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Note4Students

There is intense debate on labour market reforms in India today. It is argued that but for restrictive labour laws that create inflexibility in the labour market, the Indian economy would have experienced a higher growth of employment. The government has come up with some Labour reforms like: Deen Dayal Upadhyay Shramev Jayate Karyakram, new social security schemes, convergence of social security schemes with labour welfare etc.

Context/Introduction

• The body of legislation that shapes the industrial and labour environment in India is huge. Here is a minuscule sampler:
• Minimum Wages Act, 1948; Trade Unions Act, 1926; Contract Labour Act, 1970; Weekly Holidays Act, 1942; Beedi and Cigar Workers Act, 1966.
• These and much more form a crisscrossing network of chaotic, strangulating, overlapping and often-contradictory laws that are crying out for overhaul.
• Despite low wages, India is not a global manufacturing hub, even while being one of the fastest growing service sectors in the world. India’s service sector has grown at an annual rate of 9% since 2001, and contributed 64% of the GDP in 2015-16.The industrial sector, meanwhile, only recorded a negligible increase and contributes nearly half at 20% of GDP.

Despite the availability of human resources, India has not been able to leverage its demographics for industrial development.

Issues in Indian labour laws

Archaic laws

1. In the pre-independence period, British colonialists in India suppressed labour rights, trade unions and the freedom of association among workers. As a result, labour activism became a part of the Indian freedom struggle.
2. In 1950, the newly framed Constitution of India looked to undo these wrongs by including fundamental labour rights, along with complex labour laws. These laws made hiring additional workers increasingly difficult.
3. Despite several decades of economic progress, these laws have not been amended or reformed in order to foster a friendlier climate for business.

Labour productivity

1. India has low labour productivity in comparison with other developing nations.
2. As a result, in the early days of offshoring, Western firms showed greater interest in setting up manufacturing facilities in Thailand, Mexico, China, Vietnam and Philippines rather than in India.
3. All of these countries had as bad a record of bureaucratic corruption as India did at the time, but labour productivity was found to be higher in those countries.

Politics

1. In Kerala alone, for example, there were nearly 363 hartals between 2005 and 2012, causing loss of so many working days
2. In addition, in the 1970s and 1980s, Indian politics was dominated by socialists who created the impression that profit making by private enterprises is undesirable.
3. Policymakers also further strengthened India’s complicated labour laws

Complexity

1. Labour is a subject in concurrent list of the Constitution of India. Thus both centre and states can enact laws on labour matters
2. There are about 45 central government laws and more than 100 state statutes, sometimes overlapping or contradicting

Rigidity

1. India has one of the most rigid labour regulatory frameworks in the world
2. Example- Industrial Disputes Act of 1947 stipulates that a firm with 100 employees or more cannot close down without government permission
3. Such laws curtail the growth of a firm by forcing it to hire fewer workers and remain small

Cost of compliance

1. There are also high costs involved in complying with several labour laws
2. Example- under the Factories Act, firms with 10 or more workers and firms which use electric power are required to keep records and file regular reports on matters such as overtime work, wages, attendance, sick leave and worker fines.

Need For Reforms

1. As early as in 2002, the Second National Commission on Labour suggested the formulation of labour codes similar to those in Russia, Germany, Poland, Hungary and Canada
2. The commission recommended that labour legislation be divided into five broad areas: industrial relations, wages, social security, safety and welfare, and working conditions.
3. NITI Aayog has pressed for ‘substantive’ reforms in labour laws to take the country out of the current low-productivity and low-wage jobs situation.
4. It is predicted that the size of India’s workforce will swell to 249 million by 2050, while China’s is set to decline to 166 million during the same period.

Recent Reforms

1. Recently Govt. unveiled a new roadmap, including measures to end ‘Inspector Raj’ with a system that is expected to sharply curb the element of discretion with labour inspectors and a single window compliance process for companies on labour-related issues.
2. As a step in this direction, all 1,800 labour inspectors will be disallowed from swooping down on companies and instead, a computerised system will randomly send them on inspections, based on data trends and objective criteria.
3. Following inspections, they will have to upload their reports within 72 hours and cannot modify them thereafter.
4. Govt. also unveiled nearly half-a-dozen schemes, including a Shram Suvidha Portal where employers can submit a single compliance report for 16 labour laws, a new web-based labour inspection system, unique account numbers for members of the EPFO, a revamped Rashtriya Swasthya Bima Yojana as well as a new skill development and apprenticeship scheme.
5. Sharply streamlined the cumbersome compliance process, manufacturers can now register online at the Shram Suvidha portal and file a self-certified single compliance report for 16 Central labour laws.
6. In return, labour inspections by four central agencies — EPFO, Employees’ State Insurance Corporation, Central Labour Commissioner and Director General of Mines’ Safety — will be based on a computerised list of units that are picked up from this database.
7. A panel, headed by Finance Minister Arun Jaitley, is mulling converting 44 labour laws into four simplified codes. They relate to industrial relations, wages, social security and safety.

Criticism for the Reforms

1. Any dilution of the existing laws will compromise employees’ welfare and they think the government is insisting on changing labour laws without realizing that it is not a short cut for job creation
2. The government said that 30 million organized sector workers are getting less than 15000 a month. So, by changing the laws you will put these poor workers in
   further trouble.
3. The trade unions have opposed the provision of deducting 8 days salary for one day of strike.

Way ahead:

1. Legislative reforms such as those taken up recently by central government and states such as Rajasthan, Gujarat, MP are very much needed
2. Empowering women to enter the workplace and providing them additional support
3. Physically challenged- Increasing current 3% reservation in governmental and government-funded jobs. Also ensuring that workplaces are disabled-friendly
4. Example- Karnataka granted exemptions to IT industries from the Industrial Employment (Standing Orders) Act of 1946. It undermines the employer’s autonomy in determining the terms of employment, working hours, leave grant and similar matters
5. Providing social security to workers in the informal sector would also pave the way for a more satisfied and productive workforce
6. Training and skilling- India has a demographic advantage but in order to utilize this dividend, India needs to invest heavily in training its talent
7. India’s supply of labour presently outnumbers industry’s demand for them. As a result, the government and manufacturing firms need to invest in training and skilling

Conclusion:

1. The guiding principle for India’s labour policy reformers should not merely be ring fencing jobs but safeguarding workers through social assistance, re-employment support (such as that which is provided in several Western nations) and skill building, and supporting employers in employee training and development.

Model Question

Q.) Recent Labour Reforms balance the concerns of the industries and the workers. Critically evaluate.

Q.) “Success of make in India program depends on the success of Skill India programme and radical labour reforms.” Discuss with logical arguments.(2015 GS Paper III)

References

http://labour.nic.in/

http://indianexpress.com/article/india/india-others/live-prime-minister-narendra-modi-announces-labour-reforms/

http://www.livemint.com/Politics/OeEG5RZFnP7xEX61lV9rYM/Niti-Aayog-presses-for-substantive-reforms-of-labour-laws.html

http://www.thehindu.com/business/budget/india-has-second-fastest-growing-services-sector/article6193500.ece

 

Note4Student

India offers today the world’s largest market for PPPs. As the PPP market in infrastructure matures in India, new challenges and opportunities have emerged and will continue to emerge. To address this Kelkar committee submitted its report “Report on Revitalising and Revising PPP models in Infrastructure” and Infrastructure vital part of GS 3 . Makes this topic important from exam point of view.

Definition

Standards & Poor definition of PPP is any medium to long term relationship between public and private sectors, involving sharing of risks and rewards for multi sectorial skills, expertise and finance to deliver desired policy outcomes.

Introduction

According to the World Bank, India is one of the leading countries in terms of readiness for PPPs.

Rapid Urbanisation, increase in per capita income and high industrial growth led demand for basic infrastructure such as water supply and sanitation, seamless transportation and energy. To fulfil these demands India has systematically rolled out a PPP program with increasing budgetary allocation in 12th FYP for the delivery of high-priority public utilities and infrastructure.

Context

According to the data from the Ministry of Statistics and Programme Implementation’s (MOSPI) Online Computerised Monitoring System for projects and infrastructure monitoring, of 351 ongoing projects costing above Rs 1,000 crore in the infrastructure sector, 127 projects were delayed and 115 were in cost overruns, and 51 were showing both time and cost overruns as of February 2017.

Why PPP and its challenges

1. Investment in infrastructure in India has posed a challenge in the last few years.
2. Reports of delayed or stalled infrastructure projects.
3. Rate of growth of Gross Fixed Capital Formation (GFCF) have been disappointing.
4. Inadequate acceleration in private sector projects due to unfavourable market conditions.
5. lack of appetite for fresh investment by promoters and
6. Delays in obtaining environmental clearances.
7. Slowdown in delivery of projects has been attributed to over regulation, problems in land acquisition and scarcity of funds.
8. “Obsolescing Bargain”-the loss of bargaining power over time by private player in PPPs due to plicy changes.

Different PPP Models

In India, road projects are awarded via one of the three models: Build-Operate Transfer (BOT)-Annuity, BOT-Toll, and EPC (engineering, procurement and construction) contract.  An advanced version  of  (MCA) Model Concession Agreement HAM model is a mix of BOT (Built Operate Transfer) and EPC (Engineering, Procurement and Construction) model.

Engineering Procurement  Model:

1. Under this system the entire project is funded by the government.
2. The EPC entails the contractor build the project by designing, installing and procuring necessary labour and land to construct the infrastructure, either directly or by subcontracting.
3. Under EPC model the contractor is legally responsible to complete the project under some fixed predetermined timeline and may also involve scope for penalty in case of time overrun.
4. In EPC as all the clearances, land acquisition and regulatory norms have to be completed by the government itself and the private players do not have to get itself involved in these time taking procedures.

Hybrid Annuity Model:

1. In India, the new HAM is a mix of BOT Annuity and EPC models.
2. As per the design, the government will contribute to 40% of the project cost in the first five years through annual payments (annuity). whereas the remaining 60% is raised by developer from equity or loan as variable depending upon the value of assets created.
3. Under HAM, Revenue collection would be the responsibility of the National Highways Authority of India (NHAI).The developer doesn’t have right to collect revenue.

Advantages:

The brief picture of Risk Allocation can be tabulated as in Table:

Type of Risks/Models	Financing Risk	Revenue collection Risk	O&M Risk
BOT Model	By Private	By Private	By Private
Annuity Model	By Private	By Govt	By Private
VGF	By Govt and Private	By Private	By Private
EPC Model	By Govt	By Govt	By Govt
HAM	By Govt and Private	By Govt	By Private

1. Financial burden of private players and even government will reduce.
2. Will reduce dependency on Banks for loans private player can raise money form equity. Thus NPAs of banks for long gestation project will also decrease. Helps cut the overall debt and improves project returns.
3. Developers will take ‘traffic risk’ help in expediting project completion. From government side it does take the traffic risk, it also earns better social returns by way of access and convenience to daily commuters.
4. Will speed up stalled projects.

Kelkar Committee recommendations

1. Contracts need to focus more on service delivery instead of fiscal benefits.
2. Better identification and allocation of risks between stakeholders
3. Renegotiation clause of Concession Agreement
4. Infrastructure PPP Project Review Committee (“IPRC”) may be constituted to evaluate and send its recommendations on any problems of PPP project.
5. Infrastructure PPP Adjudication Tribunal (“IPAT”) chaired by a Judicial Member (former Judge SC/Chief Justice HC) with a Technical and/or a Financial member, where benches will be constituted by the Chairperson as per needs of the matter in question.
6. Institutionalization of mechanism like the National Facilitation Committee (NFC)to ensure time bound resolution of issues e.g. Clearances.
7. Unsolicited Proposals(“Swiss Challenge”)to be discouraged to avoid information asymmetries and lack of transparency.
8. PPP structures not to be adopted for very small projects.
9. Amend the Prevention of Corruption Act, 1988 to distinguish between genuine errors in decision-making and acts of corruption.
10. vBuild up capacity in all stakeholders, including regulators, authority, consultants, financing agencies, developers.
11. Set up an institute of excellence in PPP to inter alia guide the sector, provide policy input, timely advice and undertake sustainable capacity building.

Conclusion

1. India’s infrastructure deficit-whether congested roads and ports, inadequate hospitals or wastewater treatment facilities, and slow trains-is a key factor constraining rapid, competitive economic growth and job creation and thereby imposing huge costs on society. Low productivity, poor competitiveness, high costs, and the slow pace of urbanization are some of the consequences of this deficit.
2. India will be the world’s most populated country before 2030, outgrowing China. Without sustained rapid economic growth and the resulting productive jobs, India will be unable to convert its demographic transition into a demographic dividend.
3. To address the above concerns it is imperative to create quality infrastructure by different means. One of the most effective mean is PPP.

Questions:

Q.) Examine the features of HAM model? How it is different from EPC? Explain how it will revitalise infrastructure deficit to achieve broad developmental objectives?

Q.) Recently kelkar committee submitted report on Revitalising and reviving languishing infrastructure projects. Discuss major recommendations of kelkar committee.

References:

Kelkar ‘ Report on Revitalising and Revising PPP models in Infrastructure’.

PIB

Ministry of Statistics and program Implementation

Ministry of Roadway Transport and Highways.

News on Air and Rajya sabha Debate.

 

Note4Students

Banking Sector in India is crippled with multidimensional problems like mounting NPAs, Twin Balance sheet Syndrome (TBS), Merging banks causing structural problems, loss of employment, difficulty in recognizing defaulters, falling short of adhering BIS norms. Financial Sector is very much important for UPSC and the current government gives so much importance to the Banking Sector.

Background/ Introduction

1. Reforms in banking sector started even before independence with passing of The Reserve Bank of India Act, 1934 (RBI Act).
2. Later Nationalization of banks, consolidation, diversification, liberalization of the banking industry in 1980s and 1990s were part of the ongoing reforms.
3. From the 1991 economic crisis India has grown significantly in terms of economic development. So has its banking sector Government of India (GOI) set up various committees with the task of analyzing India’s banking sector and recommending legislation and regulations to make it more effective, competitive and efficient. Two such expert Committees were set up under the chairmanship of M. Narasimham. They submitted their recommendations in the 1990s in reports widely known as the Narasimham Committee-I (1991) and the Narasimham Committee-II (1998) Report.
4. Narasimham committee Recommendations revolved around:
5. Autonomy in Banking.
6. Reform the role of RBI.
7. Tighten Provisioning norms- Capital adequacy ratio, Asset classification (NPAs).
8. Entry for foreign banks.
9. SARFASI Act 2002.

Certain Facts:

1. AS per KPMG-CII report, India’s banking sector expanding rapidly and has the potential to become fifth largest banking industry in the world by 2020 and third largest by 2025.
2. The share of gross NPAs in India could inch up to 10.2% by March 2018, from 9.6% in March 2017, according to the FSR-Financial Stability report.

Current Problem in Banking Sector

1. With changing global economic situations, demand for speedy, secure and efficient service delivery from customers, Information and Communication revolution, big bang long gestation infrastructure projects, the problems of Banking system undergone drastic changes:

(a)Twin balance sheet:

1. The public sector banks are burdened with the high non-performing assets (NPAs) while some of the corporate houses are also under stress due to sluggish global demand. This has been called the “TBS problem” or “Twin Balance Sheet Syndrome“.
2. This leads to incomplete transmission of the monitory policy, unwillingness of banks to lend credit on account of rising NPAs affecting Credit growth in turn economic activity.

(b)Non-performing Assets:

1. When the borrower stops paying interest or principal on a loan for 90days or more considered as NPA.
2. According to RBI’s recent data, the gross non-performing assets (NPAs) of public sector banks are just under Rs 4 lakh crore which is alarming. Reasons for NPAs:
3. Bad lending practices
4. Delay in environmental clearances leading to
5. Wilful defaulters due to crony capitalism.
6. Global, regional and national Financial crises.
7. Poor performance across different sectors like Infra, Steel, Discom etc.
8. Not adhering provisioning norms- BASEL I, II, III.
9. Failure of SARFASI, ARC.

(c)Requirements of Reserve ratio:

1. RBI policy mandates reserve ratios CRR 4%, SLR 20%. And compulsory Primary Sector lending for social sector projects affects the credit expansion of banks.

(d)Increasing Competition and funding sources

1. Strengthening of Bond Market, External Borrowing sources,
2. Indian PSBs not competitive.

Crisis in Management

Measures taken by RBI and Government:

1. Debt Recovery Tribunals (DRTs)

1. To decrease the time required for settling cases.

Amendments to the SARFAESI Act: The Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Bill, 2016 includes

1. The SARFAESI Act allows secured creditors to take possession over collateral, against which a loan had been provided, upon a default in repayment.
2. This process is undertaken with the assistance of the District Magistrate, and does not require the intervention of courts or tribunals.
3. The Bill provides that this process will have to be completed within 30 days by the District Magistrate
4. Bill empowers the District Magistrate to assist banks in taking over the management of a company, in case the company is unable to repay loans.
5. Act creates a central registry to maintain records of transactions related to secured assets.

2. 4R SOLUTION

1. Economic Survey 2016-17 gives 4R solution to solve TBS problem – Recognize, Recapitalize (Eg Indradhanush), Resolution and Reform. Economic Survey 2016-17  Volume II stress more upon last R i.e. Reform.

3.INDRADHANUSH

1. Indradhanush framework for transforming the PSBs represents the most comprehensive reform effort undertaken since banking nationalization in the year 1970 to revamp the Public Sector Banks (PSBs) and improve their overall performance by ABCDEFG.

1. A-Appointments: Based upon global best practices and as per the guidelines in the companies act, separate post of Chairman and Managing Director and the CEO will get the designation of MD & CEO and there would be another person who would be appointed as non-Executive Chairman of PSBs.
2. B-Bank Board Bureau: The BBB will be a body of eminent professionals and officials, which will replace the Appointments Board for appointment of Whole-time Directors as well as non-Executive Chairman of PSBs
3. C-Capitalization: As per finance ministry, the capital requirement of extra capital for the next four years up to FY 2019 is likely to be about Rs.1,80,000 crore out of which 70000 crores will be provided by the GOI and the rest PSBs will have to raise from the market.
4. D-DEstressing: PSBs and strengthening risk control measures and NPAs disclosure.
5. E-Employment: GOI has said there will be no interference from Government and Banks are encouraged to take independent decisions keeping in mind the commercial the organizational interests.
6. F-Framework of Accountability: New KPI(key performance indicators) which would be linked with performance and also the consideration of ESOPs for top management PSBs.
7. G-Governance Reforms: For Example, Gyan Sangam, a conclave of PSBs and financial institutions. Bank board Bureau for transparent and meritorious appointments in PSBs.

 

4. BANKRUPTCY & INSOLVENCY CODE 2015

1. The Code creates time-bound processes for insolvency resolution of companies and individuals.  These processes will be completed within 180 days.  If insolvency cannot be resolved, the assets of the borrowers may be sold to repay creditors.
2. The National Company Law Tribunal (NCLT) will adjudicate insolvency resolution for companies.  The Debt Recovery Tribunal (DRT) will adjudicate insolvency resolution for individuals.
3. The Code creates an Insolvency and Bankruptcy Fund.

Other Major reforms

Payment and Postal Banks on recommendation of Nachiket Mor Committee to acheive Financial Inclusion and reduce banks burden.

Economic Survey 2016-17 suggests setting up of a centralised Public Sector Asset Rehabilition Agency (PARA)

the Agency will look after the largest, most difficult Cases, and make Politically Tough Decisions to reduce Debt

‘Scheme for Sustainable Structuring of Stressed Assets (S4A) by RBI for resolution of large stressed assets.

Startegic Debt Restructuring involves transferring equity of the company to lenders also enable a change in management control.

1. The Banking Regulation (Amendment) Bill, 2017
2. It seeks to amend the Banking Regulation Act, 1949 to insert provisions for handling cases related to stressed assets.
3. The central government may authorise the Reserve Bank of India (RBI) to issue directions to banks for initiating proceedings in case of a default in loan repayment. These proceedings would be under the Insolvency and Bankruptcy Code, 2016.
4. also be applicable to the State Bank of India, its subsidiaries, and Regional Rural Banks.

Merging of SBI subsidiaries as well as other PSBs to

1. improve efficiency in service delivery
2. to become single biggest lender of bigger infrastructure projects and
3. to achieve top ranking in global ranking.

Marginal Cost of Fund Based Lending Rate (MCLR)

The MCLR rate is the minimum rate below which the banks are not allowed to lend, except in some case allowed by the RBI. It is an internal reference rate for the bank. The MCLR method was introduced in the Indian financial system by the Reserve Bank of India in the year 2016. The MCLR system has replaced the base rate system that was introduced in the year 2010.

Why MCLR was Introduced?

To effectively implement monetary policy, since MCLR is more sensitive to policy rates like Repo rate and Reverse Repo Rate.

Prior to the implementation of MCLR, different banks are using different methods for calculating base rates. Thus, MCLR aims at:

1. To improve the transmission of policy rates into the lending rates of banks.
2. To bring transparency in the methodology followed by banks for determining interest rates on advances.
3. To ensure availability of bank credit at interest rates which are fair to borrowers as well as banks.
4. To enable banks to become more competitive and enhance their long run value and contribution to economic growth.

Calculation of MCLR

MCLR lending rate is dependent on all the sources of bank borrowing. A bank borrows from multiple sources like, fixed deposits, demand deposits, saving accounts, current accounts. Apart from these, banks also invest in equity, whose return are also considered while calculating MCLR.

The formula prescribed by the Reserve Bank of India for calculation of MCLR is given below:

Marginal cost of funds = Marginal borrowing cost x 92% + return on the net worth x 8%

Thus, marginal cost of borrowings has a weightage of 92% while return on net worth has 8% weightage in the marginal cost of funds.

Here, the weight given to return on net worth is set equivalent to the 8% of risk weighted assets prescribed as Tier I capital for the bank.

The marginal cost of borrowing refers to the average rates at which deposits of a similar maturity were raised in the specified period.

Banks must also maintain a cash reserve ratio of 4%. On this deposit, no interest is earned by the bank. Under MCLR, banks can avail some allowance called Negative Carry on CRR. Negative carry on account of’ Cash reserve ratio (CRR)- Negative carry on the mandatory CRR arises because the return on CRR balances is nil. Negative carry on mandatory Statutory Liquidity Ratio (SLR) balances may arise if the actual return thereon is less than the cost of funds.

Also, the operating costs must be considered and taken care of. There are several expenses of a bank that includes raising funds, opening branches, paying salary to its employees etc. These are not charged to the customers. Operating Cost associated with providing the loan product, including cost of raising funds, but excluding those costs which are separately recovered by way of service charges.

Finally comes the discount or tenor premium. The reset period for the interest rate is called the tenor. It is directly proportional to the reset period i.e. the tenor is higher if the reset period is higher. Tenor Premium- The change in tenor premium cannot be borrower specific or loan class specific. In other words, the tenor premium will be uniform for all types of loans for a given residual tenor.

Thus, MCLR depends on

1. Tenor premium,
2. Operating costs of the bank,
3. Negative carry on Cash Reserve Ratio, and
4. Marginal cost of funds.

Conclusion

1. Banks are the backbone of every economy. The banks are the lifelines of the economy and play a catalytic role in activating and sustaining economic growth, especially, in developing countries and India is no exception.
2. The Indian banking sector is at a critical juncture in its evolution. It is now clear that the slump in credit growth and increase in stressed assets has affected the profitability of all banks, and threatens the very survival of some of them. To maintain impetus of economic growth with achievement of SDGs we need strong banking system.
3. Certain building blocks for the reorientation of the banking structure with a view to addressing various issues such as enhancing competition, financing higher growth, providing specialized services and furthering financial inclusion have been initiated but need to focus on implementation.
4. Vision 2020 of banking system should incorporate Transformed Banking models with emerging technologies like IT revolution,Robotics, Artificial Intelligence and FINTECH solutions to make banking affordable and accessible.
5. In order to achieve more faster and inclusive growth and to make major govt initiatives (–Make in india, Financial Inclusion etc ) overhaul reforms in banking sector is imperative.

Questions

1. Banking Sector in India is crippled with multidimensional problems like mounting Twin Balance sheet Syndrome (TBS), Merging banks causing structural problems, loss of employment, difficulty in recognizing defaulters etc. What are the government initiatives to tackle such problems?
2. Banking Reforms is not a new word to the financial sector. Explain the Banking Sector reforms taken place till now and those which are yet to be rolled out in the immediate future, in detail.

References:

1. Newspapers: The Hindu, Indian express, live mint.

2. Economic Survey 2016-17 and 2017-18.

3. RBI Site

4. PRS legislative

5. Rajyasabha and news on Air.

6. Min of Finance.

 

Economic Survey Volume II highlights importance of Industry and Infrastructure for India to maintain stable and sustainable economic growth. India’s ranking in World Bank’s Logistics Performance jumped to 36^th position in 2016 from 58^th rank in 2014. UPSC last year asked regarding Roadways so this year expected question from Ports and economic growth.

Introduction

1. World Bank rightly pointed out ‘infrastructure development’ includes–Ports, Roadways, Railways, Telecommunication, critical to delivering growth, reducing poverty, building human capability and to address broader developmental goals.
2. Economic Survey Vol II highlights among the same per capita emerging countries India’s performance is significantly better.
3. India has a coastline spanning 7516.6 kilometres, forming one of the biggest peninsulas in the world. According to the Ministry of Shipping, around 95 per cent of India’s trading by volume and 70 per cent by value is done through maritime transport.
4. There are 12 Major Ports & 187 Minor/Intermediate ports.
5. Government is taking various measures to enhance capacity of existing ports and creating new major ports, Ease of doing business- Sagarmala, Bharatmala, Inland water transport(Jal Vikas Marg), East Coast Economic corridor etc.

Sagarmala

1. Sagarmala project is a port-led development programme of Ministry of Shipping.
2. A Shipping ministry study has claimed that the project could lead to an annual saving of Rs 40,000 crore by optimizing logistics.

Need for such a project:

1. India is lacking the high quantity of international trade via coastal line due to the lack of infrastructure facilities and advanced coastal technologies.
2. The cost of shipping/evacuating goods through Indian maritime transport is quite high compared to that of China, South Korea, Japan and other developed countries. This makes Indian goods uncompetitive in the international market.
3. China, South Korea and Japan have effectively used their coastline for ‘port-led development’. India has to replicate their model to stay competitive.
4. So, a plan has to be devised to reduce logistics cost and strengthen India’s EXIM industry. Sagarmala Project is one such plan.

Objectives of Sagarmala:

PORT MODERNIZATION-

1. Augmenting operational efficiency of ports (more terminals for loading and unloading cargo).
2. 40+ capacity enhancement projects at major ports
3. 6–8 new ports.

PORT CONNECTIVITY-

1. Optimizing logistics (rails, roads and inland waterways).
2. Port and industrial connectivity.

PORT LED INDUSTRIALISATION-

1. 14 Coastal Economic Zones, Industrial Clusters Identify capacity additions Modernize India’s Ports to achieve Ease of Doing business.

COASTAL COMMUNITY DEVELOPMENT

1. Skill development.
2. Uplifting fishermen and other local communities.
3. Island development.

Vision of Sagarmala:

 

Analysis

Impact of sagarmala by 2025

Other advantages of SAGARMALA:

1. It is a counter to China’s String of Pearls.
2. It is a security infrastructure envisaged by India in the Indian Ocean region.
3. It is a defense capability enhancement project of Indian Navy.

Current challenges to Shipping Industry of India: Economic survey volume 2

1. Globally, maritime freight rates in most shipping segments endured volatility and overall downward movements.
2. There has been a sharp decline in the share of Indian ships in the carriage of India’s overseas trade from about 40 per cent in the late 1980s to 7 per cent in 2015-16.
3. Existing fleets are ageing.

Recommendations to further enhancement of this project:

1. Setting up storage capacities at origin-destination ports to shorten turnaround time.
2. Developing adequate ship-repair facilities in the maritime states.
3. Indian ports will have to upgrade their technology levels to be comparable to international standards.
4. Creating dedicated coastal berth ports for coastal shipping.
5. Establishing new transhipment port (transfer cargo from one ship to another).
6. During the last few years the non-major ports are gaining more share of cargo handling compared to major ports so the focus should be connecting non major ports to hinterland.(Economic survey volume2 )
7. Fuel tax free for indian tax vessels.
8. Government already proposed Jal Marg Vikas Project’ (on NW-I:River Ganga), a large integrated IWT project to end to end connectivity.

Conclusion

Indian ports now need to plan with a 15-20 year perspective. We are far behind other Asian countries, be it China or a tiny state like Singapore. Emerging innovative port models like Landlord Port development, Coastal Economic Zones are steps in right direction. So it is imperative to have well developed ports to boost our exports, play a vital role in maritime security and to realise broader developmental goals.

Questions:

Q.) Enumerate challenges and prospectus of Sagarmala project in India.

Q.) What do you mean by Port led development? What are the key objectives and vision of  Sagarmala Project? Its impact on trade,employement?

 

Note4Students

Like abolition of FIPB and merger of Railway budget with General budget. This is a Revolutionary step taken by Government which will have wide reaching Consequences. Since UPSC has been asking lot of questions on reform measures taken by the Modi Government A question can be expected on this topic also.

Context

Last year The Cabinet has decided in principle to advance the presentation of the Union Budget by a month, from February to January. The objective is to have the Budget constitutionally approved by Parliament and assented to by the President, and all allocations at different tiers disseminated to budget-holders, before the financial year begins on April 1.

Presenting the budget earlier comes with both advantages and disadvantages.

Advantages:

In the existing system, the Lok Sabha passes a vote on account for the April-June quarter, under which departments are provided a sixth of their total allocation for the year. This is done by March. The Finance Bill is not passed before late April or early May. If the Budget is read in January and passed by February-March, it would enable the government to do away with a vote on account for the first three months of a financial year.

Retired and serving officials say the biggest plus would be that the Finance Bill, incorporating the Budget proposals, could be passed by February or March. So, government departments, agencies and state-owned companies would know their allocations right from April 1, when the financial year begins.

It would also help the private sector to anticipate government procurement trends and evolve their business plans. And, civil society could deliberate on and give feedback in time for the parliamentary discussions.

 

Disadvantages:

1. One big disadvantage of advancing the Budget preparations is lack of comprehensive revenue and expenditure data. Currently, work on the Budget begins in earnest by December. By the time it is finalised in mid-February, data on revenue collections and expenditure trends is available for the first nine months of the financial year, i.e April-December. Based on which, projections for the full year can be made.
2. To read the Budget in January, the centre will have to start preparing it by early October. To go by less than six months of data and making projections for the full year and the next year, based on such an incomplete picture, will be an impossible task.
3. Advancing the Budget dates would be fraught with practical difficulties. Effective Budget planning also depends on the monsoon forecasts for the coming year, making the advancing the whole exercise even more difficult.
4. Besides, whether the chambers of Parliament and its standing committees will get adequate time to deliberate on the budget is a moot point. The standing committees of Parliament, whose charter is to examine the justification of the ministry-wise allocations and funding needs of concomitant programmes included in the Budget, undertake their scrutiny during a two to three-week gap within the budget session period, when the houses are adjourned. This scrutiny is an essential element in the parliamentary budget approval system.

Way ahead:

Advancing the presentation of the Budget, so as to allow Parliament to vote on tax and spending proposals before the beginning of the new financial year on April 1, is a good idea. It would do away with the need for a vote on account and allow new direct tax measures to have a full year’s play. Members of Parliament now will have to work hard over two months to vet Budget proposals, for this to work.

 

Conclusion:

These reforms make sense, but Budget reform has to go further, to incorporate a multi-year time horizon and shift to outcome-linked expenditure management, as had been recommended by a committee headed by C Rangarajan in 2011.

Note4Students

Fake news had incited violence among various communities.it also mislead the people into deep misunderstanding. Government has to take serious measures to contain fake news. So this discussion will help to understand various perspectives.

Introduction

• 1. Fake news is a threat to democracy in a way more perverse than most people appreciate.
  2. In these times of easy access to the ability to crunch large amounts of data, unstructured and in real time,
  3. it is possible for political parties or, more realistically, specialist troops employed by them, to profile individual voters and flood them with news, fake and real, that would accentuate perceived favourable political propensities or neutralise perceived hostile inclinations.

Recent Examples

1. Earlier this year a major news studio in the country doctored a video of a protest in JNU to raise doubts on the legitimacy of the educational institute. This video was further propagated by another mainstream news channel on primetime television without verification. This led to a national furore that culminated in a public thrashing of students inside court premises by lawyers and a gaping divide in public sentiment.
2. Hoaxes of GPS chips in the Rs 2,000 note did the rounds after the prime minister’s November 8 demonetisation speech. Spread by both media and WhatsApp messages (the latter being the source of numerous misleading stories in the country), it led to wide scale confusion among recipients of the new note.
3. fake photographs that have been used in facebook to inflame passions after the communal disturbances in Basirhat and Baduria in Bengal.
4. The face-swapping technology, Face2Face, developed in Stanford University, makes it increasingly easy to generate realistic videos that will allow a user to impersonate anyone she wants with amazing accuracy
5. The fake videos that are currently circulating in the Kashmir Valley (originating from both sides) showing gruesome attacks on the Army as well as inhuman repression of the civilians in order to rouse passion, may soon look like harmless pranks. With the arrival of the new and highly sophisticated fake videos, the situation can quickly go out of control.
6. The recent Election in US this has gained momentum to counter each other candidate’s arguments among public with social media.

How bad it is

1. People’s faith in social, print and electronic media reduces which could affect the benefits of these Media.
2. It can lead to violence between two or more communities thereby creating enmity and hatred between them.
3. It can disturb the social fabric of the society and tensions among communities persists for long times.
4. It reduces the tendencies of cooperation between different communities.
5. Political parties try to gain political advantages by polarizing the voter’s mind which further intensifies the tensions between different sections of society.
6. Politics of development takes back seat and communal tendencies emerge in politics.
7. In its purest form, fake news is completely made up, manipulated to resemble credible journalism and attract maximum attention and, with it, advertising revenue.
8. Political campaigning has progressed from mere appeals in the name of identity or loyalty or tall promises to something akin to psychological warfare. Parties that master the tools of such psych ops have a distinct edge over those stuck in the traditional mud. Fake news spreads on social media.

How to tackle it

1. The government must take the initiative to make all sections of the population aware of the realities of this information war and evolve a consensus to fight this war. It must also take strict action
2. News being spread using chatbots and other automated pieces of software should automatically be selected for special screening. Ordinary consumers of news can play a big role by, first, waking up to the reality that all they read on WhatsApp and Twitter is not the gospel truth, and then, by refusing to pass on what they cannot independently verify with other sources.
3. Websites that mimic well-known, credible media outlets in their name should be exposed with the vigour with which jokes are shared on social media.
4. An ombudsman deals with the credibility of news sources, it gains the privilege to ensure facts are reported
5. Government should have independent agency to verify the data being circulated in social and other media. The agency should be tasked with presenting real facts and figures.
6. Government should have mechanism for immediately issuing of notice against sites/people/agencies involved in spreading fake news.
7. There should be a provision of effective balances and check of filtering fake posts before it getting viral.
8. Social media websites should be made accountable of such activities so that it becomes their responsibility to have better controlling restricting the spread of fake news.
9. Government should take active measures for promoting awareness among people about fake news and their consequences.
10. Government should enlist penal provisions to perpetrators of fake news if it causes violence or deaths.
11. Government should make mandatory for Print and Electronic media to have internal mechanism for verifying incidents, facts and figures.
12. Public should verify the accuracy and of reliability of any news or data either from government or any independent agency specifically involved in such task.
13. Public should not blindly trust any sensitive news and should not forward it to others.
14. Public should inform concerned department about any fake post as soon as they come across. They should act as active vigilant for maintaining peace and harmony in the society.
15. NGO’s and other civil society groups can play important role in spreading awareness about the ill effects of fake news.

Some Efforts To Contain Fake News

1. Facebook changes to its News Feed to reduce stories from sources that consistently posted clickbait headlines. Last month, Facebook announced another update so that misleading posts would be downgraded. Now, Facebook will take into account clickbait at the individual post level in addition to the domain and page level, in order to more precisely reduce clickbait headlines.
2. Now some websites like Altnews.in, media vigil and Debunked are doing the work to debunk the false news.

Conclusion

A more proactive measure would be to prosecute those who incite hatred and violence by spreading fake news and fake images. Traditional media has a big stake in discrediting purveyors of material that is not editorially validated. Fakery can harm both democracy and the media business. Eternal vigilance against it is, indeed, the price of liberty.

Note4Students

India has been fighting with proxy state terrorists since independence. Nuclear weapon owned neighbours posing formidable threats to the national security. Moreover as a regional power India has gained commendable respect among the world countries.  So it is important to discuss about to design a national security policy.

Introduction

1. Unlike other democracies, India does not have a formally declared national security strategy.
2. The threats and challenges to a country’s national interests in the prevailing geo-strategic and regional security environment guide its national security objectives and these, in turn, help to formulate a comprehensive national security strategy

Analysis

What would be the basis of national security strategy

1. The primacy of national interests in the formulation of national security strategy is unquestionable.The meaning of national interest is survival
2. The protection of physical, political and cultural identity against encroachments by other nation-States.’
3. National interests may be defined as ‘the claims, objectives, goals, demands and interests which a nation always tries to preserve, protect, defend and secure in relations with other nations.
4. These are classified as vital or survival interests and other interests.
5. Vital national interests must by definition be defended by applying military force if it becomes necessary.

 

India’s vital national interests would include the following:

1. The security of Indian territory on land and sea and that of Indian airspace
2. the protection of Indian citizens
3. the security of India’s energy sources, refining facilities and merchant vessels engaged in transporting oil and gas and trade
4. A peaceful and stable internal and external security environment for unhindered socio-economic development;
5. The protection of critical infrastructure against physical disruption and cyber-attack.

 

Other major national interests comprise the following:

1. An egalitarian world order that is rules-based and promotes free trade and security of the global commons through international cooperation;
2. The promotion of democracy and respect for universal values at home and around the world.

Why do we need a National Security Strategy?

1. Maintaining the territorial integrity of India‘s borders on land, sea and air, as defined by law and enshrined in the Constitution, including the defence of India’s island territories.
2. Defending India’s coastline against aggression and infiltration; and, ensuring the security of Indian personnel and assets such as ships and oil rigs operating in the Exclusive Economic Zone.
3. Resolving the territorial and boundary disputes with China and Pakistan on favourable terms through negotiations in an early time frame. (In this context, as the territory occupied by the Chinese on the Aksai Chin Plateau in Ladakh and by the Pakistanis in Pakistan occupied Kashmir is required to be regained in accordance with two separate parliamentary resolutions, building a national consensus to resolve both territorial disputes through a negotiated settlement should be an important political objective.)
4. Protecting the lives and property of India’s citizens, including during insurgencies and against acts of terrorism.
5. Maintaining effective nuclear deterrence against the use or the threat of use of nuclear weapons against India.
6. Protecting critical infrastructure and military command and control systems against cyber-attack from State and non-State actors and developing offensive cyber operations capabilities to deter such attacks.
7. Ensuring the security of India’s energy sources, refining facilities and modes of transportation, especially the security of oil and gas fields, ships transporting oil and gas and, where necessary, oil and gas pipelines within India and abroad.
8. Undermining the China-Pakistan nexus and reducing the salience of the Pakistan army in the country’s polity.
9. Ensuring through diplomatic means and in conjunction with strategic partners that India will not be required to fight a simultaneous two-front war with China and Pakistan.
10. Providing a stable and peaceful external security environment in India’s area of strategic interest to facilitate unimpeded socio-economic development and the free flow of trade. (This may involve military intervention, singly or in conjunction with strategic partners, when India’s vital national interests are threatened.)
11. Creating and sustaining an effective capability for out-of-area contingency operations through military intervention, when necessary, to ensure peace and stability in the Indo-Pacific and the security of the global commons (freedom of navigation in the sea lanes of communication, air space, cyber space and outer space).
12. Being prepared to provide security and other assistance to the Indian Diaspora, especially in West Asia and on the Arabian Peninsula.
13. Acting vigorously against narcotics traffickers and small arms smugglers and disrupting their linkages with terrorist organisations.
14. Bringing to speedy justice both overseas and local perpetrators of terrorist strikes in India and against Indian assets anywhere.
15. Preventing the destabilisation of friendly countries in India’s area of strategic interest extending from the South China Sea in the east to the Horn of Africa in the west, and providing military and other assistance when requested by them. (In this context, stability in Afghanistan, Bangladesh, Bhutan, Nepal, Pakistan and Sri Lanka, is a major national interest.)
16. Developing balanced relationships with strategic partners, including through defence cooperation, to deter conflict and manage crises, and engaging with organisations such as the ASEAN Regional Forum and the Shanghai Cooperation Organisation to launch cooperative security initiatives, while preserving India’s strategic autonomy.
17. Promoting cooperation and understanding with neighbouring countries and implementing mutually agreed confidence-building measures to prevent crises through miscalculation.
18. Pursuing security and strategic dialogues to address key challenges before the international community.
19. Following a consistent and principled policy on nuclear disarmament and international security issues based on universality, non-discrimination and equal security for all.
20. Working dynamically to achieve the goal of self-reliance (70 per cent indigenous content) in defence procurement by 2025. (The indigenous manufacture of microchips, the basic building block of ICT products, must be a national priority.)
21. Investing appropriately in the development of high-end defence technologies in conjunction with strategic partners to gain an edge in combat capabilities over military adversaries.
22. Developing a pro-active strategic culture by exposing all students in schools and colleges to understanding basic threats and challenges to national security and the measures necessary to overcome these. (All government training institutions must also educate their trainees about national security issues by devoting a portion of the syllabus to the subject.)

Way Forward

1. The government should appoint a study group to deliberate over the important issues of national interests and national security objectives and recommend a national security strategy for consideration by the Cabinet Committee on Security. The exercise should be steered by the National Security Advisor.
2. Strengthening the national security architecture will be possible if the triad of defence and strategic studies, defence studies and analyses, and national security policy-making become interdependent organically, intellectually, professionally and systemically.

Question:

Why needs a national security strategy. What will be the objectives of security policy?

Note4Students

Prevalence of peace is the one the pre requisite for the development. Left wing extremism had engulfed many developmental efforts with its sheer coercive action. A civil administration–police coordinated action is required to bring the peace in the red corridor. Home ministry’s new policy of SAMADHAN tries to achieve a multi-dimensional development agenda through affirmative action.

Introduction:

1. India is the largest democracy in the world. However, Left Wing Extremism desires to weaken and make the roots of democracy hollow.
2. A Naxal or Naxalite is a member of the Communist Party of India (Maoist). The term Naxal derives from the name of the village Naxalbari in West Bengal, where the movement had its origin. Naxalites are considered far-left radical communists, supportive of Maoist political sentiment and ideology.

Problems Faced By government:

1. 12000 citizens of our country have lost their lives in violent activities of the Left Wing Extremists
2. Out of these 12000 people, 2700 are jawans of the Security Forces and the remaining 9300 are innocent and simple common people who are not guilty.
3. The anti-development Left Wing Extremism not only target the Security Forces but also public property like roads, culverts, railway tracks, electricity and telephone towers, hospitals, schools, anganwadi and panchayat bhawans etc, that are created by the Government for benefit of the common man.
4. It is evident from the destruction caused by the Left Wing Extremists that they do not want people to get facilities and access to the development, in the remote and inaccessible areas, because these facilities provide the path of economic and social progress, to the local people
5. It also joins them to the mainstream of the nation. The cancer of LWE flourishes in poverty or backwardness.
6. Therefore, the LWE strategy is to ensure that the people of this area stay without electricity, without road, without education, so that the vested interest of the Left Wing Extremists continues unabated.

 

Recents Developements:

1. The whole country is agitated with the martyrdom of 25 CRPF personnel in the incident of April 24, 2017 in Burkapal, Sukma district of Chhattisgarh. In such situations, the challenge before us is to maintain focus and move towards our goal with speed, in a planned manner.
2. The Government was concerned but not perturbed by the attack on the CRPF Camp by the Left Wing Extremists and
3. A new formula of SAMADHAN has been evolved to tackle the Naxalites problem.

The solution to the LWE problem is not possible with any silver bullet. There is no short-cut for it. For this short term, medium term and long term policies need to be formulated at different levels. There is need to find a solution for this problem and the strategy is available and encompassed in the word ‘SAMADHAN’ which means-

S– Smart Leadership

A– Aggressive Strategy

M- Motivation and Training

A– Actionable Intelligence

D– Dashboard Based KPIs (Key Performance Indicators) and KRAs (Key Result Areas)

H– Harnessing Technology

A– Action plan for each Theatre

N– No access to Financing

SAMADHAN:-

S – Smart Leadership-

The key properties of ‘Smart Leadership’ are:

• Vision,
• Mission,
• Passion and
• Self belief

1. A leadership full of self confidence should have a solid vision on how he would envisage the challenges of the future and prepare his team and energise his team to a mission mode, in order to achieve his objectives. To make his team secure, disciplined and victorious, should be of paramount importance for him.
2. The success stories of many police officers in India are inscribed in the minds of the common people, as to how they kept their teams alive with energy. On the Left Wing Extremism front, we also need such leadership, who despite adversity, keep their jawans full of enthusiasm and teach them only to win.
3. Be it Central Forces or the district police, they will have to work under a coordinated strategy and plan. The most important thing is that the officers will have to lead from the front. Success in this regard cannot be achieved only by sitting in Delhi, Ranchi or Raipur..
4. Unified Co-Ordination and Command is needed in the LWE Front. Along with Strategic Command, Unified Command is also required at the Operational and Tactical Level. Intelligence sharing is important too.

 

A-Aggressive Strategy-

1. Need to consider whether to react only after the occurrence of such events? Should our role not be Proactive?
2. Learning from the old incidents, we need to bring aggression into our policy. Aggression in thinking, Aggression in strategy, Aggression in deployment of forces, Aggression in operations, Aggression in development and Aggression in road construction.
3. Have to be cautious that extremely defensive deployment may result in reduction of operational offensive.
4. Have to consider that although the figures of the surrenders of the Left Wing Extremisms are increasing, but whether benefit of intelligence from these surrendered LWE cadres is being derived.
5. Must ensure that the States take the ownership of LWE operations and CAPFs cooperate with them fully. At the same time, the forces on the Ground level should not lack leadership. “Unity of Purpose” and “Unity of Action” are essential for the success of operations.

 

M – Motivation and Training –

1. The Government has superior resources, training, technology, than the Left Wing Extremists. But there is a need for better coordinated efforts to counter the strategy of the LWE.
2. Success on this front cannot be achieved only by being emotional in this regard. The right vision, right strategy, efficient use of resources, knowledge of enemy strengths and weaknesses, training of their security forces, their facilities and arrangements of tools are necessary for success.
3. In the camps where the security forces are residing, proper facilities of power, water, connectivity should be provided so that the Security Forces may remain stress free. They should also be able to contact their family as per requirement.
4. In addition to information about the place of posting, security forces should also have knowledge of language, dialects, traditions and culture so that they can adapt to the local conditions and earn the trust of the local people.
5. Security forces must adhere to Standard Operating Procedures so that they are conscious about their own security.

 

A-Actionable Intelligence

1. To develop actionable intelligence it is important that all intelligence agencies and security forces establish a good network with local people.
2. Surrendered LWE cadre should be used for intelligence collection to the maximum possible.
3. Need to depute Shadow Intelligence Officers to trace the prominent targets associated with Left Wing Extremism.
4. There is a need to establish specific procedures between State Police and Central Forces for the exchange and use of intelligence.

 

D-Dashboard based KPIs (Key Performance Indicators) and KRAs (Key Result Areas):-

• Key Performance Indicators (KPIs) and Key Result Areas (KRAs) should be determined both for the State Police and the CAPFs. This would not only help to assess the preparedness but also their performance, regular progress of its unit and individual abilities of each police officer.

 

H – Harnessing Technology –

1. Technology is a Force Multiplier.
2. Many technologies including Space, IT and Communication have brought revolutionary changes in the world. Many new techniques are also being used in dealing with law and order and the crime. On the LWE  front, there is a need to use more of such latest technologies.
3. Use of some Cutting edge Technologies
4. The use of the UAV is sub-optimal, that needs to be augmented both by numbers and by use in the right place.
5. The Mini UAVs are extremely useful. Therefore, they should be procured and available in more quantities. We must try that with every battalion there must be atleast one UAV / Mini UAV.
6. Use high resolution PTZ Cameras, GPS Tracking, Handheld Thermal Imaging, Radar, Satellite Image etc.
7. Trackers in Weapons
8. Biometrics in smart gun triggers.
9. Trackers should also be embedded in Shoes, BP jackets etc.
10. In addition, unique identification numbers should also be used in Gelatine and other explosive materials.
11. States that do not have expertise in such state of the art technology, the Central Government can assist in this regard

 

A-Action plan for each theatre:- 

1. The situation of Left Wing Extremism in different States is not the same.
2. In different States, to fight Left extremism, there is a need to fight on multiple fronts and to create a specific action plan for each of such fronts, in order to achieve success on a systematic basis.
3. There is a need to create separate short-term, medium-term, long-term strategies, whose goals and deadlines are clearly defined.
4. The Implementation should be done on a Mission Mode defining the Key Performance Indicators (KPIs) for continuous monitoring and Key Result Areas (KRAs), that should also be aligned with these strategies.

 

N-No access to financing:-

1. Economic resources play an important role in any war or any such exercise, because when money is available, only then will it be possible to buy, eat, drink and possess ammunition and weapons. Therefore, choking the financial resources of the LWE is the most basic mantra in this fight.

Conclusion:-

1. We have come a long way in defeating the fight with Left Wing Extremists. In the remote areas, our young men are constantly working for the development and protection of the area endangering their lives.
2. That day is not far when this mindless violence will be completely finished and once again the atmosphere of peace and prosperity will prevail and people will rapidly join the main stream along with enjoying the fruits of development.

 

Note4Students

Cyber security one of the most important topics surfaced in this year. Various incidents of cyber-attack necessitated the engineering of stronger cyber defence mechanisms. In this context, this following article will provide an insight about cyber security.

Introduction

1. India witnessed more than 27,000 cyber security threat incidents in the first half of 2017.
2. Authorities including the telecom regulator TRAI are also noticing the threat posed by mobile applications that collect sensitive user data

Recent incidents

1. Two Indian conglomerates were forced to pay $5 million each in order to prevent hackers from disclosing information that could have implicated them in a wrongdoing.
2. State run Union Bank of India was breached by cyber hackers. The hackers had managed to get past the bank’s security systems but the money trail was traced and the movement of funds was blocked.
3. The vulnerability of the banks came into light recently when data of about 3.2 million debit cards was lost in what is claimed to the India’s biggest breaches. SBI, HDFC Bank, ICICI, YES Bank and Axis were worst hit by the breach of the debit cards.
4. WannaCry, a crypto-ransomware that is also called WannaCrypt, affected at least 200,000 computers in 150 countries, including India, described as the largest ever of its kind. The WanaCrypt encrypts data on a computer within seconds and displays a message asking the user to pay a ransom of $ 300 in Bitcoins to restore access to the device and the data inside.

Analysis

What is Cyber Space?

1. Cyberspace comprises IT networks, computer resources, and all the fixed and mobile devices connected to the global Internet
2. A nation’s cyberspace is part of the global cyberspace; it cannot be isolated to define its boundaries since cyberspace is borderless. This is what makes cyberspace unique.
3. Unlike the physical world that is limited by geographical boundaries in space—cyberspace can and is continuing to expand. Increased Internet penetration is leading to growth of cyberspace, since its size is proportional to the activities that are carried through it.

The term “cyber security” refers to three things:

1. A set of activities and other measures, technical and non-technical, intended to protect computers, computer networks, related hardware and devices software, and the information they contain and communicate, including software and data, as well as other elements of cyberspace, from all threats, including threats to the national security;
2. The degree of protection resulting from the application of these activities and measures;
3. The associated field of professional endeavour, including research and analysis, aimed at implementing and those activities and improving their quality.

India’s Vulnerability on cyber space

1. India remains vulnerable to digital intrusions such as cyber-espionage, cybercrime, digital disruption and Distributed Denial of Service (DoS)
2. The crimes related to cyber world can be multi-layered, multi-location, multilingual, multicultural and multi-legal, that’s why it is difficult to investigate and reach to the criminal.
3. The cases related to cyber-crime have increased by 70% in the year 2014 as compared to the year 2013.
4. There is growing threat from online radicalization.
5. The number of cybercrime cases registered in India has risen by 350 per cent in the three-year period from 2011 to 2014, according to a joint study by PwC and Assocham.
6. With the growing adoption of the Internet and smart-phones, India has emerged “as one of the favourite countries among cyber criminals.”
7. Major security threat: Critical infrastructure: Attackers can gain control of vital systems such as nuclear plants, railways, transportation or hospitals that can subsequently lead to dire consequences.
8. Despite having a National Cyber Security Policy (2013), risks to our critical infrastructure remain.
9. In spite of instituting a National Cyber Security Coordinator (2014), the rivalries between the National Technical Research Organisation (the nodal agency for cybersecurity) and the Ministry of Communications and Information Technology impede cooperation.
10. Lack of coordination among different government agencies.
11. China’s emphasis on ‘cloud computing techniques’, and the involvement of its Ministry of State Security in this endeavour, suggests that it is preparing for all-out offensive cyber operations. India would be a prime target.

What India Wants

1. Bleeding edge technology: Bleeding edge refers to technology that has been released but is still not ready for the general public due to the fact that it has not been reliably tested. The term bleeding edge was formed as an allusion to the similar terms “leading edge” and “cutting edge”.
2. Big data analytics: it is the process of collecting, organizing and analysing large sets of data (big data) to discover useful information.
3. Air gapping: Air gapping is a security measure that involves isolating a computer or network and preventing it from establishing an external connection. An air gapped computer is physically segregated and incapable of connecting wirelessly or physically with other computers or network devices.  Emphasis on cloud computing techniques.
4. Offensive cyber operations and strengthened cyber security.

International Convention on Cyber-crime:

1. Convention on Cybercrime, also known as the Budapest Convention.
2. The Budapest Convention is the first international treaty that addresses Internet and computer crime by harmonizing national laws, improving legal authorities for investigative techniques, and increasing cooperation among nations.
3. The Budapest convention is the only multilateral convention on cyber security – considered critical to economic and national security of a country
4. .Developing countries including India have not signed it stating that the developed countries lead by the US drafted it without consulting them.

Way Forward

The success in the futuristic space endeavour will depend upon setting up a well-tuned, cyber secure and tamper proof cyber security system, which can provide surge capabilities to bolster India’s Space programme during critical period or in hostilities.

Questions:

Q.) Cyber security, in the near future, will be the main component of the state’s overall national security and economic security strategies. Are citizens, organizations and public institutions ready to face challenges of cyber security? Critically analyse

Q.) Discuss the necessity of and measures being taken to introduce strong cyber security framework for banking sector in India.