October 2021
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Industrial Sector Updates – Industrial Policy, Ease of Doing Business, etc.

Lessons from the death of the ease of doing business index

Note4Students

From UPSC perspective, the following things are important :

Prelims level: EoDB ranking

Mains level: Paper 3- Issues with EoDB ranking

Context

The Ease of Doing Business Index (EoDB) came under attack on grounds that its data was modified in response to pressure from countries like China and Saudi Arabia. As a result of an independent audit, the index has now been abandoned by the Bank.

Methodology used in EoDB ranking

  • World Bank researchers developed the EoDB ranking system under the assumption that better laws and regulatory frameworks would increase the ease of doing business and improve economic performance.
  • It collected data from respondents in various countries regarding existing laws and regulations on multiple dimensions, validated them through internal scrutiny, and then combined them into an overall index that allowed us to rank countries.
  • Each dimension was weighted equally and added up to create a scale.

India specific issues with the EoDB ranking

  • If we want to create an internationally comparable index, we must ask similar questions.
  • Difference in level of development not taken into account: Yet, many of these questions may not be locally salient in economies at different levels of development.
  • For example, EoDB asked questions about the ease of getting an electric connection.
  • However, it is not getting a connection that is the problem, rather the reliability of electricity supply that hampers Indian industries.
  • In addition, most of the questions focused on hypothetical cases about limited liability companies.
  •  However, the World Bank’s own enterprise survey shows that 63 per cent of Indian enterprises are sole proprietorships and only 14 per cent are limited partnerships.
  •  Focusing on protecting minority owners’ rights in this tiny segment of Indian industries and using it to rank the business climate in India does not seem particularly useful.
  • The index placed tremendous faith in formalised systems while simultaneously disdaining bureaucratic structures embedded in this formalisation.

Why EoDB ranking was so significant?

  • A bigger problem is that EoDB had acquired such power that countries competed to improve their rankings.
  • Countries assume that their EoDB ranking will attract foreign investors.
  • Empirical evidence about this presumed impact is questionable.
  • There is indeed some evidence that the score on EoDB is associated with FDI, but this association exists mainly for more affluent countries.
  •  For instance, in 2020, China was the largest recipient of FDI despite ranking 85th on the EoDB.
  • One of the less visible parts of the EoDB exercise was the underlying political message.
  • Regulation, often treated synonymously with bureaucratic hurdles, is bad, and abandoning regulations will bring positive results.

Way forward

  • Should we try to reform the index or give up on it? The decision rests on the answer to two questions.
  • First, are there universally acceptable standards of sound economic practices that are applicable and measurable across diverse economies?
  • Second, if the indices are so powerful, should their construction be left to institutions like the World Bank that bring not just knowledge but also wield the heft of global economic power?

Consider the question “What are the advantages associated with Ease of Doing Business ranking? What are the issues with it?” 

Conclusion

The presumed economic consequences, as well as political benefits associated with improving the rankings, encouraged many countries to try and “game” the system by making superficial improvements on indicators that are being measured and, when that failed, by putting explicit pressure on the World Bank research team.

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Forest Conservation Efforts – NFP, Western Ghats, etc.

Taproots to help restore India’s fading green cover

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Bonn Challenge

Mains level: Forest resources management

This op-ed tries to establish a fair link between forest cover and population dependency on it.

A decline in Forest Cover

  • The State of the World’s Forests report 2020, says that since 1990, around 420 million hectares of forest have been lost through deforestation, conversion and land degradation.
  • Nearly 178 million hectares have decreased globally due to deforestation (1990-2020).
  • India lost 4.69 MHA of its forests for various land uses between 1951 to 1995.

Various reasons

  • Despite various international conventions and national policies in place to improve green cover, there is a decline in global forest cover.
  • Dependence on forests by nearly 18% of the global human population has put immense pressure on ecosystems; in India, this has resulted in the degradation of 41% of its forests.

Why conserve forests?

  • Covering nearly 30% land surface of the earth, forests around the globe provide a wide variety of ecosystem services and support countless and diverse species.
  • They also stabilise the climate, sequester carbon and regulate the water regime.

Need for restoration

  • Restoration in laymen’s terms is bringing back the degraded or deforested landscape to its original state by various interventions to enable them to deliver all the benefits.
  • Building and maintaining activities help to improve ecological functions, productivity and create resilient forests with multifarious capabilities.
  • India’s varied edaphic, climatic and topographic conditions are spread over 10 bio-geographical regions and four biodiversity hotspots, sheltering 8% of the world’s known flora and fauna.

India’s dependency on forest resources

  • Out of its 21.9% population living under the poverty line, nearly 275 million people including local tribals depend on the forest for subsistence.
  • The intricate link between poverty and environmental degradation was first highlighted by India at the first UN global conference on the human environment in Stockholm.
  • Though India’s increasing economic growth is helping to eliminate poverty, there is continued degradation and a growing scarcity of natural resources.
  • Further, encroachment of nearly 1.48 MHA of forest and grazing in nearly 75% of forest area is also linked to the livelihood of local communities.
  • The participation of local communities with finances for incentives and rewards is essential to redress this complex riddle.

Strategies adopted by India

Ans. Bonn Challenge

  • To combat this, India joined the Bonn Challenge with a pledge to restore 21 MHA of degraded and deforested land which was later revised to 26 MHA to be restored by 2030.
  • The first-ever country progress report under the Bonn Challenge submitted by India by bringing 9.8 million hectares since 2011 under restoration is an achievement.
  • However, continued degradation and deforestation need to be tackled effectively to achieve the remaining target of restoration by addressing various challenges.

Key challenges

  • Local ecology with a research base: forest restoration and tree planting are leading strategies to fight global warming by way of carbon sequestration.
  • However, planting without considering the local ecology can result in more damage.
  • Similarly, planting a forest in the wrong places such as savannah grasslands could be disastrous for local biodiversity.

Best strategy: Natural Forest Restoration

  • Luckily recent research has shown that naturally regenerated forests tend to have more secure carbon storage.
  • Being less tech-sensitive, cost-effective and conserving more biodiversity, natural forest restoration is becoming more widely accepted.

Limitations to India

  • Nearly 5.03% of Indian forests are under protection area (PA) management needing specific restoration strategies.
  • The remaining areas witness a range of disturbances including grazing, encroachment, fire, and climate change impacts that need area-specific considerations.
  • Further, much of the research done so far on restoration is not fully compatible with India’s diverse ecological habitats hence warranting due consideration of local factors.
  • The involvement of multiple stakeholders in forest restoration is bound to cause a conflict of interests among different stakeholders; along with low priority and insufficient funding, it becomes even more challenging.

Policy measures

  • There have been remarkable initiatives to involve local people in the protection and development of forests by forming joint forest management committees (JFMC).
  • However, a review of their functionality and performance is essential to make them more dynamic and effective to scale up their involvement.
  • Therefore, negotiations with a wide range of stakeholders including these committees for resolving conflicts and fulfilling restoration objectives are a must and a challenging feat to reach a suitable trade-off.

Way forward

  • Adequate financing is one of the major concerns for the success of any interventions including restoration.
  • The active approach of restoration which includes tree planting and the involvement of communities seeks incentives and rewards and make the whole affair quite cost-intensive.
  • The contribution of corporates in restoration efforts so far has been limited to 2% of the total achievement.
  • Hence, alternate ways of financing such as involving corporates and dovetailing restoration activities with ongoing land-based programmes of various departments can help to make it easy for operation.
  • Apart from these specific challenges, the common barriers to restoration as identified globally also need critical review before placing the required methodologies and area-specific strategies in place.

Conclusion

  • Active engagement of stakeholders including non-governmental organizations, awareness and capacity building of stakeholders with enabling policy interventions and finance can help a lot to achieve restoration objectives for India.
  • The need of the hour is an inclusive approach encompassing these concerns with the required wherewithal.

 

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Forest Conservation Efforts – NFP, Western Ghats, etc.

Govt moots easy clearance for Forest Land use

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Forest (Conservation) Act, 1980

Mains level: Read the attached story

The government has proposed absolving agencies involved in national security projects and border infrastructure projects from obtaining prior forest clearance from the Centre as part of amendments to the existing Forest Conservation Act (FCA).

About Forest (Conservation) Act, 1980

  • The FCA is the principal legislation that regulates deforestation in the country.
  • It prohibits the felling of forests for any “non-forestry” use without prior clearance by the central government.
  • The clearance process includes seeking consent from local forest rights-holders and from wildlife authorities.
  • The Centre is empowered to reject such requests or allow it with legally binding conditions.
  • In a landmark decision in 1996, the Supreme Court had expanded the coverage of FCA to all areas that satisfied the dictionary definition of a forest; earlier, only lands specifically notified as forests were protected by the enforcement of the FCA.

What is the proposed amendment?

  • The proposed amendment is part of a larger rationalizing of existing forest laws for infrastructure projects.
  • The act was regressively interpreted over the right of way of railways, highways.
  • As of today a landholding agency (Rail, NHAI, PWD, etc) is required to take approval under the Act as well as pay stipulated compensatory levies.
  • They are required to pay Net Present Value (NPV), Compensatory Afforestation (CA), etc. for use of such land which was originally been acquired for non-forest purposes.

Other proposals

  • The Environment Ministry has proposed provisions for penal compensation to make good for the damages already done to trees in forest land.
  • The document also proposes removing zoos, safaris, Forest Training infrastructures from the definition of “non-forestry” activities.
  • The current definition restricts the way money collected as part of compensatory cess can be spent towards forest conservation purposes.

Previous attempts made

  • Previous attempts to amend acts linked to forest laws have been controversial.
  • There was a plan to amend the Indian Forest Act, 1927, that deals with the rights of forest dwellers, in an attempt to address contemporary challenges to the country’s forests.
  • The draft law had been sent to key forest officers in the States for soliciting comments and objections.
  • It drew flak from activists as well as tribal welfare organizations.
  • The government withdrew the draft and has said that a newer updated version was on the anvil.

 

Try answering this PYQ

Consider the following statements:

  1. As per recent amendment to the Indian Forest Act, 1927, forest dwellers have the right to fell the bamboos grown on forest areas.
  2. As per the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, bamboo is a minor forest produce.
  3. The Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 allows ownership of minor forest produce to forest dwellers.

Which of the statements given above is / are correct?

(a) 1 and 2 only

(b) 2 and 3 only

(c) 3 only

(d) 1, 2 and 3

 

Post your answers here.

 

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Cyber Security – CERTs, Policy, etc

What is Border Gateway Protocol (BGP) ?

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Border Gateway Protocol

Mains level: Internet blackout

The outages at Facebook, WhatsApp and Instagram occurred because of a problem in the company’s domain name system. At the heart of it was a BGP or Border Gateway Protocol issue.

What is BGP?

  • Simply put, it is the protocol that runs the internet or makes it work.
  • Since the internet is a network of networks, BGP is the mechanism that bounds it together.
  • When the BGP doesn’t work, internet routers can’t really figure out what to do and that leads to the internet not working.
  • The routers — big ones — keep up on updating other possible routes that are used to deliver network packets to the last possible source.
  • In this case, Facebook platforms were the last point of destination and BGP problem meant Facebook was unable to tell other networks know that it was on the internet.

How does it work?

  • The BGP is like an entity that is responsible for creating and more importantly updating maps that lead you to sites like Google, Facebook or YouTube.
  • So if someone is responsible for making and updating the map, and they make a mistake, then the traffic — or users — will not end up reaching that place.

How did a BGP issue affect Facebook?

  • A BGP update message informs a router of any changes you’ve made to a prefix advertisement or entirely withdraws the prefix.
  • There were a lot of routing changes from Facebook last night and then routes were withdrawn, Facebook’s Domain Name Server went offline.

Role of DNS

  • DNS is the phonebook of the Internet.
  • People access information online through domain names — timesofindia.com or facebook.com.
  • Internet browsers use IP or Internet Protocol addresses and what DNS does is that it translates domain names to IP addresses to browsers can load Internet resources.
  • If DNS is the internet’s phone book, BGP is its postal service.
  • When a user enters data in the internet, BGP determines the best available paths that data could travel.

 

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Nobel and other Prizes

Physiology Nobel for work on temperature and touch

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Nobel Price, Genes controling senses

Mains level: Read the attached story

 

U.S. scientists David Julius and Ardem Patapoutian have won the Nobel Medicine Prize for discoveries on receptors for temperature and touch.

Who are the Laureates?

  • David Julius and Ardem Patapoutian, working independently in the United States, made a series of discoveries in the late 1990s and early 2000s.
  • They figured out the touch detectors in our body and the mechanism through which they communicate with the nervous system to identify and respond to a particular touch.

What did they discover?

  • They discovered the molecular sensors in the human body that are sensitive to heat, and to mechanical pressure, and make us “feel” hot or cold, or the touch of a sharp object on our skin.
  • n 1997, Dr. Julius and his team published a paper in Nature detailing how capsaicin, or the chemical compound in chili peppers, causes the burning sensation.
  • They created a library of DNA fragments to understand the corresponding genes and finally discovered a new capsaicin receptor and named it TRPV1.
  • This discovery paved the way for the identification of many other temperature-sensing receptors.
  • They identified another new receptor called TRPM8, a receptor that is activated by cold. It is specifically expressed in a subset of pain-and-temperature-sensing neurons.
  • They identified a single gene PIEZO2, which when silenced made the cells insensitive to the poking. They named this new mechanosensitive ion channel Piezo1.

How do they work?

  • The human ability to sense heat or cold and pressure is not very different from the working of the many detectors that we are familiar with.
  • When something hot, or cold, touches the body, the heat receptors enable the passage of some specific chemicals, like calcium ions, through the membrane of nerve cells.
  • It’s like a gate that opens up on a very specific request. The entry of the chemical inside the cell causes a small change in electrical voltage, which is picked up by the nervous system.
  • There is a whole spectrum of receptors that are sensitive to different ranges of temperature.
  • When there is more heat, more channels open up to allow the flow of ions, and the brain is able to perceive higher temperatures.

Therapeutic implications

  • Breakthroughs in physiology have often resulted in an improvement in the ability to fight diseases and disorders. This one is no different.
  • There are receptors that make us feel pain. If these receptors can suppress, or made less effective, the person had felt less pain.
  • Chronic pain is present is a number of illnesses and disorders. Earlier, the experience of pain was a mystery.
  • But as we understand these receptors more and more, it is possible that we gain the ability to regulate them in such a way that the pain is minimized.

[Note: We will compile all Nobel Prizes into a single post once all are awarded.]

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Foreign Policy Watch: India-United States

Outer space

Note4Students

From UPSC perspective, the following things are important :

Prelims level: Read the attached story

Mains level: Outer Spaces and its utility

In opening new pathways for outer space cooperation in the recent US visit, PM Modi has positioned India to engage more productively with a rapidly evolving domain that is seeing more commerce and contestation.

Outer Space Cooperation: A backgrounder

  • International cooperation is the new normal in space exploration, but it’s not a new concept.
  • One example of this cooperation is the International Space Station (ISS).
  • Another advance in international cooperation in the peaceful exploration of outer space came with the Artemis Accords.
  • Introduced in October 2020, the Artemis Accords establish a set of principles to guide space cooperation among countries participating in NASA’s Artemis program.

There are five treaties that deal with issues related to outer space

  1. Moon Treaty: Non-appropriation of outer space by any one country, arms control, the freedom of exploration
  2. Liability Convention: Liability for damage caused by space objects
  3. Rescue Agreement: Safety and rescue of spacecraft and astronauts
  4. Outer Space Treaty: Prevention of harmful interference with space activities and the environment
  5. Registration Convention: Notification and registration of space activities, scientific investigation and exploitation of natural resources in outer space and the settlement of disputes

Why does Outer Spaces matter?

  • Space situational awareness (SSA) involves monitoring the movement of all objects — natural (meteors) and man-made (satellites) — and tracking space weather.
  • Today, space is integral to our lives and disruption of space-based communications and earth observation will have serious consequences.

India’s strategic interest in Outer Space

Delhi’s new strategic interest in outer space is based on a recognition of two important trends.

  1. Centrality of emerging technologies in shaping the 21st-century global order
  2. Urgency of writing new rules for the road to peace and stability in outer space

Why need US for this?

  • Technology cooperation has always been an important part of India-US relations.
  • But it has been a boutique discourse between the relevant agencies of the two governments.
  • The US has traditionally dominated outer space in the commercial domain.
  • As emerging technologies overhaul global economic and security structures, Delhi and Washington now have to widen the interface of technology.

Why need a comprehensive outer space treaty?

  • Although human forays into space began in the middle of the 20th century, the intensity of that activity as well as its commercial and security implications have dramatically increased in recent decades.
  • Outer space has become a location for lucrative business as well as a site of military competition between states.
  • Until recently, outer space has been the sole preserve of states. But private entities are now major players in space commerce.
  • At the same time, as space becomes a critical factor in shaping the military balance of power on the earth, there is growing competition among states.

Expanding QUAD in this term

  • Until now, the maritime domain has dominated the strategic cooperation bilaterally between Delhi and Washington as well as within the Quad.
  • The annual Malabar naval exercise, for example, began nearly three decades ago as a bilateral venture in 1992 and became a quadrilateral one in 2020 with the participation of Australia.

Why does US need India in OST?

  • India, which has developed significant space capabilities over the decades, is a deeply invested party.
  • The US recognises that it can’t unilaterally define the space order anymore and is looking for partners.
  • International cooperation on space situational awareness is similar to the agreements on maritime domain awareness — that facilitate sharing of information on a range of ocean metrics.
  • India has been strengthening its maritime domain awareness through bilateral agreements as well as the Information Fusion Centre for the Indian Ocean Region (IFC-IOR) at Gurugram.
  • India has also taken tentative steps to cope with the unfolding military challenges in outer space.
  • It has also initiated space security dialogue with close partners like the US, Japan, and France.

Making a first global move

  • When signed, the agreement with the US on SSA will be the first of its kind for India.
  • Washington has agreements with more than two dozen countries on SSA.
  • The US and Indian delegations have also discussed a US initiative called the Artemis Accords — that seek to develop norms for activity in the Moon and other planetary objects.

Way forward

  • As commercial and military activity in outer space grows, the 20th-century agreements like Outer Space Treaty and the Moon Treaty (1979) need reinforcement and renewal.
  • The growing strategic salience of outer space demands substantive national policy action in India.
  • That can only be mandated by the highest political level. Back in 2015, PM Modi’s speech on the Indian Ocean focused national attention on maritime affairs.
  • India could do with a similar intervention on outer space today.

 

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