implicit income transfer allowing the poor to afford commodities that they otherwise could not.
Price support for farmers: Further, the PDS also plays an important role in our country where public procurement at minimum support prices (MSPs) is one of the main instruments of support to farmers.
The PDS allows foodgrains to be available for cheap for consumers while assuring remunerative prices to farmers.
Food security during emergency: The PMGKAY is probably what kept many away from the brink of starvation during the novel coronavirus pandemic.
From around the mid-2000s, the PDS increasingly became a political issue, with State governments expanding coverage and reducing prices.
This ultimately led to the National Food Security Act being passed by Parliament unanimously in 2013.
Despite its shortcomings, it cannot be denied that the PMGKAY and the support that it provided during the pandemic would have been impossible had it not been for the NFSA which expanded the coverage of the PDS to about two thirds of the population.
In its absence, a much smaller number of people would have had ration cards with high errors in identification.
Other welfare schemes
At a time when there are few employment opportunities, working under MGNREGA can guarantee some assured wages; if implemented in the true spirit of the legislation this is also demand-based and, therefore, responds to as much need as there is.
Similarly, mid-day meals in schools have been proven to contribute to increased enrolment and retention in schools and addressing classroom hunger.
A number of other schemes such as old age, single women and disabled pensions, community kitchens in urban areas, free uniforms and textbooks for children in government schools, and free health-care services play a critical role in providing social security and access to basic entitlements in our country.
Way forward
Building public pressure towards making welfare delivery an electoral issue is the need of the hour.
It is important to recognise that most welfare schemes contribute to improving human development outcomes, which also results in higher economic growth in future.
As suggested by the Supreme Court, the Finance Commission could be tasked with formulating the criterion to come up with the criterion for freebies.
Sometimes, this process throws up initiatives that seem ‘wasteful’ — while these must be discussed, one cannot deny them completely.
Conclusion
There are a number of lacunae in these programmes which call for expansion in coverage, allocation of greater resources, along with putting in place mechanisms for greater accountability and grievance redress.
From UPSC perspective, the following things are important :
Prelims level: CIC
Mains level: Paper 2- Challenges facing RTI
Context
Amidst renewed concern over its functioning across states, the Right to Information Act (RTI) is set to complete 17 years this October.
Issues facing RTI
Backlog of appeals: Issues include a huge backlog of second appeals, lengthy wait time for hearings, hesitancy in posting penalties and increasing opacity in the working of the commissions.
As on June 30, 2021, 2.56 lakh appeals were pending with 26 information commissions in the country.
CICs downgraded rank: Any serious RTI query or one which concerns more than one government department requires intervention by higher officials, but it is the PIOs from junior ranks who attend hearings and are often clueless.
Often, it requires a notice to higher authorities, in some cases, the secretary of the department, to elicit the right answer.
With CICs downgraded in rank, there will be fewer and fewer notices served to the heads of departments and senior officers to appear and answer queries.
Vacancies: The commissions have been plagued with vacancies, poor choice of commissioners, untrained staff and a non-cooperative set of public information officers (PIOs).
Threat to some RTI activists: Apart from the PIOs’ general inexperience and unprofessionalism, comes the threat to some RTI activists who seek information to expose corruption.
According to the Commonwealth Human Rights Initiative (CHRI), across India, 99 RTI activists have lost their lives, 180 assaulted and 187 were threatened since 2006.
Political proclivity: The attitude of a few commissioners going public with their political proclivities is another cause for concern.
Way forward
Training of officials: The Indian information law, rated as one of the strongest in the world, needs to be bolstered by raising awareness amongst the people and organising rigorous training of government officials.
Code of conduct: A code of conduct must be evolved for the central and state information commissioners.
It is imperative for the commissioners to keep a strict distance from government heads and officialdom.
A strong political system is a must for the RTI regime to flourish.
It is imperative to ensure freedom of the press and democratic institutions, punish errant officials and maintain complete autonomy of the information commissions, in the interest of the people and the nation at large.
Conclusion
As India emerges as a global power, the implementation of legislation like the RTI Act will be under the constant scrutiny of the comity of nations.
From UPSC perspective, the following things are important :
Prelims level: Schedule H drugs
Mains level: Paper 3- E-commerce for medical drug
Context
A draft law to replace the 1940 Drugs and Cosmetics Act with a Drugs, Medical Devices and Cosmetics Bill 2022 was uploaded by the Union health ministry in early July, seeking public comments and objections.
Major provisions of the Bill
1] E-commerce for medical drugs
Presently, online sales of medicines account for a fraction of the total pharma sales in India but are forecast to grow exponentially.
The first major feature in the new Bill that affects consumers relates to e-commerce.
Like all online shopping, the consumer gets the advantage of discounts and the comfort of shopping from home.
In normal times, e-commerce can surmount three uniquely Indian disadvantages.
Storage condition: The first relates to climatic conditions, which require medicines to be stored at below 30 degrees Celsius and 70 per cent relative humidity — unattainable in most of India.
It can mandate establishing a back-end brick and mortar store for drug supply having good storage conditions.
Compliance with regal provision: The second advantage of e-commerce could be fulfilling a legal requirement — providing a bill to the consumer and retaining one copy bearing the batch numbers and expiry dates of the drugs.
In addition, the practice of accessing prescription drugs over-the-counter would reduce.
In the case of e-commerce, registration of a pharmacy can require enrollment with the central and state drug control organisations and the practice of uploading a prescription from a registered medical practitioner can be enforced.
Concern: Shopping for medical drugs on the internet could encourage overuse or incomplete use of drugs, increase dependency on habit-forming medicine — for example, sleep-inducing drugs or self-medication with products for weight loss, male enhancement, even treating mental illness — which is fraught with dangerous consequences.
A greater focus on medical devices: The draft law also proposes according a greater focus on medical devices, which include thousands of engineered apparatuses like stents, joint implants, pacemakers, catheters, etc, which require quality regulation.
Provision for advisory board: Rules for medical devices were notified in 2017 but now it is proposed to establish a statutory Medical Device Technical Advisory Board, with experts from the fields of atomic energy, science and technology, electronics, and related fields like biomedical technology to guide the process.
This is a welcome move that will bring in the required expertise.
Issues not addressed in the Bill
Mismanagement of trade: What the Bill does not address is the need to stop the continued mismanagement of the wholesale and retail drugs trade in India.
Requirements for drug license not changed: Rule 64 (2) of the Drugs and Cosmetics Rules 1945 lays down that a wholesale drug licence can be given to a qualified pharmacist or one who has passed the matriculation examination or its equivalent or a graduate with one year’s experience in dealing with drug sale.
This is a relic from 80 years ago.
When the country is reported to have over 7,00,000 pharmacists, this anachronism must be discarded.
It is essential to introduce a binding and enabling provision to only licence qualified pharmacists and put the safety of millions of citizens before the self-preservation of a few thousand wholesalers and stockists.
Way forward
There is need for ensuring digitisation of procurement, inventory control and accountability for dispensing drugs into a digital trail.
Conclusion
The debate should not be between e-commerce and retail sale. It should be between being compliant and non-compliant.
From UPSC perspective, the following things are important :
Prelims level: TRIPS waiver
Mains level: Paper 3- WTO and India
Context
The 12th Ministerial Conference (MC12) of the World Trade Organization (WTO) was concluded recently. A cursory examination of the outcomes of the meeting leaves us in no doubt that the European Union (EU) and some other developed countries are the overwhelming winners, while India finds itself on the losing side.
Background of TRIPS waiver for Covid related treatment
On October 2020, India and South Africa put forth a proposal seeking to temporarily suspend the protection of intellectual property rights such as patents, copyrights, industrial designs and trade secrets, so that the production of vaccines, therapeutics and diagnostics could be ramped up to help overcome the crisis and fight the COVID-19 pandemic.
The opponents of the proposal, i.e,. Germany, the United Kingdom, Japan, Switzerland and the United States, found themselves on the wrong side of the global opinion on this issue.
In June-July 2021, the U.S. gave its support to the proposal, but limited it to vaccines.
Pushed into a corner, the European Union (EU) made a counter-proposal to undermine the proposal made by India and South Africa.
This counter proposal provided a cosmetic simplification in certain procedural aspects of compulsory licensing in patent rules.
By March 2022, India and South Africa were corralled into accepting the EU’s proposal.
This formed the basis of the final outcome at the MC12.
Gain for EU at MC12
The ministerial outcome on the so-called TRIPS waiver represents the biggest gain for the EU.
The ministerial outcome adds very little to what already exists in the WTO rulebook.
The final outcome is almost unworkable; a big public relations victory for the EU.
Change in institutional architecture: In the name of WTO reform, the EU sought to make fundamental changes to the institutional architecture of the WTO.
It also sought to give a formal role to the private sector in WTO.
Environmental issues: The EU has also managed to create a window to pursue negotiations on issues related to trade and environment at the WTO, an issue of concern for many developing countries.
Disappointments for India
No solution to public stockholding issue: India, the issue of a permanent solution to public stockholding was identified by the Indian Minister of Commerce and Industry as being its top most priority.
Despite having the support of more than 80 developing countries, this issue has not found mention anywhere in the ministerial outcome.
Instead, the WTO members have succeeded in diverting attention from India’s interest by agreeing that food security is multi-dimensional, requiring a comprehensive solution.
No taxing electronic transmission: India has also failed in many of its other objectives, such as securing the right to raise revenues by taxing electronic transmissions.
In the area of fisheries subsidies, it gets two years to have suitable regulatory mechanisms in place to monitor fish catch and reporting.
Although it has secured a temporary reprieve to provide subsidies for enhancing its fishing fleets, it will have to fight an uphill battle on this issue in future negotiations.
Conclusion
Overall, the path ahead for India at the WTO is difficult. India’s negotiators need to undertake soul searching to learn lessons from the dynamics at the MC12, and make course corrections.
Under the WTO’s Agreement on Agriculture, government procurement for public stockholding programs is exempt from discipline if stocks are procured at current market prices.
If procured at pre-announced administered prices, however, those outlays would potentially be counted toward a country’s overall limits on trade-distorting support.
Some developing countries are concerned that their procurement of food at fixed prices under these programs may push outlays to exceed allowed limits, thus depriving them of the necessary policy space to meet domestic food security requirements.
In this context, India and other members of the G33 developing country coalition have called for WTO members to agree to a “permanent solution,” following the 2013 Bali decision to exempt these programs from legal challenge under certain conditions.
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