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Subject: Economics

  • What is the Sovereign Right to Taxation?

    Scrapping the retrospective levy is believed to provide clarity to investors by removing a major source of ambiguity on taxation laws, the government has stressed the need to establish its “sovereign right to taxation”.

    Defining a Tax

    • A document on the Ministry of Statistics and Programme Implementation website quotes the definition of tax as a “pecuniary burden laid upon individuals or property owners to support the government; a payment exacted by legislative authority”.
    • It states that a tax “is not a voluntary payment or donation, but an enforced contribution, exacted pursuant to legislative authority”.

    The ‘sovereign right to taxation’

    • In India, the Constitution gives the government the right to levy taxes on individuals and organizations but makes it clear that no one has the right to levy or charge taxes except by the authority of law.
    • Any tax being charged has to be backed by a law passed by the legislature or Parliament.

    Taxation in India

    • Taxes in India come under a three-tier system based on the Central, State, and local governments and the Seventh Schedule of the Constitution puts separate heads of taxation under the Union and State list.
    • There is no separate head under the Concurrent list, meaning Union and the States have no concurrent power of taxation, as per the document.

    Back2Basics:

    Taxation in India: Classification, Types, Direct tax, Indirect tax

  • Privatizing Indian Railways

    Context

    On July 1, 2020, the Indian Railways launched the formal process of inviting private parties to run trains on the Indian railway system. Hopes of a large participation were belied as there were no bids for nine clusters and only two bids for three clusters.

    Why current model of inviting private players to run trains has failed?

    • Lack of equal relationship: IR wants the capital and technology without giving up control, while the concessioner wants a far more equal relationship to be moderated by a regulator.
    • Constraints on efficient decision-making: IR has imposed constraints that prevent efficient decisions and adopted an organisational design that does not take into account the characteristics and associated risks that will determine outcomes and investment decisions.
    • Lumpiness of investment: The biggest dampener is the lumpiness of investment before a single passenger can be carried.
    • High risk involved: Train sets have to be purchased without really knowing how much traffic the service will be able to attract in the face of rising competition from airlines.
    • IR does not guarantee the investor that, in case the concession fails, it will acquire the train sets.
    • Absence of regulator: The other big dampener is the absence of a regulator for resolving disputes.

    Suggestions

    1) Remove the lumpiness of investment by establishing rolling stock company

    • The central issue is how to align the three interests.
    • 1) India’s need to be capable of designing and manufacturing state-of-the-art rolling stock.
    • 2) IR’s need for private capital participation.
    • 3) Private capital’s necessity of earning a profit.
    • Establish a company to lease rolling stock: The above 3 interests can be aligned provided the lumpiness of investment in train sets can be eliminated by establishing a company that leases rolling stock not only to concessioners but also to IR.
    • The rolling stock company, apart from leasing train sets, can also be the window for bringing in new technology.
    • This will also enable reducing the concession period from 35 years to a more reasonable 10-15 years, bringing in competition.
    •  For starters, IRFC, which is already into leasing rolling stock, can be that company.

    2) Bring in new technology by opening IR’s rolling stock market to international manufacturers

    • There is need to move the rolling stock industry up the industrial value chain and bring about a structural change of the Indian economy.
    • Long term arrangement with suppliers: This can only be brought about by a vision that encourages long-term arrangements with rolling stock suppliers.
    • Open the market for global players: An arrangement that gives access to IR’s rolling stock market is the only way to compel global players to share technology and form joint ventures with Indian companies.

    3) Investment in research

    • Technology transfer requires understanding the critical elements of the technology and absorbing them into the design-production process.
    • This calls for the investment of large sums of money and the involvement of universities, research institutes and national laboratories.

    4) Make changes to attract private investors

    • For attracting private players, the risks for the concessioners needs to be reduced.
    • The period of the concession needs to be reduced to around 15 years.
    • Establish regulator: There is a need to establish a regulator and moderate charges like the amount for the maintenance of tracks and stations.

    Conclusion

    With these changes, the plan may still take off. However, the initiative will remain limited to just running trains if there is no long-term vision.

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  • Why central government schemes for discoms have not worked

    Context

    A recent report of Niti Aayog has assessed the losses of discoms to be about Rs 90,000 crore in 2020-21.

    Central government schemes for discoms

    • In 2001, the Accelerated Power Development Scheme was initiated.
    • This was followed by various other schemes with some differences between them.
    •  The government had launched the UDAY scheme in 2015.
    • UDAY did not involve any monetary assistance to the states, but only promised to help the states in reducing the cost of power through coal linkage rationalization, etc.
    • Recently, the government launched a new scheme with a total outlay of around Rs 3.03 lakh crore.
    • It seeks to improve the distribution infrastructure of the distribution companies (discoms) with the primary intention of improving their financial health.
    • The objective of the scheme is to bring down commercial losses in the range of 12-15 percent and also reduce the difference between the average cost of supply (ACS) and average revenue realized (ARR) to zero by 2024-25.
    • The problem with all these schemes (including UDAY) is that they have not been delivered and the financial position of the discoms has only worsened.

    Why did schemes fail to improve the financial health of discoms?

    • Reduction of loss is a managerial issue: Reduction of commercial losses is not really about improving infrastructure, it is more of a managerial issue.
    • The average loss (inclusive of technical and commercial) is about 22 percent today.
    • But several discoms have losses in excess of 40 percent.
    • It is possible to bring down losses from 40 percent to about 15 percent without any significant investments in infrastructure.
    • Investments, however, would be required to bring down losses further to a single-digit level.
    • The governance issues of the scheme is a complex issue.
    • The two most popular parameters which are monitored are the loss levels and the difference between the ACS and ARR.
    • There are inherent problems with these parameters since they keep fluctuating and it is very difficult to fathom their trend on a quarter-wise basis, rendering the release of funds to be tricky and cumbersome.
    • In the scheme now announced by the government, about 26 parameters will be taken into consideration and assigned a score.
    • For some of the parameters, it may be difficult to assign a score across discoms which may lead to some amount of subjectivity.

    Way forward: Alternate approach

    • Provide transitional financial support: An alternate approach that could be considered by the Centre (in lieu of such assistance schemes) is providing only transitional financial support to all discoms, which are privatized under the private-public partnership mode. 
    •  A transitional support of Rs 3,450 crore spread over five years proved to be exceedingly beneficial in the case of discoms in Delhi.
    • Promote privatization: Since in an earlier policy statement the government had mentioned that privatization of discoms is to be promoted, it would make sense to consider this transitional support as a catalyst.

    Conclusion

    Adopting this approach will ensure that the central government moves away from the micro-management of discoms, which inevitably happens if the release of funds is linked to reform-linked parameters on a quarter-wise basis.

     

  • National Mission on Edible Oil-Oil Palm (NMEO-OP)

    The Centre has increased the financial outlay for the National Mission on Edible Oil-Oil Palm (NMEO-OP).

    About NMEO-OP

    • National Mission on Oilseeds and Oil Palm (NMOOP) was implemented during the 12th Five Year Plan, to expand the oil palm areas and increase the production of edible oils.
    • It was later merged with the National Food Security Mission.
    • NMEO-OP aims to resolve to allow India to be independent or self-reliant in edible oil production.
    • Through this mission, more than ₹11,000 crores will be invested in the edible oil ecosystem.
    • The government will ensure that farmers get all the needed facilities, from quality seeds to technology.
    • Along with promoting the cultivation of oil palm, this mission will also expand the cultivation of our other traditional oilseed crops.

    Why such a mission?

    • India is one of the major oilseeds growers and importers of edible oils.
    • India’s vegetable oil economy is the world’s fourth-largest after the USA, China & Brazil.
    • The oilseed accounts for 13% of the Gross Cropped Area, 3% of the Gross National Product, and 10% value of all agricultural commodities.
    • During the last few years, the domestic consumption of edible oils has increased substantially and has touched the level of 18.90 million tonnes in 2011-12 and is likely to increase further.
    • A substantial portion of our requirement of edible oil is met through the import of palm oil from Indonesia and Malaysia.
    • It is, therefore, necessary to exploit domestic resources to maximize production to ensure edible oil security for the country.

    Alternative sources

    • Oil Palm is comparatively a new crop in India and is the highest vegetable oil yielding perennial crop.
    • With quality planting materials, irrigation, and proper management, there is a potential of achieving 20-30 MT Fresh Fruit Bunches (FFBs) per ha after attaining the age of 5 years.
    • Therefore, there is an urgent need to intensify efforts for area expansion under oil palm to enhance palm oil production in the country.
    • Tree Borne Oilseeds (TBOs), like Sal, Mahua, Simarouba, kokum, Olive, Karanja, Jatropha, Neem, Jojoba, Wild Apricot, Walnut, tung etc. are cultivated/grown in the country under different agro-climatic conditions.
    • These TBOs are also good sources of vegetable oil and therefore need to be supported for cultivation.

    Try answering this PYQ:

    Q.An objective of the National Food Security Mission is to increase the production of certain crops through area expansion and productivity enhancement in a sustainable manner in the identified districts of the country. What are those crops?

    (a) Rice and wheat only

    (b) Rice, wheat, and pulses only

    (c) Rice, wheat, pulses, and oilseeds only

    (d) Rice, wheat, pulses, oilseeds, and vegetables

     

    Post your answers here: [wpdiscuz-feedback id=”7x9t7q32mz” question=”Please leave a feedback on this” opened=”1″][/wpdiscuz-feedback]

  • [pib] Operation Greens Scheme

    The Union Minister of Food Processing Industries has provided useful information regarding the Op Greens Scheme.

    Operation Greens Scheme

    • Ministry of Food Processing Industries launched the Operation Greens scheme in November, 2018.
    • The scheme aims for integrated development of the Tomato, Onion, and Potato (TOP) value chain.
    • It aims to promote Farmer Producers Organizations (FPOs), agri-logistics, processing facilities and value addition etc. in identified production clusters.
    • Under the scheme, state-wise funds are not allocated as the scheme is demand-driven and projects are approved as per scheme guidelines on the basis of applications received for setting up of projects in eligible production clusters.

    Objectives:

    • To enhance value realization of TOP farmers
    • Reduction in post-harvest losses
    • Price stabilization for producers and consumers and
    • Increase in food processing capacities and value addition etc.

    Key provisions

    • Short term intervention by way of providing transportation and storage subsidy @ 50% and
    • long term intervention through value addition projects in identified production clusters with Grant-in-aid @ 35% to 70% of eligible project cost subject to maximum of Rs. 50 crore per project

  • No fossil fuels as usual

    Context

    The spread and speed of the destruction caused by climate change in recent weeks present our new Minister of Petroleum and Natural Gas with a policy dilemma. The article offers five policy suggestions to deal with the dilemma.

    Energy dilemma facing India

    • The events of the past month all over the world have caught even the most alarmist of climate scientists by surprise.
    • These events brought into sharp relief the reality that there was no option of denying the consequential implications of the use of fossil fuels.
    • However, the dilemma India faces lies in the fact that the Indian economy is heavily dependent on fossil fuels and there is no end in sight to this dependence.
    • Further, India imports approximately 85 percent of its crude oil requirements and is exposed to the volatility of the international oil market.

    Five policy changes needed

    1) Reduce emphasis on domestic exploration

    • Not easy to locate and difficult to develop: A review of the public sector’s exploration and production (EP) track record suggests that whilst India may well be sitting on substantial hydrocarbon reserves, these reserves are not easy to locate and, even when located, difficult to develop and produce on a commercial basis.
    • The government has often compounded this economic challenge by placing administrative limits on marketing by companies and their pricing freedom.
    • High risk and structural softness in the market: The fundamental point is that EP in India is a high-risk activity, and this risk is even greater today because of the longer-term structural softness of the petroleum market.
    • The resources earmarked for exploration can be deployed more productively elsewhere.

    2) Increase productivity of producing fields

    • The ONGC needs to allocate increasing resources to improving the productivity of its producing fields.
    • Low oil recovery rate: The average oil recovery rate in India was around 28 percent that is, for every 100 molecules discovered, only 28 were monetized.
    • This number did not compare well with the global average of around 45 percent for fields of comparable geology.
    • Use technology: The application of enhanced oil recovery (EOR) technology offers a relatively low-risk avenue for increasing domestic production.

    3) Increase strategic reserves

    • We hold currently strategic reserves equivalent to 12 days of imports.
    • The government has approved plans to increase this buffer to 25 days.
    • By comparison, China, the EU, South Korea, and Japan hold between 70-100 days of reserves.
    • A significant portion of our oil imports came from the Middle East, predominantly Saudi Arabia, Iraq, and Iran.
    • This region faces deep political and social fault lines and there is no knowing when our supply lines might get ruptured.
    • We would, therefore, be well-advised to build contingency safeguards.

    4) Restructure and reorganize public sector petroleum companies

    • Consolidate upstream assets: In the first instance, the upstream assets should be consolidated under ONGC (the upstream assets of BPCL, IOC, HPCL, and GAIL should pass onto ONGC) and GAIL should be unbundled into a public utility gas pipeline company
    • Diversify: Thereafter, these companies should be encouraged to look beyond hydrocarbons to build an “energy” enterprise.
    • The restructuring will help cut back the “avoidable” costs of intra public sector competition.
    • It will also reduce the inefficiencies of “sub-scale” operations.
    • It will provide a focused platform for balancing the shorter-term need to provide secure and affordable hydrocarbons with the medium and longer-term imperative of developing clean energy.

    5) Avoid siloed thinking

    • The petroleum minister should not see his responsibility through the siloed prism of oil and natural gas.
    • He should broaden the aperture and become the progenitor of the energy transition.

    Conclusion

    The dilemma referred to in the opening sentence will be easier to resolve our priorities are set within the framework of clean energy.

  • The sovereign right to tax is not absolute

    Context

    A bill introduced in Parliament last week aims to nullify the 2012 amendment in the Income Tax Act which made the income tax law retroactively applicable on indirect transfer of Indian assets.

    Issue of taxation as a sovereign right of the state

    • Several  Investor-State Dispute Settlement (ISDS) tribunals have recognised the fundamental principle that taxation is an intrinsic element of the state’s sovereign power. 
    • The ISDS tribunals have also held that whenever a foreign investor challenges states’ taxation measures, there is a presumption that the taxation measures are valid and legal.
    • For instance, an ISDS tribunal in Renta 4 v. Russia said that when it comes to examining taxation measures for BIT breaches, the starting point should be that the taxation measures are a bona fide exercise of the state’s public powers.

    What are the limits on the taxation rights of a Country under BITs

    • The two most used BIT provisions to challenge a state’s taxation measures are expropriation and the fair and equitable treatment provision.
    • 1) Expropriation: In the context of expropriation, one of the key ISDS cases that explained the limits on the state’s right to tax is Burlington v. Ecuador.
    • In this case, the tribunal held that under customary international law, there are two limits on the state’s right to tax.
    • First, the tax should not be discriminatory.
    • Second, it should not be confiscatory.
    • 2) Fair and equitable treatment: In the context of the fair and equitable treatment provision, foreign investors have often challenged taxation measures as breaching legal certainty, which is an element of the fair and equitable treatment provision.
    • Although legal certainty does not mean immutability of legal framework, states are under an obligation to carry out legal changes such as amending their tax laws in a reasonable and proportionate manner.

    So, what happened in Cairn Energy v. India case?

    • The tribunal in Cairn Energy v. India said that taxing indirect transfers is India’s sovereign power and the tribunal would not comment on it.
    • Legal certainty: The tribunal said that India’s right to tax in the public interest should be balanced with the investor’s interest of legal certainty.
    • The tribunal held that the public purpose that justifies the application of law prospectively will usually be insufficient to justify the retroactive application of the law.
    • India argued that the 2012 amendment was to ensure that foreign corporations who use tax havens for the indirect transfers of underlying Indian assets pay taxes.
    • However, the tribunal held that this objective could be achieved by amending the income tax law prospectively, not retroactively.
    • The tribunal did not rule against retroactivity of tax laws per se but against the retroactive application that lacked public policy justification.

    Way forward

    • Carving out taxation from BITs: India in its 2016 Model BIT carved out taxation measures completely from the scope of the investment treaty.
    • Nonetheless, carving out taxation measures from the scope of the BIT does not mean that states are free to do as they please.
    • India should exercise its right to regulate while being mindful of its international law obligations, acting in good faith and in a proportionate manner.
    • ISDS tribunals do not interfere with such regulatory measures.

    Conclusion

    In sum, the debate never was whether India has a sovereign right to tax, but whether this sovereign right is subject to certain limitations. The answer is an emphatic ‘yes’ because under international law the sovereign right to tax is not absolute.

    Back2Basics:  Investor-State Dispute Settlement (ISDS) tribunal

    • ISDS is a mechanism included in many trade and investment agreements to settle disputes.
    • Settling these investor disputes relies on arbitration rather than public courts.
    • Under agreements which include ISDS mechanisms, a company from one signatory state investing in another signatory state can argue that new laws or regulations could negatively affect its expected profits or investment potential, and seek compensation in a binding arbitration tribunal.
    • The system only provides for foreign companies to sue states, not the other way around.

  • Retiring Old Coal Power Plants

    Context

    As part of the Union Budget address for 2020-21, the Finance Minister, Nirmala Sitharaman, said that the shutting down of old coal power plants, which are major contributors to emissions, will aid the achievement of India’s Nationally Determined Contributions.

    Advantages of shutting down old coal power plants

    • The availability of under-utilized newer and presumably more efficient coal-based capacity means that shutting down older inefficient plants would lead to improved efficiencies, reduced coal usage, and hence, cost savings.
    • It would be uneconomical for old plants to install pollution control equipment required to meet the emission standards announced by the Environment Ministry, and hence it would be better to retire them.

    Why the decision needs finer scrutiny?

    • Some old plants are cost-effective: There are also several old plants, which generate at lower costs, such as plants at Rihand, Singrauli, and Vidhyanchal (Madhya Pradesh).
    • Locational advantage: This may be due to locational advantage rather than efficiency, as older plants are likely to be located closer to the coal source, reducing coal transport costs.
    • Not cost-effective: Savings in generation cost from shutting down plants older than 25 years would be less than ₹5,000 crore annually, which is just 2% of the total power generation cost.
    • Not effective in reducing coal consumption: Savings in coal consumption by replacing generation from plants older than 25 years with newer coal plants are also likely to be only in the 1%-2% range.
    • Economical even after installing pollution control equipment: There are some old plants that may continue to be economically viable even if they install pollution control equipment as their current fixed costs are very low.

    Important roles played by old thermal power plants

    • A significant part of power supply: Plants older than 25 years makeup around 20% of the total installed thermal capacity in the country and play a significant role in the country’s power supply.
    • Supporting renewable: To support the growing intermittent renewable generation in the sector, there is an increasing need for capacity that can provide flexibility, balancing, and ancillary services.
    • Old thermal capacity, with lower fixed costs, is a prime candidate to play this role until other technologies (such as storage) can replace them at scale.
    • Political economy risk: There is also a political economy risk, as aggressive early retirement of coal-based capacity, without detailed analyses, could result in real or perceived electricity shortage in some States, leading to calls for investments in coal-based base-load capacity by State-owned entities.

    Way forward

    • Nuanced analysis needed: Instead of using age as the only criteria, a more disaggregated and nuanced analysis needs to be used.
    • Constraint related to renewable and increasing demand: We also need to take into account aspects such as intermittency of renewables, growing demand, and the need to meet emission norms, to make retirement-related decisions.

    Conclusion

    It may be prudent to let old capacity fade away in due course while focusing on such detailed analysis and weeding out the needless capacity in the pipeline, to derive long-term economic and environmental benefits.

  • Taxation Laws (Amendment) Bill

    Context

    With the government proposing to repeal the ‘retrospective tax’ amendment introduced in the Union Budget 2012-13, a 14-year-story has come to an end.

    Background of retrospective tax

    • In 2007 Vodafone acquired Hutchison Essar, the telecom company, for $11 billion. But the deal did not take place in India.
    • Yet, Vodafone was slapped with a huge income tax demand in India.
    • The Supreme Court rule in favour of Vodafone and said that the Indian authorities could not tax a deal executed in Cayman Islands.
    • This verdict led to the 2012 amendment in the Income Tax Act, to the effect that if an Indian asset was held by a foreign company and an acquirer bought this holding company, such a transaction was deemed to be taxable in India because the underlying asset was located in India.
    • More importantly, this change was made retrospectively from 1962.
    • Now, the government has introduced The Taxation Laws (Amendment) Bill, 2021 to undo this insidious provision from the Finance Bill, 2012.
    • The government will not raise tax demands in any such case if the transaction occurred before 28 May 2012.
    • The tax on the indirect sale of assets located in India still stays on the statute books, but it is fully visible to and understood by any parties looking to enter into such a transaction.

    Why repeal of retrospective taxation is a good move?

    • Resolution of case the cases: This will potentially help resolve 17 cases in which income tax demand had been raised, including two high profile cases—Cairn and Vodafone.
    • Visibility and stability: The government is putting to rest the concept of retrospective taxation and is also creating visibility and stability for the future.
    • Predictability: The most important aspect of any tax regime is its predictability and this decision helps bring that.
    • Honouring the rule of law: It also reiterates India’s commitment to honour the rule of law and treaties.
    • Build confidence: Apart from the various reform measures and incentives being offered, the sanctity of contracts is a key factor that any investing entity will look at when deciding on expanding business operations in India.
    • The government’s move would help build confidence and provide a fillip to Atmanirbhar Bharat.

    Conclusion

    As the post-covid recovery picks up, focus needs to be on the future rather than keeping a sword of uncertainty for the past dangling on potential investors. Such a decision needs political capital and ownership, which comes through strongly in this case.

     

  • South Asia’s emerging digital transformation

    Context

    COVID-19 has forced South Asia to take a quantum leap in digitalisation, which will help shape its future prosperity.

    Spike in digitisation due to Covid

    • In India, COVID-19 accelerated the launch of the National Digital Health Mission, enhancing the accessibility and the efficiency of health-care services by creating a unique health ID for every citizen.
    • Pandemic accelerated South Asia’s embrace of e-commerce, boosted by digital payment systems.
    • Bangladesh alone witnessed an increase of 70-80% in online sales in 2020, generating $708.46 million in revenues.
    • Even smaller nations such as Nepal recording almost an 11% increase in broadband Internet users.

    The dangers of a digital divide

    • A wide digital divide persists in access and affordability, between and within the countries of South Asia.
    • Despite having the world’s second-largest online market, 50% of India’s population are without Internet with 59% for Bangladesh and 65% for Pakistan.
    • This divide could permanently put children out of school, place girls at risk of early marriage, and push poor children into child labour costing economies billions of dollars in future earnings.
    • Businesses too have paid a heavy price for the gap in digital solutions, whereby many South Asian firms failing to embrace e-commerce or other cloud-based technologies to survive the financial chaos of the novel coronavirus pandemic.

    Asian digitalisation

    • Digital transformation is a global imperative with the adoption of advanced technologies.
    • At the forefront of Asian digitalisation are countries such as Singapore, Japan, and South Korea recognised as global technological hubs.
    • The digital boom in the Association of Southeast Asian Nations (ASEAN) economies is pushing a “common market” initiative, fostering regional economic integration and enhancing global competitiveness.
    • South Asia has also made significant strides in the adoption of digital technologies such as the Digital Bangladesh Vision 2021.

    How digitalisation can help South Asia?

    • The region still has a long way to go.
    • Jobs in e-commerce: E-commerce could drive the post-pandemic growth in South Asia, providing new business opportunities and access to larger markets.
    • In India, e-commerce could create a million jobs by 2030 and be worth $200 billion by 2026.
    • Growth driven by Fintech: Fintech could drive significant growth and reduce poverty by building financial inclusion.
    • Increase in productivity: A timely, inclusive, and sustainable digital transformation can not only bolster productivity and growth but also serve as a panacea for some of the region’s socio-economic divides.

    Steps need to be taken

    • To reap the dividends of digital transformation, South Asia needs to address legal, regulatory and policy gaps as well as boost digital skills.
    • Digital infrastructure: A robust digital infrastructure is a sine qua non and there exists a huge financing gap.
    • India alone needs an annual investment of $35 billion to be in the top five global digital economy.
    • Private-public partnership: Public-private partnership needs to be leveraged for the region’s digital infrastructure financing.
    • Regulatory roadblocks need to be addressed as e-commerce regulations are weak in South Asia.
    • Digital literacy: There would be no digital revolution without universal digital literacy.
    • Governments and businesses need to come together to revamp the education system to meet the demand for digital skills and online platforms.
    • Cybersecurity measures: The crossflow of data and personal information calls for stringent cybersecurity measures as many have experienced painful lessons in data privacy during the pandemic.
    • Digital Single Market Proposal: By addressing issues such as regulatory barriers on currency flows inhibiting online payment to transport-related constraints for cross-border e-commerce activities, South Asia can emulate the European Union’s Digital Single Market Proposal.
    • Collaboration: Concerted collaboration at all levels is needed to push South Asia out of stagnancy and towards a digital future of shared prosperity.
    • Partnership for digital revolution: During the pandemic, South Asian nations joined hands to collectively battle the crises by contributing towards a COVID-19 emergency fund, exchanging data and information on health surveillance, sharing research findings, and developing an online learning platform for health workers.
    • If the eight nations (Afghanistan, Bangladesh, Bhutan, India, Nepal, Maldives, Pakistan and Sri Lanka) can start walking the talk, partnership for a successful digital revolution is plausible.

    Conclusion

    A shared “digital vision” could place the region on the right track towards the Fourth Industrial Revolution.