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  • 7 Years of UPA Government vs 7 Years of NDA Government

    The article compares the performance of the present government under Prime Minister Modi with the first seven years of the Manmohan Singh government on various fronts.

    Context

    The current government completed seven years at the Centre recently. It is time to reflect and look back at its performance on basic economic parameters over the last seven years. It may also be interesting to compare and see how it fared vis-à-vis the first seven years of UPA government (2004-05 to 2010-11) under Manmohan Singh.

    Analysing the progress by studying key economic indicator

    1)  GDP growth

    • One of the key economic parameters is GDP growth.
    • It is not the most perfect one, as it does not capture specifically the impact on the poor, or on inequality.
    • But higher GDP growth is considered central to economic performance as it enlarges the size of the economic pie.
    • The average annual rate of growth of GDP under the Modi government so far has been just 4.8 per cent compared to 8.4 per cent during the first seven years of the Manmohan Singh government.
    • If this continues as business as usual, the dream of a $5 trillion economy by 2024-25 is not likely to be achieved.

    2) Inflation

    • The Modi government scores much better on the inflation front with CPI (rural and urban combined) rising at 4.8 per cent per annum.
    • It is well within the tolerance limits of RBI’s targeted inflation band and also much lower than 7.8 per cent during the first seven years of the Manmohan Singh government.

    3) Forex reserves

    • Also, at macro level, foreign exchange reserves provide resilience to the economy against any external shocks.
    • On this score too, the Modi government fares quite well with forex reserves rising from $313 billion on May 23, 2014 to $593 billion on May 21, 2021.

    4) Food and agriculture

    • It engages the largest share of the workforce in the economy and matters most to poorer segments.
    • On the agri-front, both governments recorded an annual average growth of 3.5 per cent during their respective first seven years.
    • However, on the food and fertiliser subsidy front, the Modi government broke all records in FY21, by spending Rs 6.52 lakh crore and accumulating grain stocks exceeding 100 million tonnes in May end, 2021.
    • One area in which the Modi government performed very poorly is agri-exports.
    • In 2013-14 agri-exports had crossed $43 billion while during all the seven years of the Modi government agri-exports remained below this mark of $43 billion.
    • Sluggish agri-exports with rising output put downward pressure on food prices.
    • It helped contain CPI inflation, but subdued farmers’ incomes.

    5) Infrastructure development

    • The Modi government has done better in power generation by increasing it from 720 billion units per annum to 1,280 billion units per annum.
    • Similarly, road construction too has been at least 30 per cent faster under the Modi government.

    6) Social sector

    • Based on an international definition of extreme poverty (2011 PPP of $ 1.9 per capita per day), the World Bank estimated India’s extreme poverty in 2015 to be about 13.4 per cent, down from 21.6 per cent in FY 2011-12.
    • Even the incidence of multidimensional poverty hovered around 28 per cent in 2015-16.
    • Three key indicators can be used to assess performance on this front:
    • One, average annual person days generated under MGNREGA in the first five years since this programme started under the UPA in 2006-07 to 2010-11, which was 200 crore, and under Modi government it improved to 230 crore.
    • Two, average annual number of houses completed under the Indira Awaas Yojana and PM Awaas Yojana-Gramin, which improved from 21 lakhs to 30 lakhs per annum.
    • Three, open defecation free (ODF) which was only 38.7 per cent on October 2, 2014 and shot up to 100 per cent by October 2, 2019, as per government records.

    Conclusion

    The current government has turned out to be more welfare-oriented than reformist in revving up GDP growth. How long this welfare approach is sustainable without enlarging the size of GDP pie is an open question.

  • Prime Prelims Ts 2022 launched | Program starting from 19th June 2021 | Enrollment open

    Program starting from 19th June 2021

    click here to enroll in Prime Prelims Ts 2022 With Individual Mentorship
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    40 Tests (8 Basic, 8 Advanced, 10 Current Affairs, 10 Full Length, 4 CSAT)

    Download PDF for better visibility – Prime Prelims TS 2022 Time Table

     It’s 2021-22 session and we are set to look at the brighter side of Covid mayhem. Apparently, it dented our confidence but not the will to stand tall. So much happened over the last couple of years and now things are set for a revival. Several exams were battered with UPSC Civil Services being no exception.

    Despite the churnings happening around us, few fundamentals couldn’t be challenged at least about the UPSC exam. Much coveted UPSC civils service has always attracted the best talents from across India. Hence on the flip side heightening the competition. So, you really have to strive hard. As a result, a focussed and measured approach is always needed and that too throughout the year.

    Those who have already faced the exam would know it themselves. The importance & contribution of the Mock Tests in finetuning the prep process cannot be overemphasized.

    I wouldn’t mention anyone else but cite my own example.

    During the first year of preparations, I used to struggle through Hindu and Express for current affairs. Investing around 4 hours a day fighting the menace of changing context all on my own. Then I realised the need for something which had the potential to give me clarity on the content and samples of what comes in the exam.

    It then became evident that a reliable touch of direction and a source of instant help, whenever necessary is indispensable. That’s when I would know what are my weaknesses and how to correct them. Not only that but also how to mend my gaps in understanding.

    These sessions have the power of healing touch and reassurance. That’s how I could divert all my energy with a needle tip precision and forsake all the non-core worries to my mentors/course designers.

    Now fast forward to the present, to prove the point we have many testimonies and attestations. Not the least many top rankers in several pep talks have emphasised the importance of Mocks / Practice Test papers. And Civilsdaily IAS has always been at the centre stage.

    Comparison Between With Mentorship, Without Mentorship and Other Program
    click here to enroll in Prime Prelims Ts 2022 With Individual Mentorship
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    Presenting you few highlights about our Prime Prelims Program 2022

    1. Complete course revision with Test Paper-based time-plan

    The complete course has 36 Test papers, to enhance the exam worthiness of an aspirant. Especially those who have their house (concepts) in order about the course/syllabus. The idea of solving test or mock papers is with the intent to find out the gaps in our preparation. Sometimes they are also helpful for the mains or subjective type questions.

    2. A holistic mix of Static – cum- Dynamic Test series

    Course completion is what we care to establish with each finishing module. And this incorporates the aspect of Current affairs and Associated statics as well. Hence an aspirant gets a holistic mix of Static cum Dynamic elements featured in this course.

    3. Mentor & Discussion help for 1-1

    This is an important element for aiding/expediting the process of course completion within a specified time limit. Mentorship with tests is going to help an aspirant keep a track of the syllabus, which was earlier either glossed over or paid little attention to. Mentors will be the person who would have the responsibility to ensure you end up with all the papers. Also, imparting valuable advice to stay sane and mindful.

    Test Mentorship calls would be provided once you are up-to-date with all the allotted tests. Calls would be scheduled as per this plan:

    1. One call after the first two tests. Aimed at guiding the basics.
    2. One call after the successful completion of basic tests.
    3. One call after the successful completion of Advanced tests.
    4. One call before the start of FLTs.
    5. One call before the Prelims Exam.

    4. All India Rankings

    All India rankings are here to help you deal with the moments of truths vis-à-vis your preparation level. They give you the necessary nudge to focus back on evaluating the current state of preparation. Your mentor would have a lot more to focus on wrt the rankings you achieve.

    5. Performance-based Aspirant Cohorts on Civilsdaily Habitat

    At Civilsdaily, you would get a community always ready to deal with unexpected roadblocks. We aim to create a like-minded and similarly placed aspirant cohort. For a better discussion of tasks and problem-solving capabilities. So as a member of any Cohort, chat (responsibly) with other learners.

     If you have a question, chances are, you’re not alone. Reach out in the discussion forum to ask for help from other learners taking this program.

    6. CivilsDaily Habitat Sessions – Ask Anything

    Where your queries about courses/syllabus / basic doubts would be addressed to keep you always on the move.

    Throughout this course, you will learn about the techniques of time management, the ability to find a static–dynamic convergence. Also, peace of mind about course completion under the guidance of a mentor. The mentor would also provide a lot of reading material from time to time. But sometimes, you may need to look things up on your own for extra learning. Things change fast in our dynamic socio-political setup, so it is critical to do your own research so you can stay up-to-date on what is new.

    7. Tikdams for mastering the art of intelligent guesstimates

    Tikdam technique is a very important skill which can boost your score by 30+ marks. It will prepare you and enhance your ability to perform under pressure (& lack of information). 

    We not only impart but make you practice these skills in our Test Series. We will provide:

    1) Static and Tikdam Lectures: Lectures on static subjects will *not* focus on explaining you the basics but instead focus on important details/trivia you skip to miss. From a prelims perspective, these details become very important. We are also releasing 30+ Hours of Advanced Video Lectures on Static subjects – Polity, History, Geography, Economy

    2) Economic Survey and Budget lectures: The importance of Union budget and economic survey can’t be overstated, not only for UPSC prelims but also for Mains and Essay as well, it is a not to be missed section for preparation. Even for UPSC interview candidates, these lecture series are very important.


    3) Static PDF Notes: Civilsdaily has been known for its high-quality content. In this Program, We will be providing Static notes of various Subjects like Economics, Arts and Culture, Environment, Geography, History etc.

    Our Testimonials:

    What is there on Habitat?

    • #DDS sessions – Dedicated sessions every day to resolve doubts in real-time. Never keep a doubt to yourself.
    • An ecosystem for co-learning and active learning.
    • A highly motivated community to bring flexibility and consistency to your preparation.
      Samachar Manthan Civilsdaily IAS Current Affairs UPSCHabitat – Desktop and Mobile view
    click here to enroll in Prime Prelims Ts 2022 With Individual Mentorship
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    Program inclusion:

    • 40 Tests
      • 8 Basic tests
      • 8 Advanced tests
      • 10 Current Affairs
      • 10 Full-Length Tests
      • 4 CSAT tests
    • Civilsdaily’s Monthly Magazine Combo
    • Individual Mentorship
    • Economic Survey & Budget Videos and Notes
    • Advanced Static + Tikdam Videos
    • Admission to the exclusive Civilsdaily Prelims club on Habitat.
    • Monthly Zoom call and Static PDF notes.

    This is what our students have to say about our mock tests..

    Feedback for 2021 Prelims Mocks

    Civilsdaily’s Community: Testimonials

    Two variants of Prelims Ts 2022:

    click here to enroll in Prime Prelims Ts 2022 With Individual Mentorship
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  • Simultaneous Elections in India

    The article deals with the issue frequent elections in the country and highlights the need for debate on the idea of “one nation, one election”.

    Need for debate on one nation one election

    The idea has been around since at least 1983, when the Election Commission first mooted it. The concept needs to be debated mainly around five issues.

    1) Financial costs of  conducting elections

    • The costs of conducting each assembly or parliamentary election are huge and, in some senses, incalculable.
    • Directly budgeted costs are around Rs 300 crore for a state the size of Bihar.
    • But there are other financial costs, and incalculable economic costs.
    • Before each election, a “revision” of electoral rolls is mandatory.
    • The costs of the millions of man-hours used are not charged to the election budget.
    • The economic costs of lost teaching weeks, delayed public works, badly delivered or undelivered welfare schemes to the poor have never been calculated.

    2) Cost of repeated administrative freezes

    • The Model Code of Conduct (MCC) has economic costs too.
    • Works may have been announced long before an election is announced, but tenders cannot be finalised, nor work awarded, once the MCC comes into effect.
    • Time overruns translate into cost overruns.
    • But the huge costs of salaries and other administrative expenditures continue to be incurred.
    • Add to this the invisible cost of a missing leadership.
    • Important meetings and decisions get postponed, with costs and consequences that are difficult to calculate.
    • A NITI Aayog paper says that the country has at least one election each year.

    3) Visible and invisible costs of repeatedly deploying security forces

    • There are also huge and visible costs of deploying security forces and transporting them, repeatedly.
    • A bigger invisible cost is paid by the nation in terms of diverting these forces from sensitive areas.

    4)  Campaign and finance costs of political parties

    • There is little doubt that the fiscal and economic costs of an election are not trivial, and that two elections, held separately, will almost double costs, including those incurred by political parties themselves.

    5) Question of regional/smaller parties having a level playing field

    • There are fears about the Centre somehow gaining greater power, or regional parties being at a disadvantage during simultaneously held elections.
    • However, fixed five-year terms for state legislatures in fact take away the central government’s power to dissolve state assemblies.
    •  Until 1967 when simultaneous elections were the norm.
    • The Constitution and other laws would need to be amended is obvious, but that is hardly an argument against the proposal.

    Consider the question “There are huge costs associated with the frequent elections in the country. Is simultaneous elections a solution? What are the issues involved?”

    Conclusion

    As the elections in four states and one Union territory in March-April are suspected to have contributed to the second wave of Covid infections, a well-reasoned debate on a concept as important as “one nation, one election” is called for.

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  • Need to deal with distortions built into GST

    The article highlights the issues with the one state one vote system adopted in the GST Council decision making.

    Context

    The Goods and Services Tax (GST) Council in India is still engaged in a discussion on whether life-saving and hard-to-come-by products should be taxed. Such delay in decision-making can largely be explained by the distorted design and incentive structure of the GST itself.

    Imbalance in collection and distribution of taxes

    • The taxes collected under GST are accumulated by the Union government and a portion is transferred back to each state under a formula.
    • As is the case with most federal countries, there is a large imbalance in the collection and distribution of taxes between states.
    • this holds true also for income accrued to, and distributed, from the GST pool.
    • Four states — Maharashtra, Tamil Nadu, Karnataka, and Gujarat contribute nearly as much as the remaining 27 states combined.
    • Most federal countries exhibit this characteristic where a few large, rich, provinces or states contribute disproportionately.

    Variation in dependence of States on transfers from the Union government

    • Only about 30 per cent of the overall revenue of the states mentioned above — Maharashtra, Tamil Nadu, Gujarat, and Karnataka — comes from the Union government.
    • But for the remaining 27 states, roughly 60 per cent of their revenues are obtained through transfers from the Union government.
    • For the smaller Northeastern states, these transfers from the Union government constitute 80-90 per cent of their total revenues.
    •  In effect, the states that contribute the most to the GST pool are the least dependent on transfers from the Union government while the ones that contribute the least are the most dependent.

    Two problems in net-transfers in India

    1) One-sided transfers

    •  In almost every federal union, net-transfers work to reduce differences in development between states over time.
    • However, Over the last 25 years or so, net transfers have become increasingly one-sided in India.
    • That is, the quantum of net-transfers diminishes, as states become more equal through such transfers.
    • But in India, the opposite has occurred.

    2) Indirect taxes and cess

    • The Union government of the last seven years has greatly exacerbated this problem through two actions.
    • First, it has reconstructed the composition of taxation away from the fair and progressive channel of direct taxation towards the inherently regressive and unfair channel of indirect taxes.
    • Second, the Union has shifted a large proportion of taxation roughly 18 per cent of its overall revenues into cesses, a special form of taxes that remain outside the GST pool and hence do not have to be shared with the states.
    • Since 2014, cess revenues grew 21 per cent every year leading to a doubling in terms of its share of GDP.

    Implications of these two problems for fiscal federalism

    • The combined effect of these problems is that all states (collectively) get a lower share of overall revenues.
    • Individual states face an ever-increasing disparity in the ratio of funds received from the Union as a proportion of taxes collected by the Union from that state.
    • This is an affront to fiscal federalism and an assault on “cooperative federalism”.

    Issue of ‘one state one vote’ system

    • States that are more dependent on transfers from the Union want to maximise GST collections while states that are less dependent can afford to be more sensitive to citizens’ concerns.
    • The case of taxes on Covid products is perhaps the starkest instance of such differences.
    • Most large states are ready to forego this tax revenue for humanitarian considerations.
    • But 19 states representing the remaining 30 per cent of the population seem keen to continue to levy GST on Covid products.
    •  These are mostly smaller states.
    • Given the smaller population of such states, the adverse impact of Covid taxes will be minimal for them.
    • But they will reap the benefits of additional revenues from GST on Covid products levied on the much larger populations of the bigger states.

    Conclusion

    When direct tax policy decisions are legislated by Parliament, which has proportional representation from states according to their size of the population, indirect tax policy decisions should not be subject to one state one vote system.

  • 7th June 2021| Daily Answer Writing Enhancement(AWE)

    Topics for Today’s questions:

    GS-1 Modern Indian history from about the middle of the eighteenth century until the present- significant events, personalities, issues

    GS-2 Functions and responsibilities of the Union and the States, issues and challenges pertaining to
    the federal structure.
    Parliament and State legislatures—structure, functioning, conduct of business, powers & privileges and issues arising out of these.

    GS-3 Inclusive growth and issues arising from it.

    Science and Technology- developments and their applications and effects in everyday life.

    GS-4 Lessons from the lives and teachings of great leaders, reformers and administrators.

     

    Following are the questions:

    Question 1)

     

    Q.1) “The 19th century reforms movements were not just socio-religious movements rather they affected every aspect of Indian life” Elucidate. What were their limitations? (15 Marks)

     

    Question 2)

    Q. 2) The fiscal and economic cost associated with frequent elections in India are enormous. Is simultaneous elections a solution? What are the concerns with it? (10 Marks)

    Question 3)

    Q.3) The digital payment boom in India is indicative of a larger paradigm shift in the ease of access to financial services. In light of this, examine the role played by JAM trinity in increasing financial inclusion in India. (10 marks)

    Question 4)  

    Q.4) What does the following quotation means to you? “My Life is my Lesson” Mahatma Gandhi (10 Marks)

     

    HOW TO ATTEMPT ANSWERS IN DAILY ANSWER WRITING ENHANCEMENT(AWE)?

    1. Daily 4 questions from General studies 1, 2, 3, and 4 will be provided to you.

    2. A Mentor’s Comment will be available for all answers. This can be used as a guidance tool but we encourage you to write original answers.

    3. You can write your answer on an A4 sheet and scan/click pictures of the same.

    4.  Upload the scanned answer in the comment section of the same question.

    5. Along with the scanned answer, please share your Razor payment ID, so that paid members are given priority.

    6. If you upload the answer on the same day like the answer of 1st June is uploaded on 1st June then your answer will be checked within 72 hours. Also, reviews will be in the order of submission- First come first serve basis

    7. If you are writing answers late, for example, 1st June is uploaded on 3rd June, then these answers will be evaluated as per the mentor’s schedule.

    8. Also, if you are uploading an answer late then tag the mentor like @Swatantra so that the mentor is notified about your answer

    *In case your answer is not reviewed, reply to your answer saying *NOT CHECKED*. Swatantra Sir’s tag is available, tag him.

    For the philosophy of AWE and payment: 

    CLICK HERE To join Daily AWE

  • 7th June 2021 | Prelims Daily with Previous Year Questions

    [WpProQuiz 665]

    [WpProQuiz_toplist 665]

  • UPSC CSE Prelims Previous Years Questions Compilations for Paper I (2020-2016)

    Indian Polity Previous Years Questions CompilationDownload
    Indian Economy Previous Years Questions CompilationDownload
    Science and Technology Previous Years Questions CompilationDownload
    Ancient History Previous Years Questions CompilationDownload
    Medieval History Previous Years Questions CompilationDownload
    Modern Indian History Previous Years Questions CompilationDownload
    Environment Previous Years Questions CompilationDownload
    Geography Previous Years Questions CompilationDownload
    Arts and Culture Previous Years Questions CompilationDownload

  • BRICS

    As India is gearing up to host this year’s BRICS summit, the grouping is facing fresh challenges, from disputes among member countries to tackling COVID-triggered crises and opportunities.

    What is BRICS?

    • To be clear, BRICS was not invented by any of its members.
    • In 2001, Goldman Sachs’ Jim O’Neill authored a paper called “Building Better Global Economic BRICs”, pointing out that future GDP growth in the world would come from China, India, Russia and Brazil.
    • Significantly, the paper didn’t recommend a separate grouping for them, but made the case that the G-7 grouping, made up of the world’s most industrialized, and essentially Western countries, should include them.
    • O’Neill also suggested that the G-7 group needed revamping after the introduction of a common currency for Europe, the euro, in 1999.
    • In 2003, Goldman Sachs wrote another paper, “Dreaming with BRICs: Path to 2050”, predicting that the global map would significantly change due to these four emerging economies.
    • In 2006, leaders of the BRIC countries met on the margins of a G-8 (now called G-7) summit in St. Petersburg, Russia, and BRIC was formalized that year.

    Issues in its consolidation

    • Common ground for the members was built by ensuring that no bilateral issues were brought up, but the contradictions remained.
    • Many economists soon grew tired of “emerging” economies that didn’t reach the goals they had predicted.
    • Others saw India’s closer ties with the US after the civil nuclear deal as a sign its bonds with BRICS would weaken.
    • Meanwhile, Russia, which had hoped to bolster its own global influence through the group, had been cast out of the G-7 order altogether after its actions in Crimea in 2014.
    • China, under Xi Jinping, grew increasingly aggressive, and impatient about the other underperforming economies in the group, as it became the U.S.’s main challenger on the global stage.

    Long-term prospects

    • China’s decision to launch the trillion-dollar Belt and Road Initiative in 2017 was opposed by India, and even Russia did not join the BRI plan, although it has considerable infrastructure projects with China.
    • South Africa’s debt-laden economy and the negative current account have led some to predict an economic collapse in the next decade.
    • Brazil’s poor handling during the Covid-19 crisis has ranked it amongst the world’s worst-affected countries, and its recovery is expected to be delayed.
    • India’s economic slowdown was a concern even before Covid-19 hit, and government policies like “Aatmanirbhar” were seen as a plan to turn inward.

    Issues with BRICS nations

    • Concerns about aggressions from Russia in Ukraine and Eastern Europe and China in the South China Sea, the border with India and internally in Hongkong and Xinjiang are clear visible.
    • There is creeping authoritarianism in democracies like Brazil and India have made investors question long-term prospects of the group.
    • In the market, BRICS has been mocked for being “broken”, while others have suggested it should be expanded to include more emerging economies like Indonesia, Mexico and Turkey, called the “Next-11”.

    A roadmap to progress

    • BRICS is an idea that has endured two decades, an idea its members remain committed to, and not one has skipped the annual summits held since 2009.
    • Along the way, BRICS has created the New Development Bank (NDB) set up with an initial capital of $100 billion.
    • There is a BRICS Contingent Reserve Arrangement fund to deal with global liquidity crunches, and a BRICS payment system proposing to be an alternative to the SWIFT payment system.

    Reforming the multilaterals

    • The BRICS ministerial meeting held this week sent several important signals to that end, issuing two outcome documents.
    • It included the first “standalone” joint statement on reforming multilateral institutions, including the UN and the UNSC, IMF and World Bank and the WTO.
    • It remains to be seen how far countries like China and Russia, which are already “inside the tent” at the UNSC, will go in advocating for the other BRICS members.
    • Another important agreement was the BRICS ministerial decision to support negotiations at the WTO for the waiver of trade-related intellectual property rights (TRIPs) for vaccines and medicines to tackle the Coronavirus.

    Way forward

    • What appears clear is in the post-Covid world, priorities for all economies will change, and offer up a churning in the world of the kind seen two decades ago, when the idea of a grouping of emerging economies was first floated.
    • For BRICS, the next few months could crystallize that idea, or sink it further, leaving others to wonder whether the “Rise of the Rest” as it was once called, is an idea whose time will ever come at all.

  • Colombo Port City Project and Chinese involvement

    Sri Lanka recently passed the controversial Colombo Port City Economic Commission Bill, which governs the China-backed Colombo Port City project worth $1.4 billion, amid wide opposition to the creation of a “Chinese enclave” in the island nation.

    Colombo Port City Project

    • The Colombo Port City has grabbed headlines in Sri Lanka in recent months even as the relentless third wave of the COVID-19 pandemic sweeps through the country.
    • Almost an artificial island, the territory coming up on 2.69 square kilometers of land reclaimed from Colombo’s seafront has stirred controversy since its inception.
    • Those backing it see in that patch of land their dream of an international financial hub — a “Singapore or Dubai” in the Indian Ocean.

    When was it launched?

    • The project was launched in September 2014 by Chinese President Xi Jinping during a visit to the island nation under the Mahinda Rajapaksa administration’s second term.
    • After President Mahinda Rajapaksa was ousted in January 2015, the successor “national unity” government of Maithripala Sirisena and Ranil Wickremesinghe went ahead with the project after briefly halting it.
    • On returning to power in November 2019, the Rajapaksas vowed to expedite the project. The Sri Lankan government says the project will bring in around 83,000 jobs and $15 billion initially.

    Issues with the project

    • But skeptics claim that it could well become a “Chinese colony”, with the Bill, which is now an Act.
    • The law provides China substantial “immunity” from Sri Lankan laws, besides huge tax exemptions and other incentives for investors.

    What is the extent of China’s involvement?

    Effectively, China has substantial control over two key infrastructure projects in Sri Lanka for a century.

    • The port city project is financed chiefly through Chinese investment amounting to $1.4 billion.
    • In return, the company will receive 116 hectares (of the total 269 hectares) on a 99-year lease.
    • The city separates from but located adjacent to the Colombo Port, the country’s main harbor — is the third major port-related infrastructure project where China has a significant stake.
    • China Merchants Port Holdings has an 85% stake in the Colombo International Container Terminal under a 35-year ‘Build Operate and Transfer’ agreement with the Sri Lanka Port Authority.
    • In 2017, the Sirisena-Wickremesinghe administration, unable to repay the Chinese loan with which it was saddled by the previous government, handed over the Hambantota Port to China on a 99-year lease.

    Concerns from within Sri Lanka

    • Since its launch, the Colombo Port City project has faced opposition from environmentalists and fisherfolk, who feared that the project would affect marine life and livelihoods.
    • However, in the absence of wider political and societal support, their resistance did not dent successive governments’ resolve to pursue the project.
    • The more recent opposition was specific to the Colombo Port City Economic Commission Bill.
    • The resistance came from Opposition parties and civil society groups, including many who do not oppose the project per se, but rather its governance by “an all-powerful commission answerable to no one”.
    • Significantly, a section of Buddhist monks, wielding much influence in Sri Lankan politics and the Sinhala society, also opposed the Bill and said that it eroded Sri Lanka’s sovereignty.

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