The Minister of Cooperation has provided some information about the Nandini Sahakar Yojana.
NCDC has cumulatively disbursed financial assistance amounting to Rs. 6426.36 crore for the development of cooperative societies exclusively promoted by women across the country.
About Nandini Sahakar Yojana
The Nandini Sahakar Scheme was initiated by the National Cooperative Development Corporation (NCDC) in 2010.
It is a women-focused framework providing financial assistance, project formulation, hand-holding, and capacity development.
The scheme aims to assist women cooperatives in undertaking business model-based activities under the purview of NCDC.
Features of the Scheme
Any cooperative society with at least 50% womenas primary members and a minimum of three months in operation is eligible to apply.
Assistance is provided in the form of credit linkage for infrastructure term loans and working capital, along with subsidies or interest subvention from other government schemes.
There is no minimum or maximum limit on financial assistance for projects by women cooperatives.
NCDC offers a 2% interest subventionon its rate of interest on term loans for new and innovative activities.
A 1% interest subvention is provided on term loans for all other activities, resulting in lower borrowing costs for women cooperatives.
Since WWII, U.S. foreign policy framed democracies vs. dictatorships, but this binary blurs with recent domestic political trends and shifting allegiances.
The binary between democracy and autocracy in the USA
Difference between Democracy and Autocracy
Democracy is defined as a system of government where the population, typically through elected representatives, exercises power. It emphasizes freedom, constitutional governance, and the protection of fundamental rights.
In contrast, autocracy is characterized by absolute power held by a single ruler, where the will of the ruler supersedes the rights and freedoms of individuals. Autocracies suppress dissent and limit political pluralism, often relying on force and coercion to maintain control.
Current Political Climate
The political landscape in the U.S. has shifted towards a more autocratic style of governance, particularly among factions within the Republican Party. This shift is marked by a growing acceptance of strongman leadership, which seeks to undermine traditional democratic norms and institutions.
Trump’s rhetoric and actions have often reflected a disdain for the checks and balances that are foundational to American democracy. His assertion of broad presidential powers and his attempts to consolidate authority signal a move away from democratic principles toward a more autocratic governance model.
Implications of the Shift
This trend raises concerns about the future of democracy in the U.S. Supporters of Trump and similar populist leaders often view the federal government as an adversary, promoting a narrative that pits “the people” against a corrupt establishment.
What are the different phases of transformation?
Rise of the Administrative State: The first phase was the rise of the administrative state under Theodore Roosevelt, Woodrow Wilson, Franklin Roosevelt, Lyndon Johnson and Richard Nixon.
This broadened the scope of government intervention and generated a complex bureaucracy to address social problems and welfare.
Centralizing Executive Power: As the administrative state grew, presidents needed to bring it under their direct control. During the 1980 transition, Ronald Reagan’s team employed a large staff to centralize control over policy, budgeting, and appointments. This led to the centralized apparatus that now resides in the Executive Office of the President.
In 2024, embracing autocratic tendencies: The populist faction of the Republican Party, concentrated among less educated, blue-collar, white, rural, and religious populations disadvantaged by globalization, embraces a strongman vision of leadership that operates beyond democratic norms.
Trump waged a campaign against norms and institutions of two-party politics, culminating in his efforts to overturn the 2020 election. The Supreme Court’s ruling granting Trump immunity from prosecution for official acts has significantly blurred the line between democracy and autocracy.
The present new normal
Erosion of Democratic Norms and Institutions: Trump showed disdain for legal limitations on presidential power and waged a campaign against democratic norms and institutions. His attempts to overturn the 2020 election results despite losing to Biden exemplified this authoritarian tendency.
Conservatism and Nationalism: Trumpism embraced conservative values like opposition to abortion, support for gun rights, and backing law enforcement.
Trump reshaped U.S. foreign policy to prioritize American interests over global cooperation and multilateralism.
Way forward:
Strengthen Democratic Institutions: Need to reinforce checks and balances to prevent executive overreach, enhance judicial independence, and protect electoral integrity to ensure democratic principles are upheld.
Promote Civic Education and Engagement: Need to educate citizens on democratic values, the importance of pluralism, and the dangers of autocracy to foster informed and active participation in the democratic process.
India will require significant political and diplomatic acumen to navigate the fallout from Sheikh Hasina’s fall, which could destabilize and potentially reshape the geopolitics of the subcontinent.
Why Hasina’s fall was not a surprise?
Long-standing Discontent: Widespread protests against Sheikh Hasina’s government had been brewing over issues like a controversial quota system for government jobs, indicating significant public discontent.
Authoritarian Drift: Hasina’s government has been accused of suppressing opposition and civil society through measures like the Digital Security Act, which has been used to arrest critics and journalists.
Historical Context: Since gaining independence in 1971, Bangladesh has experienced several military coups, political assassinations, and periods of military rule, including the killing of Hasina’s father, Mujibur Rahman, in 1975.
Five Challenges Beyond 1971
Engagement with Opposition: Due to prevailing political uncertainity, India need to distance itself from Hasina and engage with her opponents to maintain credibility and influence in Bangladesh.
Managing Regional Rivalries: India needs to prepare for potential exploitation of the situation by Pakistan and China, which may seek to influence the new government against Indian interests.
Historical Narratives: India needs to navigate the complex historical narratives surrounding the 1971 liberation of Bangladesh, recognizing that many in Bangladesh do not share the same interpretation.
Economic Stability: Ensuring economic stabilization in Bangladesh will be crucial, requiring collaboration with regional partners to prevent extremism and maintain stability.
Recognition of Local Agency: India must acknowledge that Bangladesh has its own political dynamics and agency, which cannot be solely dictated by Indian interests or actions.
What India must prepare for now? (Way forward)
Diplomatic Strategy: India needs to develop a proactive diplomatic strategy to engage with the new government in Bangladesh while avoiding perceptions of interference.
Security Concerns: India must be vigilant about border security and the potential resurgence of anti-India activities, especially if the new government leans towards Pakistan or China.
Economic Engagement: Strengthening economic ties and leveraging people-to-people connections will be essential for maintaining a positive relationship with Bangladesh, regardless of political changes.
Learning from Past Experiences: India should draw lessons from its past experiences with political transitions in the region, such as in Afghanistan, to navigate the current situation effectively.
Collaborative Approach: Working with international partners, including the US and Gulf nations, will be important to address the challenges posed by the political shift in Bangladesh and to ensure regional stability.
Mains PYQ:
Q Critically examine the compulsions which prompted India to play a decisive role in the emergence of Bangladesh. (2013)
The UP Assembly’s amendments to its regressive ‘Anti-conversion’ law appear aimed at facilitating misuse, with over 400 cases registered since the original 2021 law.
What is UP’s ‘Anti-conversion’ law?
Uttar Pradesh’s “Anti-conversion” law, officially known as the Uttar Pradesh Prohibition of Unlawful Conversion of Religion Act, 2021, prohibits religious conversion through unlawful means such as misrepresentation, force, undue influence, coercion, allurement, or fraudulent means.
Why was the Original 2021 Anti-Conversion Law Amended by UP?
Increased Stringency: The amendments aim to make the original law more stringent, responding to claims of rising cases of forced conversions and the alleged involvement of foreign and anti-national elements in demographic changes.
Response to Public Discontent: The government cited the need to enhance penalties and legal measures to prevent unlawful conversions, particularly concerning vulnerable groups such as minors and women.
Legitimacy of Complaints: The amendment allows third parties to file complaints about alleged unlawful conversions, expanding the scope of the law and potentially increasing its application against inter-faith marriages.
What are Its concerning features?
Harsh Penalties: The amended law introduces severe penalties, including imprisonment of up to 20 years or life for targeting minors, women, or certain communities through coercion or force.
Bail Conditions: The law imposes stringent bail conditions that make it difficult for accused individuals to secure bail, requiring public prosecutor consent and a presumption of guilt.
Third-Party Complaints: The provision allowing anyone to file complaints against alleged conversions opens the door for misuse by communal organizations and individuals with vested interests, potentially targeting inter-faith couples.
What does it state about bail conditions and ‘foreign funding’?
Bail conditions: The amended law states that an accused individual cannot be granted bail unless the public prosecutor has the opportunity to oppose it, and there is reason to believe the accused is not guilty and unlikely to repeat the offence.
Foreign funding: The law prescribes stiff penalties for receiving funds from foreign organizations for unlawful conversion, with fines and imprisonment aimed at deterring financial support for conversion activities.
How is it different from other states?
Comparison with Other States: While several states like Odisha and Madhya Pradesh have anti-conversion laws, Uttar Pradesh’s amendments are notably harsher, including provisions for life imprisonment, which are not present in other states.
Bail and Proof Burden: Other states may not impose such severe bail conditions or the reverse burden of proof required in Uttar Pradesh, making it easier for accused individuals in those states to secure bail.
Scope of Complaints: In many states, only aggrieved individuals or their close relatives can file complaints, whereas Uttar Pradesh’s amendments allow for broader third-party complaints, increasing the potential for misuse.
Way forward:
Promote Awareness of Rights: Implement comprehensive public awareness campaigns to educate citizens about their legal rights concerning religious conversion and inter-faith marriages.
Legal and Constitutional Review: Stakeholders, including civil society organizations and legal experts, should actively pursue legal challenges against the amended law in the Supreme Court of India.
Numerous examples in recent time exist in the history of Parliament and State Assemblies where MPs or MLAs have defected from their party.
These activities often led to the frequent falling of governments.
What is Anti-Defection Law?
The 52nd Constitutional Amendment introduced the anti-defection law through the Tenth Schedule in 1985.
It aimed at tackling political defections destabilizing governments, especially after the 1967 general elections.
According to this Schedule, a member of the State Legislature or the House of Parliament who voluntarily resigns from their political party or abstains from voting in the House contrary to the party’s instruction may be removed from the House.
This voting instruction is issued by the party whip, a member of the parliamentary party nominated by the political party in the House.
Process of Disqualification under Anti-Defection Law
Petition:
Any member of the House can initiate the process by filing a petition/complaint with the Speaker (Lok Sabha) or Chairman (Rajya Sabha) alleging defection by another member.
The Presiding Officer CANNOT initiate disqualification proceedings suo moto and can only act upon a formal complaint.
Deciding Authority:
The Speaker of Lok Sabha, the Chairman of Rajya Sabha, or the State Legislative Assembly decides disqualification petitions under the anti-defection law.
Timeframe:
The law does not specify a strict timeline for the decision, which has led to criticism due to potential delays.
Judicial Review:
The decision can be challenged in courts, ensuring a system of checks and balances.
The landmark judgment in Kihoto Hollohan vs. Zachillhu and Others (1992) upheld the constitutionality of the anti-defection law and affirmed that decisions regarding disqualification are subject to judicial review.
Exceptions:
No disqualification if 1/3rd members of the legislature party split to form a separate group (provision DELETED by the 91st Amendment in 2003).
Mergers of political parties are allowed when 2/3rd of the members of a legislative party agree to merge with another party.
Three-Test Formula of the Supreme Court:
The Supreme Court in Sadiq Ali versus Election Commission of India (1971) laid down the three-test formula for recognizing the original political party:
Test of Aims and Objectives of the party.
Test of Party Constitution, which reflects inner-party democracy.
Test of Majority in the legislative and organizational wings.
Limitations of the Anti-Defection Law
Dictatorship of Party: The law has been criticized for undermining democratic principles by restricting legislators’ freedom of speech and making them more accountable to party leaders than their constituents.
Limited Political Choice: The law discriminates against independent members, disqualifying them immediately if they join a political party, while nominated members have a six-month grace period.
Partial Law: The law needs a more precise timeline for resolving defection cases. It allows large-group defections, fostering opportunistic mergers and “horse-trading”, destabilizing the political system.
Promotes Defection: It fails to address root causes like intra-party democracy, corruption, and electoral malpractices.
Recommendations on Reforming the Law
Dinesh Goswami Committee (1990):
Disqualification should be limited to cases of voluntarily giving up membership or voting/abstention contrary to the party direction only in specific motions.
Decision on disqualification should be made by the President or Governor based on the advice of the Election Commission.
Law Commission of India (2015):
Proposed shifting the power to decide disqualification petitions from the Presiding Officer to the President or Governor based on the advice of the Election Commission.
Supreme Court in K. M. Singh v. Speaker of Manipur (2020):
Recommended transferring the Speaker’s decision-making authority over disqualification petitions to an independent tribunal presided over by judges.
Committee Led by Rahul Narwekar:
Announced by Lok Sabha Speaker Om Birla to review the nation’s anti-defection law.
PYQ:
[2022] With reference to anti-defection law in India, consider the following statements:
The law specifies that a nominated legislator cannot join any political party within six months of being appointed to the House.
The law does not provide any time-frame within which the presiding officer has to decide a defection case.
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
[2013] The role of individual MPs (Members of Parliament) has diminished over the years and as a result healthy constructive debates on policy issues are not usually witnessed. How far can this be attributed to the anti-defection law, which was legislated but with a different intention?
The government has introduced the Waqf Act Amendment Bill 2024, in order to improve administration and management of the Waqf properties.
Aim: To address existing issues in the management and administration of Waqf properties, ensuring better transparency and efficiency.
It also seeks to improve the legal framework governing Waqf boards and their operations across India.
Background:
The Waqf Board Amendment Bill 2024 proposes changes to the Waqf Act of 1995.
The Waqf Board Act, initially enacted in 1995, is a legal framework governing the administration of Waqf properties in India.
Waqf refers to the endowment of property for religious or charitable purposes, and the act outlines the structure, functions, and powers of Waqf boards responsible for managing these properties.
The Central Waqf Council is a statutory body that advises and oversees the functioning of state-level Waqf Boards in India, established under the Waqf Act.
Wakf board’s income is exempt from Income Tax but revenue generated from leasing of properties can be taxed under the service tax and GST laws.
Features of the Proposed Bill:
Waqf Board will mandatorily have two Non-Muslim members.
District magistrates may be involved in overseeing waqf properties to ensure proper management. The survey is to be carried out by the district collector, not by Waqf.
Properties are to be registered through a Centralized Portal for better scrutiny. Properties already claimed by boards will undergo new verification processes to resolve disputes and prevent misuse.
Waqf will lose the right to decide whether any property is a Waqf Asset or not.
Present Composition of Waqf Board
Chairperson
Leads the Board
State government nominees
Representatives appointed by the state. (The Waqf Board operates under the supervision of the state government as per the provision of the Wakf Act 1995).
Legislators and parliamentarians
State representatives from the Muslim community
State Bar Council members
Muslim Legal experts providing guidance
Mutawalis
Managers of waqf with an annual income of Rs 1 lakh and above
Islamic scholars
Religious experts contributing to decision-making
Significance of the Waqf Board Amendment Bill 2024:
The bill seeks to bring about significant administrative reforms and ensure more inclusive and efficient management of Waqf assets. Here are some of the significances of the Waqf Board Amendment Bill 2024:
Enhanced Transparency: The bill includes provisions to digitize records and create a centralized database. This will make it easier to track and manage Waqf properties, reducing the potential for fraud and mismanagement.
Improved Governance: Administrative reforms proposed in the bill by the government will lead to more professional and efficient management of Waqf properties. This could result in better utilization of these resources for charitable and religious purposes.
Protection of Waqf Properties: The bill aims to protect Waqf properties by regulating leasing and preventing encroachments. Unauthorized use and exploitation of these properties will be prevented, ensuring they are used for their intended religious and charitable purposes.
Inclusion and Representation: Including Muslim women and non-Muslims in Waqf Boards is a step toward more inclusive governance, ensuring diverse perspectives in decision-making.
Efficient Dispute Resolution: The new dispute resolution mechanism will help in resolving conflicts related to Waqf properties more effectively, reducing the burden on regular courts and ensuring quicker justice.
Q1 Comment on the important changes introduced in respect of the Long-term Capital Gains Tax (LCGT) and Dividend Distribution Tax (DDT) in the Union Budget for 2018-2019. (UPSC IAS/2018)
Q2 Distinguish between Capital Budget and Revenue Budget. Explain the components of both these Budgets. (UPSC IAS/2021)
Prelims:
Under which of the following circumstances may ‘capital gains’ arise? (2012) 1. When there is an increase in the sales of a product 2. When there is a natural increase in the value of the property owned 3. When you purchase a painting and there is a growth in its value due to an increase in its popularity Select the correct answer using the codes given below: (a) 1 only (b) 2 and 3 only (c) 2 only (d) 1, 2 and 3
Note4Students:
Prelims: Short-Term Capital Gains (STCG) and Long-Term Capital Gains (LTCG);
Mains:Impact of gambling instincts on the stock market;
Mentor comments: In India, capital gains are classified into two categories based on the holding period of assets. Short-Term Capital Gains (STCG) apply to assets held for 12 months or less, taxed at a rate of 15% for listed equity shares. In contrast, Long-Term Capital Gains (LTCG) are applicable when assets are held for more than 12 months, taxed at 10% for gains exceeding ₹1 lakh, with no indexation benefits. This framework encourages long-term investment while imposing higher tax rates on short-term trading activities.
Let’s learn!
__
Why in the News?
The Indian government has increased taxes on both short-term and long-term capital gains from stock market investments in its latest Budget, along with raising the securities transaction tax on derivatives trading.
How capital gains occur
Definition of Capital Gains: Capital gains are profits earned from the sale of an asset that has increased in value over the holding period. This occurs when the selling price exceeds the original purchase price.
Market Dynamics: In a perfect market wherefuture cash flows are accurately forecasted, capital gains would not exist, as assets would be bought and sold at their fair value. However, in reality, uncertainty leads to mispricing, allowing investors to buy undervalued assets and realize gains when their true value is recognized.
Investor Behavior: Investors who allocate capital efficiently into undervalued businesses can earn capital gains when others recognize the fair value of those businesses. Conversely, those who misallocate capital into overvalued assets may incur capital losses.
Economic Implications: Efficient capital allocation is crucial for economic prosperity. Misallocation, such as investing in sectors with low demand (e.g., cruise ships during a pandemic), can lead to overall economic inefficiency and resource wastage.
Taxation and Incentives: A uniform tax on capital gains may help mitigate resource misallocation, but it can also impact private investment incentives and overall economic growth.
Impact of gambling instincts on the stock market
Increased Retail Participation: The Economic Survey 2023-24 highlights that the surge in retail investor participation in Futures and Options (F&O) trading is largely driven by inherent “gambling instincts.”
This is evidenced by the rapid growth in trading volumes, with retail traders’ share in derivatives trading rising from 2% in 2018 to 41% in 2024.
Potential for High Returns: Derivatives trading offers the allure of outsized gains, which appeals to investors seeking quick profits.
High Risk of Losses: Despite the appeal of quick profits, the reality is stark; a study by the Securities and Exchange Board of India (SEBI) found that 89% of individual traders in the equity F&O segment suffered losses, with average losses of ₹1.1 lakh in FY22.
Gambling instincts are worse for derivatives
Complexity and Misunderstanding: Derivatives are often misunderstood due to their complexity. This lack of understanding leads to a negative perception because many do not grasp their practical benefits and risk management functions.
Speculative Nature: The speculative aspect of derivatives trading can resemble gambling, especially when neither party intends to buy or sell the underlying asset. This speculative behaviour is seen as risky and irresponsible, contributing to the negative reputation of derivatives.
Risk Transfer: Derivatives allow for the transfer of risk from one group of investors to another.While this risk management is beneficial, the perception that some investors profit from others’ risk aversion can be seen as exploitative or opportunistic.
Market Impact: Just as with active trading in the cash market, speculative trading in derivatives can be socially beneficial by providing liquidity and risk management tools. However, the public often overlooks these benefits and focuses on the perceived destabilizing effects and the potential for large, rapid losses, which can harm individual investors and financial markets.
Way forward:
Investor Education: Need to implement comprehensive educational programs for investors to improve their understanding of derivatives and capital markets.
Transparency in Trading: Need to increase transparency in derivatives markets by requiring more detailed disclosures about trading strategies, potential risks, and the impact of speculative trades.
The Prime Minister recalled the Parliament’s 5-year-old decision to abrogate Articles 370 and 35(A), calling it a watershed moment.
About Articles 370 and 35(A) of the Indian Constitution
[1] Article 370:
Description
Provision
Grants special autonomous status to the state of Jammu and Kashmir.
Nature
Initially intended as a temporary provision, subject to eventual change or abrogation.
Powers of State
Allowed J&K to have its own Constitution and autonomyover internal matters except defense, foreign affairs, finance, and communications.
Presidential Order
President of India could extend or modify the application of Indian laws to J&K with the concurrence of the state government.
Autonomy Details
Provides a degree of autonomy to the state and permits the state to give some special privileges to its “permanent residents”.
Emergency Provisions
Emergency provisions are not applicable to the state on the grounds of “internal disturbance” without the concurrence of the State.
State Boundaries
Name and boundaries of the State cannot be alteredwithout the consent of its legislature.
Separate Institutions
State has its own constitution, a separate flag, and a separate penal code (Ranbir Penal Code).
Assembly Duration
Duration of the state’s Assembly is 6 years, unlike five in the rest of India.
Parliamentary Jurisdiction
Indian Parliament can pass laws regarding J&K in the matters of defense, external affairs, and communication only.
Any other law formed by Union will only be applicable in J&K by presidential order if it concurs with the state assembly.
Abolishment Condition
President may, by public notification, declare that this Article shall cease to be operative but only on the recommendation of the Constituent Assembly of the State.
Abolishment
In August 5, 2019, through a Presidential Order and a resolution passed by the Indian Parliament.
Impact of Abrogation
J&K’s special status was revoked.
It was reorganized into two Union Territories: Jammu and Kashmir, and Ladakh.
[2] Article 35A:
Description
Provision
Empowers the J&K legislature to define permanent residents of the state and provide them with special rights and privileges.
Insertion
Added to the Constitution through a Presidential Order in 1954.
Permanent Residents
Defined by the state as those who were state subjects on May 14, 1954, or have been residents for 10 years, and lawfully acquired immovable property.
Special Rights
Permanent residents were given exclusive rights to employment under the state government, acquisition of immovable property in the state, and scholarships.
Constitutionality Debate
Debated on the grounds that it was not added via an amendment procedure.
Criticism
Criticized for being discriminatory and creating a sense of separation from the rest of India.
Revocation
Along with Article 370, Article 35A was effectively nullified on August 5, 2019.
PYQ:
[2016] To what extent is Article 370 of the Indian Constitution, bearing marginal note “Temporary provision with respect to the State of Jammu and Kashmir”, temporary? Discuss The future prospects of this provision in the context of Indian polity.
Q1 Critically discuss the objectives of Bhoodan and Gramdan movements initiated by Acharya Vinoba Bhave and their success. (UPSC IAS/2013)
Q2 Can the vicious cycle of gender inequality, poverty and malnutrition be broken through microfinancing of women SHGs? Explain with examples. (UPSC IAS/2021)
Note4Students:
Mains: Reason behind the inequality in India ;
Mentor comments: Inequality in India is characterized by significant disparities in wealth and income distribution. The richest 1% of the population owns over 58% of the nation’s wealth, while the bottom 50% holds merely 3%. Factors contributing to this inequality include caste, gender, and regional disparities. Women, for instance, earn 34% less than men and own only 2% of agricultural land despite comprising 42% of the agricultural workforce. The COVID-19 pandemic exacerbated these inequalities, with the wealth of billionaires increasing while poverty deepened for many.
Let’s learn!
__
Why in the News?
In their March 2024 study, “Income and Wealth Inequality in India, 1922-2023: The Rise of the Billionaire Raj,” economists Nitin Kumar Bharti, Lucas Chancel, Thomas Piketty, and Anmol Somanchi report that in 2022-23, the top 1% of the population held 22.6% of the total income and 40.1% of the total wealth in India.
A case of gross disproportion as per study
Income and Wealth Distribution: In 2022-23, the top 1% of India’s population received 22.6% of national income and owned 40.1% of total wealth. This marks the highest levels of inequality recorded since 1961, indicating a stark concentration of wealth among the richest individuals, with the top 0.1% earning nearly 10% of national income.
Comparison with Historical Context: The report suggests that the current inequality levels are greater than those during the British colonial rule, with the top 10% of the population owning 65% of total wealth. In contrast, the bottom 50% holds only 6.4% of total wealth and earns 15% of national income.
Wealth of the Wealthy: The wealthiest 10,000 individuals possess an average of ₹22.6 billion, which is approximately 16,763 times the average wealth of an Indian.
Start of inequality: The rise in inequality began in the 1980s with economic liberalization, accelerating after the 1991 reforms. The share of the bottom 50% in national income dropped significantly, while the income share of the top 10% increased dramatically during the same period.
The reason behind the inequality:
Economic Liberalization: The economic reforms initiated in the 1990s led to rapid growth in certain sectors, particularly in urban areas, while rural and less developed regions lagged behind.
Lack of Inclusive Growth: Economic growth has not been inclusive, with benefits disproportionately favouring certain sectors and geographic regions. For instance, the service sector, which significantly contributes to GDP, is concentrated in a few states like Maharashtra and Karnataka.
High Unemployment and Underemployment: A lack of sufficient job creation and the prevalence of underemployment contribute to low productivity and income levels among the majority of the population
Caste and Gender Discrimination: Social stratification based on caste and gender continues to limit access to opportunities for marginalized groups. For example, upper castes hold a disproportionate share of wealth, while Scheduled Castes and Scheduled Tribes have significantly lower ownership of assets.
Educational Disparities: Access to quality education is uneven, with lower-income groups often lacking the resources to attain higher education, which is crucial for upward mobility. This educational gap perpetuates income inequality.
Regional Imbalances: Certain states in India are significantly more developed than others, leading to disparities in income and wealth distribution. For instance, five states own about 50% of the country’s total wealth, Maharashtra (17% of the country’s wealth share) Uttar Pradesh (11.6%), Kerala (7.4%), Tamil Nadu and Haryana
Way forward
Redistribution of Wealth: The funds generated from increased taxation should be directed towards social programs that improve access to education, healthcare, and nutrition for lower-income groups.
Invest in Rural Development: Need to focus on targeted investments in rural areas which can help bridge the gap between urban and rural economies.
Promote Quality Education and Skill Development: Expanding access to quality education and vocational training for marginalized communities can empower individuals and enhance their employability.
A seven-judge Bench of the Supreme Court has ruled that States can subdivide Scheduled Castes (SC) into groups to allocate sub-quotas within the Dalit reservation.
Will the Weaker Among Dalits Get Representation from Further Sub-Classification?
The Supreme Court’s ruling allows states to create sub-classifications within the SC category, which is expected to enable states to earmark sub-quotas for the most marginalized sections of Dalits.
This decision aims to ensure better representation for weaker groups within the SC community who have historically been underrepresented and have not benefitted adequately from existing reservations.
The ruling emphasizes that treating SC communities as a homogeneous group undermines the objective of reservations, as there are significant differences in advancement and discrimination among various SC communities.
Why Did the Supreme Court Overrule a Five-Judge Decision of 2004?
The 2004 judgment in E.V. Chinnaiah vs. State of Andhra Pradesh held that SCs constitute a single homogeneous class and that any sub-classification was unconstitutional, as it violated Article 341, which empowers the President to notify the list of SCs.
The recent seven-judge Bench, led by Chief Justice D.Y. Chandrachud, found this ruling to be incorrect, stating that SC communities are not homogeneous and that there are inter se differences among them.
The majority opinion argued that the act of notifying a list of SCs does not create a uniform class, and sub-classification is permissible based on “intelligible differentia” and should have a rational nexus to the purpose of doing it.
What are the views on Creamy layer exclusion?
The concept of the creamy layer, which excludes more advanced members of a community from benefiting from affirmative action, is currently applicable only to Other Backward Classes (OBCs) and has not been extended to Dalit communities.
Justice B.R. Gavai, in a separate opinion, emphasized the need to identify and exclude the more advanced among SCs from affirmative action benefits, arguing that treating all members equally disregards the principle of equality.
The opinions regarding creamy layer exclusion do not constitute a directive for the government to implement this concept for SCs, as the issue was not directly addressed in the current case.
Do the Judges’ Opinions on this Constitute a Direction to the Government?
The judges’ opinions on sub-classification and creamy layer exclusion provide a legal framework for states to follow but do not serve as a direct mandate for the government to implement changes.
The ruling establishes that states have the authority to sub-classify SCs for the purpose of extending reservation benefits, but the specific implementation details and parameters for creamy layer exclusion remain open for further consideration and do not compel immediate action from the government.
Way forward:
Implementation Framework for Sub-Classification: The government should establish a comprehensive framework that outlines the criteria and process for sub-classification of SCs.
Addressing Creamy Layer Exclusion: The government should consider developing specific criteria for identifying the “creamy layer” within SCs, similar to the criteria used for OBCs.
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