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  • New global order in post-Covid-19 world

    The article discusses the changes that the world will experience in the global order in the aftermath of Covid-19. The major changes will be on the economic and geopolitical front. Various changes are discussed in the article. We have read some article on the same topic and the basic theme is the same. Role of China and the US, failure of the international institutions are some of the common themes.

    Failure of international institutions

    • The existing international institutions such as the United Nations, the United Nations Security Council and the World Health Organization (WHO) are seen to have failed to measure up to the grave challenge posed by the pandemic.
    • The UN Security Council is under attack for being slow in dealing with a situation that appears, at least on the surface, far graver than any military threat in recent decades.
    • The WHO has been tarred with the charge of bias and of grossly underestimating the nature of the epidemic.
    • That prestigious global institution should have been singled out for attack at this time speaks volumes about the mood prevailing across the world.

    Economic shock

    • There are many other aspects of the COVID-19 crisis that will drastically impact the globe.
    • Negative growth: On the economic front, the World Bank has already predicted negative growth for most nations. India’s growth forecast for the current fiscal year has been put at 5% to 2.8%.
    • Contraction of the economy and the loss of millions of jobs across all segments will further complicate this situation.

    One of the most important factors that we realised in the corona crisis in the role of the state. Take note of this factor. A question can be asked on the role of the state, for ex. “The COVID-19 pandemic has brought into focus the important role of the state in our lives. comment.”

    The important role of the state in focus

    • What is likely to change even more dramatically are certain other aspects relating to political management and security. Both terms are set to gain new meanings.
    • The role of the state as an enforcer of public goodwill almost certainly become greatly enhanced.
    • The dominant imperative would be to not put limits on the role of the state even where the situation may not be as grave as the present one.
    • Many pieces of legislation of yesteryears that had been relegated to the archives — they were perceived to be anachronistic in a modern democratic set-up — may get a new lease of life.
    • Some pieces of legislation such as the Disaster Management Act already reflect this reality today.
    • Other pieces of legislation could follow in its wake.
    • This trend is already becoming evident to some extent across the world. Europe has shown a willingness to sacrifice personal liberties in favour of greater state control.
    • Post COVID-19, the world may have to pay a heavy price in terms of loss of liberty. An omnipotent state could well become a reality.

    Following are the changes in geo-economics and geo-politics that post-covid world would see.

    Role of China under scrutiny

    • Far-reaching changes can also be anticipated in the realm of geo-economics and geopolitics. The world needs to prepare for a sea change.
    • One nation, viz. China, is presently seeking to take advantage of and benefit from the problems faced by the rest of the world in the wake of the epidemic.
    • Negligence on the part of China: China remains totally unfazed by the stigma that the current world pandemic owes a great deal to its negligence.
    • More importantly, it is seeking to convert its ‘failure’ into a significant opportunity.
    • This is Sino-centrism at its best, or possibly its worst.
    • China now seeks to benefit from the fact of its ‘early recovery’.
    • It wants to take advantage of the travails of the rest of the world, by using its manufacturing capability to its geo-economic advantage.
    • Seeking geopolitical advantage: Simultaneously, it seeks to shift from being a Black Swan (responsible for the pandemic), to masquerade as a White one, by offering medical aid and other palliatives to several Asian and African countries to meet their current pandemic threat.
    • In turn, it seeks to gain a geopolitical advantage by this action.

    Hostile takeover bids by China

    • There are enough reports of China’s intentions to acquire financial assets and stakes in banks and companies across the world amid crisis.
    • Shares in HDFC: India seems to have woken up only recently to this threat after the Peoples’ Bank of China acquired a 1% stake in India’s HDFC.
    • Across the world, meanwhile, the clamour against China’s hostile takeover bids is becoming stronger.
    • Several countries apart from India, such as Australia and Germany, have begun to restrict Chinese foreign direct investment in companies and financial institutions in their countries.
    • These countries recognised the inherent danger of a possible Chinese hostile takeover of their critical assets.

    China taking advantage of RCEP and Belt and Road initiative

    • Restricting hostile takeovers may not be adequate to checkmate China.
    • It is poised to dominate the Regional Comprehensive Economic Partnership (RCEP).
    • Which will enable China to exploit market access across the Association of Southeast Asian Nations, East Asian nations, Australia and New Zealand.
    • Together with its Belt and Road Initiative, China is ostensibly preparing the way for a China-centric multilateral globalisation framework.

    The diminishing role of the US’s and Europe

    • The geopolitical fallout of this pandemic could be still more serious.
    • One distinct possibility is that COVID-19 would effectively put paid to the existing global order that has existed since the late 1940s.
    • The United States which is already being touted in some circles as a ‘failing’ state, will be compelled to cede ground.
    • Weakened economically and politically after COVID-19 has ravaged the nation, the U.S.’s capacity to play a critical role in world affairs is certain to diminish.
    • The main beneficiary of this geopolitical turnaround is likely to be China, a country that does not quite believe in playing by the rules of international conduct.
    • Weakened Europe: Europe, in the short and medium-term, will prove incapable of defining and defending its common interests, let alone having any influence in world affairs.
    • Role of Germany: Germany, which may still retain some of its present strength, is already turning insular.
    • Both France and the post-Brexit United Kingdom will be out of the reckoning as of now.

    Problems in West Asia and the possible role of Israel

    • In West Asia, both Saudi Arabia and Iran are set to face difficult times.
    • The oil price meltdown will aggravate an already difficult situation across the region.
    • There may be no victors, but Israel may be one country that is in a position to exploit this situation to its advantage.

    India: Economic and geopolitical challenges

    • In the meantime, the economic downturn greatly reduces India’s room for manoeuvre.
    • In South Asia, India faces the prospect of being isolated, with the Chinese juggernaut winning Beijing new friends and contacts across a region deeply impacted by the economic consequences of the COVID-19 pandemic.
    • Likewise, India’s leverage in West Asia — already greatly diminished — will suffer further.
    • With oil prices going down and the Indian expatriate community (who are among the hardest hit by this downturn) out on a limb.
    • Reduction in remittances: Many of the latter may seek repatriation back to the host country, substantially reducing the inflow of foreign funds to India from the region.

    A question based on the changes in the global order in the post-pandemic world could be asked by the UPSC, for ex- “In the post-Covid-19 world, we are experiencing several changes. What are the changes in the geo-politics that are likely to affect India’s interests?”

    Conclusion

    In the post-Covid-19 world, we are about to see many changes on the economic and geopolitical front. India should prepare itself for the emerging challenges on various fronts.

  • Kesavananda Bharati Case (1973): The judgment that upheld basic structure of India’s constitution

    Exactly 47 years ago, the Supreme Court passed its landmark judgment in Kesavananda Bharati vs State of Kerala, considered among the most significant constitutional cases in India’s judicial history.

    Major judgments of the Supreme Court are mentioned in the newscard. Aspirants are advised to memorize them all with thier key features. UPSC may ask a prelim question mentioning all these judgements and asking which of them are related/not related to the Amendments in the Constitution.  Right from the Shankari Prasad Judgment (1951) to the Ayodhya Judgement (2019), note down all important judgements.

    Background

    Amending  the Constitution

    • The Constitution of a country is the fundamental law of the land. It is based on this document that all other laws are made and enforced.
    • Under some Constitutions, certain parts are immune from amendments and are given a special status compared to other provisions.
    • Since the Indian Constitution was first adopted, debates have raged as to the extent of power that Parliament should have to amend key provisions.

    Early years of Absolute Power

    • In the early years of Independence, the Supreme Court conceded absolute power to Parliament in amending the Constitution, as was seen in the verdicts in Shankari Prasad (1951) and Sajjan Singh (1965).
    • The reason for this is believed to be that in those initial years, the apex court had reposed faith in the wisdom of the then political leadership when leading freedom fighters were serving as Parliamentarians.
    • In subsequent years, as the Constitution kept being amended at will to suit the interests of the ruling dispensation, the Supreme Court in Golaknath (1967) held that Parliament’s amending power could not touch Fundamental Rights, and this power would be only with a Constituent Assembly.

    Parliament could make any amendment

    • Article 13(2) reads, “The State shall not make any law which takes away or abridges the right conferred by this Part (Part-III) and any law made in contravention of this clause shall, to the extent of the contravention, be void.”
    • In both the cases, the court had ruled that the term “law” in Article 13 must be taken to mean rules or regulations made in exercise of ordinary legislative power and not amendments to the Constitution made in exercise of constituent power under Article 368.
    • This means Parliament had the power to amend any part of the constitution including Fundamental rights.

    The tussle between Parliament and the judiciary

    • In the early 1970s, the government of then PM Indira Gandhi had enacted major amendments to the Constitution (the 24th, 25th, 26th and 29th) to get over the judgments of the Supreme Court in RC Cooper (1970), Madhavrao Scindia (1970) and the earlier mentioned Golaknath.
    • In RC Cooper, the court had struck down Indira Gandhi’s bank nationalization policy, and in Madhavrao Scindia it had annulled the abolition of privy purses of former rulers.

    Background for the Kesavananda Bharati Case

    • All the four amendments, as well as the Golaknath judgment, came under challenge in the Kesavananda Bharati case.
    • Here, relief was sought by the religious figure Swami Kesavananda Bharati against the Kerala government vis-à-vis two state land reform laws.
    • Since Golaknath was decided by eleven judges, a larger bench was required to test its correctness, and thus 13 judges formed the Kesavananda bench.
    • Critics of the doctrine have called it undemocratic since unelected judges can strike down a constitutional amendment. At the same time, its proponents have hailed the concept as a safety valve against majoritarianism and authoritarianism.
    • Noted legal luminaries Nani Palkhivala, Fali Nariman, and Soli Sorabjee presented the case against the government.
    • The majority opinion was delivered by CJI S M Sikri, and Justices K S Hegde, A K Mukherjea, J M Shelat, A N Grover, P Jaganmohan Reddy, and H R Khanna. Justices A N Ray, D G Palekar, K K Mathew, M H Beg, S N Dwivedi, and Y V Chandrachud dissented.

    A closer win

    • By a 7-6 verdict, a 13-judge Constitution Bench ruled that the ‘basic structure’ of the Constitution is inviolable, and could not be amended by Parliament.
    • The basic structure doctrine has since been regarded as a tenet of Indian constitutional law.

    The judgment in Kesavananda Bharati

    • The Constitutional Bench, whose members shared serious ideological differences, ruled by a 7-6 verdict that Parliament should be restrained from altering the ‘basic structure’ of the Constitution.
    • The court held that under Article 368, which provides Parliament amending powers, something must remain of the original Constitution that the new amendment would change.
    • The court did not define the ‘basic structure’, and only listed a few principles — federalism, secularism, democracy — as being its part.
    • Since then, the court has been adding new features to this concept.

    ‘Basic structure’ since Kesavananda

    • The basic structure doctrine was first introduced by Justice Mudholkar in the Sajjan Singh case (1965).
    • Major features were notably propounded by Justice Hans Raj Khanna in 1973.
    • The ‘basic structure’ doctrine has since been interpreted to include the supremacy of the Constitution, the rule of law, Independence of the judiciary, doctrine of separation of powers, federalism, secularism, sovereign democratic republic, the parliamentary system of government, the principle of free and fair elections, welfare state, etc.
    • An example of its application is SR Bommai (1994), when the Supreme Court upheld the dismissal of the governments by the President following the demolition of the Babri Masjid, invoking a threat to secularism by these governments.

  • What are Deep Fakes?

    Cybercrime officials in India have been tracking certain apps and websites that produce vulgar photographs of innocent persons using Artificial Intelligence (AI) algorithms. These images are then used to blackmail victims, seek revenge or commit fraud on social networking and dating sites.

    The most notorious misuse of AI is knocking the door. The Deepfake is an application of Deep Learning (an axiom of AI and Machine Learning). UPSC may ask a mains question about the challenges posed by AI-based technology.

    What is Deep Fake?

    • Cybercriminals use AI software — now easily available on apps and websites — to superimpose a digital composite (assembling multiple media files to make a final one) on to an existing video, photo or audio.
    • They are computer-generated images and videos.
    • Using AI algorithms a person’s words, head movements and expressions are transferred onto another person in a seamless fashion.
    • That makes it difficult to tell that it is a deepfake unless one closely observes the media file.

    Threats posed

    • Because of how realistic deepfake images, audio and videos can be, the technology is vulnerable for use by cybercriminals who could spread misinformation to intimidate or blackmail people.
    • With real-time face tracking it is becoming easier to fabricate believable videos of people doing and saying things they never did.
    • There are rising cases of “revenge porn” i.e. creation of sexually explicit videos or images that are posted on the Internet without the consent of the subject as a way to harass them.

    What are the catfish accounts?

    • Catfishing refers to the practice of setting up fictitious online profiles most often for the purpose of luring another into a fraudulent romantic relationship.
    • A “catfish” account is set up a fake social media profile with the goal of duping that person into falling for the false persona.

    What can we do to protect yourself?

    • A basic check of their social media profiles, comments on the images and whether similar profiles exist could help determine if the person is genuine.
    • While it is not easy to keep track of who downloads or misuses the user images, the best way to protect is to ensure that we are using privacy settings on social media profiles.
    • If one feels his/her image has been used without prior permission, they could use freely available reverse image search tools to find images that are similar to yours.
    • One can also be mindful of who he/she is conversing with on the web.

  • Who was Lord Basaveshwara?

    Prime Minister has offered his homage to the 12th-century social reformer Basaveshwara on his birth anniversary.

    Vaishnavism and Shaivism are the two most profound strands of Bhakti Movement in Indian history. Enlist all the Bhakti Saints and their theistic philosophy and teachings. Try to spot the minute differences between them.

    Lord Basaveshwara

    • Basaveshwara or Basavanna was an Indian 12th-century statesman, philosopher, a poet and Lingayat saint in the Shiva-focussed Bhakti movement and a social reformer in Karnataka.
    • He lived during the reign of the Kalyani Chalukya/Kalachuri dynasty.
    • He was active during the rule of both dynasties but reached his peak of influence during the rule of King Bijjala II in Karnataka, India .

    Founder of Lingayat cult

    • The traditional legends and hagiographic texts state Basava to be the founder of the Lingayats.
    • However, modern scholarship relying on historical evidence such as the Kalachuri inscriptions state that Basava was the poet-philosopher who revived, refined and energized an already existing tradition.

    His Philosophy

    • Basava’s Lingayat theology was a form of qualified nondualism, wherein the individual Atman (soul) is the body of God, and that there is no difference between Shiva and Atman (self, soul).
    • Basava’s views finds places in Vedanta school, in a form closer to the 11th century Vishishtadvaita philosopher Ramanuja.

    Famous works

    • Basavanna spread social awareness through his poetry, popularly known as Vachanaas.
    • Basavanna rejected gender or social discrimination, superstitions and rituals but introduced Ishtalinga necklace, with an image of the Shiva Liṅga to every person regardless of his or her birth.
    • As the chief minister of his kingdom, he introduced new public institutions such as the Anubhava Mantapa (or, the “hall of spiritual experience”) which welcomed men and women from all socio-economic backgrounds.

    Back2Basics: Bhakti Movement

    • The Bhakti movement refers to the theistic devotional trend that emerged in medieval Hinduism.
    • It originated in eighth-century south India and spread northwards.
    • It swept over east and north India from the 15th century onwards, reaching its zenith between the 15th and 17th century CE.
    • It has traditionally been considered as an influential social reformation in Hinduism, and provided an individual-focused alternative path to spirituality regardless of one’s birth or gender
    • Salvation which was previously considered attainable only by men of Brahmin, Kshatriya and Vaishya castes, became available to everyone.

  • The universal delivery of food and cash transfers by the state amid Covid-19

    This focus of this article is on the universal delivery of food and cash transfer amid corona pandemic. There are some estimates of the cost of universal cash transfer and food delivery in the article and suggestion to ensure universal delivery.

    Universal food and cash delivery is needed

    • The immediate need for universal food and cash delivery is by now obvious and urgent.
    • Across the country, there are reports of people — migrant workers, local workers, peasants, pastoralists, fisherpeople, vendors, ragpickers, and the destitute — facing extreme hardship, even starvation, because their livelihoods have been extinguished by the lockdown.
    • These have created further an unprecedented humanitarian crisis, as millions of households with depleted savings have no way to access food and other basic necessities over the coming weeks.
    • The threat of infection from COVID-19 makes even harder their coping mechanisms.
    • In these dire circumstances, it is essential for the state to directly provide the basic means of survival to anyone who needs it.
    • This must be in both cash and kind. Food access is the most important.
    • But because of the closure of economic activity and the absence of any livelihood opportunity, this must be combined with cash transfers to tide over this period and the immediate aftermath.
    • Food transfers must be provided for at least six months, and cash transfers for at least three months, though these can be extended depending on the period of lockdown.
    • Because of the severity of the crisis and the high probability of widespread hunger and descent into poverty, these transfers must be universal, made available to every person who needs them, without relying on exclusionary criteria, existing lists or biometric identification.

    The points mentioned below give us the ideal of food-grain stocks with India. And there are also the estimates of how much would be required if we decide to go for universal delivery of food. The data given below is important from Mains perspective.

    How much will be the cost of universal food delivery?

    • Consider first free universal provisioning of 10 kg of grain (wheat or rice) per person per month.
    • This is likely to be availed of by at most around 80 per cent of the population.
    • With an estimated population of 1.3 billion, providing this for six months would require 62.4 million tonnes of grain.
    • This is a maximal estimate — the actual requirement would be lower.
    • Stocks with the FCI: The FCI is currently holding 77 million tonnes of foodgrain stocks, compared to buffer stock norms of 24 million tonnes.
    • It is expected to procure another 40 million tonnes from the current rabi harvest.
    • It could easily release and allow the free distribution of foodgrain of 5 million tonnes and still have foodgrain stocks of 54.5 million tonnes, if the expected rabi procurement targets are met.
    • Cost of storing grains: Furthermore, it is costly for the FCI to store this grain. The current costs of storage are estimated to be Rs 5.60 per kilogramme per year or Rs 2.80 for six months.
    • This means that by releasing 4 million tonnes to feed the hungry of India over the next six months, the FCI would actually be saving Rs 17,472 crore, assuming that these idle stocks would have persisted.
    • But even if these were sold, the costs are the revenue that would have been earned.
    • This is difficult to estimate but by using Finance Minister’s estimates in Budget we get a (maximal) figure of Rs 1,17,000 crore.

    Cost of universal cash transfer

    • In addition, a proposed cash transfer of Rs 7,000 per month for three months to every household, assuming again that 80 per cent of households would receive this.
    • With five persons per household, this expenditure would be Rs 4,36,800 crore.
    • The two transfers together amount to Rs 5,53,800 crore, or around 9 per cent of currently estimated GDP.

    Financing the expenditure through fiscal deficit

    • This sum of Rs. 5,53,800 is not a forbidding sum.
    • A great part of the responsibility to make these resources available vests with the Union government.
    • But whatever taxes are introduced in a supplementary budget that has become unavoidable, the expenditure incurred has to be financed immediately through a fiscal deficit.
    • Given the massive deflationary pressures and a complete collapse of economic activity, there is a strong case for financing the additional public expenditure through deficit financing or borrowing directly from the RBI.
    • This is required both for coping with the pandemic and for softening the blow of the lockdown.

    Following two suggestions are important suggestions for the delivery of food and cash in case we don’t have reliable data.

    How to ensure universal delivery of food?

    • The question arises of how universal delivery of these food and cash transfers is to be ensured.
    • Existing lists are inadequate for the purpose because they significantly underestimate and exclude those who should be beneficiaries.
    • For example, at least 100 million people are excluded from access to food under the National Food Security Act based on the 2011 Census.
    • The most effective way of dealing with the food emergency is to provide food delivery at doorsteps or neighbourhood collection points to anyone who asks for it, with a simple marker such as the indelible ink used during elections to serve as the indicator of receipt.

    How to endure universal delivery of cash?

    • For cash transfers, the matter is more complicated.
    • In rural India, MGNREGA job cards and pensions cover most households and allow bank payments.
    • The urban poor include migrants, contract and casual workers mostly in small and medium enterprises, daily wagers, domestic workers, self-employed persons like street vendors, sex workers and ragpickers, and the destitute including homeless people.
    • But there is no comprehensive record of the urban poor because the state has instituted no effective mechanisms to secure labour rights or social security rights to most urban workers.
    • The urban poor build and service the city, surviving without rights and a hostile or indifferent state.
    • The legally-mandated registration of inter-state migrants and construction workers in practice excludes most because their employers with the connivance of the state don’t wish to be bound to secure their rights.
    • The humanitarian emergency created by the pandemic and lockdown entails universal cash transfers again to every adult who presents herself to designated officials in decentralised offices.
    • For those who have accessible bank accounts, the funds can be credited to these accounts.
    • For others, the Odisha system, whereby pensions are disbursed as cash in hand at pre-specified times, maybe a useful model to follow.
    • This also can be adopted with indelible ink as proof of receipt.

    Employment schemes after cash transfers

    • The income transfers must quickly give way to an expanded rural employment guarantee scheme, and a new urban employment programme.
    • These urban employment programs include caregiving and building water supply, sanitation and shelter for the urban poor.
    • Private hospitals also need to be nationalised at least for the duration of the pandemic.

    Conclusion

    The working and poor people should not be made to bear the burden of the pandemic. There is a need for a bold resolve, by central and state governments, to literally reach the last person, rural or urban, with the food and cash they require to survive with dignity.

     

     

  • East India will require heavy investment to tide over the post-Covid loss of livelihood

    The article discusses the issue of migrant labourers and the problems eastern states could face due to the return of labourers and the lack of employment opportunities in these states. The return of migrant labourers may lead to the mechanisation in the states where they worked. A relief-cum-stimulus package at least 5% of the GDP is suggested by the author.

    IMF’s projections for the economy

    • The IMF’s projections for GDP growth for this year seem to be either in the negative or below 2 per cent for almost all major countries of the G-20 group.
    • India could do a little better compared to the other BRICS nations, but its growth will most likely be below 2 per cent.
    • This, of course, is under an optimistic scenario.
    • Many experts reckon that India could also go into negative GDP growth this year if it does not reboot the economy properly and in time.

    The problem of collapse in demand

    • The Centre and the Reserve Bank of India are trying to remove all roadblocks so that factories and farms can resume operations.
    • The focus is largely on the supply side — how to ease restrictions and how to increase liquidity in the system for resuming production.
    • It may not take too long as the real problem is the collapse in demand.
    • And that demand may not pick up easily as the virus is likely to stay with us for quite some time.
    • We could have lockdowns again if there is a surge in infection.
    • This will surely limit our travel and restrict our shopping for non-essentials.
    • However, there is one demand that can easily revive — that of food.

    Why food demand matters?

    • The NSSO survey of consumption expenditures for 2011-12 revealed that about 45 per cent of the total expenditure of an Indian household is on food.
    • For the poor, the NSSO reckoned, this figure was about 60 per cent.
    • We do not have information about the consumption patterns in 2020, guess is that about 35-40 per cent of the expenditure of an Indian household is on food and for a poor household, this figure is around 50 per cent.
    • Herein, lies the scope to reboot the economy.

    Labour shortage and mechanisation

    • The sudden announcement of the nationwide lockdown gave labours no time to go back to their families.
    • They lost their jobs and incomes and having spent whatever little savings they had, these workers have been reduced to penury.
    • The Centre and states, despite their best efforts, have not managed to address the problem of hunger of these workers.
    • Even civil society has not managed to bridge the gap.
    • The migrant labourers may well have lost their trust in the state, and once the lockdown is lifted, most of them are likely to rush back to their families in villages.
    • And, it could be some time before they are back in the cities — that is, if they return at all.
    • So, farms and factories, especially the MSMEs in the relatively developed states of western, southern and north-western India are likely to face labour shortages for many months, perhaps years.
    • This could lead to more mechanisation of farms and factories in these states.
    • In Punjab, for example, most of the wheat harvesting is already done by combined harvesters.
    • Now even paddy harvesting could be done by mechanised harvesters.

    The double challenge for states which are home to migrants

    • However, eastern Uttar Pradesh, Bihar, Jharkhand, West Bengal, and Odisha, from where much of the migrant labour comes, will face a double challenge.
    • Their agriculture, with tiny farm holdings, is already saddled with a large labour force — this comprises 45 to 55 per cent of the total labour force of these states.
    • Non-farm income from wages and salaries, through migrant labour, was an important source of income for households in these states.
    • This is now severely hit. In all probability, the per capita rural incomes of these states could shrink, at least in the short run.
    • This could lead to poverty and increase hunger and malnutrition.
    • How does one then reboot the economy and also address hunger and malnutrition?

    The lockdown and the subsequent plight of the migrant labourers brought to the fore uneven development in the country. The points mentioned below suggest the ways to address this problem. A question based on this issue could be asked by the UPSC, for ex- “The issue of migrant labourers amid Covid-19 pandemic highlighted the uneven development in the country. In this context, state the reasons which led to the uneven development of various regions of the country. Suggest ways to address the problem”.

    The requirement of a special investment package for eastern states

    • A special investment package — like the Marshall Plan of USA in 1948 — for the eastern belt of India is required.
    • Investment should be used to build better infrastructure, agri-markets and godowns, rural housing, primary health centres, schools and enhances people’s skills.
    • The package will go a long way to revive the economy and augment the incomes of the migrant workers.
    • Rising incomes will generate more demand for food as well as manufactured products, giving a fillip to the growth engines of agriculture as well as the MSME sector.
    • Building better supply chains for food directly from farm-to-fork, led by the private sector, will enhance the export competitiveness of agriculture.
    • It will also ensure a higher share of farmers in the consumers’ rupee.
    • Long-term demand-driven growth: Such broad-based development in a relatively underdeveloped region of the country will lay the foundations of a long-term, demand-driven, growth of the industry in India.
    • The all India relief package of Rs 1.7 lakh crore announced by the central government earlier, which is about 0.8 per cent of the country’s GDP, is too small to reboot the economy.

    Conclusion

    If India has to bounce back quickly, it needs a much bigger relief cum stimulus package — certainly not below 5 per cent of GDP. And, it should focus more on the eastern belt, where the issue is that of survival.

    Back2Basics: Marshall Plan, 1948

    • The Marshall Plan, also known as the European Recovery Program, was a U.S. program providing aid to Western Europe following the devastation of World War II.
    • It was enacted in 1948 and provided more than $15 billion to help finance rebuilding efforts on the continent.
    • The brainchild of U.S. Secretary of State George C. Marshall, for whom it was named, it was crafted as a four-year plan to reconstruct cities, industries and infrastructure heavily damaged during the war and to remove trade barriers between European neighbours – as well as foster commerce between those countries and the United States.

  • What are the concerns around the AarogyaSetu app?

    • Recently the AarogyaSetu app — for pan-India use was launched as the main contact tracing technology endorsed by the Central government.
    • Soon it became one of the most downloaded apps globally and has crossed the 75 million mark.
    • However, there are concerns for more transparency on the inner workings of an app that seeks the personal details of millions.

    RIght to Privacy is a very much contested topic for GS. The Aarogya Setu app which has a lot more to offer, is under the radar due to underlying vacuum of Privacy Law in India.

    AarogyaSetu App

    • The App enables people to assess themselves the risk of their catching the Corona Virus infection.
    • It is designed to keep track of other AarogyaSetu users that a person came in contact with and alert him or her if any of the contacts tests positive for COVID-19.
    • It achieves this using the phone’s Bluetooth and GPS capabilities.
    • Once installed in a smartphone through an easy and user-friendly process, the app detects other devices with AarogyaSetu installed that come in the proximity of that phone.
    • The app can then calculate the risk of infection based on sophisticated parameters if any of these contacts has tested positive.
    • The personal data collected by the App is encrypted using state-of-the-art technology and stays secure on the phone till it is needed for facilitating medical intervention.

    Issues with the app

    • The AarogyaSetu app faces the same issue as every other contact tracing technology that has come up during the pandemic period — it is people dependent.
    • It needs widespread usage and self-reporting to be effective.
    • Given that any number of total users will be a subset of smartphone owners in India, and there are bound to be variations in the levels of self-reporting, the efficacy is not bulletproof.
    • The terms of use of the app also say as much, distancing the government from any failure on the part of the app in correctly identifying COVID-19 patients.

    Are there privacy concerns?

    • First of all, the app exists in the privacy law vacuum that is India.
    • With no legislation that spells out in detail how the online privacy of Indians is to be protected, AarogyaSetu users have little choice but to accept the privacy policy provided by the government.
    • The policy goes into some detail on where and how long the data will be retained, but it leaves the language around who will have access to it vague.
    • As per the policy persons carrying out medical and administrative interventions necessary in relation to COVID-19” will have access to the data.
    • This suggests interdepartmental exchanges of people’s personal information and is more excessive than countries like Singapore and even Israel.

    Technical issue

    • Beyond the legal loopholes, there are technical loopholes as well.
    • The unique digital identity in AarogyaSetu is a static number, which increases the probability of identity breaches.
    • The abundance of data collected is also potentially problematic.
    • AarogyaSetu uses both Bluetooth as well as GPS reference points, which could be seen as overkill whereas other apps such as TraceTogether make do with Bluetooth.

    Other issues

    • Experts emphasise that automated contact tracing is not a panacea.
    • They caution against an over-reliance on technology where a competent human-in-the-loop system with sufficient capacity exists.

  • Exercise Pitch Black 2020

    Australia has informed India that their premier multilateral air combat training exercise Pitch Black 2020 scheduled in July has been cancelled due to the COVID-19 situation.

    All-time generic question seeking ‘match the pairs’ can be asked from the news as such.  Click here for more exercises.

     Ex Pitch Black 2020

    • Exercise Pitch Black is a biennial warfare exercise hosted by the Royal Australian Air Force (RAAF).
    • The aim of the exercise is to practice Offensive Counter Air (OCA) and Defensive Counter Air (DCA) combat, in a simulated war environment.
    • In the last edition of Pitch Black in 2018, the IAF for the first time participated with its Su-30MKI fighters, one C-130 and one C-17 transport aircraft.
    • It provided a unique opportunity for an exchange of knowledge and experience with these nations in a dynamic warfare environment.
    • The next edition of Pitch Black is scheduled in 2022.

    India’s defence relation with Australia

    • The defence and strategic engagement with Australia have steadily gone up in recent years especially on the bilateral front with naval cooperation at the forefront.
    • The bilateral naval exercise AUSINDEX early last year saw the participation of the largest Australian contingent ever to India with over 1,000 personnel.
    • The Mutual Logistics Support Agreement (MLSA) has been long pending and is expected to be concluded soon as well as a broader maritime cooperation agreement including the Maritime Domain Awareness (MDA) to elevate the existing strategic partnership.
    • Australia recently made a pitch for trilateral cooperation among India, Australia and Indonesia to identify new ways that our three countries can collaborate to be the best possible custodians of the Indian Ocean.

  • Lockdown with a human face: Immediate focus should be on alleviating hardships of poor, vulnerable groups

    The article deals with the policy response to the crisis. Reducing the pain inflicted on the poor and vulnerable section should be the priority. The size and nature of the stimulus package is also discussed in the article.

    The dilemma of lives Vs. livelihood

    • As the coronavirus spreads, severe dilemmas haunt policymakers.
    • Testing of lockdown? Even the scientific community is confused and does not seem to know whether the South Korean model of more intensive testing is preferable to the European model of a complete lockdown.
    • The economic crisis that we are facing today is very different from any crisis that we have encountered recently.
    • This is the first economic crisis in recent memory to have been triggered by a non-economic factor — a pandemic.
    • A lockdown essentially amounts to limited economic activity and this results in throwing temporary workers and daily wage earners out of employment.
    • Migrant labour falls in this category.
    • According to the 2011 census, the number of migrant workers under the category, “migrants for work/employment” was 41.42 million.
    • This number must have grown substantially by now.
    • The impact of the lockdown has fallen very heavily on the poor and vulnerable groups.
    • We need to bear this in mind while evolving the strategy to combat the virus.

    Expenditure during the pandemic

    • First, medical and healthcare expenditure, which includes the money spent on extension of hospital facilities, employment of additional medical and healthcare workers, costs of testing on a much wider scale and the purchase of accessories like personal protection equipment, ventilators and testing kits.
    • The expenditure under this category is a “must” and there can be no compromise on it.
    • The length of the battle will decide the cost.
    • Second, the expenditure involved in taking care of the people thrown out of employment, and other vulnerable sections of the population.
    • Third, stimulation expenditure aimed at restarting the economy. Here, the financial system presided over by the RBI will play an important role. But the government also has a role.

    Two issues to consider while deciding on the lockdown

    • The “life” versus “livelihood” dilemma pertains to the lockdown policy.
    • A tight lockdown over an extended period may save lives by curtailing the progress of the virus.
    • But at the same time, it places several segments of society under severe hardship.
    • With the lack of economic activity, many will go hungry.
    • In this context, the government must look at two issues.
    • First, it must consider to the extent to which the lockdown can be relaxed while keeping in mind the priority of restricting the spread of the virus.
    • The government has recently announced some relaxations.
    • This is a welcome step. However, it must keep this concern under continuous consideration. It must explore other options on the medical front as well.
    • For example, will more testing make it possible to reduce restrictions?
    • Second, if the lockdown is a “compulsion”, we need to pay adequate attention to the plight of people who have been affected adversely.
    • The government had earlier announced certain measures to help some segments of society.
    • With the lockdown being extended, it is necessary to raise the levels of relief, and also cover segments of society not covered earlier — migrant labour, for example.

    The following points about the stimulus package are appearing repeatedly in most of the article on economic damage to the economy. They are also relevant from the UPSC perspective. A question based on it,  like “What steps were taken by the government to revive the Indian economy in the aftermath of the corona crisis?” can be asked.

    What should be the nature of the stimulus package?

    • There is much talk about a “stimulation package” to revive the economy.
    • The financial system will have to lead the charge.
    • Additional expenditure: Expectations regarding additional expenditures by the government vary from 2 per cent of the GDP to 5 per cent of the GDP.
    • Normal sources of financing will not be adequate to meet this order of expenditure.
    • Many analysts felt that the figure of 3.5 per cent of the GDP as the fiscal deficit, indicated in the budget for 2020-21, would be exceeded.
    • The pandemic will necessitate an increase in expenditure.
    • Moreover, with the decline in economic activity, revenues will also go down.
    • The revenue projections were made on the assumption that the nominal income growth would be 10 per cent.
    • But this is unlikely to be achieved. The nominal income growth is likely to be 7 per cent, at best.
    • Given the increase in expenditures and the slowdown in revenue collection, the borrowing programme will exceed significantly over what was indicated in the budget.
    • The monetisation of debt is inevitable and it will have its own consequences.
    • Provisions for states: The brunt of the expenditures will be borne by the state governments and therefore, the Centre must allocate additional resources to them.
    • They may also be allowed additional borrowing above 3 per cent of the state domestic product.

    What will be the overall growth rate for India?

    • In the first quarter of 2020-21, the GDP growth rate will be negative.
    • Agricultural performance during the year could be the same as in 2019-20 as the rainfall is expected to be normal.
    • The developed world may go through a recession over the year.
    • Thus the external sector may not be of much help.
    • It is quite possible for the economy to have a V-type recovery from the second quarter of 2020-21.
    • On that assumption, the overall growth rate for the year can be 3 per cent. This is an optimistic estimate.

    Conclusion

    To return to the present, the focus of the government has to be two-fold. It must act vigorously to contain the virus, explore the possible alternatives to complete lockdown. Second, it must take all actions to provide adequate help to the poor and the needy including the migrant workers. Lockdown, as necessary, must be with a human face.

     

  • Public policy dilemma of choosing between lives and livelihood

    This article deals with how the different sections of a society assign different weightage to the various factors they are faced with in life. In the case of Covid-19, one section of society which is well-off might care more about the possible loss of life while other section might end up attaching more weightage to the loss of livelihood than to the possible loss of life due to infection. The article discusses this issue in detail.

    Difference between risk and uncertainty

    • Since the days of Frank Knight, economists have differentiated between the two.
    • Risk has a known probability distribution.
    • For uncertainty, the probability distribution is unknwon.
    • COVID-19 makes us confront uncertainty, not risk.
    • For uncertainty, there is a subjective probability distribution, which can, and does, vary from individual to individual.

    So, how the subjective probability distribution is devised by a person?

    • Through information and experience, one already possesses.
    • There are various rationality assumptions used by economists. They are often violated.
    • Otherwise, behavioural economics wouldn’t have come into existence.
    • Typically, given a situation, when your decision doesn’t agree with someone else, you say they are being irrational.
    • However, with uncertainty, the problem may not be with rationality assumptions, but with differences in subjective probability distributions.

    Lack of data for various factors

    • Because of COVID-19, there is a certain risk of getting infected. Let’s call this the infection rate — total infections divided by the total population.
    • We don’t know this infection rate for India or for any other country for that matter.
    • No country has done universal testing.
    • No testing for random sample: No country has done universal testing for a proper random sample either.
    • The ICMR has told us more than 75 per cent of Indian patients will be asymptomatic.
    • Who do we test? Those who show symptoms, those who have been in contact with confirmed patients and those who suffer from severe respiratory diseases.
    • Most countries do something similar.
    • Sampling bias: In other words, when we work out an infection rate based on those tested, there is a sampling bias.
    • This isn’t a proper infection rate.
    • The only country where we have had something like a random sample is Iceland.
    • There, the infection rate was 0.8 per cent.
    • Data for death rate: There are similar caveats about the death rate.
    • If we mechanically divide the number of deaths by the number of confirmed cases for India, we will get a death rate just over 3 per cent.
    • The global figure is a little less than 7 per cent.
    • But neither of these is a death rate for the total population since only those with severe symptoms are included in infection numbers.
    • Three per cent or seven per cent are over-estimates.
    • In a controlled environment like Diamond Princess, death rate as a ratio of total passengers, and not those infected, was less than 0.4 per cent.
    • The true infection rate and true death rate are not alarming numbers.

    How the lack of data is reflected in subjective probability distribution?

    • There are slices in India’s population pyramid with rural/urban and other spatial differences too.
    • Consider two extreme types-type A and type B.
    • Type A, who are globalised in information access and morbidity.
    • Life expectancy is 80 plus and there are lifestyle diseases like diabetes and high blood pressure.
    • This co-morbidity increases possible death rates and thanks to globalised access to information, certainly increases perceptions about death rates, making them out to be higher than they are.
    • Some of them have fixed incomes, regardless of what happens to lockdown.
    • The high probability assigned to loss of life: In terms of maximising expected payoffs with a subjective distribution, high probability is attached to loss of life and low probability to loss of livelihood.
    • How type B forms a subjective probability?
    • Type B, someone whose life expectancy is 60, without a fixed income stream and whose health concerns are tuberculosis and water-borne diseases, not COVID-19.
    • Nor is access to information that globalised.
    • The high probability assigned to loss of livelihood: High subjective probability will be attached to loss of livelihood and low probability to death from COVID.
    • Both types reflect subjective probabilities. Neither is “irrational”.
    • The tension between the two: Type A would like the lockdown to continue indefinitely, until the long tail of the infection curve tapers off, perhaps beyond September.
    • Type B would like lockdown to be eased soon, with necessary restrictions in hotspots.
    • There is indeed tension between lives and livelihood.
    • Even if health outcomes and information access are like Type A, but income is contingent on growth, preferences might mirror Type B.

    The issues highlighted here can be broadly used in the various scenario where there is uncertainty involved and various stakeholders perceive the probable outcomes in entirely different ways. Various points here can be used to answer the question based on policy making.

    Balancing the differential individual preferences in public policy

    • One set of individuals imposes its choice on the rest.
    • Type A disproportionately influences policy.
    • This determination of aggregate preferences is a dynamic process.
    • Therefore, sooner or later, Type B contests this and as the lockdown is prolonged and livelihood costs mount, discontent surfaces, as it has across a range of countries.
    • There were also welfare economics notions that pre-dated social choice theory, such as compensation principles of Kaldor, Hicks and Scitovsky.
    • The point can be made using the two stereotypes. Specifically, Type A need to compensate Type B for their losses.
    • To state it starkly, livelihood losses suffered by Type B need to be compensated by the government through redistributive measures and this has to be financed by higher taxes imposed on Type-A.
    • The right question for the Type A is not whether they want the lockdown to continue, but whether they are willing to pay a COVID-tax to support lockdown extension.

    A question based on policy formation issues explained here can be framed, for ex. “Risk has a known probability distribution. For uncertainty, the probability distribution is unknown. COVID-19 makes us confront uncertainty, not risk. In this context, there is a debate between saving lives and saving livelihoods. In such a scenario, what can be the most probable solutions that public policy must delve into, in order to maintain the balance between this uncertainty and risk.”

    Conclusion

    Extending or ending the lockdown decision represent the public policy dilemma. Without a revival in growth, the tax-paying capacity of Type B is limited and with job losses, some Type As become Type Bs. The choice is starker.