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GS Paper: GS2

  • Expanding the G7

    There has been a call for expansion of G7 by the U.S. President. Against this backdrop, this article examines the historical background in which the group emerged. But a lot has changed since. So, it would be appropriate for G7 to adjust to the new reality. But what would be the focus of a new mechanism? What are the areas in which India would be interested? All such questions are answered in this article.

    Call for expansion of G7 and China’s objection

    • Recently, the U.S. President proposed the expansion of G7 to G10 or G11,  with the inclusion of India, South Korea, Australia and possibly Russia.
    • Elaborating this logic, the White House Director of Strategic Communications said the U.S. President wanted to include other countries, including the Five Eyes countries.
    • Five Eye is an intelligence alliance comprising Australia, Canada, New Zealand, the United Kingdom and the United States.
    • The U.S. also stressed said the expanded group should talk about the future of China.
    • A Chinese Ministry of Foreign Affairs official immediately reacted, labelling it as “seeking a clique targeting China”.

    Should India care about China’s objection if invited to join?

    • China’s objection to an expanded G7 is no reason for India to stay away from it, if invited to join.
    • India has attended several G7 summits earlier too, as a special invitee for its outreach sessions.
    • India’s Prime Minister was guest invited to Biarritz, France to the G7 summit last year, along with other heads of government.

    The historical background of G7

    • The G7 emerged as a restricted club of the rich democracies in the early 1970s.
    • The quadrupling of oil prices just after the 1973 Arab-Israeli War, when  OPEC imposed an embargo against Canada, Japan, the Netherlands, and the United States, shocked their economies.
    • Although the French were spared the embargo, the chill winds of the OPEC action reverberated around the world.
    • So, French President invited the Finance Ministers of five of the most developed members of the Organisation for Economic Cooperation and Development, the United States, Germany, Japan, Italy, and the United Kingdom, for an informal discussion on global issues.
    • This transformed into a G7 Summit of the heads of government from the following year with the inclusion of Canada in 1976.
    • And the European Commission/Community (later Union) joined as a non-enumerated member, a year later.
    • On the initiative of U.S. President Bill Clinton and British Prime Minister Tony Blair, the G7 became the G8, with the Russian Federation joining the club in 1998.
    • This ended with Russia’s expulsion following the annexation of Crimea in 2014.

    Declining share G7 and rising of E7 in world GDP

    • When constituted, the G7 countries accounted for close to two-thirds of global GDP.
    • According to the 2017 report of the accountancy firm, PwC, “The World in 2050”, they now account for less than a third of global GDP on a purchasing power parity (PPP) basis.
    • And less than half on market exchange rates (MER) basis.
    • The seven largest emerging economies (E7, or “Emerging 7”), comprising Brazil, China, India, Indonesia, Mexico, Russia and Turkey, account for over a third of global GDP on purchasing power parity (PPP) terms.
    • And over a quarter on MER basis.

    Predictions for India

    • India’s economy is already the third largest in the world in PPP terms, even if way behind that of the U.S. and China.
    • By 2050, the PwC Report predicts, six of the seven of the world’s best performing economies will be China, India, the United States, Indonesia, Brazil, and Russia.
    • Two other E7 countries, Mexico and Turkey, also improve their position.
    • It projects that India’s GDP will increase to $17 trillion in 2030 and $42 trillion in 2050 in PPP terms, in second place after China, just ahead of the United States.
    • This is predicated on India overcoming the challenge of COVID-19, sustaining its reform process and ensuring adequate investments in infrastructure, institutions, governance, education and health.

    Limitations of G7

    • The success or otherwise of multilateral institutions are judged by the standard of whether or not they have successfully addressed the core global or regional challenges of the time.
    • The G7 failed to head off the economic downturn of 2007-08.
    • This failure led to the rise of the G20.
    • In the short span of its existence, the G20 has provided a degree of confidence, by promoting open markets, and stimulus, preventing a collapse of the global financial system.
    • The G7 also failed to address the contemporary issues, such as the COVID-19 pandemic, climate change, the challenge of the Daesh, and the crisis of state collapse in West Asia.
    • It had announced its members would phase out all fossil fuels and subsidies, but has not so far announced any plan of action to do so.
    • And their coal fired plants emit “twice more CO2 than those of the entire African continent”.

    Turmoil in West Asia and failure of Europe to act

    • Three of the G7 countries, France, Germany, and the U.K., were among the top 10 countries contributing volunteers to the ISIS.
    • West Asia is in a greater state of turmoil than at any point of time since the fall of the Ottoman Empire.
    • This turmoil has led to a migrants crisis.
    • Migrant crisis persuaded many countries in Europe to renege on their western liberal values, making the Mediterranean Sea a death trap for people fleeing against fear of persecution and threat to their lives.

    So, to deal with the unprecedented challenge, we need new institution

    • The global economy has stalled and COVID-19 will inevitably create widespread distress.
    • Nations need dexterity and resilience to cope with the current flux, as also a revival of multilateralism, for they have been seeking national solutions for problems that are unresolvable internally.
    • Existing international institutions have proven themselves unequal to these tasks.
    • A new mechanism might help in attenuating them.
    • It would be ideal to include in it the seven future leading economies, plus Germany, Japan, the U.K., France, Mexico, Turkey, South Korea, and Australia.
    •  The 2005 ad hoc experiment by Prime Minister Tony Blair in bringing together the G7 and the BRICS countries was a one-off.

    What should be the focus of this new institution?

    • A new international mechanism will have value only if it focuses on key global issues.
    • A related aspect is how to push for observing international law and preventing the retreat from liberal values on which public goods are predicated.
    • Global public health and the revival of growth and trade in a sustainable way -that also reduces the inequalities among and within nations- would pose a huge challenge.

    What should be India’s priority in new institution?

    • India would be vitally interested in three: 1) international trade, 2) climate change, 3) the COVID-19 crisis.
    • Second order priorities for India would be cross-cutting issues such as counter-terrorism and counter-proliferation.
    • An immediate concern is to ensure effective implementation of the 1975 Biological Weapons Convention .
    • And the prevention of any possible cheating by its state parties by the possible creation of new microorganisms or viruses by using recombinant technologies.
    • On regional issues, establishing a modus vivendi with Iran would be important to ensure that it does not acquire nuclear weapons and is able to contribute to peace and stability in Afghanistan, the Gulf and West Asia.
    • The end state in Afghanistan would also be of interest to India.
    • And also the reduction of tensions in the Korean Peninsula and the South China Sea.

    Consider the question “There has been a clamour for expanding G7 and India is being considered as one of the prospective candidates in the expanded group. In light of this examine the challenges and opportunities for India if it gets entry into the expanded group.”

    Conclusion

    The decaying influence in geopolitics and declining share in the world GDP calls for the formation of the new institution. IF and when that institution comes into being India should try to address its immediate concern with the help of new mechanism based on values.

  • Strategic importance of Daulat Beg Oldie, Ladakh

    In the reporting on the LAC stand-off, the Darbuk-Shyok-Daulat Beg Oldie (DSDBO) road has often appeared in news.

    Practice questions for mains:

    Q. Discuss how India’s all-weather border infrastructure has created new festering points for the Sino-Indian border skirmished.

    Daulat Beg Oldie

    • DBO is the northernmost corner of Indian Territory in Ladakh, in the area better known in Army parlance as Sub-Sector North.
    • DBO has the world’s highest airstrip, originally built during the 1962 war but abandoned until 2008 when the Indian Air Force (IAF) revived it as one of its many Advanced Landing Grounds (ALGs) along the LAC.

    The DSDBO Road

    • DSDBO is an all-weather 255-km long road 255-km long built by India over nearly 20 years.
    • Running almost parallel to the LAC, the DSDBO road, meandering through elevations ranging between 13,000 ft and 16,000 ft, took India’s Border Roads Organisation (BRO) almost two decades to construct.
    • Its strategic importance is that it connects Leh to DBO, virtually at the base of the Karakoram Pass that separates China’s Xinjiang Autonomous Region from Ladakh.

    A trigger for PLA incursions

    • Of the possible triggers cited for the PLA targeting of Indian Territory along the LAC in eastern Ladakh, the construction of DSDBO all-weather road is possibly the most consequential.
    • The Chinese build-up along the Galwan River valley region overlooks and hence poses a direct threat to the DSDBO road.

    Significance of DSDBO Road

    • The DSDBO highway provides the Indian military access to the section of the Tibet-Xinjaing highway that passes through Aksai Chin.
    • The road runs almost parallel to the LAC at Aksai Chin, the eastern ear of erstwhile Jammu and Kashmir state that China occupied in the 1950s, leading to the 1962 war in which India came off worse.
    • The DSDBO’s emergence seemingly panicked China, evidenced by the 2013 intrusion by the PLA into the nearby Depsang Plains, lasting nearly three weeks.
    • DBO itself is less than 10 km west of the LAC at Aksai Chin. A military outpost was created in DBO in reaction to China’s occupation of Aksai Chin.
    • It is at present manned by a combination of the Army’s Ladakh Scouts and the paramilitary Indo-Tibetan Border Police (ITBP).

    Other strategic considerations

    • To the west of DBO is the region where China abuts Pakistan in the Gilgit-Baltistan area, once a part of the erstwhile Kashmir principality.
    • This is also the critical region where China is currently constructing the China-Pakistan Economic Corridor (CPEC) in Pakistan-Occupied Kashmir (PoK), to which India has objected.
    • As well, this is the region where Pakistan ceded over 5,180 sq km of PoK to China in 1963 under a Sino-Pakistan Boundary Agreement, contested by India.

    Also read:

    https://www.civilsdaily.com/burning-issue-india-china-skirmish-in-ladakh/

     

  • LAC row: China reaches accord with India

    China said that it had “reached an agreement” with India on the ongoing tensions along the Line of Actual Control (LAC), a day after India announced troops from both sides had begun a “partial disengagement” from some of the stand-off points.

    Practice question for mains:

    Q. “Early settlement of the boundary question serves the fundamental interests of both countries”. Discuss in light of the ongoing border skirmishes between India and China.

    Read the complete story here:

    [Burning Issue] India-China Skirmish in Ladakh

    Troops moving back

    • Partial deinduction has happened from some points in Galwan and Hot Springs areas.
    • Chinese side removed some of the tents and some troops and vehicles have been moved back, and the Indian side to has reciprocated.
    • At some points in the Galwan Valley, Chinese troops have moved back 2-3 km. However, there is no change in the ground situation at Pangong Tso.

    De-escalation begins

    • India and China held Major general-level talks to discuss further de-escalation at several standoff points in Eastern Ladakh including Patrolling Point (PP) 14, following a broad accord reached on Saturday in talks held at the Corps Commander-level.
    • As per the agreement, a series of ground-level talks would be held over the next 10 days, with four other points of conflict identified at PP15, PP17, Chushul and the north bank of Pangong Lake.
    • The Chinese Foreign Ministry said both sides had agreed to handle the situation “properly” and “in line with the agreement” to ease the situation.
    • However, it did not provide specific details on some of the stand-off points, such as Pangong Lake, where Chinese troops are still present on India’s side of the LAC.

    No final solution yet

    • At present, the two sides are taking actions in line with the agreement to ameliorate the border situation.
    • Government officials said a partial disengagement had happened at some points in the Galwan area and at Hot Springs, but there was no change at Pangong Lake.
    • Chinese state-run media has revealed that the ongoing dispute will not escalate into a conflict.
    • But it added due to the complexity of the situation, the military stand-off could continue for a little longer.

    Way forward

    • The military-level talks showed that both sides do not want to escalate tensions further.
    • It showed that China and India remain determined to peacefully resolve border issues.
    • However, the ongoing stand-off is not likely to end immediately, as concrete issues must still be resolved.

  • Vamsadhara River Water Dispute

    Andhra Pradesh  and Odisha CM recently held talks to iron out all differences with regard to the sharing of Vamsadhara River waters.

    Note all major rivers over which inter-state disputes exist say Narmada, Mahadayi, Cauvery, Krishna, etc. Observe their flow and the area swept.

    Also, refer your atlas to check the complicated border sharings between Chhatisgarh, AP/Telangana and Odisha.

    Vamsadhara River

    • River Vamsadhara is an important east-flowing river between Rushikulya and Godavari, in Odisha and Andhra Pradesh.
    • The river originates in the border of Thuamul Rampur in the Kalahandi district and Kalyansinghpur in Rayagada district of Odisha.
    • It runs for a distance of about 254 kilometres, where it joins the Bay of Bengal at Kalingapatnam, Andhra Pradesh.
    • The total catchment area of the river basin is about 10,830 square kilometres.

    The dispute

    • Andhra Pradesh wants to build the Neradi bridge across the river which will be possible only after Odisha’s consent.
    • Odisha argues that the flood flow canal would result in drying up the existing river bed and consequent shifting of the river affecting the groundwater table.
    • Odisha also raised the issue of scientific assessment of available water in Vamsadhara at Katragada and Gotta Barrage, Andhra Pradesh and the basis for sharing the available water.

    Back2Basics: Interstate River Water Disputes

    • River waters use/harnessing is included in states jurisdiction. However, article 262 of the Constitution provides for the adjudication of inter-state water disputes.
    • Under this, Parliament may by law provide for the adjudication of any dispute or complaint with respect to the use, distribution and control of waters of any inter-state river and river valley.
    • The President of India may also establish an interstate council as per Article 263 to inquire and recommend on the dispute that has arisen between the states
    • The Parliament has enacted the two laws, the River Boards Act (1956) and the Inter-State Water Disputes Act (1956).
    • Under this, Parliament may by law provide for the adjudication of any dispute or complaint with respect to the use, distribution and control of waters of any inter-state river and river valley.
    • The Inter-State Water Disputes Act empowers the Central government to set up an ad hoc tribunal for the adjudication of a dispute between two or more states in relation to the waters of an inter-state river or river valley.
    • The award of the tribunal is final and binding on the parties to the dispute.
    • Neither the Supreme Court nor any other court is to have jurisdiction in respect of any water dispute which may be referred to such a tribunal under this Act.

  • Complexity of India-Nepal relations

    This article helps us understand Nepal’s perspective of the India-Nepal border dispute. Though the issue dates back to India’s independence, it came to dominate the political landscape in Nepal since 1990s. But there is no solution in sight. So, what makes the issue complex? Read to know…

    What the border dispute between two countries is about?

    • The inauguration of the “new road to Mansarovar” on May 8 by India’s defence minister has strained the relations between Nepal and India.
    • Nepal claims that a section of the road passes through the territory of Nepal and links with the Tibetan Autonomous Region of China through the Lipu Lekh pass in Nepal.
    • The 1816 Sugauli Treaty between Nepal and British India placed all the territories east of the Kali (Mahakali) river, including Limpiyadhura, Kalapani and Lipu Lekh at the northwestern front of Nepal, on its side.
    • The borders of Nepal, India and China intersect in this area.
    • Given the situation in 1961, Nepal and China fixed pillar number one at Tinker pass with the understanding that pillar number zero (the tri-junction of Nepal, India, and China) would be fixed later.
    • Lipu Lekh pass is 4 km northwest and Limpiyadhura 53 km west of Tinker pass.

    No progress on the solution of the issue

    • The dispute over the Kalapani area has spanned the last seven decades.
    • Both Nepal and India have recognised it as an outstanding border issue requiring an optimal resolution.
    • When in August 2014, Prime Minister Narendra Modi became the first Indian Prime Minister to visit Nepal in 17 years, Nepal’s Prime Minister Sushil Koirala raised this issue again.
    • The two prime ministers agreed to resolve the issue on a priority basis and directed their foreign secretaries “to work on the outstanding boundary issues including Kalapani and Susta”.
    •  There was virtually no progress on the ground.

    Nepal’s objection to India-China agreement

    •  In May 2015, Prime Minister Modi visited China, and the two countries agreed to “enhance border areas cooperation”.
    • The May 2015 agreement is a broad one compared to the 1954 India-China agreement “on trade and intercourse between Tibet Region of China and India”, which mentions Lipu Lekh pass as one of the six passes “through which traders and pilgrims of both countries may travel”.
    • Nepal protested against the inclusion of its territory, Lipu Lekh, in the joint statement without its consent and demanded that the two countries make necessary corrections to reflect the ground realities.
    • The protest was ignored.

    Growing nationalism and distrust let to the deterioration of relations

    • The tone of Nepal-India relations appears to be dominated by frustrations of the past and traditional attitudes more than the opportunities of the future.
    • The widening gap in understanding each other’s concerns has helped feed Nepali nationalism and create a dense cloud of distrust and suspicion between the two countries.
    • The gap widened after India chose to impose an economic blockade in response to Nepal’s sovereign decision to promulgate a democratic constitution.
    • The current ruling Communist Party of Nepal made people’s anger over the blockade its campaign plank during the 2017 general election.

    What makes the border issues complex and difficult to solve?

    • Complexity of the issue stems from the fact that the political leadership handles only a small part of this very important bilateral relationship.
    • India as a big neighbour is rarely seen grasping the psychological dimensions of the relationship.
    • Officials handling these multifaceted relations may momentarily influence the atmospherics but they rarely touch the core of these relations, let alone reorient or transform them in the rapidly changing context.
    • This is manifest in the deferring of substantive conversations on the outstanding boundary issue for decades.
    • The foreign secretary level mechanism has not met even once to discuss the border issue since its formation.
    • There are over three dozen bilateral mechanisms between Nepal and India to engage at various levels.
    • The meetings of these mechanisms are rarely regular.

    Consider the question “The India-Nepal border dispute looks minor, but allowing it to fester is likely to sow the seeds of immense competition and intense rivalry in the sensitive Himalayan frontier with far-reaching geopolitical implications. Comment.”

    Conclusion

    Geography, history, and economy make Nepal and India natural partners, sharing vital interest in each other’s freedom, integrity, dignity, security and progress. People-to-people relations are unique strengths of bilateral relations. India, for it’s part and in the spirit of its ‘neighbourhood first’ policy, must start a solution-oriented dialogue and find the solution to the dispute.

  • Central Administrative Tribunal (CAT) bench for the UT of J&K and Ladakh

    The union govt. has inaugurated the 18th Bench of Central Administrative Tribunal (CAT) for the Union Territories of Jammu and Kashmir and Ladakh.

    Try this question from our AWE initiative:

    “The Central Administration Tribunal which was established for redressal of grievances and complaints by or against central government employees nowadays is exercising its powers as an independent judicial authority.” Explain. (10 Marks)

    What is Central Administrative Tribunal (CAT)?

    • The Central Administrative Tribunal had been established under Article 323 – A of the Constitution for adjudication of disputes and complaints with respect to recruitment and conditions of service.
    • It aims to provide speedy and inexpensive justice to the aggrieved public servants.
    • It adjudicates for the persons appointed to public services and posts in connection with the affairs of the Union or other authorities under the control of the Government.
    • In pursuance of Article 323-A, the Parliament has passed the Administrative Tribunals Act in 1985.
    • The act authorizes the Central government to establish one Central Administrative Tribunal and the state administrative tribunals.

    Composition of the CAT

    • The CAT is a specialist body consisting of Administrative Members and Judicial Members who by virtue of their specialized knowledge are better equipped to dispense speedy and effective justice.
    • A Chairman who has been a sitting or retired Judge of a High Court heads the Central Administrative Tribunal.
    • There are now 18 Benches and 21 Circuit Benches in the CAT all over India.

    Its functioning

    • It exercises jurisdiction only in relation to the service matters of the parties covered by the Administrative Tribunals Act, 1985.
    • The Tribunal is guided by the principles of natural justice in deciding cases and is not bound by the procedure, prescribed by the Civil Procedure Code.
    • Under Section 17 of the Administrative Tribunal Act, 1985, the Tribunal has been conferred with the power to exercise the same jurisdiction and authority in respect of contempt of itself as a High Court.

    Independence of working

    • The conditions of service of the Chairman and Members are the same as applicable to a Judge of High Court as per the Administrative Tribunals (Amendment) Act, 2006.
    • The orders of CAT are challenged by way of Writ Petition under Article 226/227 of the Constitution before respective High Court in whose territorial jurisdiction the Bench of the Tribunal is situated.

  • Pay attention to their objectives in dealing with China and Pakistan

    While their interests overlap, Pakistan and China diverge when it comes to their objective in Kashmir. Both want to keep the pressure on India to avoid it from changing the status quo. Extending this line of argument, the author in this article suggest that India should separate the policy response to China from Pakistan, as they differ in their objectives.

    Coordinated efforts to corner India?

    • Latest news on the Ladakh front suggests that Chinese and Indian forces have begun to disengage in select areas.
    • But this does not detract from the reality that in the past few weeks Beijing and Islamabad are making coordinated efforts to challenge India’s presence in the Kashmir-Ladakh region.
    • There is stepped-up activity on Pakistan’s part to infiltrate terrorists into the Valley.
    • China has undertaken provocative measures on the Ladakh front to assert control over disputed areas around the Line of Actual Control (LAC).

    Let’s see how Pakistan and China’s interests overlap

    • In Pakistan’s case the intensification in its terrorist activities is related in part to the dilution of Article 370. 
    • Dilution of Article 370 helps India de-link Ladakh from the Kashmir problem.
    • For China, the division of Ladakh from Jammu and Kashmir allows India a freer hand in contesting China’s claims in the region.
    • Increasing road-building activity on India’s part close to the LAC augments this perception.
    • In addition, Ladakh borders China’s most restive provinces of Xinjiang and Tibet.
    • Ladakh is also contiguous to Pakistan-occupied Kashmir (PoK), Gilgit and Baltistan, where the Chinese have invested hugely under the China-Pakistan Economic Corridor (CPEC) project.
    • External Affairs Minister S. Jaishankar’s remark last year that India expects to have “physical jurisdiction over (POK) one day” has alarmed Beijing which sees any such Indian move as threatening the CPEC project.
    • These factors demonstrate the overlapping interests that Beijing and Islamabad have regarding India in this region.

    The above factors explain why Pakistan and China would want India to be so preoccupied with taking defensive measures in Kashmir and Ladakh as to have little time and energy left to attempt to alter the status quo in POK or in Aksai Chin.

    But there are major differences in Pakistani and Chinese objectives regarding India

    • These differences are related to their divergent perceptions of their disputes and their different force equations with India.
    • For China, Ladakh is primarily a territorial dispute with strategic ramifications.
    • China also believes it is superior to the Indian militarily and, therefore, can afford to push India around within limits as it has been attempting to do in the recent confrontation.
    • For Pakistan, its territorial claim on Kashmir is based on an immutable ideological conviction that it is the unfinished business of partition and as a Muslim-majority state is destined to become a part of Pakistan.
    • Islamabad also realises that it is the weaker power in conventional terms and therefore has to use unconventional means, primarily terrorist infiltration, to achieve its objective of changing the status quo in Kashmir.
    • China is a satiated power in Ladakh having occupied Aksai Chin and wants to keep up the pressure on New Delhi to prevent the latter from trying to change the situation on the ground.

    Way forward-Pay attention to objectives while negotiating

    • China’s primary concern with regard to Kashmir is to prevent any Indian move from threatening the CPEC project.
    • It does not challenge the status quo in Kashmir.
    • Pakistan, on the other hand, is committed to changing the status quo in Kashmir at all cost.
    • It has been trying to do so since Partition not only through clandestine infiltration but also by engaging in conventional warfare.
    • Therefore, while it is possible to negotiate the territorial dispute with China on a give-and-take basis.
    • Doing the same is not possible in the case of Pakistan which considers Kashmir a zero-sum game.
    • India should, therefore, distinguish the different objectives on the part of Beijing and Islamabad and tailor its responses accordingly without conflating the two threats to its security.

    Consider the question “Policy response of India in dealing with Pakistan and China should consider differences in their objectives in relation to Kashmir. And clubbing them together just because of their tactical overlap should be avoided. Elaborate.”

    Conclusion

    Lumping the twin threats posed by Pakistan and China together because of a tactical overlap between them makes it difficult to choose policy options rationally. So, the policy response must understand the difference in their objectives and avoid clubbing them together.

  • India-China border crisis: It is not about the U.S.

    India’s growing closeness to the U.S. could be the reason for China’s aggression along India’s border. This is the explanation we often come across. But is it really the case?. This article probes the same question. Example of China’s dispute with Indonesia and Philippine help us analyse the U.S. angle to Indo-China border dispute. So, what is the conclusion?

    An easy explanation to India-China border crisis

    • Why has China precipitated a fresh military crisis with India in eastern Ladakh?
    • Among the many explanations making the rounds in Delhi, there is always the easy and attractive one — it’s all about America.
    • Delhi has incurred Beijing’s wrath by moving closer to Washington, goes the argument.
    • India’s renewed enthusiasm for the US-led Quad, it is said, is encouraging China to teach a lesson to Delhi.

    But does this explanation applies to the other countries as well? Look at Indonesia

    • No!
    • This theory does not hold up in relation to other countries having problems with China.
    • Let us turn to the South China Sea, where China is on a bold and ambitious drive to expand its control over the disputed waters.
    • Let us start with gathering tensions over the territorial dispute between Beijing and Jakarta.
    • Over the last year and more, Jakarta is coping with a Chinese challenge in its waters off its Natuna Islands.
    • The Natuna are nearly 1,500 km from the Chinese mainland.
    • The Natuna themselves lie outside Beijing’s nine-dash line that claims nearly 80 per cent of the South China Sea.
    • The dispute is over the exclusive economic zone that the islands confer on Indonesia.
    • China says it has historic rights to these waters and has been dispatching its fishing fleet into these waters.

    Maybe China sees a problem with Jakarta-Washington relations: Let’s analyse

    • Jakarta did not support the US approach to the Indo-Pacific.
    • and went to great lengths to develop a concept of its own and get it endorsed by the ASEAN.
    • Indonesia is not a member of the much-maligned Quad.
    • Its foreign policy is wedded to non-alignment.
    • And as the host of the historic Bandung Conference in 1955, Indonesia is a founding member and champion of Non-aligned Movement.

    Now, let’s consider second example: Philippines

    • The story of the Philippines — one of the oldest military allies of the US in Asia — nicely complements the non-aligned Indonesia’s troubles with China.
    • When he came to power in 2016, President Rodrigo Duterte decided to distance the Philippines from the US and embraced China.
    • He had a hope of finding a reasonable settlement to the substantive maritime territorial dispute with Beijing.
    • In February this year, Manila announced the decision to terminate the agreement that lets American troops operate in the Philippines.
    • But last week, the Philippines “suspended” the decision to terminate military cooperation with the US.
    • The reason: The PLA’s relentless military pressure on the South China Sea islands claimed by Manila and including them in a new Chinese administrative district.

    So, what the two examples suggest?

    • Neither Jakarta that is scrupulously non-aligned nor Manila that was ready to break its alliance with the US has been spared from Beijing’s current muscular approach to China’s territorial disputes.
    • China has long-standing claims, right or wrong, on the territories of its neighbours.
    • The other is the dramatic shift in the regional power balance in favour of China.
    • Unlike in the past, China now has the military power to make good its claims and alter the territorial status quo, if only in bits and pieces.
    • This is what China is doing in the South China Sea.
    • And the situation may not be any different in Ladakh.

    Consider the question “The shift in the regional power balance and not the growing Indo-U.S. relations explains the assertive nature of China in India-China border issues. Elaborate.”

    Conclusion

    The real challenge for Delhi in managing its expansive territorial dispute with Beijing, then, is to redress the growing power imbalance with China. The rest is detail.

  • Taking care of finances of local governments

    This article makes some suggestions to improve local finance and argues that the extant fiscal illusion is a great deterrent to mobilisation.

    Advantageous position in handling disasters

    • In terms of information, monitoring and immediate action, local governments are at an advantage, and eminently, to meet any disaster such as COVID-19.
    • While increasing the borrowing limits of the state form 3.5% of GDP to 5%, there was a recognition that local governments should be fiscally empowered immediately.
    • This is a valid signal for the future of local governance.

    4 challenges posed by Covid and addressing them collectively

    • COVID-19 has raised home four major challenges:1) economic, 2) health, 3) welfare/livelihood 4) resource mobilisation.
    • These challenges have to be addressed by all tiers of government in the federal polity, jointly and severally.

    Local government empowerment: 5 critical areas

    • 1) Own revenue is the critical lever of local government empowerment.
    • But the several lacunae that continue to bedevil local governance have to be simultaneously addressed.
    • 2) The new normal demands a paradigm shift in the delivery of health care at the cutting edge level.
    • 3) The parallel bodies that have come up after the 73rd/74th Constitutional Amendments have considerably distorted the functions-fund flow matrix at the lower level of governance.
    • 4) There is yet no clarity in the assignment of functions, functionaries and financial responsibilities to local governments.
    • Functional mapping and responsibilities continue to be ambiguous in many States.
    • Instructively, Kerala attempted even responsibility mapping besides activity mapping.
    • 5) The critical role of local governments will have to be recognised by all.

    Let’s look into resource mobilisation issue: 3 Heads

    • A few suggestions for resource mobilisation are given under three heads: 1) local finance, 2) Members of Parliament Local Area Development Scheme-MPLADs, 3) the Fifteenth Finance Commission (FFC).

    1. Local finance

    • Property tax collection with appropriate exemptions should be a compulsory levy and preferably must cover land.
    • The Economic Survey 2017-18 points out that urban local governments, or ULGs, generate about 44% of their revenue from own sources as against only 5% by rural local governments, or RLGs.
    • Per capita own revenue collected by ULGs is about 3% of urban per capita income while the corresponding figure is only 0.1% for RLGs.
    • There is a yawning gap between tax potential and actual collection, resulting in colossal underperformance.
    • When they are not taxed, people remain indifferent.
    • LGs, States and people seem to labour under a fiscal illusion.
    • In States such as Uttar Pradesh, Bihar and Jharkhand, local tax collection at the panchayat level is next to nil.
    • Property tax forms the major source of local revenue throughout the world.
    • All States should take steps to enhance and rationalise property tax regime.
    • A recent study by Professor O.P. Mathur shows that the share of property tax in GDP has been declining since 2002-03.
    •  The share of property tax in India in 2017-18 is only 0.14% of GDP as against 2.1% in the Organisation for Economic Co-operation and Development (OECD) countries.
    • If property tax covers land, that will hugely enhance the yield from this source even without any increase in rates.

    Other 2 options for raising finances

    • 1) Land monetisation and betterment levy may be tried in the context of COVID-19 in India. To be sure, land values have to be unbundled for socially relevant purposes.
    • 2) Municipalities and even suburban panchayats can issue a corona containment bond for a period of say 10 years.
    • We are appealing to the patriotic sentiments of non-resident Indians and rich citizens.
    • Needless to say, credit rating is not to be the weighing consideration.
    • That the Resurgent India Bond of 1998 could mobilise over $4 billion in a few days encourages us to try this option.

    2) MPLADS

    • The suspension of MPLADS by the Union government for two years is a welcome measure. The annual budget was around ₹4,000 crore.
    • The Union government has appropriated the entire allocation along with the huge non-lapseable arrears.
    • MPLADs, which was avowedly earmarked for local area development, must be assigned to local governments, preferably to panchayats on the basis of well-defined criteria.

    3) Fifteenth finance commission-FFC

    • A special COVID-19 containment grant to the LGs by the FFC to be distributed on the basis of SFC-laid criteria is the need of the hour.
    • The commission may do well to consider this.
    • The local government grant of ₹90,000 crore for 2020-2021 by the FFC is only 3% higher than that recommended by the Fourteenth Finance Commission.
    • Building health infrastructure and disease control strategies at the local level find no mention in the five tranches of the packages announced by the Union Finance Minister.

    Suggestions related to grants

    • The ratio of basic (i.e. with no conditions) to tied (with condition)grant is fixed at 50:50 by the commission.
    • In the context of the crisis under way, all grants must be untied  for freely evolving proper COVID-19 containment strategies locally.
    • The 13th Finance Commission’s recommendation to tie local grants to the union divisible pool of taxes to ensure a buoyant and predictable source of revenue to LGs (accepted by the then Union government) must be restored by the commission.

    Consider the question “The stable source of revenue for the local government bodies whether from their own sources or in the form of grants should lie at the heart of efforts to empower them. Comment.”

     Conclusion

    COVID-19 has woken us up to the reality that local governments must be equipped and empowered. Relevant action is the critical need.

    B2BASICS:

    73rd and 74th Amendment Acts, 1993

    • It’s been 25 years since decentralized democratic governance was introduced in India by the 73rd and 74th Constitution Amendments, which came into force on April 24 and June 1, 1993, respectively.
    • The 73rd Amendment to the Constitution (Part IX) has given constitutional status to the Panchayats, and has provided it with a substantial framework. It envisions the Panchayats as the institutions of local self-governance and also the universal platforms for planning and implementing programmes for economic
      development and social justice.
    • The creation of lakhs of “self-governing” village panchayats and gram sabhas, with over three million elected representatives mandated to manage local development, was a unique democratic experiment.
    • Article 243A gives constitutional recognition to the Gram Sabha as a body consisting of persons registered in the electoral rolls relating to a village comprised within the area of the Panchayat at the village level.
    • The 74th Amendment Act provided for the constitution (Part IXA) of three types of municipalities in urban areas depending upon the size and area.
    • The Constitution provides for a complete institutional mechanism including reservation for women and formation of State Finance Commissions (SFCs) for local democracy.

  • Gairsain to be Uttarakhand new Summer Capital

    The Uttarakhand Governor has given her assent for declaration of Bhararisen (Gairsain) in Chamoli district as its summer capital.

    Practice question:

    Q. Discuss the feasibility of having multiple administrative capitals for some states in India.

    Gairsain

    • Gairsain is situated at the eastern edge of the vast Dudhatoli mountain range, located almost at the centre of the state, at a distance of approximately 250 kilometres from Dehradun.
    • It is easily accessible from both the Garhwal and the Kumaon divisions, and in a way, acts as the bridge between the two regions.
    • The state Assembly is located in Dehradun, but sessions are held in Gairsain as well.

    Why Gairsain is held as summer capital?

    • Gairsain was best suited to be the capital of the mountainous state as it was a hilly region falling on the border of Kumaon and Garhwal regions.
    • Even when Uttarakhand was carved out as a separate state from UP on November 9, 2000, statehood activists had contended that Gairsain was best suited to be the capital.
    • But it was Dehradun in the plains that were named the temporary capital. The issue is largely political.

    What are the other examples of multiple capital cities?

    • Several countries in the world have implemented the concept.
    • In Sri Lanka, Sri Jayawardenepura Kotte is the official capital and seat of the national legislature, while Colombo is the de facto seat of the national executive and judicial bodies.
    • Malaysia has its official and royal capital and seat of the national legislature at Kuala Lumpur, and Putrajaya is the administrative centre and seat of the national judiciary.
    • Among Indian states, Maharashtra has two capitals– Mumbai and Nagpur (which holds the winter session of the state assembly).
    • Himachal Pradesh has capitals at Shimla and Dharamshala (winter).
    • The former state of Jammu & Kashmir had Srinagar and Jammu (winter) as capitals (remember Darbar Move).

    Also read:

    https://www.civilsdaily.com/news/concept-of-three-capitals-in-andhra-pradesh/