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Day: March 13, 2018

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March 2018
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Health Sector – UHC, National Health Policy, Family Planning, Health Insurance, etc. Health

[op-ed snap] Unhealthy Binaries


Mains Paper 2: Governance | Issues relating to development & management of Social Sector/Services relating to Health, Education, Human Resources

From UPSC perspective, the following things are important:

Prelims level: National Health Protection Scheme

Mains level: Healthcare infrastructure in India


Misleading beliefs related to the healthcare sector

  1. The first, most deep-rooted misleading belief, is that private practitioners are less suited to deliver healthcare services than public healthcare professionals
  2. The second is that health outcomes of patients are immaterial, that there is no need to track patients or maintain records, spending more money on healthcare is enough

Institutional infrastructure to track health outcomes

  1. Tracking health status means that patient outcomes like disease, death, infection and so on, be regularly ascertained, reported and monitored
  2. In some countries, it is routine to set up such reporting systems
  3. They even set up disease-specific registers in which a variety of hospitals and physicians participate

Status of such infrastructure in India

  1. In India, till date, there has been no institutional framework fixing such key indicators
  2. There isn’t any general rule mandating that these should be reported regularly, whether in the public or private sector
  3. The need to track patient status is not given the importance it deserves

Optimal performance not possible

  1. In the absence of system-wide requirements, it is merely ideology and individual conscience that determines the quality of care available to patients
  2. Systems that are driven only by ideology and individual conscience can hardly perform optimally

Patient tracking

  1. It can be done by setting up a simple user-friendly software application
  2. This could be used to record patient data on a few key parameters
  3. Many state governments like Maharashtra, Andhra Pradesh, and Tamil Nadu use such software applications for secondary and tertiary care programmes
  4. These applications could be modified for patient tracking

Way forward

  1. India is moving towards creating structures for universal healthcare with the National Health Protection Scheme
  2. To successfully put care and quality back into healthcare, it is important to set up this kind of system to track the health status of patients
  3. Tracking health status will matter and effectiveness of resource use has little to do with the size of resources made available
Labour, Jobs and Employment – Harmonization of labour laws, gender gap, unemployment, etc. Industries

New metric for jobs growth to include informal economy


Mains Paper 3: Economy | Development & employment

From UPSC perspective, the following things are important:

Prelims level: Labour Bureau, NITI Aayog, TDS, GSTN, sixth economic census

Mains level: Job growth and related issues


Expanding the scope of job creation in the country

  1. The government has now decided to start counting jobs created in the non-farm informal sector
  2. The government has asked labour bureau under the Union labour ministry to begin counting jobs created in establishments deploying less than 10 people
  3. It means establishments and shops run by a single owner or with one employee too will be counted as employment generation

A pragmatic definition of workers

  1. In July 2017, a government task force headed by then NITI Aayog vice-chairman had suggested adopting a “pragmatic definition” of formal workers
  2. It recommended that workers covered under private insurance or pension, those subjected to tax deduction at source (TDS) and those working in companies excluded from the Goods and Services Tax Network (GSTN) should be considered for counting of jobs

Data coverage

  1. The labour ministry will take the 2013-14 sixth economic census as the base for the new survey of informal jobs
  2. The annual household survey by the department of statistics, the quarterly establishment survey by labour bureau covering eight sectors and 18 subsectors and now the new survey of establishments with less than 10 employees will give a comprehensive picture of jobs in India
Capital Markets: Challenges and Developments Finance and Banking

Bill on chit funds sector introduced in Lok Sabha


Mains Paper 2: Polity | Parliament & State Legislatures – structure, functioning, conduct of business, powers & privileges & issues arising out of these.

From UPSC perspective, the following things are important:

Prelims level: Chit Funds (Amendment) Bill, 2018, Parliamentary Standing Committee on Finance

Mains level: Chit fund scams and ways to curb them


Bill to streamline and strengthen the chit fund sector

  1. A bill to streamline and strengthen the chit fund sector was introduced in the Lok Sabha
  2. It mandates video conferencing while the opening of bids and seeks to hike commission of foremen from 5% to 7%


  1. Concerns have been expressed by various stakeholders regarding challenges being faced by the chit business
  2. The Central government had constituted a key advisory group on chit funds to review the legal, regulatory and institutional framework for the sector and its efficacy and to suggest initiatives required for its orderly growth
  3. The Chit Funds (Amendment) Bill, 2018 is based on the recommendations of the Parliamentary Standing Committee on Finance and the Advisory Groups on Chit Funds set up by the Central government

Proposed amendments

  1. The amendment bill provides for allowing the mandatory presence of two subscribers, as required either in person or through video conferencing duly recorded by the foreman, while the bids are being opened
  2. It also provides for increasing of a ceiling of foreman’s commission from 5% to 7%
Innovations in Biotechnology and Medical Sciences Basic Sciences

Electricity from soil bacteria and reading lights from plants

Image source


Mains Paper 3: Science & Technology | developments & their applications & effects in everyday life

From UPSC perspective, the following things are important:

Prelims level: Microbes, Plant microbial fuel cells, photochemistry, electrochemistry, luciferin, nanoparticles

Mains level: Alternative ways to generate electricity


Generating electricity from plants and microbes

  1. A group of researchers at the Wageningen University in the Netherlands has hit upon a method that generates electricity from living plants and the microbes
  2. These microbes live beneath plants in the soil, where the plants drop their roots

Plant microbial fuel cells

  1. The plant does photosynthesis, using sunlight, water, and atmospheric carbon dioxide, generating food in the form of carbohydrates and oxygen for our breathing
  2. The microbes in the soil use some of this organic material coming out of the plants into the ground, metabolize them and, in the process, generate carbon dioxide and hydrogen ions and electrons
  3. While the plant above the ground does photochemistry, the bacteria beneath do electrochemistry, generating positive and negative ions
  4. Scientists have placed positive and negative electrodes in appropriate positions and obtained an electric current, just as we do with batteries
  5. This method of producing electricity is through what is termed as plant microbial fuel cells (PMFC)


  1. The method is completely natural and environment-friendly
  2. It needs no externally added material and is part of a cyclic process in nature

Making plants glow

  1. A firefly glows because it has an enzyme that converts a molecule called luciferin into oxyluciferin, and the energy released in this reaction comes out in the form of visible light
  2. The enzyme is called luciferase
  3. Plants do not have luciferin or luciferase
  4. If we can somehow inject into a plant luciferin and luciferase, perhaps the plant too will emit light
  5. The technology of nanoparticles is being experimented to do this



  1. A nanoparticle (or nanopowder or nanocluster or nanocrystal) is a microscopic particle with at least one dimension less than 100 nm
  2. Nanoparticles are of great scientific interest as they are effectively a bridge between bulk materials and atomic or molecular structures
  3. Nanoparticles exhibit a number of special properties relative to bulk material
  4. Size-dependent properties are observed such as quantum confinement in semiconductor particles, surface plasmon resonance in some metal particles and superparamagnetism in magnetic materials
  5. The properties of materials change as their size approaches the nanoscale and as the percentage of atoms at the surface of a material becomes significant
  6. Nanoparticles have a very high surface area to volume ratio
  7. This provides a tremendous driving force for diffusion, especially at elevated temperatures

S-400 deal may be finalised by March 31


Mains Paper 3: Science & Technology | Awareness in the fields of IT, Space, Computers, robotics, nano-technology, bio-technology and issues relating to intellectual property rights.

From UPSC perspective, the following things are important:

Prelims level: Particulars of the Missile system.

Mains level: Background and the complexity of the deal.


Deal is in the final stage

  1. The contract negotiations for the purchase of the S-400 Triumf long range air defence systems are in the final stages, and are expected to be closed by March 31

Background of the deal

  1. India is planning to buy five systems that is expected to cost about Rs. 39,000 crore and is considered one of the most potent Surface to Air missile systems in the world
  2. It can track and shoot down a range of incoming airborne targets at ranges of upto 400km
  3. In 2016, the two countries had concluded the Inter-Governmental Agreements for five S-400 systems and four stealth frigates after which the contract negotiations began to conclude a commercial contract

It is a very complex deal

  1. Officials termed the negotiations as “very complex” as there were thousands of pages of documentation to be discussed
  2. Russia has already conveyed to India that the deal should not have any offset clause as it is a strategic system


S-400 missile system

  1. The S-400 Triumf, previously known as the S-300PMU-3, is an anti-aircraft weapon system developed in the 1990s by Russia’s Almaz Central Design Bureau as an upgrade of the S-300 family
  2. It has been in service with the Russian Armed Forces since 2007
  3. The S-400 uses four missiles to fill its performance envelope: the very-long-range 40N6 (400 km), the long-range 48N6 (250 km), the medium-range 9M96E2 (120 km) and the short-range 9M96E (40 km)
  4. The S-400 has been described, as of 2017, as “one of the best air-defence systems currently made”
Goods and Services Tax (GST) Finance and Banking

[op-ed snap] Not by fear alone: GST e-way Bills


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: Not much

Mains level: The e-way bill system and related concerns.


Important decision taken by the GST council

  1. The council has decided to stick to the prescriptions of the group of ministers on the rollout of the e-way bills system
  2. So, starting April 1, all inter-State movement of goods above the value of Rs. 50,000 will require the generation of an e-way bill to help track their movement

Rolling out of the e-way bill plan

  1. As proposed by the ministerial group, the e-way bill system for tracking intra-State movement will be launched in a phased manner, with all States to be on board by June 1
  2. From April 1 onwards, every week a few States will start the system for internal trade

Why is this decision important?

  1. The government is keen to use the (e-way bill)system to foil tax evasion or non-filing of returns
  2. Issue: But this is a compliance nightmare in the making for taxpayers with operations in multiple locations

Agencies(The Central Board of Excise and Customs, together with the GST Network) have begun deploying data analytics on the vast repository of information collected from taxpayers

  1. Action is likely to begin soon on taxpayers, based on variances and data gaps that have been found in returns

Some related concerns

  1. While industry remains edgy about the capacity of the IT system to cope with e-way bills from April 1, new rules and forms for the generation of these transit challans have been issued
  2. Tax experts have voiced concern about some of these rules,
  3. including one that empowers commissioners to notify those officers who can intercept any mode of conveyance to carry out physical verification of e-way bills while goods are in transit, akin to the old physical checkpost system

Disappointment for taxpayers

  1. The  most disappointing for business is the failure of the GST Council to finalise a simplified tax form for assessees
  2. For now, taxpayers will have to stick to the current compliance system till June 2018

Panel seeks more amendments to Insolvency and Bankruptcy Code


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: Particulars of the IBC.

Mains level: Recommendations by the Insolvency Law Committee.


Recommendations for the Insolvency and Bankruptcy Code (IBC) 

  1. The insolvency law committee has recommended that the Insolvency and Bankruptcy Code (IBC) be amended
  2. Why: to make eligibility requirements for bidders stricter and give lenders more flexibility in decision-making, said two people aware of the developments
  3. These recommendations given below, require parliamentary approval to come into effect


  1. The panel has recommended amendments to Section 29A of the IBC, which bars wilful defaulters, those with non-performing assets for over a year and people connected to these parties from bidding for stressed assets
  2. The panel has suggested a change in the definition of connected party to include a person who along with a resolution applicant picks up an equity stake in the company facing insolvency
  3. The panel has also recommended allowing promoters of medium, small and micro enterprises to submit resolution plans, provided they are not classified as wilful defaulters
  4. The other recommendation is to bring homebuyers on a par with unsecured financial creditors, giving them a greater say in insolvency proceedings


Insolvency and Bankruptcy Code

Banking Sector Reforms Finance and Banking

[op-ed snap] Bank frauds and the HR factor in PSU banks


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: EASE

Mains level: The newscard discusses the importance of the HR in Banks. It also discusses a strategy to solve the vulnerable condition of Indian Banks.


Human resource (HR) failure: One of the main reasons behind Bank Frauds

  1. Human resource (HR) department in bans failed in implementing measures for “preventive vigilance”
  2. So much so that the central vigilance commissioner has had to step in and order the transfer of all officers who have exceeded three years and clerks, five years, in the same position and office

An opportune time to have another look at the Enhanced Access and Service Excellence (EASE)

  1. It was proposed last year by the department of financial services (DFS)
  2. This outlines the duties and responsibilities of public sector banks for their healthy growth
  3. It recognizes that banking is intrinsically human-centric despite the increasing invasion of machines

Helping the Banks bounce back will require focusing on a 4R policy:
(1) Recruitment:

  1. The current practice of common recruitment by an outside agency needs to be shunned
  2. Instead, every PSU bank needs to recruit depending on its specific requirements
  3. Banks, being “special”, need specialized talent, as observed globally
  4. Banking has become increasingly knowledge and information intensiv
  5. Now, PSU banks need a wide spectrum of specialists in the policy and operation cycle, encompassing all activities, rather than jacks of all trades

(2) Remuneration:

  1. As per RBI data, the compound annual growth rate of per employee wages and salaries, which was 13.7% from 2004-05 to 2010-11, decelerated to 6.4% from 2010-11 to 2016-17
  2. However, the more crucial point is the current “different banks same pay” practice based on five-yearly bipartite settlements with unions
  3. This has built-in perverse incentives
  4. It undermines enterprise not only among the workers of the underperforming banks but also the well-performing ones, thus doubly jeopardizing systemic efficiency and flouting economic principles and logic
  5. Therefore, instead of collective bargaining, the salaries of PSU bank employees need to be linked to the respective bank’s “ability to pay” with components of variable pay

(3) Reskilling:

  1. In any profession, skilling/reskilling is the most valuable link in the entire HR chain of recruitment to retirement
  2. For this, the 2014 RBI suggests the importance of both internal and specialized certification-based external training programmes, coupled with appropriate placement policies in banks, to bridge the talent deficit
  3. The report needs to be implemented without delay

(4) Research

  1. Banking must be recognized as a knowledge-based industry, like information technology, where decisions necessitate constant research and development
  2. In general, the research quotient in PSU banks’ decision-making process is minimal.
  3. Only a few large banks have research units—which are, by and large, devoted to macroeconomic studies
  4. PSU bank leadership must embrace the knowledge and learning ecosystem

The way forward

  1. HR capabilities have a strong correlation with business results
  2. In PSU banks, the time has come to move on from episodic HR initiatives to connecting HR to the mainstream corporate strategy and transformation agendas
Masala Bonds Finance and Banking

NBFCs to be active issuers of Masala bonds: Fitch


Mains Paper 3: Economy | Investment model

From UPSC perspective, the following things are important:

Prelims level: NBFIs, Masala bonds

Mains level: Growth of bond market in India


Need for diversified funding

  1. The non-bank financial institutions (NBFIs) in India will be active issuers of Masala bonds over the medium-term
  2. This reflects their rising need for diversified funding to support growth
  3. Rating agency Fitch made this forecast

Growth in NBFI credit and masala bonds market

  1. NBFI credit grew by 13% in 2017, around 4x faster than bank credit
  2. NBFIs had already shifted towards bond market funding in recent years as yields had fallen while bank lending rates had remained stubbornly high
  3. Estimates suggested that there were $7 billion in Masala bonds outstanding at end-September 2017
  4. This indicated reasonable activity since the first issuance in 2016


Masala bonds

  1. Masala bonds are bonds issued outside India but denominated in Indian Rupees, rather than the local currency
  2. The term was used by the International Finance Corporation (IFC) to evoke the culture and cuisine of India
  3. Unlike dollar bonds, where the borrower takes the currency risk, masala bond makes the investors bear the risk
  4. The first Masala bond was issued by the World Bank-backed IFC in November 2014
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