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Distribution: weekly

  • Dravidian Model of Development

    The Chief Minister of Tamil Nadu is pushing for a ‘Dravidian Model’ where economic development is inclusive.

    What is the Dravidian Model?

    • The goal is equal economic development that will be in tune with social justice.
    • It has taken root since the days of the Justice Party government [in pre-Independent India].
    • TN polity has divided the task into short-term and long-term, and travels with the objective of improving the economy by implementing them within the time frame.

    Note: The Government of India Act 1919 implemented the Montagu-Chelmsford reforms, instituting a Diarchy in Madras Presidency. The diarchial period extended from 1920 to 1937, encompassing five elections. Justice party was in power for 13 of 17 years.

    Unique features of this developmental approach

    (1) Financial planning

    • TN has constituted an Economic Advisory Council comprising internationally renowned economists since there is a need to evolve an economic development to suit the current situation.
    • It has emerged out higher as comparatively high levels of human development with economic dynamism.

    (2) Health and education

    • It sought and ensured opportunity-equalizing policies in the expanding modern sectors through affirmative action policies and investments in education and health.
    • Tamil Nadu has been a pioneer in broad-basing entry into school education through a slew of incentives, the noon meal scheme being the most well-known.

    (3) Social Harmony

    • It also succeeded in building a bloc of lower caste groups under a Dravidian-Tamil identity that subsumed and sought to transcend individual caste identities.
    • It has distinct political mobilization against caste-based inequalities in the state.
    • Mobilization built an ethos that questioned the privileges of caste elites and the naturalness of merit in a caste society.

     

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  • BARC ratings for news channels to resume soon

    Ratings by Broadcast Audience Research Council (BARC) for the news channels will resume, after the organisation revised its procedures and protocols.

    The ratings were suspended after the Mumbai police busted a racket involving a private channel’s efforts to tamper the TRPs.

    Try this question:

    Q.What do you mean by “TRP Journalism”? Discuss the loopholes in the present system of self-regulation in Indian media.

    What is TRP?

    • In simple terms, anyone who watches television for more than a minute is considered a viewer.
    • The TRP or Target Rating Point is the metric used by the marketing and advertising agencies to evaluate this viewership.
    • In India, the TRP is recorded by the Broadcast Audience Research Council (BARC) using Bar-O-Meters that are installed in televisions in selected households.
    • As on date, the BARC has installed these meters in 44,000 households across the country. Audio watermarks are embedded in video content prior to broadcast.
    • These watermarks are not audible to the human ear, but can easily be detected and decoded using dedicated hardware and software.
    • As viewing details are recorded by the Bar-O-Meters, so are the watermarks.

    What is BARC?

    • It is an industry body jointly owned by advertisers, ad agencies, and broadcasting companies, represented by The Indian Society of Advertisers, the Indian Broadcasting Foundation and the Advertising Agencies Association of India.
    • Though it was created in 2010, the I&B Ministry notified the Policy Guidelines for Television Rating Agencies in India on January 10, 2014, and registered BARC in July 2015 under these guidelines, to carry out television ratings in India.

    How are the households selected?

    • Selection of households where Bar-O-Meters are installed is a two-stage process.
    • The first step is the Establishment Survey, a large-scale face-to-face survey of a sample of approximately 3 lakh households from the target population. This is done annually.
    • Out of these, the households which will have Bar-O-Meters or what the BARC calls the Recruitment Sample are randomly selected. The fieldwork to recruit households is not done directly by BARC.
    • The BARC on its website has said that the viewing behaviour of panel homes is reported to BARC India daily. Coincidental checks either physically or telephonically are done regularly.

    Vigilance activities by BARC

    • Certain suspicious outliers are also checked directly by BARC India.
    • BARC India also involves a separate vigilance agency to check on outliers that it considers highly suspicious.
    • And as per the guidelines of the Ministry of Information and Broadcasting, these households rotate every year.
    • This rotation is in such a manner that older panel homes are removed first while maintaining the representativeness of the panel.
    • The Ministry guidelines further say that the secrecy and privacy of the panel homes must be maintained, and asked the BARC to follow a voluntary code of conduct.

    What are the loopholes in the process?

    • Several doubts have been raised on many previous occasions about the working of the TRP.
    • As per several reports, about 70% of the revenue for television channels comes from advertising and only 30% from subscriptions.
    • It is claimed that households were being paid to manipulate the TRP.

     

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  • [pib] Harvest Festivals in India

    The President has greeted the people of India on the occasion of Makar Sankranti and Pongal festivals.

    Makar Sankranti

    • Makar Sankranti or Uttarayan or Maghi or simply Sankranti is considered as the transition day of Sun into the Capricorn.
    • Now the sun moves northwards in the Hindu calendar.
    • Dedicated to the deity Surya, many native festivals are organized all over India.
    • It mostly falls at the end of Kharif harvests.

    Statewise festivals celebration

    • Pongal: In South India and particularly in Tamil Nadu, it’s the festival of Pongal which is being celebrated over 4 days at harvest time.
    • Lohri: It is celebrated in North India particularly in Punjab as a traditional winter folk festival or as a popular harvest festival of farmers.
    • Bhogi: In Andhra Pradesh, it is celebrated as a four day festival with a bonfire with logs of wood, other solid-fuels, and wooden furniture at home that are no longer useful.
    • Magha Bihu: In Assam and many parts of the North East, the festival of Magha Bihu is celebrated. It sees the first harvest of the season being offered to the gods along with prayers for peace and prosperity.
    • Uttarayan: Gujarat celebrates it in the form of the convivial kite festival of Uttarayan.
    • Saaji: In Shimla District of Himachal Pradesh, Makara Sankranti is known as Magha Saaji. Saaji is the Pahari word for Sankranti, start of the new month. Hence this day marks the start of the month of Magha.

    Try this question from our AWE initiative:

    Do we have cultural pockets of small India all over the nation? Elaborate with examples. (15 Marks)

     

     

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  • Reaping India’s demographic dividend

    Context

    Countries like Singapore, Taiwan and South Korea have already shown us how demographic dividend can be reaped to achieve incredible economic growth by adopting forward-looking policies and programmes.

    The window of demographic opportunity

    • With falling fertility (currently 2.0), rising median age (from 24 years in 2011, 29 years now and expected to be 36 years by 2036), a falling dependency ratio (expected to decrease from 65% to 54% in the coming decade taking 15-59 years as the working age population), India is in the middle of a demographic transition.
    • This provides a window of opportunity towards faster economic growth. India has already begun to get the dividend.
    • As fertility declines, the share of the young population falls and that of the older, dependent population rises.
    • If the fertility decline is rapid, the increase in the population of working ages is substantial yielding the ‘demographic dividend’.
    • The smaller share of children in the population enables higher investment per child.
    • Therefore, the future entrants in the labour force can have better productivity and thus boost income.
    • With the passage of time, the share of the older population rises and that of the working age population begins to fall and hence the dividend is available for a period of time, ‘the window of demographic opportunity’.

    Need for forward-looking policies

    • Without proper policies, the increase in the working-age population may lead to rising unemployment, fueling economic and social risks.
    • This calls for forward-looking policies incorporating population dynamics, education and skills, healthcare, gender sensitivity, and providing rights and choices to the younger generation.

    Lessons for India

    • Countries like Singapore, Taiwan and South Korea have already shown us how demographic dividend can be reaped.
    •  There are important lessons from these countries for India.
    • 1) NTA data: The first is to undertake an updated National Transfer Accounts (NTA) assessment.
    • Using NTA methodologies, we find that India’s per capita consumption pattern is way lower than that of other Asian countries.
    • A child in India consumes around 60% of the consumption by an adult aged between 20 and 64, while a child in China consumes about 85% of a prime-age adult’s consumption.
    • The NTA data for India needs to be updated to capture the progress made on such investments since 2011-12.
    • 2) Invest more in children and adolescents: India ranks poorly in Asia in terms of private and public human capital spending.
    • It needs to invest more in children and adolescents, particularly in nutrition and learning during early childhood.
    • 3) Make health investments: Health spending has not kept pace with India’s economic growth.
    • The public spending on health has remained flat at around 1% of GDP.
    • Evidence suggests that better health facilitates improved economic production.
    • Hence, it is important to draft policies to promote health during the demographic dividend.
    • 4) Make reproductive healthcare services accessible on a rights-based approach: We need to provide universal access to high-quality primary education and basic healthcare.
    • The unmet need for family planning in India at 9.4% as per the latest National Family Health Survey-5 (2019-21) is high as compared to 3.3% in China and 6.6% in South Korea, which needs to be bridged.
    •  5) Bridge gender differentials in education: The gender inequality of education is a concern.
    • In India, boys are more likely to be enrolled in secondary and tertiary school than girls. This needs to be reversed.
    • 6) Increase female workforce participation: As of 2019, 20.3% of women were working or looking for work, down from 34.1% in 2003-04.
    • New skills and opportunities for women and girls befitting their participation in a $3 trillion economy is urgently needed.
    • It is predicted that if all women engaged in domestic duties in India who are willing to work had a job, female labour force participation would increase by about 20%.
    • 7) Address the diversity between StatesWhile India is a young country, the status and pace of population ageing vary among States.
    • Southern States, which are advanced in demographic transition, already have a higher percentage of older people.
    • These differences in age structure reflect differences in economic development and health – and remind us of States’ very different starting points at the outset of the 2030 Sustainable Development Goals Agenda.
    • But this also offers boundless opportunities for States to work together, especially on demographic transition, with the north-central region as the reservoir of India’s workforce.
    • 8) Governance reform: A new federal approach to governance reforms for demographic dividend will need to be put in place for policy coordination between States on various emerging population issues such as migration, ageing, skiling, female workforce participation and urbanisation.

    Conclusion

    In India, the benefit to the GDP from demographic transition has been lower than its peers in Asia and is already tapering. Hence, there is an urgency to take appropriate policy measures.

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  • [Sansad TV] Perspective: Innovation in Education

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    Context

    • The buzzword across the globe for the 21st century is Innovation which is considered to be the primary driver of progress.
    • Incentivising innovation and intellectual property creation is important for India’s future growth prospects.
    • Making all these considerations, the Ministry of Education’s innovation cell has recently released the third edition of Atal Ranking of Institutions on Innovation Achievements (ARIIA) 2021.

    What is Atal Ranking of Institutions on Innovation Achievements (ARIIA)?

    • ARIIA ranking classifies participating institutions into two major categories; technical and non-technical.
    • It is developed by the All India Council for Technical Education (AICTE) and the Ministry’s Innovation Cell.
    • It aims to systematically rank all major higher educational institutions and universities in India.

    Highlights of ARIIA 2021

    • In the technical ranking IIT Madras has been recognised as the Most Innovative Educational Institute in India.
    • This is the third time that IIT Madras has secured the first rank. IIT Bombay and IIT Delhi were placed at the second and third ranks respectively.
    • Out of total of 3551 HEIs registered, 1438 institutions including all IITs, NITs, IISc, etc. participated in this exercise.

    Why discuss innovation?

    • Academic nature: For the longest of time in India, innovation was either tucked away in the R&D centres of government enterprises, academia and the MNEs.
    • Situational constraints: Quiet often it was around unorganised markets in the form of the cheap Jugaad.
    • Rise of Unicorns: With over 35 Unicorns (and counting), India has become the third-largest hub of Unicorns globally, something that is not even remotely replicable by others in similar class of economies.
    • Pitch for Indigenization: Introduced at the beginning of the 2020s, the ‘Vocal for Local’ credo is symbolic of a nation that is beginning to believe in its own self-worth.
    • Unleashed potential: From ISRO’s groundbreaking low-budget streaks to India being a frontrunner in the Covid vaccine development, India’s ability to innovate is beginning to make a lasting impact on the world.
    • Global acknowledgement: The Global Innovation Index indicates India has been consistently outperforming other economies. India’s ranking has gone up from 81 (2015) to 48 (2020).

    For a better India

    • The once stereotypical attitude of ‘chalta hai’ is giving way to the newfound zeal around ‘how to make things work better.
    • This is the question that Indian entrepreneurs are applying to the products and services landscape of new India.

    Why does India need innovation?

    • Heterogeneity of users: With the hard metrics of innovation ecosystem in place, what really acts as the magic ingredient is the vast and heterogenous user segments in India that are hungry for novel solutions.
    • Capable institutions: This combination of strong capabilities and categories ripe for disruption makes India a fertile ground for new innovations.
    • Youth: India is also a young country. While population growth is under control, it is still growing at two per cent per year in population.
    • Being later than never: Technology is clearly the biggest area of transformation in India. India has some advantages in this area from being a ‘late mover’, which has enabled it to leapfrog the competition in many cases.

    Hurdles to Innovation in HEIs

    • Low gross enrolment ratio is a major challenge in India towards the introduction of innovation in education
    • Inadequate quality of education and infrastructure that is requisite to boost innovation
    • Lack of funds for state-run Universities
    • Faculty crunch and severe shortage of teaching staff and poor facilities
    • Stagnant academic syllabus in institutions other than IITs/NITs
    • Decline in research standards due to lack of infrastructure
    • Limited institutional support- While India has the scientific talent, we do not have the deep pockets and the enabling ecosystem that drives most of the innovation in the West.

    Structural lacunae

    • Lack of incubation centres: In terms of world-class manufacturing, India still lags behind.
    • Limited policy successes: Even though the government has an initiative in place to encourage companies under Make In India/ Vocal for Local, it hasn’t had any major victories in terms of attracting big players.
    • Weaker IPR regime: The lack of funding support in the country forces innovators in India to park their IP rights outside the country.

    Significance of Innovation in Higher Education

    • Competition: The ranking system of ARIIA facilitates a healthy competitive environment among institutions to expand the purview of innovation. 
    • Formative years of students: This ecosystem would inspire young students to put forth their ideas in their formative years. 
    • Quality enhancement: ARIIA will exert a large emphasis on the quality of innovation and will make an attempt to examine the influence of the innovations nationally and internationally. 
    • Social applications: The innovation in education has a far-reaching impact on human development for productivity, research and improved value chain interaction across different spheres of the economy.

    Way forward

    • In today’s knowledge-driven economy, innovation is the primary driver of progress. And, a large reservoir of entrepreneurial energy in India waiting to be tapped lies in these HEIs.
    • For innovation to flourish, ideas must be funded and taken to market. The HEIs are the right place to invest in for innovations.
    • It is by investing in breakthrough ideas and embracing entrepreneurship as an economic model of growth that India will be able to unleash the power of innovation to ensure a better life for its billion-plus citizens.

    Conclusion

    • We must build the credibility of Indian innovation within our borders and convince people that the quality of research done in India is at par with the best in the world.
    • This can be done by promoting more innovations in HEIs.

  • Govt releases revised guidelines for Universal Accessibility

    From the design plan to the implementation, various aspects of the built environment have been covered under the new guidelines for universal accessibility recently drafted by the Centre.

    What is Universal Accessibility?

    • Universal Accessibility can be defined as the conditions for easy access.
    • It would allow any individual (even those whose mobility, communicative ability, or understanding is reduced) to access and enjoy a place, product, or service, and to do so freely and independently.

    Why is universal accessibility important?

    • Universal design is so important because if a space is accessible, usable, and convenient for everyone regardless of age or ability, it’s inclusive for all.
    • An accessible school, library, community centre, govt office or park means everyone can participate fully in their community.

    What are the new guidelines?

    • The Central Public Works Department (CPWD) released the Harmonised Guidelines and Standards for Universal Accessibility in India 2021.
    • Drafted by a team of the IIT-Roorkee and the National Institute of Urban Affairs of the MoHUA, the revised guidelines aim to give a holistic approach.
    • Earlier, the guidelines were for creating a barrier-free environment, but now they are focusing on universal accessibility.

    Key highlights

    • Ramps: The guidelines provide the gradient and length of ramps — for example, for a length of six metres, the gradient should be 1:12. The minimum clear width of a ramp should be 1,200 mm.
    • Beyond PwDs: While making public buildings and transport fully accessible for wheelchair users is covered in the guidelines, other users who may experience temporary problems have also been considered. For instance, a parent pushing a child’s pram while carrying groceries or other bags, and women wearing saris.
    • Women friendly: Built environment needs for accessibility for women should consider diverse age groups, diverse cultural contexts and diverse life situations in which women operate. Diverse forms of clothing (saris, salwar-kameez, etc.) and footwear (heels, kolhapuri chappals, etc.) require a certain orientations.
    • Accessibility symbols: The guidelines call for accessibility symbols for PwD, family-friendly facilities and transgender to be inclusively incorporated among the symbols for other user groups.
    • Targeted authorities: The guidelines are meant for State governments, government departments and the private sector, as well as for reference by architecture and planning institutes.

    Policy measures for Persons with Disabilities (PwDs)

    • India is a signatory to the UN Convention the Right of Persons with Disabilities, which came into force in 2007.
    • The ‘Accessible India Campaign’ (Sugamya Bharat Abhiyan) was launched in 2015 to enable Persons with disabilities to gain universal access, equal opportunity for development.
    • The Union Minister for Social justice and Empowerment has also launched the “Sugamya Bharat App” to complain for ease accessibility for PwDs.
    • India has its dedicated the Rights of Persons with Disabilities Act, 2016, which is the principal and comprehensive legislation concerning persons with disabilities.

    Back2Basics: Sugamya Bharat Abhiyan

    • Accessible India Campaign or Sugamya Bharat Abhiyan is a program that is set to be launched to serve the differently-able community of the country.
    • The flagship program has been launched on 3 December 2015, the International Day of People with Disabilities.
    • The program comes with an index to measure the design of disabled-friendly buildings and human resource policies.
    • The initiative also in line with Article 9 of the (UN Convention on the Rights of Persons with Disabilities) which India is a signatory since 2007.
    • The scheme also comes under the Persons with Disabilities Act, 1995 for equal Opportunities and protection of rights which provides non-discrimination in Transport to Persons with Disabilities.

     

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  • Election Campaign Funding by Political Parties

    With several Assembly elections coming up, the issue of campaigning is back on the track. Campaign funding reforms are one of the biggest issues in electoral reforms worldwide.

    Why in news?

    • Elections are fought with huge funds nowadays.
    • Estimates vary, but a candidate may spend in crores in just one constituency.
    • This vital issue is neglected by voters in the noise of campaigns, leaders, celebrities, and media coverage.

    Caps on Election Expenditure

    The Election Commission of India (ECI) imposes limits on campaign expenditure incurred by a candidate and not political parties.

    The ceiling on poll expenditure varies across States:

    (a) Bigger states

    • With candidates in Assembly Elections in bigger states like Bihar, Uttar Pradesh, and Tamil Nadu now allowed to spend up to 40L (from ₹30.8 lakhs as against ₹28 lakhs earlier.)
    • For a candidate contesting a Lok Sabha Poll in these States, the revised ceiling on poll expenditure is now 90lakh (₹77 lakhs earlier).

    (b) Smaller states

    • While the enhanced ceiling for a Lok Sabha candidate is now 75Lakh (Earlier ₹59.4 lakhs) those contesting an Assembly can spend up to 28 Lakh( earlier ₹22 lakhs.)
    • Goa, Arunachal Pradesh, Sikkim and a few Union Territories (AGMUT states) based on the size of their constituencies and population, have a lower ceiling on poll expenditure.

    How are such ceilings made?

    • Such changes are made by amending the Conduct of Elections Rules.
    • The last time the expenditure ceiling was enhanced was in 2014 just ahead of the Lok Sabha polls.

    What happens when expenditure exceeds the limit?

    • Contesting candidates are required to file a mandatory true account of election expenses with the EC.
    • An incorrect account or expenditure beyond the ceiling can attract disqualification for up to three years as per Section 10A of The Representation of the People Act, 1951.

    What doesn’t account to Election expenditure?

    • The expenditure incurred by leaders of a political party on account of travel by air or by any other means of transport for propagating programme of the political party is not considered to be the election expenditure.
    • Any expenditure which is done for service of the Government and discharge of official duty is also not considered to be election expenditure.

    Why is this issue important for the voter?

    • Voters vote for candidates, political parties and leaders so that they deliver benefits to the citizens.
    • If election funds are obtained from other sources, the Governments in power are obliged to the funders more than the voters.
    • The government may take decisions that benefit the donors rather than the voters.
    • Even if a rich candidate funds his own election, the focus is on recovering the investment made rather on public service.

    Situation in India on Election Funding

    • Transparency in funding is absent after the introduction of Electoral Bonds.
    • Now citizens cannot know who is funding the political parties.

    Way forward

    There is also much to learn from international experience. Broadly there are three classes of remedies.

    • First is to make all election funding completely transparent so that voters know who is funding whom.
    • Second is to prevent private interests from unduly influencing elections or Governments. This is done by a set of rules on limiting funding.
    • Third is to try and have a more level playing field so that good politicians, candidates and parties with less funds also stand a chance of competing in elections.

     

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  • Mullaperiyar Dam Issue

    The Supreme Court has told Tamil Nadu and Kerala that it was not there to “administer the dam” when a supervisory committee was already in place to examine the issue of safety of the Mullaperiyar Dam and the management of its water level.

    Do you know?

    The Mullaperiyar dam is located in Kerala on the river Periyar but is operated and maintained by the neighbouring state of Tamil Nadu.

     

    John Pennycuick (the architect of this dam) sold his family property in England to mobilize money to fund the project! People of the region fondly name their children under his name a remark of reverence.

    Mullaperiyar Dam

    • It is a masonry gravity dam on the Periyar River in Kerala.
    • It is located on the Cardamom Hills of the Western Ghats in Thekkady, Idukki District.
    • It was constructed between 1887 and 1895 by John Pennycuick (who was born in Pune) and also reached in an agreement to divert water eastwards to the Madras Presidency area.
    • It has a height of 53.6 m (176 ft) from the foundation, and a length of 365.7 m (1,200 ft).

    Operational issue

    • The dam is located in Kerala but is operated and maintained by Tamil Nadu.
    • The catchment area of the Mullaperiyar Dam itself lies entirely in Kerala and thus not an inter-State river.
    • In November 2014, the water level hit 142 feet for first time in 35 years.
    • The reservoir again hit the maximum limit of 142 feet in August 2018, following incessant rains in the state of Kerala.
    • Indeed, the tendency to store water to almost the full level of reservoirs is becoming a norm among water managers across States.

    The dispute: Control and safety of the dam

    • Supreme court judgment came in February 2006, has allowed Tamil Nadu to raise the level of the dam to 152 ft (46 m) after strengthening it.
    • Responding to it, the Mullaperiyar dam was declared an ‘endangered’ scheduled dam by the Kerala Government under the disputed Kerala Irrigation and Water Conservation (Amendment) Act, 2006.
    • For Tamil Nadu, the Mullaperiyar dam and the diverted Periyar waters act as a lifeline for Theni, Madurai, Sivaganga, Dindigul and Ramnad districts.
    • Tamil Nadu has insisted on exercising the unfettered colonial rights to control the dam and its waters, based on the 1886 lease agreement.

    Rule of Curve issue

    • A rule curve or rule level specifies the storage or empty space to be maintained in a reservoir during different times of the year.
    • It decides the fluctuating storage levels in a reservoir.
    • The gate opening schedule of a dam is based on the rule curve. It is part of the “core safety” mechanism in a dam.
    • The TN government often blames Kerala for delaying the finalization of the rule curve.

    Back2Basics: Periyar River

    • The Periyar is the longest river in the state of Kerala with a length of 244 km.
    • It is also known as ‘Lifeline of Kerala’ as it is one of the few perennial rivers in the state.
    • It originates from Sivagiri hills of Western Ghats and flows through the Periyar National Park.
    • The main tributaries of Periyar are Muthirapuzha, Mullayar, Cheruthoni, Perinjankutti.

     

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  • Issues with India’s GDP data

    Context

    There are three major reasons why the GDP data, and hence any narrative of economic recovery based on it, are questionable.

    Background

    • The NSO released the current GDP series in 2015, using 2011-12 as its base year.
    • Some have argued that the problem in the new series is the real growth rate. This is debatable.
    • Scholars have pointed to measurement problems, both in the nominal and real GDP growth rates.

    Three issues with the GDP data, and  narrative of economic recovery based on it

    [1] Double deflation problem

    • The new series entailed a shift from a volume-based measurement system to one based on nominal values, thereby making the deflator problem more critical.
    • Simply put, the NSO calculates real GDP by gathering nominal GDP data in rupees and then deflating this data using various price indices.
    • The nominal data needs to be deflated twice: Once for outputs and once for inputs.
    • But the NSO — almost uniquely amongst G20 countries — deflates the nominal data only once.
    • It does not deflate the value of inputs.
    • To see why this is a problem, consider what happens when the price of imported oil goes down.
    • In that case, input costs will fall and the profits recorded by Indian firms will rise.
    • This increase in profits is merely the result of a fall in input prices, so it needs to be deflated away.
    • But the NSO doesn’t deflate away the increase in profits.
    • Since the cost of inputs is measured by the WPI (wholesale price index), a crude measure of the overestimation caused by the absence of “double deflation” is given by the gap between the WPI and the CPI (consumer price index).
    • In the 2014-2017 period, oil prices plunged, causing the WPI to fall sharply relative to the CPI.
    • This meant that real growth was probably overstated.
    • In the last few months, the exact opposite has been happening. WPI inflation is soaring.
    • The rapid increase in the WPI relative to the CPI is imparting an upward bias to the deflator.

    [2] Sectoral weight not updated

    • When it calculates GDP, it takes a sample of activity in each sector, then aggregates the figures by using sectoral weights.
    • To make sure that the weights are reasonably accurate, the NSO normally updates them once a decade.
    • It has now been more than 10 years since the weights were changed, and there are no signs of a base year revision.
    • As a result, the sectoral weights are still based on the structure of the economy in 2010-11, when in particular the information technology sector was much smaller.

    [3] Measurement of unorganised sector

    • Measurement of the unorganised sector has always been difficult in India.
    • Once in a while, the NSO undertakes a survey to measure the size of the sector.
    • In the meantime, it simply assumes that the sector has been growing at the same rate as the organised sector.
    • However, starting in 2016 the unorganised sector has been disproportionately impacted by a series of shocks.
    • In 2018, the NBFC sector reported serious problems, which in turn impacted unorganised sector firms since they were heavily dependent on NBFCs for funds.
    • From 2020 onwards, the pandemic has impacted the unorganised sector more than the organised sector enterprises.
    • Despite these shocks, the NSO does not seem to have made any adjustments to its methodology for estimating the growth of the unorganised sector.

    Consider the question “Elaborate the issues with India’s GDP data. Suggest the way forward.”

    Conclusion

    There are serious problems with India’s GDP data. Any analysis of recovery or growth forecast based on this data must be taken with a handful of salt.

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  • Places in news: Darvaza Gas Crater

    Turkmenistan President has ordered experts to find a way to extinguish a fire in a huge natural gas crater, the Darvaza gas crater also known as the ‘Gateway to Hell’.

    Darvaza Gas Crater

    • Located in the Karakum desert, 260 kilometres away from Turkmenistan’s capital, Ashgabat, the crater has been burning for the last 50 years.
    • The crater is 69 metres wide and 30 metres deep.
    • While the details of the origin of the crater are contested but it has been said that the crater was created in 1971 during a Soviet drilling operation.
    • In 1971, Soviet geologists were drilling for oil in the Karakum desert when they hit a pocket of natural gas by mistake, which caused the earth to collapse and ended up forming three huge sinkholes.

    Why is it flamed?

    • This pocket of natural gas contained methane, hence to stop that methane from leaking into the atmosphere, the scientists lit it with fire, assuming the gas present in the pit would burn out within a few weeks.
    • The scientists seemed to have misjudged the amount of gas present in the pit, because the crater has been on fire for five decades now.

    A popular tourist attraction

    • The crater has become a significant tourist attraction in Turkmenistan.
    • In 2018, the country’s president officially renamed it as the “Shining of Karakum”.

    Why did Turkmenistan order to extinguish it?

    • Calling it a human-made crater, it has negative effects on both environment and the health of the people living nearby.
    • It also ends up losing valuable natural resources for which could fetch significant profits.

    How harmful are methane leaks?

    • Methane is the primary contributor to the formation of ground-level ozone, a hazardous air pollutant and greenhouse gas, exposure to which causes 1 million premature deaths every year.
    • Methane is also a powerful greenhouse gas. Over a 20-year period, it is 80 times more potent at warming than carbon dioxide.

    Back2Basics: TAPI Gas Pipeline

    • The Turkmenistan–Afghanistan–Pakistan–India (TAPI) Pipeline is a natural gas pipeline being developed with the participation of the Asian Development Bank.
    • It will be a 1,814km trans-country natural gas pipeline running across four countries.
    • It will transport natural gas from the Galkynysh Gas Field in Turkmenistan through Afghanistan into Pakistan and then to India.
    • The plan for the TAPI project was originally conceived in the 1990s to generate revenue from Turkmenistan’s gas reserves by exporting natural gas via Afghanistan to Pakistan and India.
    • Construction on the project started in Turkmenistan on 13 December 2015, work on the Afghan section began in February 2018, and work on the Pakistani section was planned to commence in December 2018.
    • Presently, the construction work has been stalled due to terror activities of Taliban in Afghanistan since few years.

     

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