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Type: Explained

These Newscards correspond to the explained section of various newspapers. They become immensely important for both prelims and mains and special attention needs to be paid to them

  • On sanctions and shadow fleets

    Why in the News?

    During coverage of the Russia-Ukraine conflict, many Western media outlets have referred to tanker ships transporting Russian crude oil or oil products to other countries as a “shadow fleet.”

    What is shadow fleet?

    • The “shadow fleet” refers to tanker ships transporting oil from sanctioned countries, using tactics like flag hopping, complex ownership structures, and cargo transfers at sea to evade detection and sanctions.

    What are Flags of Convenience (FoCs)?

    • Flags of Convenience (FoCs) refer to the practice of registering a ship in a country other than that of the ship’s owner. Ships then fly the flag of the country where they are registered, known as the “flag state.”
    • Initially, FoCs emerged as a way for shipowners to minimize taxes and avoid stringent regulations. They allow shipowners to benefit from favorable regulatory environments, such as lower taxes, less stringent safety requirements, and more lenient labor laws.
    • Examples: Common FoCs include Panama, Liberia, and the Marshall Islands. These nations have minimal regulations, making it easier for ships to operate with reduced scrutiny.

    How do corporations with large fleets obscure ownership and origin of cargo? (Challenges to find the origin country of the ship)

    • Complex Ownership Structures: Corporations often create complex ownership arrangements to hide the true identity of shipowners. This may involve setting up multiple shell companies, where each company owns only one or two ships. The use of offshore accounts and subsidiaries further adds to the opacity.
    • Frequent Changes in Ship Registration and Management: Ships frequently switch their flag state (known as “flag hopping”) to avoid detection and regulatory compliance.
    • Renaming Vessels: Ships involved in activities that could trigger sanctions often change their names to avoid being traced back to previous sanctioned activities.
    • Using FoCs and Non-Compliant Jurisdictions: Ships may be registered in countries that are not signatories to international regulatory frameworks, such as the International Maritime Organization (IMO).
      • For instance, Eswatini has emerged as a FoC because it does not follow IMO guidelines, allowing for less regulatory oversight.

    Why has India been accused of hosting a shadow fleet?

    • Increased Russian Oil Shipments: Indian firms and Dubai-based entities with Indian ties have been involved in transporting Russian oil, raising suspicions of sanction evasion.
    • Certification by Indian Register of Shipping (IRS): The IRS certified more ships linked to Russian oil post-sanctions, which some viewed as supporting “shadow fleet” operations.
    • Use of Flags of Convenience: Ships connected to India often registered under foreign flags, obscuring their ownership and the origin of their cargo to bypass sanctions.

    What are the different ways through which ships ensure they don’t lose their insurance?

    • Switching Insurance Providers: If a ship loses its Protection and Indemnity (P&I) insurance cover due to violations of sanctions, the owner may shift the vessel’s management to a different company with valid P&I insurance.
    • Changing Ship Management and Ownership: By changing the management entity or even the registered owner (via shell companies), ships can regain insurance cover without having to comply with the initial sanctions.
    • Use of Different Flag States: Ships registered under FoCs or jurisdictions not compliant with international regulations face less scrutiny, which can help them maintain insurance coverage despite potentially violating sanctions.
    • Renaming Vessels: This practice helps erase the association of the ship with any prior incidents or sanctions violations, allowing the ship to be insured under a different identity.

    Way forward: 

    • Enhance Oversight and Transparency: India should tighten regulations on ship certification and ownership disclosure, ensuring compliance with international norms to prevent any association with sanction-evading activities.
    • Strengthen International Coordination: India should collaborate with global maritime bodies to align its policies with international shipping standards, promoting responsible trade practices while safeguarding its economic interests.

  • The case for a nature restoration law in India

    Why in the News?

    The urgent global issue of ecosystem degradation affects India significantly, with nearly 30% of its land degraded. India’s need for a comprehensive nature restoration law is critical, drawing inspiration from the EU’s NRL

    Why does India need a Nature Restoration Law?

    • High Land Degradation: Nearly 30% of India’s land is degraded, with areas like Gujarat, Karnataka, Maharashtra, and Rajasthan severely affected.
    • Rising Desertification: The extent of desertification in India has increased significantly, impacting ecosystems and agricultural productivity.
    • Biodiversity Loss: The degradation of natural habitats threatens India’s rich biodiversity and contributes to the global biodiversity crisis.
    • Climate Change Mitigation: Degraded ecosystems lose their ability to act as carbon sinks, worsening climate change impacts.
    • Economic Implications: Land degradation affects agriculture, water security, and livelihoods, necessitating legal intervention for sustainable management.

    What should the Nature Restoration Law in India include?

    • Legally Binding Restoration Targets: Similar to the EU’s NRL, set mandates to restore a specific percentage of land and water bodies by 2030 and 2050.
    • Multi-Ecosystem Approach: Include provisions for forests, agricultural lands, rivers, wetlands, and urban areas to ensure comprehensive ecosystem restoration.
    • Monitoring and Reporting Mechanisms: Establish a framework for monitoring progress, conducting periodic reviews, and reporting on restoration outcomes.
    • Funding and Incentive Mechanisms: Provide financial support and incentives for states, communities, and private entities engaging in restoration projects.
    • Integration with Existing Programs: Align with ongoing initiatives like the Green India Mission and watershed programs for enhanced effectiveness.

    What are the potential benefits of implementing such a law?

    • Environmental: Restoring degraded lands can enhance biodiversity, improve soil health, and increase carbon sequestration, aiding climate resilience.
    • Economic: Could generate economic returns through improved agricultural productivity, job creation, and enhanced water security.
    • Social: Restoration projects can create rural employment opportunities and support sustainable livelihoods, especially in degraded areas.
    • Alignment with International Commitments: Helps India achieve its Sustainable Development Goals (SDGs), especially Goal 15, and meet Paris Agreement targets.

    Way forward: 

    • Adopt a Comprehensive Restoration Framework: India should enact a Nature Restoration Law with legally binding targets, integrating multi-ecosystem restoration approaches and aligning with existing environmental programs.
    • Strengthen Monitoring and Funding Mechanisms: Establish robust monitoring frameworks for progress evaluation and provide financial incentives for restoration efforts, ensuring effective implementation and long-term sustainability.

  • India, China reach deal on easing LAC tensions 

    Why in the News?

    India and China announced an agreement on patrolling arrangements, resolving the military standoff along the Line of Actual Control (LAC), as per government officials.

    What are the key components of the agreement between India and China?

    • Patrolling Arrangements: The agreement includes the resumption of patrolling along the Line of Actual Control (LAC) in previously disputed areas, where patrolling had been stopped since 2020.
    • Disengagement and Buffer Zones: The agreement aims to complete the disengagement process by restoring the situation to pre-2020 levels, including addressing issues at friction points like Demchok and Depsang.
      • The existence or adjustment of buffer zones, which were established to prevent clashes, remains undisclosed.
    • Diplomatic and Military Dialogue: The resolution is a result of multiple high-level meetings and negotiations, involving Foreign Ministers, the Working Mechanism for Consultation and Coordination (WMCC), and military commanders from both sides.
    • Return to Pre-2020 Status: Indian officials have indicated that the situation at the LAC will revert to what it was before 2020, although further steps like deinduction and demobilization of troops still need to be undertaken.

    How does this agreement impact the broader geopolitical landscape in the region?

    • Regional Stability: The agreement could contribute to stability along the India-China border and help reduce military tensions in the region, especially at sensitive points like the Galwan Valley, where past clashes occurred.
    • Influence on China-India Relations: It marks a potential thaw in India-China relations, creating a conducive atmosphere for high-level diplomatic engagements, possibly including a meeting between Prime Minister Modi and President Xi Jinping during the BRICS summit.
    • Implications for Multilateral Forums: The agreement preceding the BRICS summit indicates a strategic effort to avoid bilateral friction overshadowing multilateral diplomacy. A peaceful resolution along the border could bolster cooperation within BRICS and other regional platforms.
    • Signal to Neighboring Countries: The resolution may influence the perception of China’s border policies among other neighboring countries in Asia, possibly setting a precedent for dispute resolution.

    What are the implications for India’s national security strategy?

    • Shift Towards Dialogue and Diplomacy: The agreement underscores India’s willingness to resolve border issues through diplomatic means while maintaining a strong defense posture.
    • Strategic Focus on LAC Management: Although disengagement is underway, continued monitoring and readiness at the LAC will remain crucial. The agreement may lead to a recalibration of India’s military deployments and infrastructure development along the border.
    • Enhanced Security Coordination: With border tensions easing, India can refocus on comprehensive security strategies involving cooperation with allies and partners in the Indo-Pacific region, addressing broader challenges such as maritime security and countering China’s influence.
    • Preparedness for Future Contingencies: The completion of disengagement does not eliminate future risks. India will likely continue to strengthen its border infrastructure and military capabilities as a precaution against any future incursions.

    Way forward: 

    • Strengthen Diplomatic Engagements: India should prioritize continuous diplomatic dialogues with China to solidify the agreements reached and prevent future misunderstandings.
    • Enhance Border Infrastructure and Defense Preparedness: India should invest in improving border infrastructure and logistics to support troop mobility and supply lines.

  • SC upholds Section 6A of Citizenship Act as valid

    Why in the News?

    On October 17, 2024, political parties widely welcomed the Supreme Court’s decision upholding Section 6A of the Citizenship Act, addressing citizenship under the Assam Accord.

    What is Section 6A?

    • Section 6A of the Citizenship Act, added in 1985, grants citizenship to immigrants in Assam who entered between January 1, 1966, and March 25, 1971, under the Assam Accord provisions.

    What are the implications of upholding Section 6A for citizenship in Assam?

    • Legal Recognition of the Assam Accord: The verdict reinforces the Assam Accord’s legal status, acknowledging the cut-off date of March 25, 1971, for granting citizenship to immigrants. This solidifies the Accord’s role as a foundational legal document addressing the state’s citizenship issues.
    • Clarifying Citizenship Status: The ruling provides legal clarity on the citizenship status of individuals who entered Assam between January 1, 1966, and March 25, 1971. They are granted citizenship if they comply with specific conditions, while those arriving post-1971 are deemed illegal immigrants.
    • Impact on the NRC Process: The decision may influence the National Register of Citizens (NRC) process in Assam by determining who is eligible for inclusion. The cut-off date could guide the verification of citizenship claims, potentially affecting those at risk of being declared stateless.

    How does this ruling interact with existing immigration laws and policies?

    • Consistency with the Foreigners Act: The ruling aligns with existing immigration policies under the Foreigners Act, where illegal immigrants are identified and potentially deported.
    • Implications for Deportation and Detection: The verdict mandates continued efforts to detect and deport illegal immigrants who arrived post-March 25, 1971.
      • This may intensify identification and deportation processes, requiring robust legal and administrative mechanisms.
    • Role in NRC and Citizenship Amendment Act (CAA) Debate: The ruling interacts with ongoing discussions about the CAA, which grants citizenship to non-Muslim migrants from neighboring countries who entered before December 31, 2014.

    What are the broader constitutional implications of this decision?

    • Federalism and Regional Autonomy: The judgment upholds Assam’s unique historical and cultural context, recognizing the state’s special legal provisions under the Assam Accord.
    • Right to Equality and Non-discrimination: By validating different cut-off dates for citizenship determination in Assam compared to the rest of India, the ruling raises questions about equal treatment and the uniformity of laws across the country.
    • Judicial Endorsement of Accord-based Legislation: The ruling sets a precedent for upholding legislation based on historical accords or regional agreements.

    Way forward: 

    • Full Implementation of the Assam Accord: Ensure the complete execution of all clauses of the Accord, including detecting, deleting, and deporting illegal immigrants, while providing support to those recognized as citizens to integrate smoothly into society.
    • Strengthen Legal and Administrative Frameworks: Enhance the infrastructure for the NRC process, deportation mechanisms, and border management to maintain consistency in immigration policies, while addressing humanitarian concerns for affected individuals.

  • Climate change impact harsher on poorer farmers in India: FAO report

    Why in the News?

    On October 16, 2024, the FAO said that poor households around the world lose 5% of their income each year due to heat stress and 4.4% due to floods.

    About FAO: 

    • The Food and Agriculture Organization (FAO) is indeed a specialized agency of the United Nations (UN), established to lead international efforts aimed at combating hunger and improving food security and nutrition globally.
    • It founded on October 16, 1945, FAO operates from its headquarters in Rome, Italy, and comprises 195 members, including 194 countries and the European Union.

    Key Objectives of the Food and Agriculture Organization (FAO):

    • Eradicate Hunger and Malnutrition: The FAO aims to eliminate hunger, food insecurity, and malnutrition worldwide by promoting sustainable agricultural practices and increasing food availability.
    • Promote Sustainable Agriculture: The organization encourages sustainable management of natural resources and resilient agricultural systems to combat climate change and preserve biodiversity.
    • Reduce Rural Poverty: FAO works to improve the livelihoods of rural populations through economic development, social protection measures, and improved access to markets.
    • Enhance Food Systems: It focuses on improving food production, distribution, and consumption to ensure the global population has access to nutritious, safe, and affordable food.
    • Respond to Crises: The FAO assists countries in addressing food-related emergencies and building resilience against future shocks, such as natural disasters and conflicts.

    Key Highlights of the Present Report by FAO:

    • Economic Losses from Climate Stress: The report highlighted that poor households globally lose 5% of their income due to heat stress and 4.4% due to floods annually, compared to better-off households.
    • Impact on Rural Poor in India: It found that rural poor households in India are affected by climate stress differently, with reduced off-farm employment opportunities during droughts, forcing them to allocate more resources to agriculture.
    • Structural Inequalities: The report noted that poor households’ vulnerability to climate stressors is rooted in structural inequalities, calling for policy measures such as expanding social security.
    • Recommendations for Livelihood Support: Suggested scaling up anticipatory social protection programs and improving off-farm employment opportunities to reduce reliance on negative coping strategies.
    • Gender and Employment Barriers: The report urged addressing gender disparities in non-farm employment through gender-transformative approaches to tackle discriminatory norms.

    What is NITI Aayog’s Response?

    • Efforts to Combat Climate Change: NITI Aayog highlighted India’s proactive measures, such as the National Innovations on Climate Resilient Agriculture (NICRA) project, which supports farmers’ adaptation to severe climate conditions.
    • Social Safety Nets: Emphasized India’s implementation of a nationwide employment guarantee scheme and extensive food distribution efforts during the pandemic as evidence of social protection measures.
    • Women’s Workforce Participation: Cited data from the Periodic Labour Force Surveys showing increased female participation in the workforce, indicating progress in addressing gender issues.
    • Open to FAO Suggestions: Acknowledged the value of considering the FAO’s recommendations for further policy improvement while emphasizing India’s existing initiatives.

    Way forward: 

    • Strengthen Social Protection: Expand anticipatory social protection programs and climate-resilient agricultural practices to support vulnerable households, reducing income losses from climate stress.
    • Address Structural Inequalities: Enhance off-farm employment opportunities, tackle gender disparities, and implement policies targeting the root causes of vulnerability to climate-related risks.

  • India’s SDG focus and its Human Development issues 

    Why in the News?

    On September 9-10, 2023, New Delhi hosted the G-20 Summit, where participants committed to enhancing the implementation of the UN Agenda 2030 for Sustainable Development.

    How effectively is India progressing towards achieving the SDGs by 2030?

    • Current Status: India is classified in the “medium human development” category, with an HDI value of 0.644 and a rank of 134 out of 193 countries.
    • Improvement Over Time: India saw an increase of 48.4% in HDI value from 1990 (0.434) to 2022 (0.644), indicating positive long-term trends despite recent stagnation and slight declines due to factors such as the COVID-19 pandemic.
    • SDG Interconnections: India’s HDI dimensions directly align with several SDGs, including SDG-3 (good health), SDG-4 (quality education), and SDG-5 (gender equality). Progress in these areas is critical for achieving broader SDG targets.
    • Rank Improvements: From 2015 to 2022, India improved its HDI ranking by four places, while neighboring countries such as Bangladesh and Bhutan improved their rankings by 12 and 10 places, respectively, highlighting the need for India to enhance its efforts.

    What are the key human development challenges that India faces?

    • Gender Inequality: India has one of the largest gender gaps in the Labor Force Participation Rate (LFPR), with a stark difference of 47.8 percentage points between women (28.3%) and men (76.1%). The GDI indicates significant disparities in HDI achievements between genders, which undermines development.
    • Income Inequality: India experiences high income inequality, with the richest 1% holding 21.7% of total income, significantly higher than many neighboring countries and above global averages. This poses a barrier to sustainable development and equitable growth.
    • Education and Health: The impact of the COVID-19 pandemic has negatively affected education and health sectors, leading to increased vulnerabilities among poorer and marginalized populations.
    • Urban-Rural Divide: There is a notable disparity in female labour force participation between rural (41.5%) and urban areas (25.4%), suggesting that urban policy initiatives may not adequately support women’s employment.

    What strategies can be implemented? (Way forward)

    • Strengthening Gender Equality: Implement gender-transformative approaches to enhance women’s participation in the labour force and address systemic barriers. This includes policies promoting work-life balance, flexible work arrangements, and targeted skill development programs.
    • Enhancing Education and Skill Development: Invest in quality education, vocational training, and lifelong learning opportunities that cater to both genders, particularly in rural areas.
    • Promoting Social Protection: Expand social safety nets and anticipatory social protection programs that target vulnerable populations, particularly women and marginalized groups.
    • Reducing Income Inequality: Implement progressive taxation and wealth redistribution policies to address the concentration of income.
    • Multi-Stakeholder Engagement: Foster collaboration between government, civil society, and the private sector to implement sustainable development initiatives.

    Mains PYQ:

    Q National Education Policy 2020 isin conformity with the Sustainable Development Goal-4 (2030). It intends to restructure and reorient education system in India. Critically examine the statement. (UPSC IAS/2020)

  • Abject failure: Reports Global Hunger Index (GHI), 2024

    Why in the News?

    The 2024 Global Hunger Index (GHI) indicates that the number of undernourished people in India this year, approximately 200 million, would rank as the seventh largest population in the world, comparable to the size of Brazil’s population.

    Why it is a matter of concern?

    • High Undernourishment Levels: India’s Global Hunger Index rank is 105 out of 127 countries, classified under the “serious” category with a score of 27.3. An estimated 200 million people, or roughly 14% of India’s population, are undernourished, a figure comparable to the population of Brazil.
    • Child Malnutrition: India’s child stunting rate stands at 35.5%, and the child wasting rate is 18.7%, indicating widespread malnutrition. These rates reflect a failure in the healthcare and social safety net systems.
    • Infant Mortality Rate: Although India’s infant mortality rate is slightly below the global average (26 per 1,000 live births compared to the global average of 28), it remains a significant issue.
    • Impact of Food Inflation: Food inflation more than doubled between FY22 and FY24, increasing from 3.8% to 7.5%. This disproportionately affects low-income households, leading to reduced food accessibility.

    What about India’s GDP growth?

    • High Economic Growth Rate: India was the world’s fastest-growing economy in FY24, with a growth rate of 6.8% and a GDP nearing $4 trillion, ranking fifth globally.
    • Low Per Capita Income: Despite rapid economic growth, India’s per capita income remains low at $2,485 in FY24, which is less than a fourth of the global average of $13,920 in FY22. This disparity suggests significant income inequality and limited improvement in living standards for many.
    • Record Food Production vs. Hunger: In FY24, India achieved one of its highest food production levels at 332 million tonnes. However, the abundance in food production did not translate into improved food security due to distribution challenges, economic disparities, and climate-related impacts.

    What is the debate about data collection methodology?

    • Use of Sample Registration System (SRS) Data: The GHI uses data from India’s Sample Registration System (SRS), which is annually published by the Ministry of Statistics and Programme Implementation. It provides statistics on births, deaths, infant mortality, and other vital indicators.
    • Government’s Criticism of GHI Methodology: There has been ongoing criticism from the Indian government regarding the GHI’s methodology, particularly the reliance on survey data and subjective measurements for assessing hunger and malnutrition. 
      • The government argues that the GHI may not accurately reflect the improvements in nutrition and food distribution initiatives.
    • Challenges in Addressing Undernutrition: Even with abundant food production, systemic issues such as poor nutrition programs, climate impacts on agricultural productivity, and socioeconomic factors continue to affect food security in India.  

    Way forward: 

    • Strengthen Nutrition and Social Safety Programs: India should enhance the effectiveness of nutrition programs, such as the Integrated Child Development Services (ICDS) and Mid-Day Meal Scheme, ensuring better coverage, quality, and targeting to reduce child malnutrition and undernourishment.
    • Address Economic Inequality and Improve Food Access: Implement policies to reduce income disparities and make essential foods more affordable, such as expanding the Public Distribution System (PDS) to cover vulnerable groups affected by inflation and climate-related agricultural disruptions.

  • As the world warms and cool

    Why in the News?

    The rising demand for cooling is leading to increased fossil fuel consumption for electricity generation, which in turn contributes to climate change and gradually elevates atmospheric temperatures.

    What are the primary impacts of climate change on human societies?

    • Heat-Related Health Risks: Increased temperatures and more frequent heatwaves lead to higher incidences of heat-related illnesses and deaths. For instance, global heatwaves already result in approximately 12,000 fatalities annually.
    • Threats to Food Security: Extreme temperatures and unstable weather patterns negatively impact agricultural productivity, affecting food quality and availability, and driving up prices.
    • Access to Essential Services: Over 1.1 billion people face immediate risks due to inadequate access to cooling, impacting health services (like vaccine storage), food preservation, and economic productivity.
    • Increased Mortality: By 2050, deaths from extreme heat are projected to surge, with the World Health Organization predicting up to 255,000 heat-related fatalities each year.

    How Can Societies Effectively Adapt to the Ongoing Changes in Climate?

    • Promoting Energy-Efficient Cooling: Improve the efficiency of cooling devices to reduce energy demand and mitigate climate impacts. This includes transitioning away from hydrofluorocarbons (HFCs) under international agreements like the Kigali amendment.
    • Nature-Based Solutions: Implement alternatives to mechanical cooling, such as planting shade trees and using smart building designs to naturally regulate temperatures.
    • Policy and Technological Innovations: Governments should enforce strict compliance with energy efficiency standards for cooling equipment and incentivize the development of sustainable cooling technologies.

    What Role Does International Cooperation Play in Addressing Climate Change?

    • Global Agreements: Initiatives like the Paris Agreement and the Kigali amendment to the Montreal Protocol emphasize the need for unified international action to reduce greenhouse gas emissions and promote sustainable development goals.
    • Shared Resources and Technology Transfer: International efforts, such as those led by Rwanda and the African Group, advocate for access to energy-efficient technologies, particularly for developing nations.
    • Enhancing Compliance and Monitoring: Countries are urged to strictly adhere to global agreements, such as phasing down HFCs, to achieve climate targets and protect vulnerable populations.

    Way Forward:

    • Accelerate the Transition to Energy-Efficient Cooling: Enhance international efforts to double the average energy efficiency of cooling devices and support the shift to climate-friendly refrigerants.
    • Integrate Cooling Solutions into Climate and Development Policies: Recognize cooling as a development issue and address its critical role in poverty alleviation and achieving the Sustainable Development Goals (SDGs).

  • India, Pakistan avoid blaming each other at SCO meeting

    Why in the News?

    External Affairs Minister S. Jaishankar informally interacted with Pakistan’s Prime Minister Shehbaz Sharif and Foreign Minister Ishaq Dar during the SCO summit’s concluding lunch in Islamabad.

    About SCO:

    • The SCO was established in 2001 to promote regional cooperation in security, economic development, and cultural exchange among its member states, which include China, India, Russia, Pakistan, and several Central Asian countries.
    • The organization represents around 40% of the global population, making it one of the largest regional groups. Its influence spans economic, political, and security dimensions.
    • The SCO focuses on combating terrorism, separatism, and extremism (the “three evils”), enhancing regional security, and fostering economic collaboration among member states.
    • The SCO holds annual summits, rotating between member countries, to discuss various topics ranging from economic cooperation to regional security challenges.

    What were the major insights during SCO 2024 summit?

    • Diplomatic Engagement: The informal interaction between India’s External Affairs Minister and Pakistan’s leadership marked a notable shift in diplomatic engagement, highlighting a more constructive tone compared to previous meetings.
    • Avoidance of Contentious Issues: Both India and Pakistan’s leaders refrained from discussing sensitive topics such as Kashmir, indicating a focus on cooperation rather than conflict during this summit.
    • Collective Responsibility: The Indian foreign minister emphasized the need for an “honest conversation” about trust and cooperation in the SCO region, highlighting the importance of addressing concerns over terrorism and separatism in fostering trade and connectivity.
    • Positive Outcomes: The summit resulted in the signing of eight documents, including proposals for economic dialogue, cooperation in the creative economy, and strategies for addressing challenges in areas like green development and digital economy.
    • Future Cooperation: The joint statement from the summit emphasized optimizing the region’s potential in various sectors such as trade, innovation, and climate change, indicating a commitment to collaborative economic growth.

    Challenges for India: 

    • India-Pakistan Relations: Pakistan’s membership complicates India’s position within the SCO. The rivalry between India and Pakistan can hinder India’s ability to assert its interests effectively, especially since China and Russia are influential players in the organization.
    • Balancing Relations: India’s participation in the SCO necessitates a delicate balancing act between its traditional ties with Russia and its growing partnerships with Western nations. This is particularly challenging given the SCO’s often anti-Western posture.

    Way forward: 

    • Strengthen Regional Cooperation: India should prioritize common interests within the SCO, such as counter-terrorism, economic development, and connectivity, while using diplomatic channels to reduce tensions with Pakistan and maintain constructive dialogue.
    • Strategic Balancing: India can pursue a balanced approach by aligning its SCO engagements with its broader foreign policy goals, leveraging partnerships with Russia and Central Asia while carefully managing its ties with Western nations.

  • Spotlighting the work of the Economics Nobel winners

    Why in the News?

    • This year’s Nobel Prize in Economics, officially known as the Sveriges Riksbank Prize in Economic Sciences, was awarded to Daron Acemoglu, Simon Johnson, and James Robinson (AJR).  
    • AJR have highlighted the importance of institutions in development, but critics argue that this approach tends to favour Western liberal models over other institutional frameworks.

    Why Do Some Nations Succeed While Others Fail?

    • Role of Institutions: The economic success or failure of nations can often be traced back to the nature of their institutions. 
      • Inclusive institutions encourage economic activity by providing secure property rights, legal frameworks, and political systems that incentivize growth. 
      • In contrast, extractive institutions concentrate wealth and power in the hands of a few, leading to economic stagnation and social inequality.
    • Historical Path Dependence: Countries that experienced inclusive economic institutions early in their development tend to be more prosperous, while those with a history of extractive institutions face significant barriers to growth. Historical events shape the trajectory of institutional development and influence current outcomes.

    What Is the Impact of Historical Institutions on Current Economic Outcomes?

    • Colonial Legacy: Institutions established during colonialism, especially extractive ones, have long-lasting impacts. Areas with landlord-based land tenure systems or direct colonial rule have struggled with lower agricultural productivity, fewer social services, and weaker infrastructure.
    • Natural Experiment Evidence: AJR’s research used historical data, such as differences in settler mortality, to show that regions colonized by Europeans with high mortality rates ended up with extractive institutions that still negatively affect growth today.
    • Long-Term Development Patterns: The effects of historical institutions persist, shaping economic development, social structures, and governance even after countries gain independence or transition to new political systems.

    Why do critics argue that this approach tends to favour Western liberal models over other institutional frameworks?

    • Historical Bias: Critics argue that AJR’s approach overlooks the diverse paths of development, favoring Western institutions while underestimating non-Western experiences and historical complexities.
    • Western Norms as Universal: The framework tends to present Western liberal institutions as ideal models, disregarding how other systems might effectively function in different cultural and socio-political contexts.

    Why Are Inclusive Institutions Not More Widely Adopted?

    • Conflict of Interests: Powerful groups with control over resources have incentives to maintain extractive institutions to protect their wealth and power, resisting changes that would lead to a fairer distribution of economic benefits.
    • Collective Action Challenges: Reforming extractive institutions requires solving collective action problems where diverse groups must agree on new rules that may threaten the established elite’s interests.
    • Path Dependency: Historical conditions can create institutional inertia, making it challenging to shift from extractive to inclusive frameworks due to deep-rooted social, political, and economic norms.

    Way forward: 

    • Strengthen Inclusive Institutions: Focus on legal and policy reforms that secure property rights, ensure fair governance, and promote transparent decision-making, encouraging broad-based economic participation and growth.
    • Empower Marginalized Groups: Implement policies that reduce power concentration by supporting grassroots movements, enhancing education access, and providing economic opportunities to disadvantaged communities to overcome historical inequalities.