The proposed Consumer Protection (E-Commerce) Rules, 2020, have been drafted ostensibly in the name of the consumer. The rules are driven more by the desire to shield the traditional brick-and-mortar stores, and handicap e-commerce firms, especially the foreign ones.
Issues with the provisions of draft Consumer Protection (E-Commerce) Rules, 2020
1) Fall-back liability clause is unfair for those operating through marketplace model
Under this provision, e-commerce entities will be liable in case suppliers on the platform fail to deliver the goods to consumers, causing them a loss.
E-commerce firms in India operate through either the inventory model or the marketplace model.
As FDI is permitted only in the marketplace model.
Under the marketplace model, e-commerce platforms don’t hold inventory, but simply connect buyers and sellers.
Foreign players typically operate through this model.
Considering that these platforms exercise little or no control over the inventory under this model, how can they be held liable for the sellers’ actions.
2) Identifying goods based on country of origin and providing fair opportunity to domestic sellers
The draft rules also require e-commerce platforms to identify goods based on their country of origin.
And when goods are being viewed for purchase by consumers, the rules also mandate platforms to provide suggestions to ensure “fair opportunity” for domestic sellers.
This raises the question as to why the Make in India campaign is being pushed through the Consumer Protection Act.
Surely, if domestic manufacturers are competitive, consumers will automatically gravitate towards them.
Interests of consumers, not domestic manufacturers, should be at the core of the consumer protection framework.
3) Overlapping/competing jurisdictions
Data protection: The draft rules have sought to safeguard consumer data by restraining e-commerce firms from sharing consumer data without consent.
But the data protection should be governed by the provisions under the Personal Data Protection Bill and not the Consumer Protection Act.
Considering the graded approach that is likely to be adopted under the Data Protection Bill, an e-commerce user’s data could be classified as per its vulnerability and be left under the jurisdiction of the data protection authority.
Dominant position: The rules also state that e-commerce entities are prohibited from abusing their dominant positions in the market.
The “abuse of dominant position” has been given the same meaning as that prescribed under Section 4 of the Competition Act, 2002.
This will open the scope for new consumer protection authority to enter into issues of abuse of dominant position — the domain of the Competition Commission of India.
Consider the question “Over-regulation tends to curb competition and create monopolies instead of ensuring its holistic growth dovetailed with fair competition. In light of this, examine the issues with the draft Consumer Protection (E-Commerce) Rules, 2020?”
Conclusion
The lines of demarcation that have been drawn up in the retail landscape — single brand vs multi-brand, online vs offline, domestic vs foreign — serve only to protect powerful vested interests, not benefit the consumer as is often proclaimed.
GS-1 Post-independence consolidation and reorganization within the country.
GS-2 Comparison of the Indian constitutional scheme with that of other countries.
GS-3 Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth;Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment. GS-4 Aptitude and foundational values for Civil Service, integrity, impartiality and non-partisanship, objectivity, dedication to public service, empathy, tolerance and compassion towards the weaker-sections
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The world is facing gloomy times in midst of the pandemic, conflicts, and natural calamities.
Recently, we witnessed the horrors caused by nature in Chamoli district, the ground of the famed Chipko movement in Uttarakhand.
Nature’s warning is evident with visible cracks in its erstwhile harmonious relationship with humanity.
This essay/article emphasizes the need for building an ecological civilization and descending from the present cliff of uncertainty towards peaceful living and inclusive development and respect for nature.
The first industrial revolution that took place 250 years ago was primarily with coal and steam; the second with electricity and oil; the third with computers and its accessories; and now the fourth is a fusion of technologies in the physical, digital and technological worlds.
Civilizational chaos
The wave of industrial and green revolution marked a major turning point in earth’s ecology and humans’ relationship with the environment.
During the 20th century, with the detonation of the atomic bomb, humanity entered a new era.
Thus, we gained the power to destroy ourselves (mutually assured destruction), without the wisdom to ensure that we must avoid doing so.
Looming threats to mankind
Widespread industrialization, the proliferation of factories, destruction of forests for the construction of massive dams & power stations and the migration of people has all caused serious disturbances in the ecosystem.
The resulting climate change and global warming is a serious threat to the present as well as the future.
Both nature and world peace are under threat.
All these developments coupled with geopolitics have put humanity on a cliff and presents dangerous situations.
Future of Peace
The future of peace and harmony in the 21st century is likely to be directly linked to issues concerning five key realities of life today:
Ecology, global warming, and climate change
Nuclear weapons, the emerging technology of warfare and the continuing arms race among nation-states
Geopolitics and nationalism
Religious extremism and
Poverty and inequality
We do not know how to retrieve the present dangerous situation away from its self-destructive ways. This needs to be appreciated in a threefold perspective:
[1] Nature
Today there is a credible threat to human survival from global warming and climate change with the potential to damage the lives and habitats of billions of people in different parts of the world.
The enormity of the challenge of conservation of ecology and halting climate change is formidable and calls for making changes in our behavior and thinking.
At the heart of the matter is: How do we move towards building fresh sensitivities for conservation in our civilizational processes?
Five events of the recent times need to be particularly referred to:
Outbreak of pandemic SARS (severe acute respiratory syndrome) in Hong Kong in 2002-03;
Bushfires in Brazil and Australia of 2019;
Continuous extinction of species
Forest fires in California alongside the Covid-19 pandemic in 2020 and
Coronavirus pandemic
These five events have given us signals that if ecology problems are not attended to urgently the world may not need world wars to destroy itself.
[2] Science
In the last decades of the 20th century, the focus of society has shifted decisively towards science and its domineering daughter, technology, both in the western and developing countries.
This has led to the globalization of products, cultural values, and information. It is integrating markets and trade.
But what becomes of environment and nature in such a scenario, remains a matter of great concern.
We have been brought to an alarming situation primarily on account of excessive greed, faulty planning, insensitive politics, and lack of imagination.
Technology, being value-neutral, has accelerated the pace of the downward journey.
Outcome: Climate change
Climate change and global warming are posing serious problems.
The biggest polluter has been the release of carbon dioxide.
To control it with speed, we have to change the terms of the market. It is based on the law of profit.
A change would mean rejecting the general line of dealings in the market in the world for the sake of the long-term interests of the human race. Are we ready for this major break? And, here wisdom comes.
[3] Wisdom
Wisdom is defined as ‘the ability to use one’s knowledge and experience to make good decisions and judgments.’
Wisdom is a product of experiences and reflections not only of the present generation but of the civilizational processes of a nation and also of the world.
Human beings can destroy their environment as well as can rise above petty interests, use technology and reverse the process of destruction of plant species and minimize carbon emissions.
At the present juncture, if we do not make use of our cumulative wisdom, nature will be harmed and succeeding generations will blame us for our failure.
We have to keep the Vedic precept of ‘माता भूमिः पुत्रो अहं पृथिव्याः ’ (‘This earth is our mother and we are its sons.’) in our minds.
Thankfully, on 12 December 2015, the Global Climate Accord was reached among 195 countries of the world in Paris.
The Paris Accord as it came to be known, commits countries to actions and policies that would restrict the rise in global temperatures ‘well below’ 2 degrees Celsius (3.6 degrees Fahrenheit) by the year 2100.
Way Forward
We have to generate hope, courage, and respect for nature.
We should employ science and human ingenuity with determination to overcome the present state of despondency.
If science, spirituality, and wisdom go hand in hand, one can create a better world on this earth. Mahatma Gandhi said: ‘Earth provides enough to satisfy every man’s need but not for every man’s greed’.
It should become the maxim of the post-Covid world, that it will need farsighted leadership and efficient institutions of governance.
There is an imperative requirement to contemplate and work towards building an ecological civilization that would outline the ways of living in harmony with nature.
Bahudha Approach is based on the maxim enjoined upon us by the Rigveda. It proclaims: Ekam Sad Vipra Bahudha Vadanti The Real is One, the learned speak of it variously. This provides for dialogue among different religions, cultures, and ways of living. It celebrates diversity and respect for harmonious living and nature.
Conclusion
The post-Covid world would be a different world.
It has made evident that we are all interdependent and have to work for sharing economic benefits as well as fruits of science together, irrespective of religious, ethnic, economic, and cultural divides.
We have to move towards building an ecological civilization and descending from the present cliff of uncertainty towards peaceful living and inclusive development and respect for nature.
The union environment ministry has put together an amnesty scheme for infrastructure and industrial projects that have violated environmental clearance (EC) norms for Environment Impact Assessment.
What is the Scheme?
The new amnesty scheme empowers regulatory institutions at both central and state levels:
(1) To identify and report cases of violation
It refers to identify, examine and appraise violation projects, refraining from causing further environmental damage and also compensating for causing damage to the environment.
(2) To take action against violators in terms of closure or demolition of a project
It defines three different actions to be taken for the violation projects depending upon their EC status.
In case the project has not obtained EC, it will be ordered to close its operations.
If the project has undergone expansion without obtaining EC for the expanded portion, it will be ordered to revert the activity/production to the limit granted in the existing EC.
(3) To levy penalty on them that is akin to the scale of the project
It entitles the regulatory authorities to levy penalties on the proponent, in addition to the bank guarantee.
Issues with the scheme
There is also no established procedure to ensure that the complaints made against the violator are not dismissed without hearing.
This ambiguity in the memorandum leaves scope for a less transparent redressal mechanism.
The penalties suggested could be termed as legitimating non-compliance.
Criticisms
Environmental experts argue that such a move to regularise projects, irrespective of size, scale or impact, is purely a political move.
They regarded this move as weakening the EIA process.
This will be the largest regularization scheme for projects that have operated illegally in India and added to our total environmental and social burdens.
Thousands of projects operate in different states without any environmental approval.
Way forward
Looking at the plethora of violation cases it is imperative to develop such a mechanism.
However, we should not compromise the existing environmental regulations and adopt a ‘zero tolerance for violation’.
Back2Basics: Environment Impact Assessment
Environment impact assessment is a process under the Environment (Protection) Act, 1986, which prevents industrial and infrastructural projects from being approved without proper oversight.
This process ensures that every project should go through the EIA process for obtaining prior environmental clearance.
EIA covers projects such as mining of coal or other minerals, infrastructure development, thermal, nuclear and hydropower projects, real estate and other industrial projects.
The projects are assessed based on their potential impact on the environment. Based on the assessments, they are granted or denied environmental clearance by a panel of experts.
Loopholes in draft EIA 2020
The EIA new draft 2020 allows post-facto clearance.
This means that even if a project has come up without environmental safeguards or without getting environment clearances, it could carry out operation under the provision of the new draft EIA 2020.
This is disastrous because we already have several projects that are running without EIA clearances.
Lt Governor has dismissed 11 Jammu and Kashmir government employees for alleged terror links under provisions of Article 311(2)(c) of the Constitution.
What is Article 311?
Article 311 of the Constitution deals with ‘Dismissal, removal or reduction in rank of persons employed in civil capacities under the Union or a State’.
Under Article 311(2), no civil servant can be “dismissed or removed or reduced in rank except after an inquiry in which he has been informed of the charges and given a reasonable opportunity of being heard in respect of those charges’’.
Subsection (c) of the provision, however, says this clause shall not apply “where the President or the Governor, as the case may be, is satisfied that in the interest of the security of the State it is not expedient to hold such inquiry”.
Remedy available
The only available remedy to a terminated employee is to challenge the government’s decision in the High Court.
The Union Cabinet has approved of the term of the Commission constituted under Article 340 of the Constitution to examine the issue of Sub-categorization within Other Backward Classes (OBCs) in the Central List.
What is the Sub-categorization of OBCs?
OBCs are granted 27% reservation in jobs and education under the central government.
In September 20202, a Constitution Bench of the Supreme Court reopened the legal debate on the sub-categorization of SCs and STs for reservations.
The debate arises out of the perception that only a few affluent communities among over 2,600 included in the Central List of OBCs have secured a major part of this 27% reservation.
Need for sub-categorization
The argument for sub-categorization — or creating categories within OBCs for reservation — is that it would ensure “equitable distribution” of representation among all OBC communities.
To examine this, the Rohini Commission was constituted on October 2, 2017.
At that time, it was given 12 weeks to submit its report but has been given several extensions since, the latest one being the 10th.
Before the Rohini Commission was set up, the Centre had granted constitutional status to the National Commission for Backward Classes (NCBC).
Why so many extensions are being given?
In process of preparing the sub-categorized central list of OBCs, the Commission has noted several ambiguities in the list as it stands now.
The Commission is of the opinion that these have to be clarified/rectified before the sub-categorised central list is prepared.
A hurdle for the Commission has been the absence of data for the population of various communities to compare with their representation in jobs and admissions.
Many groups of OBCs have been demanding enumeration of OBCs in the Census.
Back2Basics: Article 340
Article 340 of the Indian Constitution lays down conditions for the appointment of a Commission to investigate the conditions of the backward classes.
The President may by order appoint a Commission consisting of such persons as he thinks fit to investigate the conditions of socially and educationally backward classes within the territory of India.
The Union Cabinet has approved the continuation of the Centrally Sponsored Scheme (CSS) for the Development of Infrastructure Facilities for Judiciary. It also approved the decision to support the Gram Nyayalayas by proving recurring and non-recurring grants for a period of 5 years with a total outlay of Rs 50 crores.
About the Scheme
A Centrally Sponsored Scheme (CSS) for Development of Infrastructure Facilities for Judiciary has been in operation since 1993-94.
Adequacy of judicial infrastructure is critical for the reduction of pendency and backlog of cases in Courts.
The primary responsibility of infrastructure development for the subordinate judiciary rests with the State Governments.
The present proposal provides for additional activities like the construction of lawyer halls, toilets complexes and digital computer rooms.
This will add to the convenience of lawyers and litigants besides reducing the digital divide.
Why such a move?
Adequacy of judicial infrastructure is critical for the reduction of pendency and backlog of cases in Courts.
Several courts are still functioning in rented premises with insufficient space and some in dilapidated conditions without basic amenities.
Well-equipped judicial infrastructure facilitates the administration of justice in a manner that allows easy access and timely delivery of justice to all.
What is Gram Nyayalayas Scheme?
Gram Nyayalayas were established for speedy and easy access to the justice system in the rural areas across the country.
The Gram Nyayalayas Act came into force on October 2, 2009.
In terms of Section 3(1) of the Act, it is for the State Governments to establish Gram Nyayalayas in consultation with the respective High Courts.
The Act authorizes Gram Nyayalaya to hold a mobile court outside its headquarters.
Some major reasons behind the non-enforcement include financial constraints, the reluctance of lawyers, police and other government officials.
Features of the Gram Nyayalayas
Gram Nyayalaya is established generally at headquarter of every Panchayat at the intermediate level or a group of contiguous panchayat in a district where there is no panchayat at an intermediate level.
The Gram Nyayalayas are presided over by a Nyayadhikari, who will have the same power, enjoy the same salary and benefits of a Judicial Magistrate of First Class.
Such Nyayadhikari is to be appointed by the State Government in consultation with the respective High Court.
Jurisdiction
A Gram Nyayalaya have jurisdiction over an area specified by a notification by the State Government in consultation with the respective High Court.
The Court can function as a mobile court at any place within the jurisdiction of such Gram Nyayalaya, after giving wide publicity to that regard.
The Gram Nyayalayas have both civil and criminal jurisdiction over the offences and nature of suits specified in the First, Second and Third schedule of the Act.
The pecuniary jurisdiction of the Nyayalayas are fixed by the respective High Courts.
Appeals in criminal matter can be made to the Sessions Court in the respective jurisdiction and in civil matters to the District Court within a period of one month from the date of judgment.
Trials
Gram Nyayalayas can follow special procedures in civil matters, in a manner it deem just and reasonable in the interest of justice.
Civil suits are proceeded on a day-to-day basis, with limited adjournments and are to be disposed of within a period of six months from the date of institution of the suit.
In execution of a decree, the Court can allow special procedures following rules of natural justice.
Gram Nyayalayas allow for conciliation of the dispute and settlement of the same in the first instance.
They have been given the power to accept certain evidence which would otherwise not be acceptable under the Indian Evidence Act.
But the quest for sustained higher growth has been elusive for India for the last five years. The pandemic seems to make it more elusive.
The magnitude of contraction in the economy
There is nothing encouraging in the provisional estimates of annual national income (2020-21), released by the National Statistical Office.
The agriculture sector continued its impressive growth performance, reiterating that it still remains as the vital sector of the economy, especially at times of crisis.
The manufacturing sector continued its subdued growth performance, failing to emerge as the growth driver.
The contraction in trade (-18.2%), construction (-8.6%), mining (-8.5%) and manufacturing (-7.2%) is a matter of concern as these sectors account for the bulk of low-skilled jobs.
Gross Domestic Product (GDP) at Constant (2011-12) Prices in Q4 of 2020-21 is showing a growth of 1.6%.
The magnitude of contraction in the economy and the policy responses towards it raises an important issue of growth prospects for the next year.
Contextualising the current growth rates in terms of following three macroeconomic data would provide us a better perspective on growth recovery.
1) Rising unemployment
The unemployment data released by the Centre for Monitoring Indian Economy (CMIE) says, that in May 2021, India’s labour participation rate at 40 per cent was the same as it was in April 2021.
But, the unemployment rate shot up to 11.9 per cent from 8 per cent in April.
A stable labour participation rate combined with a higher unemployment rate implies a loss of jobs and a fall in the employment rate.
The employment rate fell to 35.3 per cent in May 2021 from 36.8 per cent in April 2021.
According to CMIE, over 15 million jobs were lost in May 2021.
May 2021 was therefore a particularly stressful month on the jobs front.
Takeaway
Employment and aggregate demand in an economy are related via the channel of disposable incomes of workers.
Aggregate demand and output growth have a positive correlation.
Hence, the prospects of growth revival in the next year look bleak at the moment and from employment perspective.
2) Low business confidence
It is the second important data point that needs to examined.
Business confidence index (BCI), from the survey by the industry body FICCI, plummeted to 51.5 from 74.2 in the previous round.
The survey also highlights the weak demand conditions in the economy.
Compounding this is the uncertainty arising out of the imposition of localised curbs due to the second wave of infections and a muddled vaccine policy in the country.
3) Low PMI
Manufacturing Purchasing Managers’ Index (PMI) has slipped to a 10-month low indicating that the manufacturing sector is showing signs of strain with growth projections being revised lower.
Both BCI and PMI slipping down indicates that the overall optimism towards 2021-22 is low, which could impact investments and cause further job losses.
Why focusing on supply-side will not work
Since last year, the policy responses have been to rely on credit easing, focusing more on supply side measures.
This policy stance is unlikely to prop up growth for three reasons.
First, the bulk of the policy measures, including the most recent, are supply side measures and not on the demand side.
Second, large parts of all the stimulus packages announced till now would work only in the medium term.
Third, the use of credit backstops as the main plank of policy has limits compared to any direct measure on the demand side as this could result in poor growth performance if private investments do not pick up.
Further, the credit easing approach would take a longer time to multiply incomes as lending involves a lender’s discretion and borrower’s obligation.
Way forward
Growth recovery depends on demand recovery.
The combined increase in exports of April and May 2021 is over 12% indicating that global demand rebound is much faster than the domestic demand.
What needs to be addressed immediately is the crisis of low domestic demand.
A tight-fisted fiscal policy approach comes at a time when conventional fiscal stimulus packages might not be enough as supply side issues arising out of episodic lockdowns need to be addressed simultaneously.
Focusing on short-term magnified growth rates resting on low bases might be erroneous, as income levels matter more than growth rates at this juncture.
Conclusion
India needs a sharp revival of demand for which higher per capita incomes are necessary.
