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September 2019

Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc

[oped of the day] The quest for inclusive growth to combat inequality


From UPSC perspective, the following things are important :

Prelims level : World Inequality Report

Mains level : Rising Inequalities

Op-ed of the day is the most important editorial of the day. This will cover a key issue that came in the news and for which students must pay attention. This will also take care of certain key issues students have to cover in respective GS papers.


According to the work of the World Inequality Lab, in the nearly 90 years between the Great Depression of 1929 and the year 2017, inequality in the US and UK first collapsed enormously and then exploded, ending up roughly where it started. 

Extent of Inequalities

  • In 1928, at the end of the Roaring Twenties, 22% of the US national income went to the richest 1%. 
  • Something very similar happened in the UK. The share of the top 1% fell steadily from 1920 to about 1979 and then went up, almost reaching the 1920 levels by 2017.
  • India has followed an even more extreme trajectory than the US since Independence. In the 1950s, the share of the top 1% in income was between 12% and 14%. That number dropped to 6% in the early 1980s and then began to climb, reaching 23% in 2017.

Not the same across all countries

  • The share of the top 1% in France, Germany, Switzerland, Sweden, the Netherlands, and Denmark was not too different from that in the US or UK in 1920. After 1920, inequality went down very sharply in all of these countries. 

What’s causing these differences

  • One view is that inequality is the cost we pay for fast growth. 
  • Countries track themselves in terms of GDP per capita despite radically different experiences with respect to inequality.
  • Across the world, the correlation between inequality and growth at the country level is negative. More unequal countries grow less fast. There is also no evidence that an increase in inequality is followed by increased growth.

Understanding Inequalities

  • There is very little support for the theory that we need to incentivize the rich so that the country grows. 
  • The sharp turnaround in inequality in the US and UK around 1980 coincides with Ronald Reagan in the US and Margaret Thatcher in the UK. They were true believers in the doctrine of incentives and pushed through a policy that combines large tax cuts for the rich with massive deregulation, and hostility towards the rights of workers. 
  • This did not happen in the rest of Western Europe, and it may be one important reason why they never saw the same explosion of inequality. 
  • Tax cuts and other giveaways to the rich do little to change their behavior.

Need for government regulation

  • It is clear that the regulations that we had in India before 1991 or China before 1979 can be debilitating. 
  • Governments do need to get out of the way of private businesses.
  • But there is a lot that can be done with a simple set of instruments
    • sensibly high taxes on high incomes and high wealth
    • vigilance against resource grabs (land, mines, water) by the rich
    • progressive carbon taxes
    • effective defense of workers’ rights by making job losses less painful

Income Inequalities

  • Income inequality is an enormous and complex challenge. 
  • The level of inequality today is the highest it has been in the last 100 years and has increased steadily over the last several decades.
  • The promise of equitable and inclusive economic growth has remained elusive.
  • Solving inequalities is not a matter of economics and policy alone, but also that of attitudes, empathy, and activism, both at the individual and societal level. 


This is not a problem that can be solved in three or five years. We must brace for this long quest with the consistent purpose for decades to come.



World Inequality Report by the World Inequality Lab at the Paris School of Economics provides estimates of global income and wealth inequality based on the most recent findings complied by the World Wealth and Income Database.

Skilling India – Skill India Mission,PMKVY, NSDC, etc.

[op-ed snap] The country’s population can be an asset: it is not a liability


From UPSC perspective, the following things are important :

Prelims level : Fertility Rate, Sex Ratio

Mains level : Population as an asset


In his address to the nation on Independence Day, Prime Minister said that a “population explosion”—posed a formidable challenge to our future. 

What’s suggested

  • Responsible citizens with small families, who contribute to their own welfare and to the good of the nation are seen as role models. 
  • Parents should think about their capacity to provide for education and healthcare before extending their families. 
  • Small families are in the national interest. 
  • Governments, at the Centre and in the states, should bring supportive schemes.

Challenges with the view

  • History
    • This is a belief system that dominated thinking 50 years ago. Family planning was the buzzword.
    • Governments provided proactive support. 
    • The Emergency culminated in the compulsory sterilization program. It led to widespread resistance and resentment among people. 
    • Such thinking did not recognize the economic or demographic factors underlying rapid population growth. 

It is important to understand the population issue in a new context.

Old thinking

  • The belief that India will remain poor because its population is growing is based on a simple logic of arithmetic. 
  • The larger the population, as a denominator, the smaller the per capita availability of everything.

New thinking

  • This reasoning does not recognize that India’s population might be growing too rapidly because it is poor. 
  • For the poor, children are a source of supplementing family income when parents are young, and of financial support in old age. 
  • High infant mortality rates only strengthen the motivation for more children.
  • Population growth rates are always high in the early stages of development because of demographic factors. As death rates drop because of improvements in public health systems that eliminate epidemic diseases, birth rates do not because poverty and illiteracy persist. 
  • As income levels rise, poverty is reduced and literacy spreads, birth rates also come down. 
  • As development leads to higher income levels, birth rates decline further to levels that merely replace the existing population. 
  • Such demographic transitions are integral to development processes. 
  • At later stages, in rich countries, birth rates might drop further so that their population declines.

The case of India

  • The demographic transition in India has been much slower than elsewhere in Asia because poverty and illiteracy persist and the public provision of education and healthcare has been grossly inadequate. 
  • The average annual rate of population growth, which was 2.1% in 1951-1971 and 2.2% in 1971-1991, dropped to 1.8% in 1991-2011 and 1.3% in 2011-2016. 
  • Birth rates dropped from 37 in 1971 and 29 in 1991 to 22 in 2011 and 19 in 2016, while fertility rates dropped from 5.2 and 3.6 to 2.4 and 2.3, respectively.
  • Projections in the Economic Survey 2019 suggest that average annual population growth in India will slow progressively to 1.1% during 2011-2021, 0.7% in 2021-2031 and 0.5% in 2031-2041. 
  • The fertility rate will drop to 1.8 in 2021 and 1.7 in 2031.
  • The natural replacement level fertility rate is 2.1 – an Indian woman would have to give birth on average to 2.1 children for the population size to remain constant. 
  • In India, given the sex ratio, with more men than women compared to the natural level, the replacement rate would need to be higher.

Hope about future

  • India’s population will continue to grow at progressively slower rates because of the relatively high proportion of young people in our population. 
  • Though our population will begin to age significantly in about a decade, the number of working-age people (20-59 years) and their share in the total population will continue to increase for more than two decades and peak at 59% in 2041.
  • For low-income countries with high underemployment, a large population is an asset rather than a liability. 
  • The high proportion of young people in the population will mean an increase in our workforce if a higher proportion of women enter the workforce. 
  • It will also mean an increase in savings rates for some time, as young people save while the old do not. 
  • This source of economic growth will not be available to many Asian countries as their workforce contracts. They would have to rely on productivity increases to sustain growth. 

Way ahead

  • We can harness this demographic dividend only through education that creates capabilities among our people.
  • We should focus on providing education and healthcare.



  • The total fertility rate (TFR) of a population is the average number of children that would be born to a woman over her lifetime.
  • It is the ratio of women to that of men in India.

Population and Associated Issues

Road and Highway Safety – National Road Safety Policy, Good Samaritans, etc.

[op-ed snap] Let’s talk safety


From UPSC perspective, the following things are important :

Prelims level : Nothing much

Mains level : MV Act and road safety


The new Motor Vehicles Act has provoked controversy.


  • The overarching aim of the new law is to bring down the number of road accidents in the country.
  • The Motor Vehicles Act stipulates the Central Government to make rules for the electronic monitoring and enforcement of road safety including speed cameras, closed-circuit television cameras, speed guns, body wearable cameras, and such other technology.
  • It also asks state governments to ensure electronic monitoring on national and state highways.

Controversial provisions

  • The penalties stipulated under the Act have attracted criticism.
  • The Motor Vehicles Act stipulates a 10-fold increase in fines for road safety traffic violations, driving under the influence of alcohol, not using seat belts and driving without seat belts.
  • Gujarat has slashed the fines for 15 violations under the Act, reducing the quantum of penalties by 50 to 70%. Two other state governments in Uttarakhand and Karnataka have also expressed reservations about the new law.

Fines are okay

  • States have the rights to bring down fines.
  • Stringent penalties are necessary because people’s lives must be saved.
    1,50,000 people die in road accidents in the country — 10% of all such fatalities worldwide.

Way ahead

  • Its litmus test will lie in effective implementation by enforcement agencies.
  • Punitive measures will not achieve much without an adequate number of traffic police personnel and road-safety devices like traffic lights.
  • Unless law enforcement officials give up old habits like bribery, the purpose of the new law will be defeated.
  • The Odisha government, which has relaxed the implementation of the law for three months, has asked traffic regulators “to counsel and handhold the public”.
  • Rajasthan has partially implemented the Act and has decided to take steps to “self-motivate people”.


The self-motivation versus deterrence debate is not new. It’s heartening that the new Motor Vehicles Act has rekindled this discussion.

International Space Agencies – Missions and Discoveries



From UPSC perspective, the following things are important :

Prelims level : K2-18b

Mains level : Read the attached story

  • K2-18b is now the only planet orbiting a star outside the Solar System known to have both water and temperatures that could be potentially habitable.


  • About 110 light years from Earth, an exoplanet eight times the mass of Earth orbits a star. Called K2-18b, it was discovered in 2015 by NASA’s Kepler spacecraft.
  • The researchers used 2016-17 data from the Hubble Space Telescope and developed algorithms to analyse the starlight filtered through K2-18b’s atmosphere.
  • The results revealed the molecular signature of water vapour, also indicating the presence of hydrogen and helium in the planet’s atmosphere.
  • It resides in a habitable zone — the region around a star in which liquid water could potentially pool on the surface of a rocky planet.
  • Scientists have found signatures of water vapour in the atmosphere of K2-18b. The discovery of water vapour is not the final word on the possibility of life.
  • That makes it the only planet orbiting a star outside the Solar System that is known to have both water and temperatures that could support life.

Not ‘Earth 2.0’

  • K2-18b is not ‘Earth 2.0’ as it is significantly heavier and has a different atmospheric composition.
  • For one thing, K2-18b’s size and surface gravity are much larger than Earth’s. Its radiation environment may be hostile.

Foreign Policy Watch: India-China

Pangong Tso Lake: the theatre of India-China LAC scuffles


From UPSC perspective, the following things are important :

Prelims level : Pangong Tso Lake

Mains level : India-China Border Issues

  • Indian and Chinese soldiers had a heated exchange in Ladakh near the Pangong Tso Lake few days back. However, the issue has now been resolved, the report said.
  • The incident recalls a similar incident almost exactly two years ago, in the same area in Eastern Ladakh.
  • Differing perceptions of where exactly the LAC lies has often been the reason for such incidents.

Pangong Tso

  • In the Ladakhi language, Pangong means extensive concavity, and Tso is lake in Tibetan.
  • Pangong Tso is a long narrow, deep, endorheic (landlocked) lake situated at a height of more than 14,000 ft in the Ladakh Himalayas.
  • The western end of Pangong Tso lies 54 km to the southeast of Leh.
  • The 135 km-long lake sprawls over 604 sq km in the shape of a boomerang, and is 6 km wide at its broadest point.
  • The brackish water lake freezes over in winter, and becomes ideal for ice skating and polo.
  • The legendary 19th century Dogra general Zorawar Singh is said to have trained his soldiers and horses on the frozen Pangong lake before invading Tibet.

The 2017 incident

  • On August 19, 2017, a video was posted online that appeared to be visual confirmation of reports of an alleged scuffle that had taken place a few days earlier between Indian and Chinese soldiers on the banks of Pangong lake.
  • The video showed the two sides kicking and punching, throwing stones, using sticks and rods against each other.
  • In the normal course, the two patrols, after coming face to face, would have been expected to engage in what is called a “banner drill”, displaying a banner asking the other side to vacate its territory.
  • Such a drill might last a few minutes to an hour — but barring some occasional jostling, the two sides would disengage quietly.

Strategic significance

  • The LAC cuts through the lake, but India and China do not agree on its exact location.
  • As things stand, a 45 km-long western portion of the lake is in Indian control, while the rest is under China’s control.
  • Most of the clashes between the two armies occur in the disputed portion of the lake.By itself, the lake does not have major tactical significance.
  • But it lies in the path of the Chushul approach, one of the main approaches that China can use for an offensive into Indian-held territory.
  • Indian assessments show that a major Chinese offensive, if it comes, will flow across both the north and south of the lake.


  • During the 1962 war, this was where China launched its main offensive — the Indian Army fought heroically at Rezang La, the mountain pass on the southeastern approach to Chushul valley.
  • Over the years, the Chinese have built motorable roads along their banks of the Pangong Tso.
  • At the PLA’s Huangyangtan base at Minningzhen, southwest of Yinchuan, the capital of China’s Ningxia Hui Autonomous Region, stands a massive to-scale model of this disputed area in Aksai Chin.
  • It points to the importance accorded by the Chinese to the area.

The dispute in the area

  • The difference in perception over where the LAC lies on the northern bank of the lake, makes this contested terrain.
  • In 1999, when the Army unit from the area was moved to Kargil for Operation Vijay, China took the opportunity to build 5 km of road inside Indian territory along the lake’s bank.
  • The August 2017 skirmish took place in this area.
  • The 1999 road added to the extensive network of roads built by the Chinese in the area, which connect with each other and to the G219 Karakoram Highway.
  • From one of these roads, Chinese positions physically overlook Indian positions on the northern tip of the Pangong lake.
  • The mountains on the lake’s northern bank jut forward in major spurs, which the Army calls “fingers”. India claims that the LAC is coterminous with Finger 8.

Why Chinese aggression?

  • On the water, the Chinese had a major advantage until a few years ago, but India purchased better boats some seven years ago, leading to a quicker and more aggressive response.
  • Although there are well-established drills for disengagement of patrol boats of both sides, the confrontations on the waters have led to tense situations in the past few years.
  • The induction of high-speed boats has ostensibly provoked the Chinese, who have responded by increasing the number of transgressions in this area in recent years.

Higher Education – RUSA, NIRF, HEFA, etc.

Jeevan Kaushal Programme


From UPSC perspective, the following things are important :

Prelims level : Jeevan Kaushal Programme

Mains level : Importance of life skills

Jeevan Kaushal Programme

  • The University Grants Commission (UGC) has launched a “life skills” (Jeevan Kaushal) programme in the curriculum for under-graduate courses across the country.
  • The new programme, which for 8 credit points, can be accommodated in any semester and is aimed at inculcating emotional and intellectual competencies in students develop verbal and non-verbal communication skills.
  • The programme will comprise four courses – communication, professional, leadership and universal human values and skills.
  • The programme will focus on team work, problem-solving and decision-making.
  • It will be effective tools in helping students develop practical knowledge that helps them when they start their careers and become responsible citizens.

Higher Education – RUSA, NIRF, HEFA, etc.

World University Rankings 2019


From UPSC perspective, the following things are important :

Prelims level : About the ranking

Mains level : State of higher education in India

  • The World University Rankings was recently released by the UK-based Times Higher Education.
  • Oxford University continues to lead the rankings table followed by California Institute of Technology and University of Cambridge. Stanford University and MIT complete the top five table.

No Indian university this year

  • For the first time since 2012, no Indian institution featured among the top 300.
  • The country’s best performing institution, IISc-Bangalore, slipped 50 places from the 251-300 ranking cohort into the 301-350 bracket.
  • The dip was on account of a significant fall in its citation impact score offsetting improvements in research environment, teaching environment and industry income.

Why India slipped?

  • The best Indian institutions are generally characterized by relatively strong scores for teaching environment and industry income.
  • But they perform poorly when it comes to international outlook in comparison to both regional and international counterparts.

No mean downgrade

  • Even as India dropped out of the top 300, it increased its representation in the rankings from 49 universities last year to 56 this time.
  • As a result, India holds on to its place as the fifth most-represented nation in the world and the third most-represented in Asia (behind Japan and mainland China).
  • It has eight more universities than Germany, which is sixth in the country ranking, but 25 fewer than China.

Antibiotics Resistance

[pib] Global Antimicrobial Resistance Research and Development Hub


From UPSC perspective, the following things are important :

Prelims level : AMR

Mains level : Not Much

  • India has joined the Global Antimicrobial Resistance (AMR) Research and Development (R&D) Hub as a new member.

Global AMR R&D Hub

  • The Hub was launched in May 2018 in the margins of the 71st session of the World Health Assembly, following a call from G20 Leaders in 2017.
  • It is supported through a Secretariat, established in Berlin and currently financed through grants from the German Federal Ministry of Education and Research (BMBF) and the Federal Ministry of Health (BMG).
  • It supports global priority setting and evidence-based decision-making on the allocation of resources for AMR R&D through the identification of gaps, overlaps and potential for cross-sectoral collaboration and leveraging in AMR R&D.
  • From this year onward, India will be the member of Board of members of Global AMR R&D Hub.
  • India looks forward to working with all partners to leverage their existing capabilities, resources and collectively focus on new R&D intervention to address drug resistant infections.


Antimicrobial resistance

  • Antimicrobial resistance (AMR or AR) is the ability of a microbe to resist the effects of medication that once could successfully treat the microbe
  • The term antibiotic resistance is a subset of AMR, as it applies only to bacteria becoming resistant to antibiotics.
  • Antibiotics are medicines used to prevent and treat bacterial infections. Antibiotic resistance occurs when bacteria change in response to the use of these medicines.
  • Bacteria, not humans or animals, become antibiotic-resistant.
  • These bacteria may infect humans and animals, and the infections they cause are harder to treat than those caused by non-resistant bacteria.
  • Antibiotic resistance occurs naturally, but misuse of antibiotics in humans and animals is accelerating the process.
  • A growing number of infections – such as pneumonia, tuberculosis, gonorrhoea, and salmonellosis – are becoming harder to treat as the antibiotics used to treat them become less effective.
  • It leads to higher medical costs, prolonged hospital stays, and increased mortality.

[pib] National Pension Scheme for Traders and Self Employed Persons


From UPSC perspective, the following things are important :

Prelims level : About the scheme

Mains level : Benefits and coverage of Pension Schemes in India

  • PM has launched the National Pension Scheme for Traders and Self Employed Persons, a pension scheme for the Vyaparis (shopkeepers/retail traders and self-employed persons),

About the Scheme

  • It is a voluntary and contributory pension scheme for entry age of 18 to 40 years with a provision for minimum assured pension of Rs 3,000/- monthly on attaining the age of 60 years.
  • The eligible Vyaparis can visit their nearest CSCs and get enrolled under the scheme. In addition people can also self-enroll by visiting its portal.
  • At the time of enrollment, the beneficiary is required to have an Aadhaar card and a saving bank/ Jan-dhan Account passbook only.
  • He/ She should be within 18 to 40 years of age group. GSTIN is required only for those with turnover above Rs. 40 lakhs.
  • The enrolment under the scheme is free of cost for the beneficiaries. The enrolment is based upon self-certification.
  • An estimated 3 crore Vyaparis in the country are expected to be benefitted under the pension scheme.

Eligibility Criteria

  • Vyaparis with annual turnover not exceeding Rs 1.5 crore are eligible for the pension.
  • The beneficiary should not be income tax payer and also not a member of EPFO/ESIC/NPS (Govt.)/PM-SYM.
  • The Central Government shall give 50 % share of the monthly contribution and remaining 50% contribution shall be made by the beneficiary.
  • The monthly contribution is kept low to make it affordable. For example, a beneficiary is required to contribute as little as Rs.100/- per month at a median entry age of 29 years.

Indian Army Updates

[pib] Exercise Maitree – 2019


From UPSC perspective, the following things are important :

Prelims level : About the Exercise

Mains level : India-Myanmar strategic relations

  • Joint Military Exercise MAITREE-2019 between India and Thailand will be conducted at Foreign Training Node, Umroi (Meghalaya) this month.

Exercise Maitree 2019

  • Exercise MAITREE is an annual training event which is being conducted alternatively in Thailand and India since 2006.
  • Indian and Royal Thailand Army (RTA) will participate in the exercise with an aim to share experience gained during various counter terrorism operations in their respective countries.
  • This is in the series of military training exercises undertaken by India with various countries.
  • Exercise MAITREE with Thailand is a significant in terms of the security challenges faced by both the nations in the backdrop of changing facets of global terrorism.
  • The scope of this exercise covers company level joint training on counter terrorism operations in jungle and urban scenario.