THE CONTEXT: As the crisis over Ukraine has entered a critical phase, most middle and great powers from Europe and Asia have rushed to either prepare for any eventuality or mediate by attempts to douse the flames. With the US recently calling a UNSC meet over the threat of the Russian invasion of Ukraine and Russian President Vladimir Putin traveling to Beijing to shore up its resolute stand on Ukraine, most nations find themselves on one side or the other of the emerging battle lines in eastern Europe. India, though, has avoided the strategic ensnarement.

THE BACKGROUND: Ukraine and Russia share hundreds of years of cultural, linguistic, and familial links. For many in Russia and in the ethnically Russian parts of Ukraine, the shared heritage of the countries is an emotional issue that has been exploited for electoral and military purposes. As part of the Soviet Union, Ukraine was the second-most powerful Soviet republic after Russia, and was crucial strategically, economically, and culturally.

CAUSE OF CONFLICT

• Balance of Power: Ever since Ukraine split from the Soviet Union, both Russia and the West have vied for greater influence in the country to keep the balance of power in the region in their favour.
• Buffer Zone for Western Countries: For the US and the European Union, Ukraine is a crucial buffer between Russia and the West.
• As tensions with Russia rise, the US and the EU are increasingly determined to keep Ukraine away from Russian control.
• Russian Interest in the Black Sea: The unique geography of the Black Sea region confers several geopolitical advantages to Russia.
• Firstly, it is an important crossroads and strategic intersection for the entire region.
• Access to the Black Sea is vital for all littoral and neighboring states, and greatly enhances the projection of power into several adjacent regions.
• The region is an important transit corridor for goods and energy.
• Protests in Ukraine: Euromaidan Movement: European Square was a wave of demonstrations and civil unrest in Ukraine, which began in November 2013 with public protests in Maidan Independence Square in Kyiv, Ukraine.
• The protests were sparked by the Ukrainian government’s decision to suspend the signing of an association agreement with the European Union, instead choosing closer ties to Russia and the Eurasian Economic Union
• Separatist Movement: The Donetsk and Luhansk regions of eastern Ukraine have been facing a pro-Russian separatist movement since 2014.
• According to the various sources, the movement is actively supported by the Russian government and Russian paramilitaries make up between 15% to 80% of the separatists fighting against the Ukraine government.
• Invasion of Crimea: Russia seized Crimea from Ukraine in what was the first time a European country annexed territory from another country since world war 2
• The annexation of Crimea from Ukraine followed a Russian military intervention in Crimea that took place in the aftermath of the 2014 Ukrainian revolution and was part of wider unrest across southern and eastern Ukraine.
• The invasion and subsequent annexation of Crimea have given Russia a maritime upper hand in the region.
• Ukraine’s NATO Membership: Ukraine has urged NATO  to speed up its country’s membership in the alliance.
• Russia has declared such a move a “red line”, and is worried about the consequences of the US-led military alliances expanding right up to its doorstep.
• The Black Sea is bordered by Bulgaria, Georgia, Romania, Russia, Turkey, and Ukraine. All these countries are NATO countries.
• Due to this faceoff between NATO countries and Russia, the Balck sea is a region of strategic importance & a potential maritime flashpoint.

CURRENT SITUATION

• Russia is seeking assurances from the US that Ukraine will not be inducted into NATO. However, the US is not prepared to give any such assurance.
• This has left the countries in a standoff, with tens of thousands of Russian troops ready to invade Ukraine.
• Russia is keeping the tensions high at the Ukraine border in order to get sanctions relief and other concessions from the West.
• Any kind of military action by the US or EU against Russia would precipitate a major crisis for the whole world and has so far not been mooted by any of the parties involved.

 THE DYNAMICS

INTERNATIONAL DYNAMICS:

• The sway of Bidden over American politics is decreasing an all-time low rating of 33% was witnessed. In such a case, conflict with Russia is seen as an attempt to bolster domestic politics.
• There is no unity among NATO on the issue of Russia. Recently, the German chancellor said they had no intention to impose an economic section over Russia.
• Britain’s standing and influence in Russia are practically negligent.
• American relation with France is all-time low after the AUKUS fiasco.

INDIA’S POSITION AND STANDING

Military equations: 

• Moscow makes up about half of India’s total weapons import. India needs Russia to service its arms, and also for joint products, like the Brahmos missile.
• Hence, abandoning Russia is not an option for New Delhi. And at the same time, siding with Russia could incur American sanctions, i.e., CAATSA (The Countering America’s Adversaries Through Sanctions Act).
• The Biden administration is in the process of making a decision on whether to sanction India for its purchase of the S-400 Russian missile systems or to process a waiver, considering the close India-US defense ties.
• If New Delhi openly sides with Russia, then Biden may reconsider imposing sanctions.

China factor:

• In recent years, China has become the biggest threat for India—openly acknowledged by Indian Army chief MM Naravane.
• Hence, India needs both Russia and US to counter China.
• America is China’s rival while Russia is an ally. One brings deterrence, whereas the other brings leverage.
• Russia could be effective in tempering China’s aggression and America, on the other hand, will undermine its designs.
• So, it’s a win-win for India. But that advantage disappears if India picks aside.

Economic fallout:

• The India-Russia bilateral trade is worth $8 billion, while the India-Ukraine trade is worth around only $2.7 billion.
• If a war breaks out, supply chains are going to be disruptive. And the one product that will worry India is oil, both as a fuel and cooking oil.
• Last year, India bought 1.8 million tonnes of sunflower oil and 74 percent of that came from Ukraine. So, if a war breaks out cooking oil may become more expensive.
• India is already preparing for this eventuality and new markets are being explored, like Brazil and Argentina.
• Then comes the petroleum. Brent crude has already breached the 90$-mark, which the possibility to reach even the $100-mark.
• Russia makes up around 20 percent of the global supply of natural gas. If Ukraine is attacked, the prices of natural gas are going to skyrocket
• And this could disrupt India’s energy plans. So, India has a lot at stake in this conflict.

Explaining India’s position: 

• In the UNSC meeting, India abstained, circumventing a perception of supporting the US-led coalition against Russia.
• In the same breath, India also distanced itself from the Beijing Olympics through an official boycott, which in many ways has been projected and perceived as an anti-US as well as an anti-West congregation.
• The two decisions reflect two different assessments of its interests vis-à-vis compulsions of the great power politics on New Delhi.
• While some interpreted India’s absence from the UNSC meets as depicting the limitations of its closeness to the US (alongside tacit support for Russia).
• Its boycott of the Beijing Olympics evinced a coming of age in its strategic autonomy characterized by strong, independent, and interest-based decision-making irrespective of the nature of great power politics at play and the looming risk of antagonizing big powers.
• For India, the decision to carefully weigh on the Ukraine crisis has balanced two strategic necessities:
• Expectations of a close strategic partner in the US; the need to maintain strong ties with Moscow and;
• In unison, these three compulsions also narrate the story of India’s challenges today and the implicit need for a more accommodative evolution of its traditional strategic autonomy to a positioning that straddles balancing and hedging with occasional pushing.

THE CONCLUSION: As Indian strategic engagement with the United States has grown in recent years, the Modi government has shifted its reaction to developments in Ukraine ever so slightly. In 2014, the government of then-Indian Prime Minister Manmohan Singh talked about Russia’s “legitimate interests” in Ukraine; today, the Modi government underlines the “legitimate security interests of all countries” in Ukraine. It is keeping in mind our own experience of the neutral or cautious positions that Russia and the US and our other partners, including our neighbours, take on our differences with China and Pakistan, on the impact on our own security of the US/Russian policies in Afghanistan, on the omission of any direct reference to Pakistan on the issue of cross border terrorism, etc. Russia openly criticizes our Indo-Pacific and Quad choices, while the US still courts Pakistan, threatens our defense ties with Russia, and has impaired our ties with Iran.

THE INDIAN POLITY AND CONSTITUTION

1. ARUNACHAL PRADESH & MIZORAM CELEBRATES STATEHOOD DAY

THE CONTEXT: On 20^th February,2022 the two north-eastern states, Arunachal Pradesh and Mizoram celebrated the day they were accorded the status of states.

THE EXPLANATION:

• Arunachal Pradesh was earlier known as Northeast Frontier Agency (NEFA). It was renamed Arunachal Pradesh in 1972 and granted a union territory status. Earlier, the state was a part of Assam, and after it became a UT, its administration was entrusted in the hands of a chief commissioner. With the passing of the constitution 55^th Amendment Act, 1987 Arunachal Pradesh finally became a 24^th
• Mizoram’s statehood came after a bloody period of insurgency. Separatists’ groups had demanded independence from India in the 1960s. Mizo National Front (MNF) took to armed rebellion to realize this demand. The Indian government resorted to bombing parts of the state in retaliation. In 1986, Mizoram Peace Accord was signed between India and MNF. Mizoram was granted statehood on February 20, 1987, as per statehood Act of 1986 and Mizoram became the 23^rd State of the Indian union.

THE HEALTH AND SOCIAL ISSUES

2. LEPROSY DETECTION FELL DURING PANDEMIC: REPORT

THE CONTEXT: According to the latest report by the Leprosy Mission Trust India in 2019, the states accounted for 35% of the total new leprosy cases reported in the country. They reported 22,000 new cases during April-September 2019, but only 8,270 for the same period in 2020.

THE EXPLANATION:

According to the National Leprosy Eradication Programme (NLEP) report, it highlights that the proportions of multibacillary (MB) leprosy and grade-2 disability (G2D) among the new cases increased by 20% and 12%, respectively, during April-September 2020, compared to the same six-month period in 2019. Moreover, the proportion of both women and children among new cases decreased by 70% compared to the same two quarters in 2019.

The COVID-19 pandemic and its ensuing recommendations on social distancing and lockdowns caused a fall of 62.5% in the detection of active leprosy cases between April and September 2020 when compared with the previous year’s corresponding period in four States — Andhra Pradesh, Odisha, Bihar and Madhya Pradesh.

What is leprosy?

• Leprosy is also known as Hansen’s disease.
• It is an infectious disease which is caused by a bacillus Mycobacterium leprae.
• The disease has been named after Gerhard Henrik Armauer Hansen who was a Norwegian physician.
• Hansen proved that leprosy is not a hereditary disease but is caused by a bacterium.
• The disease is a curable disease and treatment at the early stage can prevent any disability.
• It can cause a progressive and permanent damage to the skin, nerves, limbs and eyes if it is left untreated.
• The incubation period of the disease is 5 years usually. Symptoms of the disease can be seen within 1 year but it could also take 20 years or even more years to occur.

How it spreads?

The disease spreads through the droplets either from the nose or mouth when the affected person sneezes or coughs.

THE ENVIRONMENT AND ECOLOGY

3. MOTHS VITAL TO POLLINATION IN THE HIMALAYAN ECOSYSTEM, FINDS STUDY

THE CONTEXT: According to the findings,moths are vital to pollination in the Himalayan ecosystem of northeast India. The study establishes 91 species of moths as potential pollinators of 21 plant families in Sikkim and Arunachal Pradesh in the northeastern Himalayas.

THE EXPLANATION:

• The details of the study were recently published in a paper titled “Settling moths are the vital component of pollination in Himalayan ecosystem of North‑East India,” pollen transfer network approach revealed in Scientific Reports, a publication from the Nature group of journals.
• The results assume significance as a majority of the pollination-related studies are based on diurnal pollinators (bees and butterflies) and the role of nocturnal pollinators have so far received less scientific attention.
• “In the present study about 65% moths (91 species) carried sufficient quantities of pollen grains to be considered as potential pollinators. Teliphasa sp. (Crambidae) and Cuculia sp. (Noctuidae) are found to carry the highest quantity of pollen”.
• Another interesting outcome of the study is that the moth species achaeajanata (a well-known pest of various economically important plants) was identified as a potential pollinator of three plant families, indicating that moths can provide net benefits as pollinators even when acting as larval herbivores of the same species.
• According to the Scientists of the ZSI, the study assumes significance as it revealed a high degree of selectivity in moths, which are generally considered generalists (that is, not very choosy about food plants), and season and altitude affect the role of moths as potential pollinators.
• Also, they noted here are about 12,000 moth species in India and about 160,000 moth species in the world, and the study can go a long way in understanding the role of the nocturnal insect pollinators.

QUICK FACTS:

• Made for each other: Bees pollinate the flowers of a whole range of plants that humans cultivate for food — fruits like apples, spices like cardamom, onion, coffee, coconut — its a long list. Bee pollinated flowers bloom during the day, when bees fly to look for food. They contain nectar, a sugar rich liquid that bees love. Bees also feed on pollen. Nectar gives the bees energy while the pollen provides them with proteins.
• Moths are attracted to purple, pink or white flowers, which have a strong, sweet smell.
• Tobacco is pollinated by moths. Bat pollinated flowers have a strong, musty smell and are bowl shaped; pollen gets stuck onto the bat’s face as it drinks the nectar.

4. CENTRE MOOTS POLICY ON SYNTHETIC BIOLOGY

THE CONTEXT: The Centre is working on a national policy on synthetic biology, an emerging science that deals with engineering life forms for a wide range of applications from making designer medicines to foods.

THE EXPLANATION:

• According to the range of experts from India, “It is time for India to consolidate its stand on the science of synthetic biology and communicate its interests and aspirations in relevant international fora with clarity and should avoid conflicting stands on science on one hand and policy on the other. “
• As part of the 12th Five-Year Plan, India had set up a task force on systems biology and synthetic biology research in 2011. This body underlined the potential benefits from synthetic biotechnology in biofuels, bioremediation, biosensors, food and health and made a strong case for a push for the technology and highlighted that India could be a world leader as a protector and supporter of “open-source biological platforms”.
• Instances of application of synthetic biology include the use of gene editing systems such as CRISPR that allow defective genes in animals, plants and even people to be silenced, or changed, and control biological outcomes. The discovery of the CRISPR system earned scientists Jennifer Doudna and Emmanuelle Charpentier the Nobel Prize for Chemistry in 2020.
• However, legislation regarding genetically modified crops are still in a lurch in India.Due to opposition from several interest groups in India, the proposed Biotechnology Regulatory Authority of India Bill is pending approval in Parliament since 2013. Currently, approvals for such crops come from the Genetic Engineering Appraisal Committee (GEAC) under the Ministry of Environment, Forest and Climate Change and Review Committee on Genetic Manipulation (RCGM) under the Department of Biotechnology.

BACKGROUND:

What is Synthetic biology?

Synthetic biology refers to the science of using genetic sequencing, editing, and modification to create unnatural organisms or organic molecules that can function in living systems. Synthetic biology enables scientists to design and synthesise new sequences of DNA from scratch.

APPLICATIONS:

• In the pharmaceutical industry, synthetic biology can be used to make natural compounds such as artemisinin used for the treatment of malaria and Car T cell therapy for cancer treatment. It is starting to be used in the fashion industry as well; some companies are exploring the possibility of dyeing jeans without producing hazardous waste.
• Then there are companies using it to deliver fixed nitrogen to plants instead of using fertilisers, engineering microbes to create food additives or brew proteins.

THE GOVERNMENT SCHEMES IN NEWS

5. THE GOVERNMENT OF INDIA & WORLD BANK SIGN LOAN AGREEMENT FOR REWARD PROJECT

THE CONTEXT: The Government of India, State Governments of Karnataka and Odisha, and the World Bank have signed loan agreements of 115 million US dollars for the implementation of “Rejuvenating Watersheds for Agricultural Resilience through Innovative Development” (REWARD) Project.

ABOUT THE PROJECT:

• It will help national and state institutions adopt improved watershed management practices to help increase farmers’ resilience to climate change, promote higher productivity and better incomes. Ministry of Finance in a statement said that the Government of India has committed to restoring 26 million hectares of degraded land by 2030 and doubling farmers’ income by 2023.
• It is effective watershed management can help enhance livelihoods in rainfed areas, while building a more resilient food system.
• It will also help the participating and other states to adopt new approaches to watershed development.India has one of the largest watershed management programs in the world. This programme will further advance this progress by developing and applying comprehensive spatial data and technologies, decision support tools, and knowledge exchanges.

Objectives of the project

• The outcomes are prevention of soil run-off, regeneration of natural vegetation, rainwater harvesting and recharging of the groundwater table.
• This enables multi-cropping and the introduction of diverse agro-based activities, which help to provide sustainable livelihoods to the people residing in the watershed area.

6. THE PM FLAGS OFF 100 KISAN DRONES

THE CONTEXT: The Prime Minister flagged off 100 Kisan drones in different cities and towns of India to spray pesticides in farms across India. He virtually addressed to a group of farmers gathered at Manesar from where the “Drone Kisan Yatra” was flagged off.

THE EXPLANATION:

What is a Kisan drone?

• The Kisan drone will have an unmanned tank filled with insecticides and nutrients. The drones are expected to have a high capacity of 5 to 10kg. The drone will spray the same amount of pesticide on about one acre of land in just 15 minutes. This will save time, will require less effort and spraying will be done uniformly.
• Also, it will be used to boost the agricultural sector in the country, the use of Kisan Drones will be promoted for crop assessment, digitization of land records etc.

What is the Need?

• This step was taken as the government aims to promote chemical-free national farming.
• During the Budget 2022 the finance minister announced “the Chemical-free Natural farming to be promoted throughout the country, with focus on farmers’ lands in 5-kilometre-wide corridors along the river Ganga in the first stage.
• Kisan Drone will usher in a new edge revolution as high-capacity drones will be used to carry vegetables, fruits, fishes to the market directly from the farms. “These items will be supplied directly to the market with minimal damage, consuming lesser time, resulting in more profits to farmers and fishermen”.

NEWS IN SHORTS-PT PERSPECTIVE

7. THE ASSAM GOVERNMENT LAUNCHED “PROJECT AROHAN”TO HONE STUDENTS’ SKILLS

Assam Government will launch a four-year mentorship programme called ‘Project Arohan’ to provide guidance to students and improve their skills.

8. GEOGRAPHICAL INDICATION (GI) LABEL ON KASHMIR PASHMINA

In order to preserve the centuries old art of spinning and weaving of genuine pashmina fabric. And to maintain international standards the Government of India (Under WTO) has established a quality mark for genuine Pashmina that will identify items the genuine fiber known as Pashm obtained from the goat living in Ladakh of Kashmir region. Geographical Indication (GI) Label on Kashmir Pashmina is a US patent stamp on the original ‘Kashmir Pashmina’ fabric or its products and is known as the G.I Mark.

 9. THE STUDY ON KASHMIR SHAIVISM

THE CONTEXT: The Kashmir Shaiva Institute (KSI) will come up as the first research, studies and publications centre on Kashmir Shaivism.

THE EXPLANATION:

• Kashmiri Shaivism, also called Pratyabhijna(Sanskrit: “Recognition”), religious and philosophical system of India that worships the god Shiva as the supreme reality. The school is idealistic and monistic, as contrasted with the realistic and dualistic school of Shaiva-siddhanta.
• It is actually a group of several monistic and tantric religious traditions that flourished in Kashmir from the latter centuries of the first millennium C.E. through the early centuries of the second.
• Vasugupta is regarded by some as the founder of the system of Hindu philosophy known as Advaita Shaivism of Kashmir, or Trika. Vasugupta’s Shiva Sutra is an important Yoga text, foundational to the Trika system of Kashmir Shaivism.
• Anuttara is the ultimate principle in Kashmir Shaivism, and as such, it is the fundamental reality underneath the whole Universe. Among the multiple interpretations of anuttara are: “supreme”, “above all” and “unsurpassed reality”.

THE PRELIMS PRACTICE QUESTIONS

QUESTION OF THE DAY 21^STFEB 2022

Q. Consider the following statements about Pashmina wool:

1. It is derived from the undercoat of Changthangi goat.
2. The undercoat is collected by combing goat, not by shearing.
3. The tribal people of Kashmir valley are traditional producers of Pashmina wool.

Which of the statements given statements is/are correct?

a) 1 only

b) 1 and 2 only

c) 1 and 3 only

d)  1, 2 and 3

ANSWER FOR 19^TH FEB 2022

Answer: A

Explanation:

• Green Hydrogen: It is produced from renewable resources of energy and not fossil fuels. The by products are water and water vapor.
• Blue Hydrogen: It is sourced from fossil fuels. The emission or the by products such as CO2 and CO are stored. It is better than grey hydrogen.
• Grey Hydrogen: India’s bulk comes from fossil fuels at present.

1. When habits return READ MORE
2. LEAD WITH COMPASSION READ MORE
3. Stress: A Positive Phenomenon READ MORE

1. Marine Birds Continue to Die as Peru Oil Spill Clean-Up Stretches On READ MORE
2. Humans have degraded 84% of the world’s coastlines, reveals a new study READ MORE
3. Wildfires will be more frequent, larger and intense due to climate change: UNEP READ MORE

1. Tapping technology for multilingual learning: As the theme of International Mother Language Day 2022, it has much relevance in reshaping Indian higher education READ MORE
2. A Bindi, a Hijab and the Inequality in What Is Proclaimed to Be Indian READ MORE
3. Will India’s gender budget truly serve as an instrument for ushering in women-led development? READ MORE

1. Upholding the law: UP pays for overreach in penalising anti-CAA protesters READ MORE
2. The steel frame of cooperative federalism READ MORE
3. The artificial intelligence-enabled nation READ MORE

(Newspapers, PIB and other important sources)

Prelim and Main

1. Leather, footwear exports to reach $6 billion in 2022-23: Council for Leather Exports READ MORE
2. Explain Speaking: Why record food grain production may trigger renewed demands for MSPs READ MORE
3. Centre moots policy on synthetic biology READ MORE
4. KSI to be first research, studies centre on Kashmir Shaivism READ MORE
5. Assam government to launch ‘Project Arohan’ to hone students’ skills READ MORE
6. Government of India, World Bank sign loan agreement of 115 million US dollar for implementation REWARD Project READ MORE

Main Exam    

GS Paper- 1

1. Tapping technology for multilingual learning: As the theme of International Mother Language Day 2022, it has much relevance in reshaping Indian higher education READ MORE
2. A Bindi, a Hijab and the Inequality in What Is Proclaimed to Be Indian READ MORE
3. Will India’s gender budget truly serve as an instrument for ushering in women-led development? READ MORE

GS Paper- 2

POLITY AND GOVERNANCE

1. Upholding the law: UP pays for overreach in penalising anti-CAA protesters READ MORE
2. The steel frame of cooperative federalism READ MORE
3. The artificial intelligence-enabled nation READ MORE

SOCIAL ISSUE

1. Protect LGBT people from violence, bias READ MORE

INTERNATIONAL ISSUES

1. The Comprehensive Economic Partnership Agreement between India and the UAE READ MORE
2. The significance of EU-India partnership in the Indo-Pacific READ MORE
3. The imperial roots of the India-China row READ MORE

GS Paper- 3

ECONOMIC DEVELOPMENT

1. Beyond the hype of blockchain, a look at its reality READ MORE
2. Green hydrogen’s promise READ MORE
3. Wealth Inequality: Capitalism Versus Socialism READ MORE

ENVIRONMENT AND ECOLOGY  

1. Marine Birds Continue to Die as Peru Oil Spill Clean-Up Stretches On READ MORE
2. Humans have degraded 84% of the world’s coastlines, reveals a new study READ MORE
3. Wildfires will be more frequent, larger and intense due to climate change: UNEP READ MORE

GS Paper- 4

ETHICS EXAMPLES AND CASE STUDY

1. When habits return READ MORE
2. LEAD WITH COMPASSION READ MORE
3. Stress: A Positive Phenomenon READ MORE

Questions for the MAIN exam

1. ‘The growing use of artificial intelligence in public policy is the most important thing to track about India’s governance’. Comment.
2. Do you think that Democracy resulting in better economic growth and educational attainment is a universal standard? Substantiate.

QUOTATIONS AND CAPTIONS

• Uncertainty is an uncomfortable position. But certainty is an absurd one.
• Barely three decades ago, there existed societies where inequality was lower than ever before in human history, as compared to now when a mere 0.027% of world’s population owns a combined wealth of $45 trillion.
• Lightning strikes and air pollution will also increase due to wildfires according to the UNEP Frontiers report.
• Without urgent change, the implications for coastal biodiversity and society will become more profound.
• Co-existing over centuries, borrowing from and nurturing each other, our languages are interwoven with our individual, local and national identity.
• A truly strategic relationship can reshape the post-pandemic world and promote a multipolar order.
• A policy thrust will work well with India’s solar push. An RPO-like package will boost demand.
• At the heart of border dispute is the larger historical challenge of fitting the Ladakh region into a territorial model ill-suited to it.
• The state’s contention that a refund of damages would send a wrong message on deterrence was also rightly denied, highlighting the supremacy of the law.
• Consultation and consensus, and not unilateralism, must inform decision making, being the bedrock of our cooperative federalism.
• Once you create a new inequality, it is difficult to extinguish it; even if this ‘interim’ ban on the hijab is lifted, the harm won’t be undone.

50-WORD TALK

• The current payment and reimbursement structure creates incentives that are not only perverse but also disparate. The larger private sector fuelled by diabolical out-of-pocket payments has little or no incentive to control costs or deliver value. On the other hand, the public sector has strong incentives to underperform, again compromising on the value in healthcare.

Things to Remember:

• For prelims-related news try to understand the context of the news and relate with its concepts so that it will be easier for you to answer (or eliminate) from given options.
• Whenever any international place will be in news, you should do map work (marking those areas in maps and also exploring other geographical locations nearby including mountains, rivers, etc. same applies to the national places.)
• For economy-related news (banking, agriculture, etc.) you should focus on terms and how these are related to various economic aspects, for example, if inflation has been mentioned, try to relate with prevailing price rises, shortage of essential supplies, banking rates, etc.
• For main exam-related topics, you should focus on the various dimensions of the given topic, the most important topics which occur frequently and are important from the mains point of view will be covered in ED.
• Try to use the given content in your answer. Regular use of this content will bring more enrichment to your writing.

[WpProQuiz 163]

THE CONTEXT: The government’s macro-economic strategy, as articulated through the Budget and the Economic Survey, can be stated simply: Growth will take care of all problems, as it had worked for India previously.  Yet many parameters have changed since then.

THE ISSUE: After the LPG era when the macro-economic indicators were comparable to today’s fiscal deficits, heavy interest burden on public debt, and problem-ridden banks. Yet the silver lining was world economy was growing which boosted tax revenues, reduced the deficit and debt in relation to GDP, and helped digest the interest burden. However, that scenario has changed since. In such a case, what’s the viability of growth being the centerpiece for the development in India?

THE SHACKLES NOW:  Due to inflationary pressure now, low-interest rates are climbing. While the global economy was accelerating then, it is slowing now. So, if the government thinks growth is the solution, can it be delivered in a slowing world with rising rates — bearing in mind also the domestic context of slower growth even during the pre-pandemic phase?

THE QUESTION NOW: In this case, given the status of the economy now Indian growth rate can sustain for 2-3 years, after which it will come under various traps. Some of these traps are

TRAPPED INDIA

Productivity trap: Persistently low productivity levels and poor productivity, performance across sectors in India are symptoms of a productivity trap. The concentration of exports of India on primary and extractive sectors undermines the participation of India in global value chains (GVCs). This, in turn, is associated with low levels of technology adoption and few incentives to invest in productive capacities. In all, competitiveness remains low, making it difficult to move towards higher added-value segments of GVCs. This fuels a vicious circle that negatively affects productivity.

Social vulnerability trap: Income growth paired with strong social policies since the beginning of the century has reduced poverty remarkably. Yet most of those who escaped poverty are now part of a new vulnerable middle class that represents 40% of the population. This comes with new challenges, as more people are now affected by a social vulnerability trap that perpetuates their vulnerable status. Those belonging to this socio-economic group have low quality, usually informal jobs associated with low social protection and low – and often unstable – income. Because of these circumstances, they do not invest in their human capital or lack the capacity to save and invest in entrepreneurial activity. Under these conditions, they remain with low levels of productivity, hence only with access to low-quality and unstable jobs that leave them vulnerable. This trap operates at the level of the individual, who is locked into a vulnerable status; this contrasts with the productivity trap, which refers to the whole economy.

Institutional trap: The expansion of the middle class in India has been accompanied by new expectations and aspirations for better quality public services and institutions. However, institutions have not been able to respond effectively to these increasing demands. This has created an institutional trap, as declining trust and satisfaction levels are deepening social disengagement. Citizens are seeing less value in committing to the fulfillment of their social obligations, such as paying taxes. Tax revenues are thus negatively affected, limiting available resources for public institutions to provide better quality goods and services, and to respond to the rising aspirations of society. This creates a vicious circle that jeopardizes the social contract in the region.

Environmental trap: This is linked to the productive structure of most developing economies, which is biased towards high material and natural resource-intensive activities. This concentration may be leading these countries towards an environmentally and economically unsustainable dynamic for two reasons. A concentration on a high-carbon growth path is difficult – and costly – to abandon; and natural resources upon which the model is based are depleting, making it unsustainable. This has also gained importance in recent years, with the stronger commitment to global efforts to fight climate change.

INTERACTIONS BETWEEN THESE DEVELOPMENT TRAPS

The four development traps interact and reinforce each other. This makes development challenges particularly complex and the need for sound analytical tools and coordinated policy responses increasingly relevant.

• There are many examples of how the traps are mutually reinforcing. With respect to the social vulnerability and productivity traps, the vulnerability associated with informal jobs is largely a by-product of low levels of productivity that characterize the Indian economy.
  • Meanwhile, informality itself acts as a strong barrier to increases in productivity and tax revenues.
• Likewise, weak institutions and social vulnerability are mutually reinforcing.
  • Populations are vulnerable because they lack an adequate safety net or because weak institutions do not provide them with quality public services such as education and health.
  • At the same time, vulnerability weakens the capacity and willingness to pay taxes and comply with formal rules, weakening the institutional setup.
• The productivity trap is also directly linked to institutions, which appear as one of the main determinants of success for countries that overcame this challenge.
• Eventually, the environmental trap is also directly linked to the diversification of the productive structure, and to the ability of the institutional setup to direct investments from resources and carbon-intensive sectors into environmentally efficient technologies.
• At the same time, environmental degradation and depletion reinforce the vulnerability trap by increasing the overall level of uncertainty.

THE WAY FORWARD

So Govt budget policy responses to overcome these development traps in India must consider their interactions. Better understanding the links and common causalities between different policy issues and objectives will be critical to developing responses that address their complex interactions effectively.

THE CONCLUSION: Leaving for the future the question of whether growth beyond 2025 can be maintained at a high pace, the question to ask today is whether such growth should be the sole measure of success. What about employment, poverty, the environment, education, and health — all of which have independent but also inter-linked salience, have suffered in the last couple of years, if not longer, and which the Budget seems to underplay?

THE INTERNATIONAL RELATIONS

1. INDIA, UAE INKS COMPREHENSIVE TRADE PACT

THE CONTEXT: India and the United Arab Emirates (UAE) signed a Free Trade Agreement (FTA), which is set to reduce tariffs for 80 per cent of goods and give zero duty access to 90 per cent of India’s exports to the UAE.

THE EXPLANATION:

• The agreement, which is expected to come into effect in about 60 days, is expected to boost annual bilateral trade to $100 billion within 5 years of its adoption, up from about $60 billion currently. The Comprehensive Economic Partnership Agreement was signed between the Ministry of Commerce and Industry and the UAE’s Ministry of Economy Ab after 88 days of negotiations.

HIGHLIGHTS OF THE TRADE PACT

• An India-UAE Joint Vision Statement was adopted which lays down contours of future course of bilateral relations and highlights areas of focus.
• On defence and security, both sides agreed to enhance maritime cooperation contributing to maintenance of peace and security in the region. They also reaffirmed joint commitment to fight against extremism and terrorism, including cross-border terrorism, in all forms, at both regional and international levels.
• On energy partnership, they agreed to promote collaboration opportunities to support India’s energy requirements, including new energies, and ensure the provision of affordable and secure energy supplies to India’s growing economy. They also expressed mutual support in energy transition and focused work on a low-carbon future.
• On climate action and renewables, they agreed to support each other’s clean energy missions and establish a joint Hydrogen Task Force to help scale up technologies, with special focus on production of Green Hydrogen.
• On emerging technologies, they agreed to expand cooperation on critical technologies and mutually promote e-businesses and e-payment solutions and promote start-ups from both countries.
• On education cooperation, they agreed to establish an Indian Institute of Technology in the UAE.
• On health cooperation, they decided to collaborate in research, production and development of reliable supply chains for vaccines and enhance investments by UAE entities in the health infrastructure in India as well as collaborate in providing healthcare in underprivileged nations.
• On food security, they acknowledged the need to enhance the resilience and reliability of food supply chains. They also decided to expand cooperation through enhanced bilateral food and agriculture trade and, promote and strengthen the infrastructure and dedicated logistic services connecting farms to ports to final destinations in the UAE.

VALUE ADDITION:

India–United Arab Emirates relations:

• Relations between both the countries were traditionally close. They had enjoyed close and friendly ties on the basis of historic and cultural ties. Barter trade for clothes & spices in exchange of dates & pearls and people-to-people contacts from the region have existed for centuries.
• Relations flourished with the creation of federation in 1971. Today, Indians make up ‘largest minority ethnic group’ in the UAE, accounting for around 38% of UAE’s total residents.

Trade Relations:

• UAE is currently India’s third-largest trading partner. It is also India’s second-largest export destination after the US. India was UAE’s second-largest trading partner in 2019. Furthermore, UAE is the eighth-largest investor in India.
• India’s major exports to the UAE include petroleum products, stones, minerals, precious metals, gems &jewellery, food items like sugar, cereals, tea, meat, fruits & vegetables, seafood, textiles etc. India imports crude petroleum, petroleum products, stones, minerals, precious metals, gems and jewellery, chemicals, wood and wood products.

THE ENVIRONMENT AND ECOLOGY

2. THE ARMY TAG FOR NEW GECKO FROM MEGHALAYA

THE CONTEXT: A team of herpetologists have recorded a new species of bent-toed gecko from a wooded part of the Umroi Military Station in Meghalaya.

THE EXPLANATION:

• Its scientific name is Crytodactylusexercitus and English name is Indian Army’s bent-toed gecko. Exercitus in Latin means army.
• “The name was given to honour the Army for its services to the country. The military station where the bent-toed gecko was discovered was also a factor behind its name.
• The genus Cyrtodactylus is represented by about 320 species worldwide and is the third most speciose vertebrate genus in the world. The members of the genus range from South Asia to Melanesia with high diversity in south Asia.
• India is now home to 40 species of the bent-toed gecko with the northeast accounting for 16 of them.

3. THE NATIONAL GREEN HYDROGEN POLICY

THE CONTEXT: Releasing the first part of India’s National Green Hydrogen Policy, the government on announced some incentives for potential manufacturers, generation companies (gencos) and distribution licensees (discoms) to boost large scale indigenous production of green hydrogen, so as todecarbonise the energy sector and reduce India’s heavy dependence on fossil fuels and crude oil imports.

THE EXPLANATION:

The Mission aims to aid the government in meeting its climate targets and making India a green hydrogen hub. This will help in meeting the target of production of 5 million tonnes of Green hydrogen by 2030 and the related development of renewable energy capacity.

What is the Significance?

• Hydrogen and Ammonia are envisaged to be the future fuels to replace fossil fuels. Production of these fuels by using power from renewable energy, termed as green hydrogen and green ammonia, is one of the major requirements towards environmentally sustainable energy security of the nation.
• Government of India is taking various measures to facilitate the transition from fossil fuel / fossil fuel based feed stocks to green hydrogen / green ammonia. The notification of this policy is one of the major steps in this endeavour.
• The policy promotes Renewable Energy (RE) generation as RE will be the basic ingredient in making green hydrogen. This in turn will help in meeting the international commitments for clean energy.

The policy provides as follows:

• Green Hydrogen / Ammonia manufacturers may purchase renewable power from the power exchange or set up renewable energy capacity themselves or through any other, developer, anywhere.
• Open access will be granted within 15 days of receipt of application.
• The Green Hydrogen / Ammonia manufacturer can bank his unconsumed renewable power, up to 30 days, with distribution company and take it back when required.
• Distribution licensees can also procure and supply Renewable Energy to the manufacturers of Green Hydrogen / Green Ammonia in their States at concessional prices which will only include the cost of procurement, wheeling charges and a small margin as determined by the State Commission.
• Waiver of inter-state transmission charges for a period of 25 years will be allowed to the manufacturers of Green Hydrogen and Green Ammonia for the projects commissioned before 30th June 2025.
• The manufacturers of Green Hydrogen / Ammonia and the renewable energy plant shall be given connectivity to the grid on priority basis to avoid any procedural delays.
• The benefit of Renewable Purchase Obligation (RPO) will be granted incentive to the hydrogen/Ammonia manufacturer and the Distribution licensee for consumption of renewable power.
• To ensure ease of doing business a single portal for carrying out all the activities including statutory clearances in a time bound manner will be set up by MNRE.
• Connectivity, at the generation end and the Green Hydrogen / Green Ammonia manufacturing end, to the ISTS for Renewable Energy capacity set up for the purpose of manufacturing Green Hydrogen / Green Ammonia shall be granted on priority.
• Manufacturers of Green Hydrogen / Green Ammonia shall be allowed to set up bunkers near Ports for storage of Green Ammonia for export / use by shipping. The land for the storage for this purpose shall be provided by the respective Port Authorities at applicable charges.

The implementation of this Policy will provide clean fuel to the common people of the country. This will reduce dependence on fossil fuel and also reduce crude oil imports.

THE GOVERNMENT SCHEMES IN NEWS

4. PRADHAN MANTRI FASAL BIMA YOJANA (PMFBY) ENTERS ITS 7TH YEAR OF IMPLEMENTATION

THE CONTEXT: The Pradhan Mantri FasalBima Yojana (PMFBY) has successfully entered its 7th year of implementation with the upcoming Kharif 2022 season, completing 6 years of its implementation since its launch announcement in February 2016.

THE EXPLANATION:

According to the Government, over 36 crore farmer applications have been insured under PMFBY, with over INR 1,07,059 crores of claims have already been paid under the scheme as of 4th February 2022.

• The PMFBY replaces the existing two schemes National Agricultural Insurance Scheme as well as the Modified NAIS.
• The scheme has been able to provide financial assistance to the most vulnerable farmers, as around 85% of the farmers enrolled with the scheme are small and marginal farmers. The recent announcement by Finance Minister of India during her 2022-23 budget speech on the use of drones for crop insurance will further strengthen the integration of technology for smooth implementation of the scheme on the ground.
• It is to be noted that the scheme will be launching a doorstep distribution drive to deliver crop insurance policies to the farmers ‘Meri Policy Mere Hath’ in all implementing States. The campaign aims to ensure all farmers are well aware and equipped with all information on their policies, land records, the process of claim and grievance redressal under PMFBY.

ABOUT THE SCHEME

Objectives

• To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases.
• To stabilise the income of farmers to ensure their continuance in farming.
• To encourage farmers to adopt innovative and modern agricultural practices.
• To ensure flow of credit to the agriculture sector.

Highlights of the scheme

• There will be a uniform premium of only 2% to be paid by farmers for all Kharif crops and 5% for all Rabi crops. In case of annual commercial and horticultural crops, the premium to be paid by farmers will be only 5%. The premium rates to be paid by farmers are very low and balance premium will be paid by the Government to provide full insured amount to the farmers against crop loss on account of natural calamities.
• There is no upper limit on Government subsidy. Even if balance premium is 90%, it will be borne by the Government.

Farmers to be covered

• All farmers growing notified crops in a notified area during the season who have insurable interest in the crop are eligible.
• To address the demand of farmers, the scheme has been made voluntary for all farmers from Kharif 2020.
• Earlier to Kharif 2020, the enrolment under the scheme was compulsory for following categories of farmers:
  • Farmers in the notified area who possess a Crop Loan account/KCC account (called as Loanee Farmers) to whom credit limit is sanctioned/renewed for the notified crop during the crop season.
  • And such other farmers whom the Government may decide to include from time to time.

Voluntary coverage: Voluntary coverage may be obtained by all farmers not covered above, including Crop KCC/Crop Loan Account holders whose credit limit is not renewed.

 THE MISCELLANEOUS

5. EXPLAINED: ALL YOU NEED TO KNOW ABOUT FIR

What is an FIR?

An FIR is the document that has been prepared by the police after verifying the facts of the complaint. The FIR may contain details of the crime and the alleged criminal.

The term first information report (FIR) is not defined in the Indian Penal Code (IPC), Code of Criminal Procedure (CrPC), 1973, or in any other law, but in police regulations or rules, information recorded under Section 154 of CrPC is known as First Information Report (FIR).

Section 154 (“Information in cognizable cases”) says that “every information relating to the commission of a cognizable offence, if given orally to an officer in charge of a police station, shall be reduced to writing by him or under his direction, and be read over to the informant; and every such information, whether given in writing or reduced to writing as aforesaid, shall be signed by the person giving it, and the substance thereof shall be entered in a book to be kept by such officer in such form as the State Government may prescribe”.

Also, “a copy of the information as recorded…shall be given forthwith, free of cost, to the informant”.

In essence then, there are three important elements of an FIR:

1. the information must relate to the commission of a cognizable offence,
2. it should be given in writing or orally to the head of the police station and,
3. it must be written down and signed by the informant, and its key points should be recorded in a daily diary.

What is a cognizable offence?

• A cognizable offence/case is one in which a police officer may, in accordance with the First Schedule of the CrPC, or under any other law for the time being in force, make an arrest without a warrant.
• In the First Schedule, “the word ‘cognizable’ stands for ‘a police officer may arrest without warrant’; and the word ‘non-cognizable’ stands for ‘a police officer shall not arrest without warrant’.”

What is the difference between a complaint and an FIR?

• The CrPC defines a “complaint” as “any allegation made orally or in writing to a Magistrate, with a view to his taking action under this Code, that some person, whether known or unknown, has committed an offence, but does not include a police report.”
• However, an FIR is the document that has been prepared by the police after verifying the facts of the complaint. The FIR may contain details of the crime and the alleged criminal.
• If, on the basis of a complaint, it appears that a cognizable offence has been committed, then an FIR under Section 154 CrPC will be registered, and police will open an investigation. If no offence is found, the police will close the inquiry.
• In case of non-cognizable offences, an FIR under Section 155 CrPC, commonly called “NCR”, is registered, and the complainant will be asked to approach a court for an order. The court may then direct the police to conduct an investigation on the complaint.
• Section 155 (“Information as to non-cognizable cases and investigation of such cases”) says: “When information is given to an officer in charge of a police station of the commission within the limits of such station of a non-cognizable offence, he shall enter or cause to be entered the substance of the information in a book…and refer the informant to the Magistrate. No police officer shall investigate a non-cognizable case without the order of a Magistrate having power to try such case or commit the case for trial.”

 What is a Zero FIR?

• When a police station receives a complaint regarding an alleged offence that has been committed in the jurisdiction of another police station, it registers an FIR, and then transfers it to the concerned police station for further investigation. This is called a Zero FIR.
• No regular FIR number is given. After receiving the Zero FIR, the concerned police station registers a fresh FIR and starts the investigation.

What if the police refuse to register an FIR?

• Under Section 154(3) CrPC, if any person is aggrieved by the refusal on the part of the officer in charge of a police station to register an FIR, she can send the complaint to the Superintendent of Police/DCP concerned who, if satisfied that such information discloses the commission of a cognizable offence, will either investigate the case, or direct an investigation by a subordinate police officer.
• If no FIR is registered, the aggrieved persons can file a complaint under Section 156(3) CrPC before a concerned court which, if satisfied that a cognizable offence is made out from the complaint, will direct the police to register an FIR and conduct an investigation.

What happens after an FIR is filed?

• The police will investigate the case and will collect evidence in the form of statements of witnesses or other scientific materials. They can arrest the alleged persons as per law.
• If there is sufficient evidence to corroborate the allegations of the complainant, then a chargesheet will be filed. Or else, a Final Report mentioning that no evidence was found will be filed in court.
• If it is found that no offence has been committed, a cancellation report will be filed. If no trace of the accused persons is found, an ‘untraced’ report will be filed.

THE PRELIMS PRACTICE QUESTIONS

QUESTION OF THE DAY 19^TH FEB 2022

Q.Which of the following explains ‘green hydrogen’?

a It is produced from renewable resources of energy.

b It is produced from green plants.

c It is produced from sea water.

d It is produced from fossil fuels.

ANSWER FOR 18^TH FEB 2022

Answer: B

Explanation:

India’s first water taxi service was inaugurated in Maharashtra connecting the Navi Mumbai area to mainland Mumbai.

1. What it means to have a fertility rate of 2 READ MORE
2. Muslim women and their right to an education READ MORE
3. Child safety READ MORE

1. Culture is not fixed, it keeps changing with time READ MORE
2. Cease all arguments READ MORE
3. How Secular are Indian Schools in Practice? READ MORE

1. The developed world and its climate goals READ MORE
2. Scarcity to abundance: How a Maharashtra village came together to address water crisis READ MORE

(Newspapers, PIB and other important sources)

Prelim and Main

1. Pradhan Mantri Fasal Bima Yojana (PMFBY) enters its 7th year of implementation READ MORE
2. Army tag for new gecko from Meghalaya READ MORE
3. Govt releases national hydrogen policy READ MORE
4. India, UAE ink comprehensive trade pact; vow to jointly fight terrorism READ MORE
5. Emerging Asian countries, including India, running out of room to keep monetary policy on pause READ MORE
6. Scarcity to abundance: How a Maharashtra village came together to address water crisis READ MORE
7. Missing: One-third of India’s recorded forests READ MORE

Main Exam   

GS Paper- 1

1. Why India Can Expect Extremely Severe Cyclones During the 2022 Pre-Monsoon READ MORE
2. What it means to have a fertility rate of 2 READ MORE
3. Muslim women and their right to an education READ MORE

GS Paper- 2

POLITY AND GOVERNANCE

1. Why farm unions must stay out of electoral politics READ MORE
2. We need to build a deliberative democracy READ MORE
3. How colonial is Indian law? READ MORE
4. Too close to call: Contest wide open in high-stakes Punjab elections READ MORE
5. How India’s centralised bureaucracy undermines its federalism READ MORE

SOCIAL ISSUE

1. Child safety READ MORE

INTERNATIONAL ISSUES

1. India needs a refugee and asylum law: On refugee issues, it ought to be among the most admired nations and not one that has much to be ashamed of — as now READ MORE  
2. Foreign quarter: On internal matters and India’s response: India must show maturity in response to international criticism of internal matters READ MORE
3. Covid has shown why world must stand united READ MORE

GS Paper- 3

ECONOMIC DEVELOPMENT

1. Beyond the hype of blockchain, a look at its reality READ MORE

ENVIRONMENT AND ECOLOGY  

1. The developed world and its climate goals READ MORE
2. Scarcity to abundance: How a Maharashtra village came together to address water crisis READ MORE

TECHNOLOGY

1. Technology has changed intelligence gathering. Now all you need is an internet connection READ MORE

GS Paper- 4

ETHICS EXAMPLES AND CASE STUDY

1. Culture is not fixed, it keeps changing with time READ MORE
2. Cease all arguments READ MORE
3. How Secular are Indian Schools in Practice? READ MORE

Questions for the MAIN exam

1. ‘When democracy lends itself to greater centralisation, state institutions do not serve as effective checks’. Comment on the statement in the light of recent issue of deputation related to civil services.
2. Discuss how the financial commitments of developed world will be a vital help for developing countries to mitigate the impacts of extreme weather events?

QUOTATIONS AND CAPTIONS

• An imbalance between the rich and the poor is the oldest and most fatal ailment of all republics.
• Minority students are made to live with dominant and majority narratives and symbolisms in educational institutions. It always happens at the cost of learning.
• When democracy lends itself to greater centralisation, state institutions do not serve as effective checks.
• With investment not forthcoming from the corporates, it was imperative to raise investment, especially in the infrastructure sector.
• The goals of going digital are novel but much will depend on the quality and speed of internet connectivity and the excellence of trainers.
• Critiques of the colonial rule in India and its legacy have been extended to law – with many allusions to the need to shake off the yoke of the colonial legacy.
• As extreme weather events rise, impacting the world’s poorest, the developed world must step up and meet its finance commitments.
• It doesn’t matter whether you are for or against the headscarf. Or if the conversation should be about legality or religion. At its core, the hijab controversy is about access to education.
• The drop in India’s fertility rate below ‘replacement level’ has been both welcome and along expected lines but it will be many years before the country’s population will actually peak.
• Blockchain is an elegant concept whose properties and potential require careful research, but treating it as a solution for all problems without thinking things through is techno-determinism.
• India must show maturity in response to international criticism of internal matters.

50-WORD TALK

• New Delhi’s decision to reprimand Singapore PM Lee Hsien Loong for observing that half of India’s MPs face criminal charges, shows how thin-skinned and easily outraged new India really is. It’s a no brainer that criminality, corruption have degraded India’s democracy. Perhaps the ire is really because Loong praised Nehru.
• Eight decades after temple entry movement, the horrific video of Brahmin priests in the Chidambaram Nataraja temple, Tamil Nadu, obstructing a Dalit woman’s prayer shows a mission unaccomplished. That too in the land of Periyar. Casteism is structural. A few laws, MPs aren’t enough to stamp out the caste privilegentsia.
• We have to live with conflict the way we live with our own selves as divided and troubled souls. We have to accept that our city or our country reflects divisions of our souls and fragments of ourselves. When we are troubled, we talk to a friend, and sort out our problems. Similarly, members of a deliberative community have to keep a conversation going to resolve issues. Elections are but one moment, albeit a defining one, in a democratic life.

Things to Remember:

• For prelims-related news try to understand the context of the news and relate with its concepts so that it will be easier for you to answer (or eliminate) from given options.
• Whenever any international place will be in news, you should do map work (marking those areas in maps and also exploring other geographical locations nearby including mountains, rivers, etc. same applies to the national places.)
• For economy-related news (banking, agriculture, etc.) you should focus on terms and how these are related to various economic aspects, for example, if inflation has been mentioned, try to relate with prevailing price rises, shortage of essential supplies, banking rates, etc.
• For main exam-related topics, you should focus on the various dimensions of the given topic, the most important topics which occur frequently and are important from the mains point of view will be covered in ED.
• Try to use the given content in your answer. Regular use of this content will bring more enrichment to your writing.

THE CONTEXT: Recently, there is a debate on the illusion of rating agencies. Basically, the issues are -their necessities, flaws &fragilities, and the need for regulation. Similarly, credit score has also become complicated due to the current covid induced financial crisis.

WHAT IS A RATING AGENCY?

Credit rating is an informed opinion of a recognized entity on the relative creditworthiness of an issuer or instrument. In other words, it is an opinion “on the relative degree of risk associated with the timely payment of interest and principal on a debt instrument”. Such recognized entity is known as Credit Rating Agencies (CRAs).

CRAs typically rate on the basis.

• Debt securities
• Short term debt instruments, like commercial papers
• Structured debt obligations
• Loans and fixed deposits

WHY THERE ARE ISSUES OF ILLUSION?

IDEOLOGICAL BIASES: CRAs might lower ratings for left governments as a strategy to limit negative policy and market surprises as they strive to keep ratings stable over the medium term. For e.g. A panel analysis of Standard & Poor’s, Moody’s, and Fitch’s rating actions for 23 Organisation for Economic Co-Operation and Development (OECD) countries from 1995 to 2014 shows that left executives and the electoral victory of nonincumbent left executives are associated with significantly higher probabilities of negative rating changes.

CONFLICT OF   INTERESTS: CRAs are funded by the very companies they rate.

LACK OF ABILITY TO PREDICT: CRAs follow the market, so the market alerts the agencies of trouble. This reason can be attributed to CRA’s ability to predict frequent near default, default, and financial disasters.

NEGLIGENCE & INCOMPETENCE: The methodology of CRAs has come under question. For example, even after using different methodologies, the result for sovereign debts comes the same. It is also alleged that CRAs can make a sound judgement on rating, but they didn’t make an effort to do it. For e.g. Moody accepted that it did not have a good model on which it could have estimated a correlation between mortgage-backed securities, so they made them up.

POLITICALLY MOTIVATED: It has also been alleged that CRAs, through their rating mechanism, force the govt to follow the path they prescribe. For e.g. During the turmoil in Tunisia, S&P issued a report warning of “downward rating pressures” on neighbouring governments if they tried to calm social unrest with “populist” tax cuts or spending increases. Further, after Crimea’s annexation, rating agencies downgraded the rating of Russia.

POLICY MEDDLING: In 203, to stop predatory lending state of Georgia brought a law. Other states of the USA, was to follow suit until S&P retaliated. And it is well known that predatory lending is responsible for the financial crisis of 2008-09.

HOW A RATING AGENCY FUNCTION

1. FOR COMPANIES 

It is evident from the Above picture that credit rating agencies depend upon the audited statements. The agencies are only as effective the as honesty of their clients.

2. FOR COUNTRY

Following are the parameters on which a country is rated

• Regulatory framework
• Tariffs
• Fiscal Policy
• Monetary Policy
• Foreign Currency Control
• Physical and human Infrastructure
• Financial Markets
• Macro Factors (Consumer spending, Inflation, Interest Rates)

 WHY RATING AGENCY IS REQUIRED

From the 80s onwards, as the financial system became more deregulated, companies started borrowing more and more from the globalized debt markets, and so the opinion of the credit rating agencies became more and more relevant.

ROLE OF THE CRAs

REDUCE INFORMATION ASYMMETRY: Since CRAs get access to the tcompany’s management and confidential information about its working, they can give an informed opinion about the ability of an instrument to meet its obligations.

UTILITY FOR ISSUERS: The issuer concisely communicates the quality of their issue through the rating of the CRAs, which helps it establish its creditworthiness.

GATEKEEPERS FOR FINANCIAL MARKETS: CRAs provide tangible benefits to financial market regulators by reducing the costs of regulation. Regulators such as RBI use CRAs to improve the awareness and decision-making of their regulated entities. For instance, credit ratings are used to determine the capital adequacy of banks the resolution of stressed assets.

PURVEYORS OF REGULATORY LICENSES: Some financial regulators mandate that certain instruments must be rated mandatorily before they are issued. Extensive integration of CRAs into the financial system transforms their role as purveyors.

MORAL SUASION: It compels developing countries to pursue more prudent and sensible monetary and fiscal policies.

INSTANCES WHEN RATING AGENCIES FAILED

• The financial collapse of New York City in the mid-1970s
• Asian financial crisis
• Enron scandal
• Global Financial Crisis
• During the global financial crisis, hundreds of billions of dollars worth of triple-A-rated mortgage-backed securities were abruptly downgraded from triple-A to “junk” (the lowest possible rating) within two years of the issue of the original rating.
• The US Financial Crisis Inquiry Commission called them “key enablers” of the financial crisis and “cogs in the wheel of financial destruction.”

THE HISTORY OF RATING AGENCY

• Credit rating agencies were first established after the financial crisis of 1837 in the US. Such agencies were then needed to rate the ability of a merchant to pay his debts, consolidating such data in ledgers.
• Systematic credit rating started with the rating of US railroad bonds by John Moody in 1909.

COMPARATIVE RATING SYMBOLS FOR LONG TERM RATINGS

• DEGREE OF SAFETY: Highest
• RATING: AAA
• Meaning: Timely payment of financial obligations
• DEGREE OF SAFETY: High
• RATING: AA
• Meaning: Timely payment of financial obligations
• DEGREE OF SAFETY: Adequate
• RATING: A
• Meaning: Changes in circumstances can adversely affect such issues more than those in the higher rating categories.
• DEGREE OF SAFETY: Moderate
• RATING: BBB
• Meaning: Changing circumstances are more likely to lead to a weakened capacity to pay interest and repay principal.
• DEGREE OF SAFETY: Inadequate
• RATING: BB
• Meaning: Less likely to default in the immediate future
• DEGREE OF SAFETY: A greater likelihood of default
• RATING: B
• Meaning: While currently financial obligations are met, adverse business or economic conditions would lead to a lack of ability or willingness.
• DEGREE OF SAFETY: Vulnerable to default
• RATING: C
• Meaning: Timely payment of financial obligations is possible only if favorable circumstances continue
• DEGREE OF SAFETY: In default or are expected to default
• RATING: D
• Meaning: Such instruments are extremely speculative and returns from these instruments may be realized only on reorganization or liquidation.
• DEGREE OF SAFETY: Some factors which render instruments outstanding meaningless
• RATING: NM
• Meaning: Factors include reorganization or liquidation of the issuer; the obligation is under dispute in a court of law or before a statutory authority etc.

CREDIT RATING AGENCIES IN INDIA

CRISIL:

• This full-service rating agency is India’s major credit rating agency, with a market share of more than 60%.
• It is offering its services in the financial, manufacturing, service, and SME sectors.
• The headquarter of CRISIL is in Mumbai.
• The majority stake of CRISIL was held by the world’s largest rating agency, Standard & Poor’s.

CREDIT ANALYSIS AND RESEARCH LIMITED RATINGS (CARE) RATINGS:

• Credit Analysis and Research Limited Ratings was established in 1993.
• It is supported by Canara Bank, Unit Trust of India (UTI), Industrial Development Bank of India (IDBI), and other financial and lending institutions.
• This is considered the second-largest credit rating company in India.
• The headquarter of Credit Analysis, and Research Limited Ratings is in Mumbai.

SMALL AND MEDIUM ENTERPRISES RATING AGENCY (SMERA):

• It is a rating agency entirely created for the rating of Small Medium Enterprises.
• It is a joint enterprise by SIDBI, Dun & Bradstreet Information Services India Private Limited (D&B), and some chief banks in India.
• The headquarter of SMERA is in Mumbai
• It has accomplished 7000 ratings.

ONICRA CREDIT RATING AGENCY:

• SonuMirchandani incorporated it in 1993
• It investigates data and arranges for possible rating solutions for Small and Medium Enterprises and Individuals.
• The headquarter of ONICRA Credit Rating Agency is located in Gurgaon
• It has broad experience in performing a wide range of areas such as Accounting, Finance, Back-end Management, Analytics, and Customer Relations. It has rated more than 2500 SMEs.

FITCH (INDIA RATINGS & RESEARCH):

• Fitch Ratings is a global rating agency dedicated to providing the world’s credit markets with independent and prospective credit opinions, research, and data.
• The headquarter of Fitch Ratings is in Mumbai.

ICRA:

• It was created in 1991 by prominent financial institutions and commercial banks in India with a devoted crew of experts for the MSME sector
• Moodys, which is considered the international credit rating agency holds the major share.

DIFFERENT BUSINESS MODELS OF CREDIT RATING AGENCIES

• MODELS: ISSUER PAY MODEL
• ADVANTAGE: Ratings are available to the entire market free of charge and will greatly aid small investors. It gives the rating agencies access to high-quality information that enhances the quality of analysis.
• DISADVANTAGE: It can lead to a serious conflict of interest since the company pays the CRAs to get the rating. The CRAs may inflate the rating to satisfy the company. It may lead to ‘Rating Shopping’ which refers to the situations where an issuer approaches different rating agencies for the ratings and then choose to publish the most favorable ratings to disclose them to the public via media while concealing the lower ratings.
• MODELS: INVESTOR PAYS MODEL
• ADVANTAGE: It would avoid the serious conflict of interest of the CRAs. This would enable the investors to get the credit rating based on the company’s true and actual financial condition.
• DISADVANTAGE: Ratings would be available only to those investors who can pay for them and take ratings out of the public domain and thus affecting the small investors. The company may not always share all the necessary information with the CRAs which can have an adverse impact on the quality of the ratings. It can pose a serious conflict of interest involving the investors themselves. If investors are the payees, they can influence CRAs to give lower-than-warranted ratings to help them negotiate higher interest rates.
• MODELS: REGULATOR PAYS MODEL
• ADVANTAGE: It eliminates the conflict of interest as seen in both Issuer Pay Model and  Investor Pay Model.
• DISADVANTAGE: The problem with this model lies in choosing the CRA and payment to be fixed. The CRA chosen by the regulator may not provide the best credit rating. Further, if the regulator pays less amount of money to the CRA, the CRA may find it difficult to continue with its business and could have an adverse impact on the quality of the ratings issued.

SHOULD RATING AGENCIES BE REGULATED?

• RATING SHOPPING: It has often been seen that both issuer and investor are involved in rating shopping. CRAs inflate the rating, particularly for structured product markets for getting more market share and profit margins.
• OLIGOPOLISTIC TENDENCIES: Around 95% of the market is controlled by only 3 CRA VIZ. S&P, MOODY’S and  Further, they use expansionist marketing. For e.g. Hannover Re lost a big chunk of the market share when it didn’t pay the service fee. (CRAs promised it free service).
• HEGEMONIC CONTROL: As the big three CRAsare located in North America, America exerts great control on the functioning of CRAs. When CRAs downgraded the USA, CRAs were fined. Further, the rating of the country is not done objectively. UK was rated lower than the USA, even when the fiscal deficit of the UK was lower than the USA.
• CONTROL: CRAs have great control over the world economy as their rating can result in the flight of capital.
• ACCOUNTABILITY: CRAs are not accountable to any country and their functioning is not transparent

CHANGES THAT IS IMPERATIVE FOR BETTER FUNCTIONING

DODD-FRANK ACT

In response to the Global Financial Crisis of 2008-2009, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act in July 2010. It encourages CRAs to invest in due diligence, strengthen internal controls and corporate governance, and improve their methodology. But some of the following provisions of it are still unimplemented:

• The legal liability of credit rating agencies should be increased.
• The use of credit ratings in regulations that set capital requirements and restrict asset holdings for financial institutions should be removed or replaced.
•  Internal controls, conflicts of interest for credit analysts, standards for credit analysts, transparency, the internal conflict of interest, and rating performance statistics should be ruled based and regulated.

THE WAY FORWARD

• A rating agency run by the UN, funded by pooled contributions from both lenders and borrowers should be established. Rating business must be made a utility, rather than a semi-cartel that intimidates elected politicians and rakes in excess profits
• With the help of technology, open-source models with fully transparent inputs and outputs should be created and promoted. Credit Risk Initiative of the National University of Singapore Risk Management Institute is one such example.

THE CONCLUSION: CRAs play a valuable role in financial markets by analyzing credit for many investors, but their inaccurate ratings can create problems of enormous proportion for the world economy. A unified, integrated effort by all the country is needed to avoid another economic meltdown, which would have severe repercussions for both, any country or its citizen

ADDITIONAL INFORMATION

ALL YOU NEED TO KNOW CREDIT SCORE

Credit score: A credit score is a number between 300–850 that depicts a consumer’s creditworthiness. The higher the score, the better a borrower looks to potential lenders. A credit score is based on credit history: number of open accounts, total levels of debt, repayment history, and other factors. Lenders use credit scores to evaluate the probability that an individual will repay loans in a timely manner.

The background: The credit score model was created by the Fair Isaac Corporation, also known as FICO, and financial institutions use it.

How Credit Scores Work: A credit score can significantly affect your financial life. It plays a key role in a lender’s decision to offer you credit. People with credit scores below 640, for example, are generally considered to be subprime borrowers. Lending institutions often charge interest on subprime mortgages at a higher rate than a conventional mortgage to compensate themselves for carrying more risk. They may also require a shorter repayment term or a co-signer for borrowers with a low credit score.

The history of credit scores in India: Credit Information Bureau (India) Limited was founded in August 2000 and is India’s first credit information firm. The organization gathers and manages financial records of individuals as well as business organizations relating to loan and credit card payments & borrowings. CIBIL acquires this data with the assistance of its bankers and credit institutions.

• CIBIL is RBI authorized and is also known as the Credit Bureau. It is covered under the 2005 Credit Information Companies Regulation Act. To find relevant information, it requires support from its associated partners, including bank members & credit institutions. Associate partners give it every month.
• In 2014, keeping the prevalent information asymmetry in mind, the RBI decided to set up a technical group on credit information based on the recommendations of the Aditya Puri committee.
• The committee included chief executives belonging to all the four credit bureaus, representation from large banks, an executive from the Indian Banks’ Association (IBA), and several RBI officials.
• The Puri committee suggested that the Cibil format could be used to standardize data formats for both consumer and commercial borrowers.

Problems in credit ratings: Erroneous credit score could either be a genuine mistake by the bank or, in some cases, when an individual stands as a guarantor for a loan. Experts believe that customers should check their scores regularly and report any discrepancies that they notice in their credit history. Due to the data entry operator, the lackadaisical attitude of most lenders and the long-winding dispute resolution process cannot be pinned on customers. While checking credit scores at regular intervals would weed out any

THE ART AND CULTURE

1. “PASUVULA PANDUGA”

THE CONTEXT: Tension prevailed at Chittoor district in Andhra Pradesh after villagers protested against the police over the conduct of a traditional bull-taming match – a version of Tamil Nadu’s jallikattu.

THE EXPLANATION:

• The villagers and the police vehemently reject the “bad propaganda” against the bull races by wrongly terming the events as “Jallikattu”.
• According to the villagers, these annual festivities, history of which dates back to the British Raj, are responsible for the preservation of the native breeds of cattle and the continuing love for the bulls despite mechanised agriculture practices.”
• As per “HaddulaPanduga”, the bulls brought to the race would be unleashed into a set track flanked by the curious crowds. The participants, mostly youth, would be encouraged to stop the raging bulls, fixing the parameters of distance and time.
• The bulls would be stopped by the youth, who pull and manage the long ropes tied to the animals. This is unlike Jallikattu of Tamil Nadu, where a frenzied bull would be released unfettered into an open ring, posing grave danger to youth who are set to tame it.

Value Addition:

PasuvulaPanduga (Festival of Cattle):

• It is considered as the ‘milder equivalent’ of Jallikattu in Tamil Nadu.
• It is conducted every yearin the villages of Chittoor district during the Kanuma festival (Sankranti).
• The bulls ran amok as the participants gave them hard chase in their attempt tame the animals and grab the prize money tied to their horns.

Kanuma festival is quite similar to the Mattu Pongal observed in Tamil Nadu. The festival is dedicated to cows, bulls and other animals that are part of agrarian economy. Cattle and cattle sheds are cleaned on the day. Cows are decorated with marigold flowers and are worshipped.

QUICK FACTS:

Bhumi Panduga is a festival celebrated by the Koya Tribe in the Chintoor Agency of East Godavari district. The tribals go hunting as part of the ‘Bhumi Panduga’ celebrations, marking the beginning of farm operations every year.

THE HEALTH AFFAIRS

2. GILOY IS SAFE TO USE: MINISTRY OF AYUSH

THE CONTEXT: Certain sections of the media have falsely linked again Giloy/Guduchi to liver damage. The Ministry of Ayush reiterates that Giloy/Gudduchi (Tinospora cordifolia) is safe and as per available data, Guduchi does not produce any toxic effect.

THE EXPLANATION:

• In Ayurveda, it is said to be the best rejuvenating herb. Acute toxicity studies of aqueous extract of Guduchi reports that it does not produce any toxic effect. However, the safety of a drug depends on how it is being used. Dosage is one of the important factors that determine the safety of a particular drug.
• A special focus has been made on its health benefits in treating various metabolic disorders and its potential as an immune booster. It is used as a major component of therapeutics for ameliorating metabolic, endocrinal, and several other ailments, aiding in the betterment of human life expectancy.
• It is a popularly known herb for its immense therapeutic applications in traditional systems of medicine and has been used in the management of COVID-19. Considering the overall health benefits, the herb cannot be claimed to be toxic.

Value Addition:

Guduchiis known in Ayurvedic medicine for the power to detoxify, rejuvenate, boost the immune system, and more. This popular adaptogenic herb is thought to prolong life and was recognized by ancient rishis of the Vedic era in the classic healthcare text, the revered Charak Samhita, written by Maharishi Agnivesha.

Also, its helps in:

• Ability to balance blood sugar
• Relieve fever and spasms
• Fight inflammation
• Promote joint health
• Calm allergic reactions
• Reduce stress
• Protect the kidneys
• Support the immune system.

THE ECONOMIC DEVELOPMENT

3. THE FINTECH OPEN HACKATHON

THE CONTEXT: NITI Aayog in association with the digital payment’s platform PhonePe launched the first-ever open-to-all hackathon that aims to showcase path-breaking solutions for the fintech ecosystem.

THE EXPLANATION:

The Hackathon will provide an opportunity for innovators, digital creators and developers from all over India to think, ideate and code.

Participants at the hackathon need to use any open-data APIs like PhonePe Pulse along with frameworks such as Account Aggregator as a foundation to power the following use cases:

• Alternate risk models for Lending, Insurance or Investments with focus on financial Inclusion.
• Innovative Products that use the power data signals for various demographics and Geos for broader adoption of financial services.
• Improved Visualisation and Derived intelligence based on the Digital payments data.

Aim:

Creating an immersive learning experience, the FinTech month with the overarching theme ‘OPEN’ aims to achieve three key objectives – 1) encourage an OPEN ecosystem across the FinTech industry; (2) Foster co-innovation and growth; (3) Ensure financial inclusion and leverage new models like Account Aggregator to unleash the next wave of fintech innovation.

 What is Fintech Company?

• Fintech is a portmanteau of the terms “finance” and “technology” and refers to any business that uses technology to enhance or automate financial services and processes.
• Fintech companies integrate technologies (like AI, blockchain and data science) into traditional financial sectors to make them safer, faster and more efficient. Fintech is one of the fastest-growing tech sectors, with companies innovating in almost every area of finance; from payments and loans to credit scoring and stock trading.

Areas of FinTech:

• Banking

• Cryptocurrency & Blockchain

• Investment & Savings

• Machine Learning & Trading

• Payments

• Lending

• Insurance

THE ENVIRONMENT AND ECOLOGY

4. THE MIGRATION OF CRIMSON ROSE BUTTERFLIES

THE CONTEXT: Thousands of Crimson Rose butterflies swarmed all available flowering plants along the beach of Dhanushkodi, Tamil Nadu. It was their stopover for nectaring, before the butterflies undertook their ultimate flight towards Sri Lanka, which is around 25 km away from the tip of Dhanushkodi.

THE EXPLANATION:

According to the officials, Migration by Tigers and Crows from the sub-family Danainae of Nymphalidaeknown to migrate just before the onset of the southwest and northeast monsoons from the Western Ghats to the Eastern Ghats and plains, and vice-versa. Butterfly species like Common Emigrant, Common Albatross and Lime Butterfly are also known to undertake migration on a large scale.

Value Addition:

Pachliopta hector, the crimson rose, is a large swallowtail butterfly belonging to the genus Pachliopta (roses) of the red-bodied swallowtails.

Distribution:

• It is found in India, Sri Lanka, Maldives and possibly the coast of western Myanmar.
• In India, it is found in the Western Ghats, southern India (Tamil Nadu, Kerala), eastern India (West Bengal and Odisha). It is a straggler in the Andaman Islands

Conservation Status:

• It is generally common and not known to be threatened.
• IUCN STATUS: LEAST CONCERN
• Wildlife Protection Act: Schedule 1 of Wildlife (Protection) Act, 1972.

 5. INDIA LACKS SOLAR WASTE HANDLING POLICY

THE CONTEXT: The International Renewable Energy Agency (IRENA) estimated that the global photovoltaic waste will touch 78 million tonnes by 2050, with India expected to be one of the top five generators of such waste.

 THE EXPLANATION:

• According to the Ministry of New and Renewable Energy (MNRE), India currently considers solar waste a part of electronic waste and does not account for it separately. And also the Ministry constituted a committee to propose an action plan to evolve a “circular economy” in solar panel, through reuse/recycling of waste generated.
• There was no commercial raw material recovery facility for solar e-waste operational in India, but a pilot facility for solar panel recycling and material recovery had been set up by a private company in Gummidipoondi in Tamil Nadu. India has set a target of producing 100 GW of solar energy by 2022.
• The cumulative capacity of grid-connected solar photovoltaic (PV) installations is around 40 GW and of the current capacity, about 35.6 GW, is generated from ground-mounted plants and 4.4 GW from rooftop solar. A gigawatt is 1,000 megawatt.

Solar panel’s life       

• Solar panels have an estimated life of 25 years and given that India’s solar manufacturing industry took off around 2010, most of the installed systems were new and early in their calendar lifecycle and therefore unlikely to generate a large quantity of solar waste.
• That, however, is only partially accurate, according to the Council for Energy, Environment and Water (CEEW), a Delhi based think-tank. End-of-life was only one of the possible waste streams for PV modules and there were several other stages where modules could get damaged.
• However,India’s solar PV manufacturing uses imported components with parts mostly sourced from China.

6. WORLD SUSTAINABLE DEVELOPMENT SUMMIT 2022

THE CONTEXT:Prime Minister delivered the inaugural address at the 21st World Sustainable Development Summit 2022 (WSDS-22)on the three-day summit organised by TERI with participation from over 100 nations.

 THE EXPLANATION:

• The theme of the summit is ‘Towards a Resilient Planet: Ensuring a Sustainable and Equitable Future’.
• According to the Prime Minister “the energy requirements of the people of India are expected to double in the next 20 years, also he urged developed countries to fulfil their commitments on finance and technology transfer.

Prime Minister Speech Highlights:

• “The Energy requirements of the people of India are expected to double in the next 20 years. Denying this energy would be denying life itself to millions. Successful climate action also needs adequate financing. For this, developed countries need to fulfil their commitments on finance and technology transfer’.
• Also, India believes in fulfilling commitments under the United Nation Framework Convention on Climate Change (UNFCCC) and added that the country has raised its ambitions during CoP-26 at Glasgow. Sustainability requires coordinated action for the global commons.
• The International Solar Alliance, our aim is One Sun, One World, One Grid. We must work towards ensuring availability of clean energy from a worldwide grid everywhere at all times. This is the ‘whole of the world’ approach that India’s values stand for”.
• He also noted the measures taken and schemes like
  • Ujjwala Yojana
  • M-KUSUM scheme
  • Broder focus on ‘chemical-free natural farming’
  • LED bulbs distribution scheme
  • National Hydrogen Missionand alsoIndia now has 49 Ramsar sites spread over more than 1 million hectaresrestoring degraded land has been one of the main focus areas.

THE GOVERNMENT SCHEMES AND INITIATIVES IN NEWS

7. THE SCHEME FOR ECONOMIC EMPOWERMENT OF DNTS (SEED)

THE CONTEXT: The Ministry of Social Justice and Empowerment, launched the Scheme for Economic Empowerment of DNTs (SEED) for the welfare of De-notified, Nomadic and Semi Nomadic Communities.

THE EXPLANATION:

Who are De-notified, Nomadic and Semi-Nomadic Tribes?

The De-notified, Nomadic and Semi-Nomadic Tribes are the most neglected, marginalized and economically and socially deprived communities. Most of them have been living a life of destitution for generations and still continue to do so with an uncertain and gloomy future. De-notified, Nomadic and Semi- nomadic Tribes somehow escaped the attention of our developmental framework and thus are deprived of the support unlike Scheduled Castes and Scheduled Tribes.

The term ‘De-notified Tribes’ stands for all those communities which were once notified under the Criminal Tribes Acts, enforced by the British Raj between 1871 and 1947. These Acts were repealed by the Independent lndian Government in 1952, and these communities were “De-Notified”. A few of these communities which were listed as de-notified were also nomadic.

About the Scheme:

• To provide coaching of good quality for DNT/NT/SNT candidates to enable them to appear in competitive examinations.
• To provide health insurance to DNT/NT/SNT Communities.
• To facilitate livelihoods initiative at community level to build and strengthen small clusters of DNT/NT/SNT Communities institutions.
• To provide financial assistance for construction of houses to members of the DNT/NT/SNT Communities.

The funds will be transferred directly to the beneficiaries in their account. The other implementing agencies are Ministry of Rural Development, National Rural Livelihood Mission (NRLM) and National Health Authority (NHA).

POINTS TO REMEMBER:

• The Government in July 2014 had constituted National Commission for Denotified, Nomadic and Semi-Nomadic Tribes (NCDNT) for a period of three years to prepare a State-wise list of castes belonging to Denotified and Nomadic Tribes and to suggest appropriate measures in respect of Denotified and Nomadic Tribes that may be undertaken by the Central Government or the State Government.
• The Renke Commission (2008) was earlier commissioned to identify and list the DNT communities.

THE PRELIMS PRACTICE QUESTIONS

QUESTIONS OF THE DAY 17^TH FEBRUARY 2022

Q. Which of the following pairs of Ramsar sites is/are correctly matched?

1. DeeporBeel – West Bengal
2. Kabartal Wetland – Bihar
3. Bhoj Wetland – Madhya Pradesh

Select the correct answer using the code given below:

a) 1 and 2 only

b) 2 and 3 only

c) 3 only

d) 1, 2 and 3

ANSWER FOR 16^TH FEB 2022

Answer: B

Explanation:

• Statement 1 is incorrect: SVAMITVA (Survey of Villages and Mapping with Improvised Technology in Village Areas) is a Central Sector Scheme of Ministry of Panchayati Raj was nation-wide launched by the Hon’ble Prime Minister on National Panchayati Raj Day, 24^th April 2021 after successful completion of pilot phase of scheme (2020-2021) in 9 states.

Scheme is a reformative step towards establishment of clear ownership of property in rural inhabited (Abadi) areas, by mapping of land parcels using drone technology and providing ‘Record of Rights’ to village household owners with issuance of legal ownership cards (Property cards/Title deeds) to property owners.

Statement 1 is correct: The Scheme is implemented with the collaborative efforts of the Ministry of Panchayati Raj, State Revenue Department, State Panchayati Raj Department and Survey of India.

[WpProQuiz 162]

1. A case for a more federal judiciary READ MORE
2. Stringent checks needed to curb human trafficking READ MORE
3. SC as the guardian of our Constitution READ MORE
4. Hijab ban: Without tolerance, India’s democratic ideals become meaningless READ MORE

1. Workplace harassment reflects gendered power dynamics READ MORE
2. Uniformity or Equality? Imposed norms for uniforms in educational institutions cannot be the basis for equality in education. READ MORE

1. India lacks solar waste handling policy READ MORE
2. 56 African heritage sites threatened by extreme coastal events: Study READ MORE
3. India’s ‘missing’ forests: DTE analysis exposes big gap in latest national forest survey estimates READ MORE

1. Concepts: Negative and Positive liberty READ MORE
2. Tapping the promise of philanthropy READ MORE
3. The artist’s reality READ MORE

(Newspapers, PIB and other important sources)

Prelim and Main

1. Guduchi is safe and does not produce any toxic effects READ MORE
2. Fintech month kickstarts on an inspiring note READ MORE
3. Thousands of Crimson Rose butterflies fly across ocean from India towards Sri Lanka READ MORE
4. Equitable energy access key of environmental policy: PM Modi READ MORE
5. Everyday Economics: What are repo & reverse-repo rates? READ MORE
6. Tonga Eruption Last Month Was Accompanied by Record-Breaking Lightning Storm READ MORE
7. Udhampur-Srinagar-Baramulla Rail Link project: Longest tunnel T-49 connected READ MORE

Main Exam    

GS Paper- 1

1. Workplace harassment reflects gendered power dynamics READ MORE
2. India’s ‘missing’ forests: DTE analysis exposes big gap in latest national forest survey estimates READ MORE

GS Paper- 1

POLITY AND GOVERNANCE

1. A case for a more federal judiciary READ MORE
2. Stringent checks needed to curb human trafficking READ MORE
3. SC as the guardian of our Constitution READ MORE
4. Hijab ban: Without tolerance, India’s democratic ideals become meaningless READ MORE

SOCIAL ISSUE

1. Pipedreams for Indian Academia – II READ MORE
2. Uniformity or Equality? Imposed norms for uniforms in educational institutions cannot be the basis for equality in education. READ MORE

 INTERNATIONAL ISSUES

1. Putin and Xi Frame a New China-Russia Partnership READ MORE  
2. India Keeps Floating Away From Its Quad Partners READ MORE

 GS Paper- 1

ECONOMIC DEVELOPMENT

1. No, policy is not too important to leave to the experts READ MORE
2. Reframing of India’s economic road map READ MORE
3. Address mismatch between skills, jobs READ MORE

ENVIRONMENT AND ECOLOGY  

1. India lacks solar waste handling policy READ MORE
2. 56 African heritage sites threatened by extreme coastal events: Study READ MORE

TECHNOLOGY

1. Technology has changed intelligence gathering. Now all you need is an internet connection READ MORE

GS Paper- 1

ETHICS EXAMPLES AND CASE STUDY

1. Concepts: Negative and Positive liberty READ MORE
2. Tapping the promise of philanthropy READ MORE
3. The artist’s reality READ MORE

Questions for the MAIN exam

1. “Environmental legislations deal with highly technically complex subject matters which require comprehensive pre legislative consultation otherwise not only there will be avoidable legal challenges but also poor implementation on the ground”. Substantiate with examples.
2. Discuss the importance of forest cover area to minimize the impact of climate change.

QUOTATIONS AND CAPTIONS

• The ambitious sacrifices all to what he terms honour, as the miser all to money.
• There is an imbalance now which the Supreme Court of India needs to address by empowering High Courts again.
• Economic policymaking needs to be insulated from politics and vested interests of business, as underlined by breaches in NSE.
• The long-term answer to the problem of unemployment is to review and upgrade the quality of education.
• Soft encroachment by the Govt in the ambit of Fundamental Rights can affect the Constitution’s basic structure, which the apex courts guards against.
• Protest is an inherent right in a democracy. But to resort to protest at the drop of a hat makes a mockery of this democratic principle.
• Not just law alone but the core issue of innately gendered power relations at workplaces must be urgently addressed.
• A good bit of the teaching done at India’s formal centres of higher learning today, especially in our metropolises, tends to rely on imported Euro-American theories, concepts, methods and ideologies.
• As the waves of this global pandemic play out, philanthropic capital will be critical in supporting the most hard-hit sectors and organisations to recover and regain resilience.
• Tolerance implies enduring an item or a practice irrespective of the abhorrence that it may engender.
• The AUKUS partnership between Australia, the U.K., and the U.S., in some sense, appeared to be the result of a quiet realization in Washington that it needs more reliable partners in the Indo-Pacific to pursue common security interests.

50-WORD TALK

• NSE’s CEO being taken for a ride for three years by a faceless yogi in matters of running India’s top stock exchange is shocking and absurd. NSE isn’t new to misgovernance controversies but this one beats them all. Letting the perpetrators off with mere fines is a travesty of justice.
• Even though Moscow is withdrawing troops from Ukraine’s borders, the crisis isn’t over. Russia thinks coercion has worked, since NATO expansion is off the table. China has drawn the same lesson from its Asian aggressions. Till the USA shows it can do more than snarl, these powers will keep pushing.

Things to Remember:

• For prelims-related news try to understand the context of the news and relate with its concepts so that it will be easier for you to answer (or eliminate) from given options.
• Whenever any international place will be in news, you should do map work (marking those areas in maps and also exploring other geographical locations nearby including mountains, rivers, etc. same applies to the national places.)
• For economy-related news (banking, agriculture, etc.) you should focus on terms and how these are related to various economic aspects, for example, if inflation has been mentioned, try to relate with prevailing price rises, shortage of essential supplies, banking rates, etc.
• For main exam-related topics, you should focus on the various dimensions of the given topic, the most important topics which occur frequently and are important from the mains point of view will be covered in ED.
• Try to use the given content in your answer. Regular use of this content will bring more enrichment to your writing.

THE CONTEXT: In his Parliament speech, PM Narendra Modi blasted the ‘babu’ culture in the country. He meant the steel frame of India, its civil servants. PM stressed the private sector’s vital role in the economy, the context was towards PSUs. To understand the essence of the PM’s criticism, we must understand the role, origin, and evolution of PSUs in India. This article discusses the evolution of PSUs, concerns, and challenges related to PSUs.

PUBLIC SECTOR UNDERTAKINGS IN INDIA

Definition:

• In India, a government-owned corporation is termed a Public Sector Undertaking (PSU). This term is used to refer to companies in which the government (either the federal Union Government or the many state or territorial governments, or both) own a majority (51 percent or more) of the company equity.

Evolution of public sector undertakings: 

• After independence in 1947, Indian industries were in a dilapidated state. It was not able to compete with the existing industries of the time.
• Industries in India were in need of a policy thrust for rejuvenation and starting fresh.
• In this direction, the Industrial Policy Resolution of 1956 of the Second Five year Plan (1956-61) provided the required framework for public sector undertakings/enterprises.
• With this, the PSUs were expected to play a leading role in the economic development of the country, preventing the concentration of economic power and reducing regional disparities for the common good.
• In 1991, the role of the public sector was reviewed due to liberalization, privatization, and globalization, and the public sector was reduced to only six areas like atomic energy, coal, defense, railway, mineral oils, and transport.
• After this, every effort was made to increase participation of the private sector in the public sector for making it profitable and enable them to compete with the private sector companies worldwide.

Role of public sector undertakings in India:

• PSUs have laid a strong foundation for the Industrial development of the country as it is not interested in profit-making but nation-building.
• They leverage the government through major shareholding in the Industries to intervene in the economy in a major way thus helping in achieving the desired socio-economic objectives and long-term goals.
• They help in pushing the agricultural economy onto the progressive pathway and rural development as well as providing basic infrastructural facilities, educational and employment opportunities.

PRIVATE SECTOR VS. BUREAUCRACY

The performance of the public and private sectors is often compared in India.

• The framework is generally that if the MBAs in the private sector can produce efficient and profitable enterprises, why can’t the IAS officers and other “public sector professionals” do the same in Government Departments and Public Sector Undertakings (PSUs)?
• It’s also argued that there is no accountability whatsoever in the public sector scenario, whereas in the private sector the deadwood is immediately jettisoned, leaving only the efficient and performance-oriented executives to progress upwards and rise to the top.
• It is quite frequently advocated that the corridors of powers as well as huge Public Sector behemoths ought to not only be manned by the private sector management-cum-subject specialists but that even the modern management practices and philosophy should be transplanted from the private to the public sector.

However, we fail to appreciate that the working scenario in the two sectors is fundamentally different and what might be regarded as an award-winning innovator in the private sector, if transposed as a clone into the public sector without a detailed examination and scrutiny, may well lead to the initiation of departmental/ vigilance proceedings. Some, such practices as paying commissions and incentives, etc. Might even be a criminal offense in the PSU arena.

THE WORKING SCENARIO OF PSUs

1. Public Sector is inherently constrained

Constitutional obligations:

• Public Sector entities, whether in the nature of Government Departments or Commercial undertakings, including the PSUs, are “State” within the meaning of Article 12 of the Constitution of India. And, the Constitution casts certain statutory, nay constitutional, obligations on the “State”. For instance, Articles 14 and 16 are not applicable to the private sector.
• Thus, the Public Sector is inherently constrained, on account of these constitutional provisions, when it comes to recruitment and promotion (including the aspects of reservation in favour of SC/ STs) as well in granting performance-linked pay or bonus to the employees who are truly outstanding.

Human-resource obligations:

• In the start-up scenario and even in the established private entities, granting sweat-equity is a widely prevalent tool to acquire and retain good human resources.
• Where the 100%, or at worst a majority, of the equity is owned by the Government, such an incentive is unimaginable.
• Even on the side of firing and retrenchment, the Public Sector is limited by the provisions of Articles 310 and 311 of the Constitution and often the deadwood continues to burden the organization till their retirement.

Political obligations:

• Further, in routine administrative matters like transfers and postings, the bureaucrats are under formal and informal pressure of the political executive, and thus even in this aspect, the human-resource management is sub-optimal and below the desirable or achievable level of efficiency and effectiveness.

2.PSUs are not solely profit driven

Profit v/s social obligations:

• Profit is the supreme motive in the private sector. The maximization of the shareholder value is the ultimate objective, lip service to Corporate Social Responsibility notwithstanding.
• In Public Sector, the objectives are multiple and often in conflict with each other.
• For instance, in the State Transport Undertakings, while it is sought to maximize profit, one of the objectives is also allowing free and concessional travel to various categories of passengers.

Objectivity in the performance:

• The stated objectives of PSUs may really be mere rhetoric. In such a scenario, one cannot very rationally or objectively assess the performance of a Public Sector Enterprise, which is quite difficult and complex.
• Thus, it’s much easier for the Private Sector to be driven by a mission, whereas the public sector is more likely to be governed by rules and procedures.

3. Complex Decision-making

levels of decision-making:

• In the private sector, the levels of decision-making are crystal clear. The managerial and financial powers are delegated in a highly transparent manner and everyone in the organization is familiar with the same.
• In the public sector or governmental functioning, the “rules of business” may delineate similar policies and procedures, but often concurrence of independent units and Departments such as Finance, Law or Personnel may be required.
• The departmental decision-making is subject to, apart from the normal supervision by the political executive, by the Parliamentary and Legislative oversight through their Committees.
• Then, of course, the presence and working of the 3C’s — CAG, CVC, and the CBI effect, rather constrains, the decision-making in the ministerial or departmental scenario.
• External pressure groups, political parties, and Press also affect the public-sector decision-making. All this makes the decisions, slow, conservative and sub-optimal.

Accountability in decision making:

• In the Private Sector, those formulating policies or making decisions are also, in general, responsible for their implementation.
• In the Government, policies are usually formulated at a very high level and generally, the concerns and constraints of the cutting-edge staff or stakeholders are not taken fully into account.
• Moreover, the failure of the policy can very easily be attributed to poor implementation and thus the framers of the faulty policies are seldom questioned or called on to account.
• The private sector is not subject to any of these restraining circumstances. It may thus be very unfair to compare the decision-making in the two sectors.

Even though the working scenarios of the private sector and PSUs are very different, still there are challenges pertaining to PSU’s functions and operational efficiency. Though the working scenario of PSUs is very challenging we cannot ignore concerns related to it.

CONCERNS RELATED TO PSUs

Statism:

• PSU’s elevated status as drivers as the economy was romanticist in approach and thus led to issues like overstaffing, corruption, wasteful practices, lack of work culture, and motivation were unchecked and systematically ignored by the government and led to the subsidization of these concerns by them.
• This led to permanent drainage on the exchequer. Thus, instead of a socialist attitude, these PSUs were developing an attitude of Statism with all its dangers.

Political interference:

• Nepotism and favourability in PSU appointments by politicians lead to inefficiency and incompetency in functioning. Therefore merit should only be the criteria for selection.
• Directors appointed by the government to the Board of Directors of PSUs try to influence the decision-making process of the board without accepting responsibility at the end creating a lot of interference in their independent functioning and economical initiatives.

Delay and Authoritarianism:

• Control from above is a big impediment in the functioning of PSUs as whenever a new project is taken up by a PSU it has to go through the Expenditure Finance Committee and Project Investment Board which is very cumbersome and causes unnecessary delay and authoritarianism

Lack of profit-making attitude:

• Lack of authority in taking a commercial mode in areas where opportunities exist for profit-making and thus gets caught in bureaucratic and political red-tapism thus keeping it bureaucratic in nature instead of a complementing approach of profitability and social obligations.
• No proper retention policies for retaining competent staff from the lure of lucrative private offers.

What should be done?

• In the globalized world, times have changed, and India has new challenges, inviting altogether new approaches and processes to emerge as a global leader. It is time for path-breaking administrative reforms, and pump-priming entrepreneurship, innovation, and production processes in the Indian economy through liberal financing, cutting the red-tape, delays, and regulatory corruption. It is the moment for unleashing the fullest potential of all sectors of the Indian economy.
• There is an imperative need for bringing unsparing reforms in the prevalent PSU culture—operating upon them and replacing their bone marrow, without any loss of time.
• It is time to separate operational freedom and ownership. It is time to end the age-old colonial outdated governmental management hegemonies.
• A dynamic society needs a dynamic governance model; we should open up governance to draw expertise from the industry, academia, and society into the services. While further professionalizing the IAS and promoting domain expertise into the service will be a practical solution to the problem.

CONCLUSION

Comparing the performance of IAS officers and other civil servants in the Governmental setup with those of the Private Sector professionals is thus quite unfair as work scenarios are very distinct from each other. More importantly, one cannot prescribe a rather simplistic and naïve solution that would be the elixir of all the ills that plague the public sector performance currently — that is, mere transplanting the private sector policies and practices to the Public Sector. That’s not to say that IAS officers are Cat’s Whiskers and that their performance is par excellent. There’s always a scope of improvement and the same can come incrementally if all the stakeholders, including the bureaucracy and the political executive, take it as a pragmatic priority, in the right earnest.