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GS Paper: GS3

  • [pib] Ranking of States on Support to Startup Ecosystems, 2019

    The Results of the second edition of Ranking of States on Support to Startup Ecosystems were recently released by Minister of Commerce & Industry.

    About the Ranking

    • The Department for Promotion of Industry and Internal Trade (DPIIT) has conducted the second edition of the States Startup Ranking Exercise.
    • The key objective is to foster competitiveness and propel States and Union Territories to work proactively towards uplifting the startup ecosystem.
    • It has been implemented as a capacity development exercise to encourage mutual learning among all states and to provide support in policy formulation and implementation.

    7 focus areas

    1. Institutional Leaders
    2. Regulatory Change Champions
    3. Procurement Leaders
    4. Incubation Hubs
    5. Seeding Innovation Leaders
    6. Scaling Innovations Leaders
    7. Awareness and Outreach Champions

  • The way out on GST compensation

    The economic disruption due to pandemic has made the issue of GST compensation bone of contention between the Centre and the States. This article argues that it is the GST Council and not the Centre which is responsible to find ways to raise the revenue in such a situation.

    GST revenue loss and role of the Centre

    • Due to global pandemic, one significant area of loss of revenue to both the Centre and the states is GST.
    • The states have the comfort of assured 14 per cent growth through the compensation mechanism.
    • The Centre has no such guarantee.
    • The Compensation Act mandates compensating the states for revenue loss on GST implementation from the Compensation Fund.

    Role of GST Council

    • The course of action to be adopted in the event of the amount in the Fund falling short of requirements was discussed at length in the GST Council.
    • The late Arun Jaitley, then chairman, had, in the 8th meeting, assured that “in case Compensation Fund fell short of the compensation payable, the GST Council shall decide the mode of raising additional resources including borrowing from the market which could be repaid by collection of cess in the sixth year or further subsequent years”; the Council had agreed to this suggestion.
    • Quite clearly,  it is the Council and not the Government of India that shall decide the mode of raising additional resources in the event of a shortfall and this is reflected in Section 10(1) of the Compensation Act.

    Why it makes sense for the States to borrow

    • It is argued that borrowings by the Centre or by the states make no difference in the context of fiscal discipline.
    • The argument further adds that the Centre should borrow in view of its higher borrowing and debt-servicing capacity and its ability to borrow at lower rates.
    • Article 292 (1) mandates that the Centre can borrow on the security of the Consolidated Fund of India (CFI).
    • However, the idea of providing compensation to the states from the Consolidated Fund of India was not agreed to in the Council, it is difficult to agree with the suggestion that GoI borrows on the basis of the said CFI.
    • Large borrowings by the Centre would push up the bond yield rates, pushing up bond yield of the states setting off a spiral leading to hike in the interest rates for businesses and individuals.
    • The states’ borrowing would become costlier if the Centre were to borrow for this purpose.
    • The borrowing capacity of the states, too, is not very inferior.
    • The RBI study of state finances shows that the debt receipts of all the states as a percentage of GDP has hovered between 2.4 per cent and 3.6 per cent during the last four years.
    • The states have on the average borrowed just about 1.25 per cent of the GSDP thus far.
    • The states are consistently borrowing less than they can borrow (legally and financially).
    • The cost of state borrowings for this purpose can be considerably lowered if arranged through a special window.
    • The Centre has already breached the budgeted borrowing limits for the current year.
    • Thus it makes sense for the states to borrow.

    Borrowing options for the States

    • There are two ways in which the States can borrow.
    • 1) Borrowing the entire shortfall in the revenue.
    • 2) Borrowing only the shortfall attributable to GST implementation with the remaining shortfall to be made good from the Cess Fund post the transition period.
    • Certain conditionalities have been relaxed for option-1.
    • However, borrowing the entire shortfall, as envisaged in option-1, will hurt both the markets and the private sector, pushing up the interest rate.
    • The single window under option-1 being arranged by the Centre and the entire debt being serviced from future cess receipts will ensure that the cost remains close to the G-sec rate.
    • Moreover, there will be no variation in the interest rate as between the states.

    Conclusion

    The states should come forward and work with the Centre in the true spirit of cooperative federalism that the Council has come to be known for these past few years.

  • Exploring the idea of blockchain voting

    The article analyses the pros and cons of the adoption of blockchain technology for remote voting.

    Background

    • The Election Commission of India has been exploring the idea of further digitising the electoral infrastructure of the country.
    • In furtherance of this, it explored the possibility of using blockchain technology for the purpose of enabling remote elections.

    What will be the benefits

    • ‘Remote voting’ would appear to benefit internal migrants and seasonal workers, who account for roughly 51 million of the populace (Census 2011).
    • The envisioned solution might also be useful for some remotely-stationed members of the Indian armed forces.

    Key issues

    • Electors would still have to physically reach a designated venue in order to cast their vote,
    • Digitisation and interconnectivity introduce additional points of failure external to the processes which exist in the present day.
    • Blockchain solutions rely heavily on the proper implementation of cryptographic protocols.
    • If security is breached, it could unmask the identity and voting preferences of electors, or worse yet, allow an individual to cast a vote as someone else.
    • The provisioning of a dedicated line may make the infrastructure less prone to outages, it may also make it increasingly prone to targeted Denial-of-Service attack.
    • Digitised systems may also stand to exclude and disenfranchise certain individuals due to flaws in interdependent platforms, flaws in system design, as well as general failures caused by external factors.

    Way forward

    • Political engagement could perhaps be improved by introducing and improving upon other methods, such as postal ballots or proxy voting.
    • Another proposed solution to this issue includes the creation of a ‘One Nation, One Voter ID’ system.

    Consider the question “What are the opportunities and challenges in the adoption of blockchain technology. Suggest the other alternatives to enable the ballot portability.”

    Conclusion

    Adoption of technology should be weighed against the risk it carries in the electoral process. While the adoption of blockchain technology offers many opportunities, the concerns it raises must be addressed before its adoption.

  • Global Biodiversity Outlook-5 Report

    The Global Biodiversity Outlook (GBO) 5 report was leaked before its official release. Let’s look at the highlights of the report.

    Try this PYQ:

    Q.Consider the following pairs:

    Terms sometimes seen in the news- Their origin

    1. Annex-I Countries- Cartagena Protocol
    2. Certified Emissions- Nagoya Protocol Reductions
    3. Clean Development- Kyoto Protocol Mechanism

    Which of the above pairs is/are correctly matched?

    (a) 1 and 2 only

    (b) 2 and 3 only

    (c) 3 only

    (d) 1, 2 and 3

    About GBO report

    • The GBO is the flagship publication of the Convention on Biological Diversity (CBD).
    • It is a periodic report that summarizes the latest data on the status and trends of biodiversity and draws conclusions relevant to the further implementation of the Convention.
    • It summarizes progress made towards achieving the objectives of the Convention, such as the Aichi Targets and identifies key actions to achieve these.

    Highlights of the Report

    • GBO-5 is an overview of the state of nature. It is a final report card on the progress made by countries in achieving the Aichi Biodiversity Targets.
    • What the world needed was a shift from business-as-usual, the report said. This transformation needed to take place in all human activities that were interlinked with natural resources.
    • This shift was crucial, the report added as natural resources would continue to decline and the world would not be able to meet the UN-mandated Sustainable Development Goals.
    • The GBO-5 suggested some shifts that need to be implemented to achieve the 2050 Vision for Biodiversity. These include:
    1. Transition within land and forests: The report called the restoration of all forests that had been degraded. It also urged restoring local ecosystems.
    2. Sustainable agriculture: Farmers would have to reduce the use of chemicals and instead focus more on agroecological farming practices, the report said.
    3. Sustainable food systems: The report urged people to eat healthier, plant-based food and less meat. It also called for a focus on the problem of food wastage within the supply chain and household.
    4. Climate action: The report called for nature-based solutions to reduce climate change
    5. One health: Agricultural and urban ecosystems, as well as wildlife, should be managed in an integrated manner, it said.

    Failure to meet the targets

    None of the 20 ‘Aichi Biodiversity Targets’ agreed on by national governments through the CBD has been met, according to the report. The world was supposed to meet these targets by 2020. Whatever little progress has been made, has to do with the following:

    • Aichi Biodiversity Target 1 (Creating awareness about the value of biodiversity)
    • Aichi Biodiversity Target 11 (17 per cent of terrestrial and inland water areas and 10 per cent of coastal and marine areas, to be effectively and equitably managed)
    • Aichi Biodiversity Target 16 (Access to genetic resources and the fair and equitable sharing of benefits arising from their utilization)
    • Aichi Biodiversity Target 17 (Creation, adoption and implementation of an effective, participatory and updated national biodiversity strategy and action plan)
    • Aichi Biodiversity Target 19 (Improvement and dissemination of knowledge, the science base and technologies relating to biodiversity).

    Back2Basics: Convention on Biological Diversity

    • The CBD, known informally as the Biodiversity Convention, is a multilateral treaty.
    • The Convention has three main goals including the conservation of biological diversity (or biodiversity); the sustainable use of its components; and the fair and equitable sharing of benefits arising from genetic resources.
    • It has two supplementary agreements:
    1. Cartagena Protocol on Biosafety- An international treaty governing the movements of living modified organisms (LMOs) resulting from modern biotechnology from one country to another
    2. Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization (ABS)
    • All UN member states—with the exception of the United States—have ratified the treaty.

  • Registration under Foreign Contribution Regulation Act (FCRA)

    The Union Home Ministry has granted FCRA registration to the famous Gurdwara Harmandir Sahib, or the Golden Temple, in Amritsar, enabling it to receive foreign donations.

    Foreign Contribution Regulation Act

    • The Foreign Contribution (Regulation) Act, 2010 is an act to regulate the acceptance and utilization of foreign contribution or foreign hospitality by certain individuals or associations or companies
    • It prohibits acceptance and utilization of foreign contribution or foreign hospitality for any activities detrimental to the national interest and for matters connected therewith or incidental thereto
    • The central government has the power to prohibit any persons or organizations from accepting foreign contribution or hospitality if it is determined that such acceptance would likely “affect prejudicially”

    (i) the sovereignty and integrity of India,

    (ii) public interest,

    (iii) freedom or fairness of election to any legislature,

    (iv) friendly relations with any foreign State, or

    (v) harmony between religious, racial, social, linguistic or regional groups, castes or communities

    Premise for the FCRA

    • Government of India enacted the Foreign Contribution (Regulation) Act (FCRA) in the year 1976 with an objective of regulating the acceptance and utilization of foreign contribution.
    • Any association, non-government organisation (NGO) or registered society requires FCRA registration to receive foreign donations for specified purposes.
    • The act was majorly modified in 2010 with several amendments because many NGOs were found using illegal use of foreign funding.

  • What are SAROD-Ports?

    Union Ministry of Shipping has e-launched ‘SAROD-Ports’ (Society for Affordable Redressal of Disputes – Ports).

    Try this MCQ:

    Q.The term SAROD is sometimes seen in the news with context to governance is related to:

    (a) Disputes Redressal

    (b) Employment

    (c) Sustainable Development

    (d) None of the above

    SAROD Ports

    SAROD-Ports are established under the Societies Registration Act, 1860 with the following objectives:

    1. Affordable and timely resolution of disputes in a fair manner
    2. Enrichment of Dispute Resolution Mechanism with the panel of technical experts as arbitrators.
    • They consist of members from the Indian Ports Association (IPA) and Indian Private Ports and Terminals Association (IPTTA).
    • They will advise and assist in settlement of disputes through arbitrations in the maritime sector, including ports and shipping sector in Major Port Trusts, Non-major Ports, including private ports, jetties, terminals and harbours.
    • It will also cover disputes between granting authority and Licensee/Concessionaire /Contractor.

  • Rethinking the defence doctrine

    Indian Army’s prevailing doctrine

    • The Army’s prevailing doctrine is designed to deter and defend against major conventional invasions.
    • This determines how the Army is organised, what equipment it operates, and where it is deployed.
    • The Army expects to win wars by launching its own punitive offensives after an enemy attack, to either destroy enemy forces or seize enemy land.
    • The Army expected that any Chinese bid to capture Indian territory would come as a major conventional invasion.

    Miscalculation about Chinese intentions

    • Chinese army crossed the LAC in several places nearly simultaneously, and in larger numbers than usual.
    • Still, the Indian Army probably expected the stand-off would repeat the pattern of years past: China would make its point with a temporary transgression and retreat after talks.
    • But China has no interest in launching a major conventional invasion, but this is not just a typical probe either.
    • China’s quick land grab looks increasingly permanent, like an attempt to change the border without triggering war.

    How to address such security threat

    • Addressing this type of security threat requires preventing, not reversing, such fait accompli land grabs.
    • This requires a fundamental shift in the Army’s doctrinal thinking.
    • This fundamental shift involves strategies revolving around punishing the adversary, to strategies that prevent its adventurism in the first place.

    Way forward

    • Surveillance: Doctrinal change involves a greater investment in persistent wide-area surveillance to detect and track adversary moves, devolved command authority to respond to enemy aggression.
    • Rehearsed procedures: It would also involve rehearsed procedures for an immediate local response without higher commanders’ approval.
    • Detection: The military must be able to detect adversary action and react quickly, even pre-emptively, to stop attempted aggression from becoming a fait accompli.
    • Delegation of power: In peacetime, local commanders must have the authority and to take anticipatory action.
    • The late-August incident at Chushul demonstrates how this can and should work.

    Conclusion

    The challenge for India is to learn the right lessons and be alert to similar tactics in other regions, like the Indian Ocean. It must not rely on doctrines forged in wars half a century ago.

  • Redefining a farmer

    The article analyses the issues of multiple definitions of a farmer. The issues of ownership as a criterion for being a farmer and its impact on tenant farmers in discussed.

    Is land ownership right criterion

    • Traditionally, land ownership is a mandatory criterion for availing benefits under various agricultural schemes in India.
    • Laws governing land leasing operate at different levels across India.
    • The Model Agricultural Land Leasing Act, 2016 was introduced to formalise land leasing.
    • However, except a few States, a majority of State governments have not extended the scope of the Act to farmers.
    • According to the 2015-16 agricultural census, about 2.65 million operational holdings are either partially or wholly leased.

    How this impact tenants

    • The impact of agrarian distress is felt disproportionately by tenant farmers.
    • The tenant farmer incurs the costs and faces the risks, while the owner receives the rent, subsidies and other support.
    • The lessees do not benefit from loan waivers, moratorium and institutional credit, and are forced to be at the mercy of moneylenders.
    • The distress is reflected in the fact that tenant farmers account for a majority of farmer suicides reported in the NCRB data.

    Multiple definitions of farmers

    • There are multiple definitions for a ‘farmer’ in official data published by the Government of India.
    • The population census defines ‘cultivators’ as a person engaged in cultivation of land either ‘owned’ or held in kind or share.
    • The 59th round of the Situation Assessment Survey (SAS) of farmers also stresses on ‘possession of land’ either owned or leased or otherwise possessed for defining ‘farmers’.
    • Delinking of land as the defining criterion for a ‘farmer’ was done in the 70th round of SAS carried out by the NSSO.
    • The 70th Round of NSSO refined the definition of a farmer as one who earns a major part of the income from farming. 

    Conclusion

    Access to land as a policy instrument in bringing about equitable growth of rural economies needs no further emphasis. However, until the time ‘land to the tiller’ remains just wishful thinking, adopting a broader definition of a ‘farmer’ is a short-term solution to ensure inclusive and sustainable growth.

  • Analysing the impact of Bt cotton

    After almost 20 years of adoption of Bt cotton in India, its time to review the claimed benefits of the Bt.

    Hybrid cotton seeds and issues

    • Until the 20th century the indigenous ‘desi’ variety, Gossypium arboreum was used.
    • From the 1990s, hybrid varieties of G. hirsutum were promoted.
    • These hybrids cannot resist a variety of local pests and require more fertilizers and pesticides.
    • Cotton suffers from plenty of infestation from moth pests such as the Pink Bollworm (PBW) and sap-sucking (Hemipteran) pests such as aphids and mealy bugs.
    • With increasing pressure to buy hybrid seeds, the indigenous varieties have lost out over the years.

    Resistant pests and introduction of Bt cotton

    • The increasing use of synthetic man-made pesticides to control pests and the rising acreage under the American long-duration cotton led to the emergence of resistant pests.
    • Resistant Pink and even American Bollworm (ABW), a minor pest in the past, began increasing, leading to a growing use of a variety of pesticides.
    • Rising debts and reducing yields, coupled with increasing insect resistance, worsened the plight of cotton farmers.
    • It was in this setting that Bt cotton was introduced in India in 2002.

    What is Bt cotton

    • The plant containing the pesticide gene from the bacteria Bacillus thuringiensis (Bt), has been grown in India for about twenty years.
    • This pesticide, now produced in each Bt plant cell, ought to protect the plant from bollworm, thereby increasing yields and reducing insecticide spraying on the cotton plant.

    Review of the utility of Bt cotton

    • Review  was published in the scientific journal Nature Plants, analysing the entire picture of the use of Bt cotton in India.
    • Earlier studies had attributed to Bt the tripling of cotton yield between 2002-2014 in India.
    • However, one detail that raises concerns over such a conclusion was that yield differences between farmers who were the early adopters of Bt cotton and those who were not suffered from selection bias.
    • Controlling for such bias showed (in 2012) that the contribution of Bt cotton to yield increase was only about 4% each year.
    • Since yields vary annually by over 10%, the benefits claimed were dubious.
    • There are discrepancies between yield and the deployment of Bt cotton.
    • For instance, the Bt acreage was only 3.4% of the total cotton area in 2003, not sufficient to credit it for the 61% increase in yield in 2003-2004.
    • The rise in cotton yields can be explained by improvements in irrigation, for instance in Gujarat, and a dramatic growth across the country in the use of fertilizers.
    • The PBW developed a resistance by 2009 in India. In a few years, the situation was dreadful.
    • A technology that works in the lab may fail in fields since real-world success hinges on multiple factors.

    Way forward

    • The cost of ignoring ‘desi’ varieties for decades has been high for India.
    • Research suggests that with pure-line cotton varieties, high density planting, and short season plants, cotton yields in India can be good and stand a better chance at withstanding the vagaries of climate change.
    •  But government backing for resources, infrastructure and seeds is essential.

    Conclusion

    It is time to pay attention to science and acknowledge that Bt cotton has failed in India, and not enter into further misadventures with other Bt crops such as brinjal or herbicide resistance.

  • [pib] ARISE-ANIC Initiative

    Atal Innovation Mission (AIM), NITI Aayog, has launched Aatmanirbhar Bharat ARISE-Atal New India Challenges, to spur applied research and innovation in Indian MSMEs and startups.

    The name ARISE typically sounds some social sector or HRD related initiative. This is where one has to be cautious.

    ARISE ANIC Initiative

    • The program is a national initiative to promote research & innovation and increase the competitiveness of Indian startups and MSMEs.
    • Its objective is to proactively collaborate with esteemed Ministries and the associated industries to catalyse research, innovation and facilitate innovative solutions to sectoral problems.
    • It also aims to provide a steady stream of innovative products & solutions where the Central Government Ministries / Departments will become the potential first buyers.
    • It is in line with the PM’s mandate of “Make in India”, “Startup India”, and “Aatmanirbhar Bharat” to fast track the growth of the Indian MSME sector.

    Its implementation

    • The programme will be driven by ISRO, four ministries—Ministry of Defence; Ministry of Food Processing Industries; Ministry of Health and Family Welfare; and Ministry of Housing and Urban Affairs.
    • It will support deserving applied research-based innovations by providing funding support of up to Rs 50 lakh for speedy development of the proposed technology solution and/or product.