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Distribution: weekly

  • From informal to the formal economy: The crooked road

    The article discusses the issues around the informal workforce in the economy. What are the factors responsible for the high informal sector in India? How is this sector responding in times of COVID? Are there some easy solutions to mainstream the informal sector into our formal economy? These are some of the points one should ponder upon while reading this article.

    The vulnerability of the informal workforce

    • Developing countries such as India are economically vulnerable to Covid-19 because of the presence of huge informal workforce.

    • Lack of protection: This vast informal workforce, which has no labour, social or health protection, is woefully ill-equipped to cope with the medical and economic shocks of the virus.

    The humongous size of the informal economy in India

    • Share of the informal sector: As per Periodic Labour Force Survey, 2017-18, 90.6 per cent of India’s workforce was informally employed.

    • This estimate includes those who are employed in informal enterprises (unincorporated small or unregistered enterprises).

    • It also includes informal workers in the formal sector (workers in the formal sector who are not provided any social security benefits by employers).

    • Take another example: Between 2004-05 and 2017-18, a period when India witnessed rapid economic growth, the share of the informal workforce witnessed only a marginal decline from 93.2 per cent to 90.6 per cent. 

    • Covid effect: Looking ahead, it is likely that informal employment will increase as workers who lose formal jobs during the COVID crisis try to find or create work (by resorting to self-employment) in the informal economy.

    • Also, formal enterprises are likely to continue hiring informal workers as they seek more flexibility and attempt to cut labour costs to cope with the COVID-19 induced economic uncertainty.

    Why is the informal more favourable over the formal?

    • The basic reason: necessity to eke out a subsistence living in the absence of alternative employment opportunities.

    • The ‘not so basic’ reasons: Some self-employed persons choose to be in the informal economy voluntarily to avoid registration or taxation.

    • Many are deterred by the costs of formalisation or don’t see much benefit from formalisation.

    • Finally, the phenomenon of informalisation of wage employment in the formal sector is a consequence of formal firms trying to avoid payroll taxes and employer’s contributions to social security or pensions to reduce labour costs.

    Some solution to smoothen the crooked road

    • A multi-pronged and comprehensive approach is needed to facilitate the transition.

    • Labour intensive growth: It requires creating more formal jobs through labour-intensive growth so that informal workers can move to these jobs.

    • Registering and taxing informal enterprises: The Indian experience of compelling informal firms to register and become tax compliant through demonetisation and introduction of GST formalised them only in a legal sense.

    • There is a need for increasing productivity of informal enterprises and incomes of the informal workforce by providing them with technical and business skills, infrastructure services, financial services, enterprise support and training to better compete in the markets.

    • Promoting the path to entrepreneurship in the informal economy.

    • Many informal enterprises would welcome efforts to reduce barriers to registration and related transaction costs as they expect to reap the benefits of formalising.

    • Reducing decent work deficit: This requires protecting informal workers by providing them a social protection floor, ensuring a set of basic working conditions (adequate living wages, limits on hours of work and safe and healthy workplaces).

    A direct question based on the issue of the informal sector can be asked by the UPSC, for ex- “There is a humongous presence of the informal sector in the Indian economy. What are the factors responsible for this? Suggest ways to transform the informal sector into the formal sector.”

    Conclusion

    Questions around the role of government and who bears the onus of protecting workers deserve careful consideration in the backdrop of the rising incidence of informal employment in the formal sector and the growth of the gig economy. It is apparent that in our relentless pursuit of economic growth, we have ignored the voices of India’s informal sector for too long.

    Back2Basics: What is the informal economy?

    • An informal economy (informal sector or grey economy) is the part of any economy that is neither taxed nor monitored by any form of government.
    • Although the informal sector makes up a significant portion of the economies in developing countries, it is sometimes stigmatized as troublesome and unmanageable.
    • However, the informal sector provides critical economic opportunities for the poor.

  • E-Renminbi: China’s Official Digital Currency

    China in a significant move has launched a trial of digital yuan in four urban centres of the country for specific services even as the world grapples with the containment of Covid.

    What is a cryptocurrency? Discuss how a vibrant cryptocurrency segment could add value to India’s financial sector. (250 W)

    Prelims Perspective:-

    1. Subtle differences btn digital and virtual currency – e.g. Regulatory issues

    2. Which countries have official virtual currency – e.g. Petro of Venezuela

    e-RMB

    • It will be the electronic form of the renminbi, with a value equivalent to the paper notes and coins in circulation.
    • The People’s Bank of China, the country’s central bank, will be the sole issuer of the digital yuan, initially offering the digital money to commercial banks and other operators.
    • It will be launched in major cities of Shenzhen, Suzhou and Chengdu, as well as the Xiong’an New Area.
    • It aims to change the financial system in big ways — by cutting costs and making transactions easier, more convenient and more transparent.
    • The public would be able to convert money in their bank accounts to the digital version and make deposits via electronic wallets.

    Back2Basics: Cryptocurrency

    • A Cryptocurrency is an internet-based medium of exchange which uses cryptographical functions to conduct financial transactions.
    • It leverages blockchain technology to gain decentralization, transparency, and immutability.
    • The most important feature of a cryptocurrency is that it is not controlled by any central authority: the decentralized nature of the blockchain makes cryptocurrencies theoretically immune to the old ways of government control and interference.
    • It can be sent directly between two parties via the use of private and public keys.
    • Unlike decentralized cryptocurrencies, such as bitcoin, that allow users to transfer value with no central authority or third party involved, the government-backed digital currency is preferred.

    What are Blockchains?

    • Blockchain, sometimes referred to as Distributed Ledger Technology (DLT), makes the history of any digital asset unalterable and transparent through the use of decentralization and cryptographic hashing.
    • Blockchain consists of three important concepts: blocks, nodes and miners.
    • Nodes can be any kind of electronic device that maintains copies of the blockchain and keeps the network functioning.
    • Miners create new blocks on the chain through a process called mining.

  • Back in news: International Whaling Commission (IWC)

    Iceland will not be hunting any whales in 2020. Iceland, alongside Norway and Japan, has frequently broken the International Whaling Commission’s 1986 worldwide moratorium, which indefinitely “paused” commercial whaling.

    Regarding IWC, we can expect a statement based prelim question asking-

    1) If IWC has a UN or any other parent organization

    2) If India is a member/observer etc.

    About International Whaling Commission (IWC)

    • The IWC is an Inter-Governmental Organisation set up by the terms of the International Convention for the Regulation of Whaling (ICRW) signed in Washington, D.C in 1946.
    • It aims to provide for the proper conservation of whale stocks and thus make possible the orderly development of the whaling industry.
    • The main duty of the IWC is to keep under review and revise as necessary the measures laid down in the Schedule to the Convention which governs the conduct of whaling throughout the world.
    • The body is the first piece of International Environmental Legislation established in 1946.
    • Commercial whaling was banned by the IWC in 1986 after some species were almost driven to extinction.
    • 89 countries have the membership of in IWC and all the member countries are signatories to this convention.
    • India is a member state of the IWC.

    Earlier reference

    • Japan has last year withdrawn from the IWC citing domestic reasons.
    • Thus, it resumed commercial whaling after 31 years, meeting a long-cherished goal of its traditionalists.

  • Strategy for calibrated opening of economy

    The article discusses the performance of India so far and the strategy for reopening of the economy. Dividing the districts based on the number of cases and adopting a suitable approach for opening the economy there while keeping the spread of the virus in control is suggested in the article.

    India performing better

    • While the OECD countries are reeling under the COVID-19 impact, India is clearly ahead of the curve.
    • This is not merely in terms of the confirmed cases in the country but is also strongly reflected in very low mortality numbers (8.5 deaths per lakh population) compared to other nations (4,040 in the UK and 1,930 in the US).
    • While the first cases were reported in most hotspot countries and India around the same time (last week of January), today, the outbreak is far more manageable in India than in most other countries.
    • It was pragmatic for a resource-poor country to be pre-emptive and declare a national lockdown when the total number of cases were still low at 500.
    • The subsequent growth of the pandemic clearly shows a perceptible decline in the number of cases due to the lockdown.
    • Though stringent, this was much-needed and a timely policy intervention by the government.
    • It is important, however, to appreciate the high and growing opportunity costs that are involved during a lockdown.
    • We must brace ourselves for long-term pandemic management (18 to 24 months) with significant economic impact on our lives.

    Policy interventions by government and two major concerns

    • The immediate costs of the lockdown are borne by the most economically vulnerable people in society.
    • This perhaps was the rationale behind the first round of economic policy interventions announced by the finance minister within a few days of the lockdown.
    • They targeted front-loading of cash transfers through PM-Kisan, support to construction workers, self-help groups, food distribution through the public distribution system, among others.
    • Two major concerns: Beyond welfare concerns, there are significant growth concerns that are mounting with every day of economic inactivity in the country.
    • Companies are struggling to honour payroll and maintain their workforce against cancelling orders and declining demand for their goods and services.
    • These in turn will lead to greater delays and defaults in loan repayments, thereby further weakening the fragile banking sector and struggling credit markets.

    The RBI’s intervention and increasing damage to the economy

    • The Reserve Bank of India stepped in for some timely monetary interventions.
    • However, the longstanding climate of risk aversion within the banking sector will mean that transmission of these monetary interventions is unlikely to be timely or adequate.
    • All eyes are set expectantly in one direction.
    • Historically, when economies are faced with major calamities, governments step in to stabilise the environment and boost confidence within the business community.
    • We have seen this response from all major economies disrupted by COVID-19 over the last several weeks.
    • India will not be an exception to this as the government fine-tunes its strategy to support and kickstart our immobilised economy.
    • The opportunity cost of time, however, is ballooning with each passing day.
    • Just like the spread of the virus, we are up against the full force and power of compounding.
    • Mindful policy interventions, when timed well, can cut growing losses and the misfortune of many.

    How the states are performing against Covid-19?

    • While we have succeeded in slowing the growth of the virus at the national level, the true gains and pains are at the state and local level.
    • As the data reveals, currently we have three states that have made remarkable gains and “flattened the curve” of COVID cases.
    • These are Kerala, Haryana and Tamil Nadu where recoveries are growing and active cases are rapidly declining.
    • States like Karnataka and Telangana are improving their recovery rates consistently, despite fluctuations.
    • Every state and local administration has to keep eternal vigil and double down on containment and testing.
    • They have to aggressively improve their contact tracing efforts with the help of their police who are trained in debriefing, call record mapping and have more manpower than public health departments of local administrations.

    The article contains the policy and governance aspects which are important from Mains Paper-2, and economic issues such as the size of the package and opportunity cost of time involved are important from the Mains Paper-3 perspective. Take note of these issues.

    What should be the strategy?

    • Given the scale and variation in infection control across the country, our national strategy needs to be informed and calibrated.
    • Currently, there are more than 300 districts in the country which have reported zero COVID-19 cases.
    • This can be confirmed quickly with some random testing and the lockdown can be lifted effective immediately.
    • Then there are about 225 districts which have reported less than 10 cases each.
    • With adequate ring-fencing at the level of the block where these cases are reported, these districts too can afford to lift their lockdowns.
    • There are, however, approximately 30 districts across the country which have reported large numbers of confirmed cases and are identified as “hotspots”.
    • The lockdown in these places needs to continue with some relaxations for basic trade and essential services.
    • Not surprisingly, these “hotspots” are also important economic centres of the country.
    • The capacity of the local administration to develop and enforce appropriate strategies of containment, contact tracing and testing, should determine their decisions to ring-fence and isolate blocks while allowing other parts of the district/city to resume economic activity.

    Way forward

    • Given the uncertainty of the virus, we seem prepared for large hospitalisation and care if the need arises.
    • The efforts now must be to further contain the growth of the infection.
    • Acting against the power of compounding: If the current rate persists, we will reach over lakh cases within three weeks. That is the power of compounding we are against.
    • Public health support team: Beyond knowledge sharing across states and adopting successful containment strategies from each other, there is a role for the central government in providing “NSG-like” public health support teams to states that need them.
    • Economic package: On the economy front similarly, the central government’s timely economic package should flatten the curve of exponentially rising opportunity costs across the sectors.

    Conclusion

    Given the relative scale and virulence of the COVID-19 virus in India, the odds seem stacked in favour of a calibrated opening of the economy.

     

  • [pib] Year of Awareness on Science & Health (YASH) Program

    National Council for Science & Technology Communication (NCSTC) has launched a programme on health and risk communication ‘Year of Awareness on Science & Health (YASH)’ with focus on COVID-19.

    There are various initiatives named with Hindi acronyms. YASH is newer among them. It is very unlikely to frame a prelim question on it. Still, we should know it for the sake of general awareness.

    YASH Program

    • YASH is a comprehensive and effective science and health communication effort for promoting grass-root level appreciation and response to health.
    • The current pandemic scenario has posed concerns and challenges all around, where scientific awareness and health preparedness play a significant role to help combat the situation.
    • This requires translation and usage of authentic scientific information to convey the risks involved and facilitates communities to overcome the situation.
    • The programme will encompass the development of science, health, and risk communication software, publications, audio-visual, digital platforms, folk performances, trained communicators, especially in regional languages to cater to various cross-sections of the society in the country.
    • It would help to save and shaping the lives of people at large, as well as build confidence, inculcate a scientific temper and promote health consciousness among them.

    Activities under YASH

    • The programme is aimed at minimizing risks at all levels with the help of public communication and outreach activities.
    • It would promote public understanding of common minimum science for community care and health safety measures like personal sanitation and hygiene, physical distancing, maintaining desired collective behaviour and so on.
    • It also includes information dissemination mechanisms to reduce the fear of risks and build confidence with necessary understanding for adopting sustainable healthy lifestyles and nurturing scientific culture among masses and societies.

  • [pib] Kisan Sabha App to Connect Farmers to Supply Chain and Freight Transportation

    Kisan Sabha App developed by CSIR to connect farmers to supply chain and freight transportation management system was recently launched.

    Initiatives as such are less likely to be asked in the prelims as the name and purpose create no different analogy. But for the sake of information and mains perspective, it is vital to remember such technology interventions while emphasizing on Agricultural marketing reforms.

    Kisan Sabha App

    • Kisan Sabha aims to provide the most economical and timely logistics support to the farmers and increase their profit margins by minimizing the interference of middlemen and directly connecting with the institutional buyers.
    • It will also help in providing the best market rates of crops by comparing nearest mandis, booking of freight vehicle at the cheapest cost thereby giving maximum benefit to the farmers.
    • The portal connects the farmers, transporters, Service providers (like pesticides/ fertilizer/ dealers, cold store and warehouse owner), mandi dealers, customers and other related entities for a timely and effective solution.
    • The app has 6 major modules taking care of Farmers/Mandi Dealers/Transporters/Mandi Board Members/ Service Providers/Consumers.

    Facilities provided by the app

    • The portal acts as a single stop for every entity related to agriculture, be they a farmer who needs better price for the crops or mandi dealer who wants to connect to more farmers or truckers who invariably go empty from the mandis.
    • It provides a platform for people who want to buy directly from the farmers.
    • It would also prove to be useful for those associated with cold store(s) or godown(s).

  • Pandemic calls for deep-set forces and scientific concepts of development for building a modern economy

    The article discusses the recovery strategies for India. There are three examples from the past from which we can draw the lessons. 1) Recovery of the US and Europe after the World Wars 2) Recovery of Japan after World War 3) China’s stimulus package after the 2008 financial crisis. In the case of the first two, climate change was not the factor. But in case of the 2008 financial package, China emphasised green technologies and was benefited from it. Drawing on China’s example, the article suggests three pronged strategy for India’s recovery taking into account the climate change factor.

    Decisions on recovery and lessons from the past recovery frameworks

    • The decisions and directions taken by states from hereon will be judged ruthlessly by historical lenses.
    • Though India has managed the pandemic with relative precision, we cannot deny an impending emergence of a new socio-economic order, where the recovery is going to be hard-earned.
    • This is not the first time the world has faced an economic crisis and won’t be the last.
    • Can a country like India, which might be one of the few countries to come out of the crisis without a recession, take lessons from past recovery frameworks?
    • Recovery frameworks: Even though the very nature of the current health crisis is much different from the past crises like World Wars and their repercussions in Europe, the US and Japan.
    • But the evidence shows that ambitious recovery plans made these nation-states more prosperous than the pre-crisis period.

    Recovery lessons form the western world after the World Wars

    • Hurt by the two World Wars and a Great Depression in between, the western world demonstrated unprecedented recovery to attain post-war full employment and stabilized income levels.
    • Almost thirty years between World War II and 1973 recession (“Glorious Thirties“), the countries like the US, Canada, Germany, and France experienced a golden period of growth.
    • In the US, the labour productivity grew at 2.82% per year which meant that productivity doubled every 25 years thanks to better machines driven by electricity and internal combustion engines, better education and massive capital investment.
    • The world wars accelerated technological innovations in energy, manufacturing and vastly improved the labour pool.

    Recovery of Japan after World War

    • Severely hit by the war, Japan’s miraculous growth from 1950 to 1990 is another example of a state using great adversity to propel itself towards prosperity.
    • Post-war liberalization was augmented by multilateral trade agreements and export promotion schemes.
    • That propelled the Japanese economy to dizzying heights making it the second-largest economy at the time.
    • Apart from fiscal stimuli, immense efforts went into strengthening human capital by promoting R&D and skilling activities.
    • Suddenly, Japan becomes one of the most ingenious economies churning out one innovative product after another in fields like electronics.
    • In addition, pioneering quality systems made Japan the first Asian economy to become a developed state.

    Recoveries based on values and technological innovations

    • All the above recoveries are rooted in modern values like create, explore and meet challenges.
    • While large investments garner a lot of attention, role played by massive skilling and resultant technological innovation should not be forgotten.
    • Skilling and innovation enabled creating goods and services of the future.

    Climate change and recovery

    • These successful recovery plans did not have the responsibility to plan for an impending climate change hanging over our head by a thread.
    • The times were different; the needs were different: more importantly, the evidences were not as irrefutable as now.
    • A 2018 study titled ‘Earth’s future’, estimated that India will lose 10% of its GDP annually in a 3°C scenario and lose 14% of its GDP annually in a 4°C scenario in the long term.
    • And the time to act is ‘now’, as consequences of inaction are existential.

    China’s stimulus after the 2008 crisis with a focus on green technologies

    • Fast-forwarding to the 21st century, the 2008–09 Chinese economic stimulus plan pumped in $586 billion to manage the crisis.
    • With serious money of $586 billion going into upgrading selected industrial sectors to firm up its presence in the global value chains (GVC).
    • Interestingly, a sizeable portion went into green technologies.
    • China understood that if the world is provided with affordable green technologies at scale, the states will incentivize the increasingly eco-aware consumers to buy these products.
    • Catalyzed by plans like “Ten Cities, Thousand Vehicles and “Thousand Talents Program (TTP)” and generous state incentives, China became a global leader in e-vehicles.
    • Chinese-made buses started roaming famous cities across the world, the roads traditionally dominated by European makers.
    • Powered by generous capital infusion, China also attained leadership in solar panels, batteries and associated supply chains in a short period setting up a sustainable growth module.
    • A lesson in fiscal prudence: The 2008–09 Chinese economic stimulus plan is also criticized for raising the Chinese debt levels, hence giving us lessons in fiscal prudence.

    Should India opt for a green recovery module?

    • Can a developing India afford to allocate a significant portion of its precious resources towards a green recovery module?
    • Unbridled economic growth and sustainable development are not mutually exclusive.
    • In fact, we might not have a choice, given the movement of global supply chain towards green technologies and tightening screws around strict sustainability standards.
    • European Commission, for instance, has announced that every euro into the recovery plan will be linked to green recovery.

    A three-pronged approach is suggested for recovery

    1. Investment and incentives for green economic activities in the selected sectors

    • First, ambitious investment and incentives in catalyzing futuristic green economic activities in selected sectors.
    • Developing, manufacturing and deploying low carbon products could help India create more jobs: the kind of jobs that will survive into the future.
    • With Giga scale battery and solar manufacturing plans already underway, there is a huge demand globally for sustainable supply chain of even traditional sectors such as textiles.
    • India could choose 5 sectors where it can fill the sustainability vacuum helping the sub-continent emerge as a new global leader in those sectors.
    • India has the potential to scale-up currently ready technologies like e-VTOLs (intra-city electric aerial mobility), which will upend the global mobility modules, increasing the profitability of growing Indian e-mobility supply chain.
    • Companies like Hyundai who have already announced manufacturing of e-VTOLs should be attracted to India.
    • Crisis situations often provide policy windows, where all the stakeholders are empowered, and historically time-consuming decisions are fast-forwarded.
    • If India manages to efficiently remove regulatory bottlenecks and creates standards for e-VTOLs before anyone else, it will take a huge chunk of the global future mobility pie.
    • Similar initiatives for other strategic sectors could be carried out.

    2. Resolve regulatory and on-ground legacy issues

    • Aggressively resolving on-ground legacy issues and challenges.
    • Shackles around entrepreneurship from labour laws to clearances regimes should be broken one by one.
    • It could be done by leveraging the cooperative and competitive federalism evidenced through the crisis under the able leadership of the Hon’ble Prime Minister.
    • And the current policy window might be an ideal opportunity for Indian democracy to deliver.

    3. Focus on skilling people

    • Third, a big-ticket omni-channel skilling architecture should be instituted.
    • Universities should be empowered and enabled to come up with new-age educational programmes to serve futuristic industries.
    • A special focus should be given to develop enough trainers to train the millions of Indian youth getting ready for the labour market every year, in new-age skills.
    • Adequate online-offline training courses must be designed in a way that it does not affect daily wages drastically.
    • The big-ticket vocational programmes, specially directed at the informal sector which constitute more than 90% of the total workforce, has the potential to employ displaced and poor labourers.
    • A strategic skill committee may be empowered to dynamically identify key skills and tweak the training modules.
    • This can be integrated with the Ministry of Environment’s Green Skill Development Program to train 10 million youth by 2030.

    The issues discussed here are important for achieving sustainable and inclusive growth. A question based on this theme was asked by UPSC in 2019.

    Consider the question “It is argued that the strategy of inclusive growth is intended to meet the objectives of inclusiveness and sustainability together. Comment on this statement.”

    Conclusion

    The current pandemic calls for deep-set forces and scientific concepts of development for building a dynamic and modern economy. Green growth is one such concept that will add a new dimension to the economic dynamism of the sub-continent helping it serve the aspirations of its citizens.

  • Rethinking the role of Intellectual Property in Corona crisis

    The article discusses the idea of creating a patent pool of the patents dealing with Covid-19. Such a patent pool will be effective in avoiding the possibility of the hostile response of societies towards patent rights. And also avoid the conflict between nations. corporations and international organisations.

    Purpose of patent rights

    • The purpose of creating and recognising patent rights is for the common public good, i.e., innovation should be made public in exchange for a limited monopoly.
    • Thus, patents need to be disclosed to the public in order to enable further research.
    • Should pandemics such as COVID-19be an exception to this?
    • With the outbreak of COVID-19, there are several innovations.
    • All these innovations may be the subject matter of patent applications around the world.
    • It will be a few years before patents are even granted.
    • However, friction already exists among various stakeholders.
    • For instance, one country made attempts to obtain exclusive rights to a vaccine being developed.
    • On the other hand, there are also collaborations taking place.
    • However, the spirit of collaborative solutions is only on the anvil.
    • The question that arises is whether the exclusivity that is recognised by patent rights will be detrimental to society.
    • Will patents create roadblocks or is there a solution?

    Possibility of conflicts over patent rights

    • Governments and international organisations need to arrive at a consensus in advance to ensure that the system is ready.
    • Procrastination would be disastrous.
    • Creating hindrances through exclusivity claims, in the wake of a pandemic, will result in dividing countries, corporations and international organisations.
    • This will not benefit patients and the world as a whole.
    • If patent owners create impediments on the strength of patent rights, the world will start despising patents and that is not a situation IP owners ought to be in.
    • Under the TRIPS (Trade-Related Aspects of Intellectual Property Rights) regime, there are several tools such as compulsory licensing that are available to ensure access to medicines.
    • However, beyond the laws, society needs to respect innovation.
    • To protect the sanctity and integrity of patent systems, and in order to ensure that an anti-IP sentiment is not generated globally, answers need to be found within the existing regime.
    • In exceptional circumstances such as these, there is a likelihood that societies may resort to extreme steps to protect themselves.
    • Before such ideas are floated, solutions should be created.

    The idea of creating a patent pool

    • One method by which aggregation and dissemination of innovative products can be ensured is by creating a patent pool.
    • Patent pools are usually effective in aggregating, administering and licensing patents related to specific areas of technology.
    • Such pools are usually managed by a central agency and the patents which become part of the pool are readily made available for licensing.
    • Some pools even publish the royalty rates payable for such licences.
    • Anyone who wishes to obtain a licence will be able to approach the pool, agree to the terms, and begin to manufacture and sell the products.
    • Such pools are prevalent in, for instance, standard essential patents related to telecom and digital innovations.
    • At the moment, individual efforts are being made by research organisations to create their own pools.
    • A more fruitful endeavour would be to create a global pool of COVID-19-related innovations, or innovations related to rare pandemics, in respect of vaccines and medicines.
    • This could be managed by a trustworthy international organisation.
    • All countries ought to have the right to implement these innovations without further permission from the patent-holders.
    • This would not require countries resorting to provisions such as compulsory licensing, state acquisition, etc.
    • Even if royalties are at a minimal level, the revenues would still be in billions of dollars owing to the large swathes of the population affected by the pandemic, who will need to be administered these products.

    Way forward

    • Creation of a pool and immediate licensing will ensure that there are hundreds of manufacturers across the world.
    • As a result, vaccines and medicines will be quickly available.
    • Such a pool needs the cooperation of not just countries and international organisations but also the hundreds of researchers, innovators, companies and universities involved.
    • Doha Declaration: Pooling of patent resources is also in line with the Doha Declaration on Public Health which is a part of the TRIPS agreement.
    • This declaration recognises the need for taking measures to ‘protect public health’ and ‘promote access to medicines’.

    A direct question on the issue can be asked by the UPSC, for ex-“Though IPRs have been provided to respect and protect the innovations and ideas, but in the wake of corona crisis, some strict provisions need to be changed. In light of the above statement, discuss the limitations of the exclusivity clause under the patents rights. And how can it be overcome in emergency situations?”

    Conclusion

    Public-private partnerships (PPP) need to be scaled up. Creation of the ‘PPP-pandemic patent pool’ at a global level, to pool all innovations, is the way forward. Let us not wait any longer.

  • Study on China dams brings the Brahmaputra into focus

    A new study highlighting the impact of China’s dams on the Mekong River has raised fresh questions on whether dams being built on other rivers that originate in China, such as the Brahmaputra, may similarly impact countries downstream.

    Make a note of:

    1) Tributaries of R. Brahmaputra

    2) Countries swept by R. Mekong

    3) Mekong-Ganga Cooperation (reminds us seeing R. Mekong)

    China’s dams on the Mekong River

    • The Mekong flows from China to Myanmar, Laos, Thailand, Cambodia and Vietnam.
    • The Mekong River Commission, which comprises Cambodia, Laos, Thailand, and Vietnam, has said more scientific evidence was needed to establish whether dams caused a 2019 drought.
    • While China’s southwestern Yunnan province which usually has above-average rainfall, there was “severe lack of water in the lower Mekong.

    Mekong dams raise some questions

    • The Mekong study was not conclusive on the question of how China’s dams had affected the quantity of flows.
    • To state that the basin had less water because of activities in China alone is misleading, mainly because that only considers the water flowing into the lower basin at one station in Thailand.
    • The study did not consider other dams and water-use along the course of the river.
    • The lower basin isn’t entirely dependent on flows from China but also receives water from tributaries in all four countries, which the study did not account for.

    Concerns for India

    • India does not have a water-sharing agreement with China, but both sides share hydrological data.
    • India has long expressed concerns over dam-building on the Brahmaptura.
    • In 2015, China operationalised its first hydropower project at Zangmu, while three other dams at Dagu, Jiexu and Jiacha are being developed.
    • India need to raise the issue of river waters in the Brahmaputra with China, as that appears to be the only methodology to ensure what happened on Mekong does not happen on Brahmaputra.

    A management problem

    • The dams are not likely to impact the quantity of the Brahmaputra’s flows because they are only storing water for power generation.
    • Moreover, the Brahmaputra is not entirely dependent on upstream flows and an estimated 35% of its basin is in India.
    • However, India concerns more about activity in China affecting quality, ecological balance, and flood management.

  • Why May 1 is observed as Labour Day?

    Today (May 1) is May Day, also known as International Workers’ Day and as Labour Day in different parts of the world. It is an occasion that commemorates the contributions of workers and the historic labour movement.

    Personality based history question in the UPSC CSE prelims is on the way to become the new normal. Kindly note all such phenomena in the news which tend to invoke some aspects of the modern Indian history. You can find all such news here.

    The Haymarket incident

    • While observed as an ancient northern hemisphere spring festival, May 1 became associated with the labour movement in the late 19th century, after trade unions and socialist groups designated it as a day in support of workers.
    • It was decided to do so in memory of the Haymarket affair of 1886, in Chicago in the United States, in which a peaceful rally in support of workers led to a violent clash with the police, leading to the deaths of 4 civilians and 7 police officers.
    • Many of the agitationists, who were protesting workers’ rights violations, straining work hours, poor working conditions, low wages and child labour, were arrested and served terms of life imprisonment, death sentences, etc., and those who died were hailed as “Haymarket Martyrs”.
    • The incident is believed to have given the workers’ movement a great impetus.

    Linked to the Russian Revolution

    • In 1889, The Second Communist International, an organisation created by socialist and labour parties, declared that May 1 would be commemorated as International Workers’ Day from then on.
    • Finally, in 1916, the US began to recognise eight-hour work timings after years of protests and uprisings.
    • In 1904, the International Socialist Congress at Amsterdam called on to demonstrate energetically on the First of May for the legal establishment of the 8-hour day.
    • After the Russian Revolution in 1917, the celebration was embraced by the Soviet Union and the Eastern bloc nations during the Cold War– becoming a national holiday in many of them.
    • Parades were a part of the celebration– the one at Moscow’s Red Square was attended by top Communists leaders and displayed Soviet military might.

    Indian Case

    • In India, May Day was first celebrated on May 1, 1923, after the Labour Kisan Party of Hindustan initiated and Comrade Singaravelar (Singaravelu Chettiar) helmed the celebrations.
    • Chettiar was known for being one of the leaders of Self Respect Movement in the Madras Presidency and for his fight for the rights of backward classes.
    • In one of his meetings, Chettiar passed a resolution stating the government should allow everybody a national holiday on Labour Day.