Foreign Policy Watch: India-Pakistan

Indus Water Treaty: A Case of Hydropolitics

op-ed snap | International Relations | Mains Paper 2: India & Its Neighborhood – Relations

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Indus river system
Mains level: Indus Water Treaty
Context
- Indus Waters Treaty (IWT) made it the headlines recently. As India issued a notification to Pakistan for modification to the treaty, speculations are rife that the treaty is showing signs of inefficacy and that cracks are visible on the sole bridge between the two nuclear neighbours. On the other hand, for many in the hydro-diplomacy community, the IWT remain a stellar example for asserting that nations can cooperate for managing their shared rivers even with mutual mistrust and hostile political relations.
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What is Indus Water Treaty (IWT)?
- The Indus Waters Treaty is a water-distribution treaty between India and Pakistan, brokered by the World Bank signed in Karachi in 1960.
- According to this agreement, control over the water flowing in three eastern rivers of India the Beas, the Ravi and the Sutlej was given to India.
- The control over the water flowing in three western rivers of India the Indus, the Chenab and the Jhelum was given to Pakistan
The present developments
- Intergovernmental negotiations to rectify material breach of the treaty: India issued a notice to Pakistan on 25th January 2023 through its commissioner to the bilateral Permanent Indus Commission suggesting that Pakistan should enter intergovernmental negotiations within 90 days to rectify the material breach of the treaty under Article 12(3) of IWT.
- Government-to-government negotiation before accepting the involvement of a neutral expert: India defended its move by stating that it was adhering to the provision under the treaty for a graded mechanism for handling an issue of concern as it interpreted it. Therefore, it asked for a government-to-government negotiation before accepting the involvement of a neutral expert and finally taking it to a court of arbitration.
Why such move?
- Pakistan initially sought a neutral expert and then backtracked: In India, the perceived root cause for this present move is that Pakistan initially sought a neutral expert to examine the technical objections that it had raised on India’s Kishanganga and Ratle Hydropower projects but then backtracked and asked for adjudication through a court of arbitration.
- Despite India’s efforts Pakistan refused to negotiate: Despite repeated efforts by India to negotiate at consecutive meetings of the Permanent Indus Commission, Pakistan refused to budge.
- Pakistan has always preferred the route of arbitration: This is of consequence since Pakistan has always preferred the route of arbitration rather than a graded approach in the past with the involvement of a neutral expert before submitting to arbitration.
- Pakistan’s repeated stance of seeking arbitration is prejudicial and pernicious: Indian strategic experts have called Pakistan’s repeated stance of seeking arbitration as prejudicial and pernicious while accusing the World Bank that it has allowed Pakistan to run riot in the last few years.
The role of World Bank?
- Brokered by WB: The long-standing Indus Waters Treaty (IWT), a first-of-its-kind arrangement that was brokered by the World Bank between India and Pakistan for sharing the waters of the Indus system,
- Signatory to the treaty to maintain ambivalence: The World Bank, as a signatory to the treaty, has maintained ambivalence and has yielded to both demands by appointing a neutral expert and a chairman for the court of arbitration.
- Legal risk in duality of discussing and resolving: This has created a particularly confounding situation due to the initiation of two mutually-exclusive tracks for discussing and resolving the thorny issues. The Bank also recognised the practical and legal risks that this duality poses.
Mistrust and mismanagement
- IWT concerns linked with National security and sovereignty: In the last two decades, both governments have raked up their concerns with the IWT, often coupling the Indus waters with national security and sovereignty with concerns emerging from the highest levels of governments at times.
- Pakistan’s accusation: Pakistani officials and ministers on their part have issued statements accusing India of creating water woes in Pakistan by allowing sudden releases of water without prior notification as was the case in 2019.
- Pakistan has also been apprehensive about two projects by India: The Baglihar and Kishanganga Hydroelectric Project (HEP), accusing India of acquiring the power to affect the timing and flow of water into Pakistan on rivers that belong to it under the provisions of IWT.
- Misplaced developmental priorities of Pakistan: The politicisation of the IWT is systematic and has been occurring in a synchronised way, especially in Pakistan due to their misplaced developmental priorities.
- Lack of ecosystems approach
Conditions that underlie any successful transboundary water negotiation process
1. Parties actively recognise their interdependencies;
2. Parties agree to explore competing and often conflicting values and interests and invent creative options for mutual gains; and
3. Parties agree to create mechanisms to monitor the implementation of the agreement and adapt the agreement to address new issues as they emerge.
Climate change is often neglected in politicization of the water issues
- The newer challenges of water governance are emerging. Water cannot be looked at as a stock of resource to be stored for human convenience, and released as per human will.
- Today, whether it is in the Ganges or in the Indus delta regions, there is hardly any acknowledgement that upstream constructions and climate change are wreaking havoc on delta livelihoods.
- Pakistan is so embroiled in the politics of water that they have become oblivious that they are losing a living heritage, the Palla fish The decline in catch is affecting the livelihoods of the fishing community.
- Moreover, higher glacial melt due to global warming around the headwaters in the Himalayas is slated to increase flow in the short run but will be a threat to water security in the long run due to scarcities.
- Therefore, all these bigger climatic threats and the threats created by the dam structures that can arrest the sediments and can cause upstream floods should be of bigger concern than mere politicisation of the water issues.
Conclusion
- On the whole, the lack of trust between nations has marred the hydropolitics of the Indus. The priority should have been settling disputes amicably by drawing strength and confidence from the past and preparing for an uncertain precipitation regime of the future due to climate change. The concerns of a much-needed integrated basin governance approach for the Indus must not be overshadowed by politics of mistrust and hatred.
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Foreign Policy Watch: India-United States

Chinese balloon over the US and India as a Peacemaker

op-ed snap | International Relations | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India

Note4Students
From UPSC perspective, the following things are important:
Prelims level: NA
Mains level: Global geopolitical struggle and India's foreign policy
Context
- On 1 February, a high-altitude balloon of Chinese origin was spotted over the US state of Montana, which also houses one of the country’s three active nuclear missile silos. on 4 February, US forces shot down the balloon over the country’s South Carolina coast and are now proceeding to collect some of the debris.
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Balloons for surveillance
- Balloons could prove much cheaper and loiter for extended periods, providing continuous surveillance over targets, unlike satellites based on orbital motion.
How The US responded?
- Initial assessment: The US government officially described it as a surveillance balloon with no immediate military or physical threat but was quick to go back on its initial assessment.
- Incident as a part of Chinese larger troubling pattern: An American view describes the Chinese balloon incident as part of a larger, more troubling pattern.
- China claims as it was civilian airship and unintentionally flown: Despite Chinese claims that the balloon was a harmless civilian airship that had unintentionally flown into US airspace, Secretary of State Antony Blinken cancelled his much-anticipated diplomatic visit to Beijing.
- Issue is a matter of violation of sovereignty: The US has said that the balloon issue is a matter of violation of sovereignty, and, as of 4 February, there are reports of another balloon being spotted over South America that China has admitted is also theirs.
Similar experiments
- US utilising high-altitude balloons: Not just China, the US has also experimented with utilising high-altitude balloons in space for a long time. In July 2022, NASA tested an aerial robotic balloon that would work in tandem with an orbiter to carry out scientific measurements of Venus.
- UK demonstrated in 2022: In August 2022, the UK selected an American company to demonstrate an uncrewed platform for stratospheric communications, intelligence, surveillance and reconnaissance (ISR). The need was for manoeuvrable, long-duration missions capable of locating targets anywhere on earth.
Global geopolitical struggle
- Default mode but with different players: The event if viewed from a historical perspective, the world is back to its default mode, only this time, it has a different set of actors.
- It involves various forms of power, primarily shaped by technology: Notably, there exist also nuclear weapons in the hands of nine powers, unlike during the Cold War era, when the number was confined to five.
- Economic and technological integration is much greater than ever before: Ever since Russia invaded Ukraine in 2022, attempts at desegregating economic and technological fields have not just continued but also gained momentum.
- Camps led by the US and China: Global cooperation is in short supply and is being morphed into a coalition-building exercise ensconced in primarily two camps led by the US and China.
India’s posture in a polarized world
- Benefited from lower cost supplies from China and Russia: Economically, it has maintained trade with China and benefited from lower-cost energy supplies from Russia.
- India’s tilt towards west: After China’s aggression on the northern borders, India has tilted to the West, especially in the maritime and technological arenas.
- Increasingly polarised world challenging India’s foreign policy: But as global tensions grow and confrontations increase, India could find itself under pressure to take sides even when its interests are not under contention. Therefore, there is a need to articulate a foreign policy paper on India’s alignment posture in a world that is becoming increasingly polarised.
- This policy must foster partnerships based on context and not on blocs: India could join hands with the US and its allies in seeking an open and rules-based Indo-Pacific order. It could even partner with China on climate change if there is a congruence of interests.
- Challenge is to avoid being dragged in war: In grand strategic terms, India’s challenge is to avoid being dragged into a World War that must be considered a growing possibility.
India as peacemaker
- Exploring the role of a peace broker
1. What could be at the back of the Indian strategic mind is to play the role of a peace broker and explore every possibility to make it count.
2. This is important because the state of relations between the US and China does not seem to have many prospects for a return to dialogue that can facilitate consensus on bilateral, multilateral and global issues.
3. It is a possibility reflected in the inability of the United Nations to intervene, as the major parties involved are themselves in contention for the position of the stronger superpower.
- India may be getting into a position to make a peacebuilding attempt:
1. A report by a US-based business intelligence consulting firm corroborates this asserts that India may be getting into a position to make a peacebuilding attempt
2. According to this survey, Prime Minister Narendra Modi is among the world’s most popular global leaders. With a 78 per cent approval rating, Modi is far ahead of other contenders.
Conclusion
- It is high time that Indian strategists explore the feasibility of making India a peacemaker. It is a difficult and challenging task that may seem impossible. But there is no reason not to try, as the Prime Minister and the posture of the nation has both internal and external popularity on its side.
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Women empowerment issues – Jobs,Reservation and education

Urban space for women: India can show the path

op-ed snap | Governance | Mains Paper 1: Role Of Women & Women Organization,Urbanization, Their Problems & Remedies

Note4Students
From UPSC perspective, the following things are important:
Prelims level: NA
Mains level: Read the attached article
Context
- More than half of the population worldwide lives in cities, making urban centres critical to socioeconomic growth and development. However, rampant urbanisation has led to unequal distribution of resources and a lopsided development approach that ignores the specific needs of women. Despite projections of two-thirds of the population living in cities by 2050, urban development remains exclusive of women’s perspectives and needs.
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Gender inequality in cities
- Primary reason: One of the primary reasons behind gender inequality in cities is that modern cities are planned mainly by men and for men, thus sidelining the needs of women.
- Designed assuming that the role of women is confined to household: The cities have been traditionally designed on the premise that a woman’s role is primarily confined to the household, barring their need to access the immediate neighbourhood.
- Patriarchal approach has taken away the Fundamental rights: This patriarchal approach, while shaping the power dynamics between men and women, has also taken away the fundamental right of women to live and thrive in a safe and inclusive outdoor environment.
Role of women and the challenges they face in urban spaces
- Women one of the most vulnerable groups in society: Women, one of the most vulnerable groups in society, face violence in physical and cyber mode, making it difficult for them to access opportunities that come with urbanisation.
- For instance: Due to poorly lit streets and a lack of women-friendly mobility systems, women cannot actively participate in the workforce. Only 27 percent of women participate in the workforce in India as compared to 79 percent of men.
- Male dominated nature of job opportunities available in the cities: Most of them are male-dominated, such as the platform economy jobs of delivery agents and those at vast construction sites, leaving less space for women to intervene.
- Women professionals are burdened with dual work responsibilities: Moreover, with an increase in the number of households in cities, women are devoting most of their time to home and caring work, thus, leaving less time for them to do a job. In this scenario, women professionals are burdened with dual work roles, impacting their physical and mental well-being.
- Discouraged drop outs: Furthermore, the social tendency to discourage urban women from working after marriage has generated a trend of ‘discouraged drop-outs’, leaving them out of the workforce.
- Role in urban planning and governance is abysmally low: Women’s participation in urban planning and governance has been abysmally low. Women hold only 10 percent of the highest ranks globally in architecture and urban planning offices. With women left out of city planning institutions, city planners ignore the needs of women and the challenges they face.
Do you know: The concept of a 15-minute city?
- The concept of a 15-minute city, i.e., where everything needed will be available within a walkable distance of 15 minutes, is attracting the interest of planners even in India.
- However, for stray examples such as Magarpatta, a city in Pune, the concept has failed to move beyond rhetoric.
Focus areas of development
- City society intervention is a prerequisite: The intervention of civil society and policymakers on specific parameters can help build gender-responsive cities that accommodate the concerns of all citizens.
- Building safer cities: Better street lighting, women-friendly transport systems, and behavioural change programmes that help people understand that the onus of safety is not on women but on society as a whole will surely improve women’s access to safer cities.
- For instance: Building technology systems such as the Safetipin app helps women map safe areas and take necessary actions in emergencies by collating a list of important contacts, GPS tracking and so on, thus, trying to make streets safer.
- Changing the attitude and mindset of society at large: Counselling sessions for men, sensitising them about how women feel if a certain social behaviour is practised, can trigger an eventual change in their mindset towards women’s needs.
- Building gender-inclusive jobs: Data suggests that 10 percent increase in women’s workforce participation rate can add US$ 770 million, approximately 18 percent, to India’s GDP. Teaching men to shoulder family responsibilities, making workspaces women-friendly, promoting women to leadership positions, and diversifying the availability of jobs can go a long way in improving the situation.
- Role of women in urban governance: Having women at the top can have a domino effect in society, making other women aspirational of the positions they can reach and the impact they can create.
- For example: Cities like Athena, Bogota, Nairobi, Dakar, and San Francisco that have had female leadership have witnessed greater socio-economic and sustainable development.
- Developing gender-sensitive infrastructure: Globally, one in three women do not have access to safe toilets. Building toilets for women and places to breastfeed and baby changing stations improves the turnout of women on the streets. Improving access to clean water will also improve overall health for women as globally.
Way ahead
- Need a paradigm shift in approaches to policymaking: Including more women in decision-making roles to identify shared concerns and build integrated solutions will need a paradigm shift in approaches to policymaking. This calls for a policy focus on optimum resource allocation and equitable distribution, ensuring easy, safe, and affordable access to all.
- Feminist approach in policymaking: Policymakers need to adopt a feminist approach to urban development.
- Feminist urbanism: Feminist urbanism seeks to understand and integrate the concerns of women and other gender and sexual minorities across caste, class, age differences, disabilities, etc.
- Developing cities on the lines of feminist urbanism: Creating a city on the lines of feminist urbanism refers to constructing compact and mixed-use neighbourhoods, inclusive streets focusing on pedestrian needs and building other critical urban infrastructure.
Conclusion
- Building global partnerships to aid gender mainstreaming in urban spaces can prove fruitful. India has a chance to further this cause as it assumes the G20 presidency. The Urban 20 grouping can bring urban policymakers from the -20 nations to deliberate on women’s rights and evolve gender-inclusive development processes to help cities attain the 2030 agenda for sustainable development holistically.
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Government Budgets

Budget and the Rural Economy

op-ed snap | Economics | Mains Paper 3: Government Budgeting

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Budget highlights
Mains level: Budget and the rural economy
Context
- Union Finance Minister Nirmala Sitharaman presented the Union Budget 2023-24. Union budgets can be understood in two ways. The first is as a standard accounting exercise of the government’s revenues and expenditures. It is this second aspect that provides insight into the government’s assessment of the challenges facing the economy and ways to overcome them.
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First aspect: standard accounting exercise of the government’s revenues and expenditures
- Projections are less reliable: Over the years, this has ceased to be a good metric with governments failing to spend what is announced in the budget. While the practice of off-budget entries is now no longer relevant, even revenue projections are much less reliable.
- Budget a comprehensive document: However, the budget continues to remain relevant as the most important and perhaps the only comprehensive economic document of the government.
Second aspect: Government’s assessment of the economic challenges and ways to overcome
- Premature to conclude: While the fog of the pandemic has disappeared and the associated supply bottlenecks have eased, it is premature to conclude that the economy has fully recovered.
- Per capita income is low: Per capita incomes in real terms in 2021-22 are still below the 2018-19 levels and the overall growth between 2016-17 and 2021-22 is at its lowest level of 3.7 per cent for any five-year period in the last four decades.
The pandemic effect:
- Economic slowdown: The fact that the economy was slowing down before the pandemic makes it clear that Covid only exacerbated the already fragile economic situation.
- Energy towards managing the pandemic: The structural factors that led to the slowdown remain, as in the last three years the government’s efforts were directed towards managing the pandemic.
- Decline in demand: The most important of these is the decline in demand, both for consumption and investment. Private consumption accounts for almost 60 per cent of the economy and this engine of growth has failed to fire.
- The distress is far more serious in rural areas: Rural wages have stagnated for almost a decade now. Farmers’ incomes have either declined or, at best, stagnated in the last five years.
Critique: Budget and the rural economy
- Withdrawal of expenditure: What has been done is the withdrawal of expenditure on almost every head that mattered for rural economic recovery. With spiraling inflation and even the cushion of free foodgrains having been withdrawn, rural areas are likely to face an uncertain situation.
- The budget for the agricultural sector is lower than the allocation last year: In real terms, the budget has declined by 10 per cent at a time when the agricultural sector is going through its worst crisis. The rise in input costs for both energy and fertilisers is likely to get worse with the withdrawal of the fertiliser subsidy.
- Declined allocation of cash transfer: Even the nominal cash transfer that was provided as part of the PM-Kisan has seen a decline in allocation. But then, this budget is no different from others in the last five years.
- Actual investment in agriculture is declined: Public investment in agriculture declined by 0.6 per cent per annum between 2016-17 and 2020-21, the last year for which data is available. This is a period when the agrarian economy has suffered its worst crisis of profitability.
- Declined budget for non-farm sector: The non-farm sector is now greater in terms of its contribution to the rural economy but has seen a decline in budget allocations.
- For instance: The budget for the Ministry of Rural Development is 13 per cent lower than the revised expenditure last year. The National Rural Employment Guarantee Scheme (MGNREGA) has seen its budget decline in the revised estimates for 2022-23. This is the lowest amount allocated in the last five years compared to actual expenditure on the scheme.
- Only Hosing scheme has seen an increase: The only scheme that has seen an increase in allocation is the rural housing scheme, from an actual spending of Rs 48,422 crore in 2022-23 to Rs 54,487 crore.
Supply-side interventions in demand constrained economy
- Preference for supply-side interventions: The government’s preference for supply-side interventions even when there is excess capacity in a demand-constrained economy. It is this understanding that is reflected in an almost one-third increase in allocation for investment. A bulk of this is in railways and roads a much-needed boost to the infrastructure sector.
- Private sector needs to accompany: But given the small share of public investment, it is unlikely to be sufficient unless it is accompanied by the private sector increasing its investment. Unfortunately, the private sector neither responding to rising public investment nor tax subsidies, as were given in 2019.
- Overall impact: This will have a negligible impact on employment and domestic demand given the low employment elasticity of these investments. Regardless, the increase in investments is welcome.
Conclusion
- The problem with this budget is not accounting but economic policy. This was the last full budget in which government could undertake serious steps to revive the economy. That required prioritising allocations towards reviving consumption demand, spurring private investment and protecting people from the vulnerabilities of high inflation and a slowing economy.
Mains Question

Q. Discuss the impact of pandemic on Indian economy. Highlight governments supply side interventions in demand constrained economy.

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Social Media: Prospect and Challenges

Digital Governance: Are GACs well equipped to deal with grievances?

op-ed snap | Governance | Mains Paper 2: Governance, Transparency & Accountability, Citizens Charters

Note4Students
From UPSC perspective, the following things are important:
Prelims level: GAC's
Mains level: Digital governance in India
Context
- Indian digital governance recently witnessed multiple developments in its appellate mechanisms. In December 2022, Google appealed two of the most significant antitrust decisions that the Competition Commission of India (CCI), issued on the functioning of digital markets. GAC’s capacity to handle complaints needs to be increased.
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Background: The Google case of anti-competitive contracts
- In October 2022, CCI found Google anti-competitive in its Android licensing contracts and app store policies in two separate orders.
- The National Company Law Appellate Tribunal (NCLAT), an authority for company law, competition law, and insolvency law matters, will hear Google’s appeals from 15-17 February.
- Simultaneously, the Ministry of Electronics and Information Technology (MeitY) recently announced the formation of three Grievance Appellate Committees to enforce the accountability of online intermediaries.
What is the grievance appellate committee (GAC)?
- Based on IT Act: The Centre established three Grievance Appellate Committees based on the recently amended Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (IT Rules 2021).
- Three GAC’s: The Centre has announced three different GACs led by the IT, Home Affairs, and Information and Broadcasting ministries.
- Composition: The committee is styled as a three-member council out of which one member will be a government officer (holding the post ex officio) while the other two members will be independent representatives.
- Complaint within 30 days: Users can file a complaint against the order of the grievance officer within 30 days.
- Online dispute resolution: The GAC is required to adopt an online dispute resolution mechanism which will make it more accessible to the users.
Importance of appellate jurisdiction
- Three pillars of regulatory framework: Regulatory frameworks stand on three pillars. These include a governing law, an empowered regulator and a fair appeals mechanism.
- An appellate mechanism is a critical part: An appellate mechanism is a critical part of this framework because it ensures an opportunity to remedy inappropriate application of governing laws. Therefore, if the framework is incapacitated, there will be an unfair application of law, which defeats the purpose of the legislation.
- Appellate bodies are essential tools for digital markets: Appellate bodies operate under a specialised mandate, which allows them to adapt their processes to the unique facets of a case. They are an essential tool for digital markets, which tend to be more complex than first meets the eye.
- For instance: Google allows Android users to bypass the Play Store and directly install apps from the internet known as sideloading. But when they do so, Google issues disclaimers about associated security risks linked to downloads from unknown sources. The CCI’s order on Android calls such disclaimers anti-competitive because they reinforce Google’s monopoly over app distribution.
Are GACs well equipped to deal with grievances?
- Not well equipped to deal with the user grievances: The recently formed Grievance Appellate Committees do not seem equipped to deal with the barrage of user grievances linked to online intermediary services.
- For instance: In October 2022, Facebook received 703 complaints, Twitter 723 and WhatsApp 701. WhatsApp then banned 2.3 million accounts. And this does not even account for all other types of online intermediation, such as e-commerce intermediaries.
- Multiple steps to arrive at a decision while the online is accessible instantly: Online content is accessible by millions instantly, and the longer unlawful content is accessible, the greater the harm to affected parties. Accordingly, a 30-day disposal period for the appeals to the GAC has been mandated. However, any dispute resolution process involves multiple steps.
- Prolonged dispute resolution: The principles of natural justice also require the originator of the disputed content to be heard. Therefore, when they’re implicated along with intermediaries and complainants, it prolongs the dispute resolution process.
- GAC’s may struggle to substantially resolve the grievances in time: The Centre has announced three different GACs led by the IT, Home Affairs, and Information and Broadcasting ministries. However, the sheer volume of online user content suggests that GACs may struggle to substantially resolve these grievances in time.
Conclusion
- Effective appeals mechanisms form an integral part of the digital governance toolkit. India has a progressive adjudicatory system that recognises the need for specialised appellate mechanisms, but its potential requires actualisation. The appellate mechanism must be strengthened for any technology policy reforms to succeed.
Mains question

Q. Briefly explain what is the grievance appellate committee (GAC)? Are GACs well equipped to deal with grievances? Discuss

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Tax Reforms

Wealth Tax: Does It Distort the Economy Too Much?

op-ed snap | Economics | Mains Paper 3: Indian Economy

Note4Students
From UPSC perspective, the following things are important:
Prelims level: wealth tax
Mains level: Tax reforms and wealth tax In India
Context
- There is a good reason we do not tax wealth directly. Actually, there are many good reasons. But that’s not stopping some states from giving it a try. There are much more effective options for targeting wealthy people for tax revenue that are better for the economy. Some the US is already doing, such as state property taxes, federal capital gains taxes and estate taxes on inheritances.
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What is wealth tax?
- Wealth tax is a direct tax unlike the goods and services tax or value-added tax, can take several forms, such as property tax, inheritance or gift tax and capital gains tax.
- It aims to reduce the inequalities of wealth.
- It is based on the market value of assets owned by a taxpayer and charged on the net wealth of super rich individuals.
Why in news?
- The new bills this week by California and Washington propose taxing their richest residents 1% to 1.5% each year.
- Four other states including New York and Illinois propose taxing unrealized capital gains, or taxing wealth based on how much it grew in the last year whether or not you sold any assets.
Crafting good tax policy starts with a question: How much will it distort economic behaviour?
- Creates distortions: Many economists say that wealth taxes create the most distortions, followed by income and consumption taxes.
- Wealth taxes discourage saving and investment: A 1% or 2% wealth tax may sound small, but it’s very large compared with current tax rates. Since it’s levied each year, it’s better compared to current taxes on realized capital income. These plans drastically reduce the return on risky investment, and rewarding risk is important for economic growth.
- Unrealized capital gains, are much harder to measure: Income is relatively easy to measure. Your employer sends you money that is well documented and has an objective value. Overall wealth, especially unrealized capital gains, are much harder to measure.
- Mostly rich people hold Wealth in assets: Very rich people also tend to hold a lot of their wealth in assets that aren’t publicly traded, either in private equity, in their own businesses, fine art, gold bars or other possessions.
- Hard to implement effectively: Most jurisdictions have abandoned wealth taxes. They are very hard to implement at the federal level, let alone by states with fewer resources to collect and assess data on wealth holdings.
- Example of Switzerland: A possible model is Switzerland, where individual cantons have their own wealth tax, but the tax accounts for a trivial share of tax revenue.
- A wealth tax is a bad policy based on the economics and feasibility: Collecting it will require tremendous resources that states don’t have and it won’t produce the revenue they’re counting on.
Wealth Tax in India
- Abolished wealth tax: The government abolished wealth tax as announced in the budget 2015. In its place, the government decided to increase the surcharge levied on the ‘super rich’ class by 2% to 12%. (Super rich are persons with incomes of Rs.1 crore or higher and companies that earn Rs.10 crores or higher).
- Abolished to simplify tax structure and discourage tax evasion: The abolition was a move to do away with high costs of collection and also to simplify the existing tax structure thereby discouraging tax evasion.
- No wealth tax at present: India presently does not have any wealth tax i.e., a tax levied on one’s entire property in all forms. It did not impose a one-time ‘solidarity tax’ on wealth in post-covid budgets that could have generated resources for essential public investment.
Way ahead
- Promising that a few wealthy people can pick up the public tab is bad economics.
- States would be better off making their consumption taxes larger and more progressive.
- They can tax luxury goods like designer clothes, private jet travel or second homes heavily.
- Governments can better enforce our existing wealth taxes by eliminating loopholes in capital gains and estate levies.
Conclusion
- Wealth taxes will continue to be in the conversation as states and the federal government need more revenue and are reluctant to raise taxes on anyone who earns more than $400,000 a year. Many economists say that wealth taxes create the most distortions, followed by income and consumption taxes. Wealth taxes need to studied not only from the lens of fiscal challenges that the states face but also market economies and probable distortions.
Mains question

Q. What is wealth tax? Highlight the present status of Wealth tax in India. It is said that Wealth tax distorts economic behaviour. Discuss in the context of States in the US proposes taxing the rich.

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Renewable Energy – Wind, Tidal, Geothermal, etc.

Micro hydro systems: An alternative source of energy

op-ed snap | Economics | Mains Paper 3: Infrastructure: Energy, Ports, Roads, Airports, Railways Etc.

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Hydropower projects and locations, and Micro hydro systems,
Mains level: Hydropower Projects in fragile Himalayan region and alternatives
Context
- The crisis unfolding in Joshimath for over a month has led to conversations on the relevance of hydropower in the Himalayan region. Two years ago, a glacier burst led to question marks over the Rishiganga hydroelectric project in Uttarakhand.
What is hydropower
- Hydropower generates electricity from the natural flow of water without releasing any emissions or pollutants. It also does not rely on fossil fuels. Therefore, it is often considered green energy.
Hydropower Projects in Himalayan region
- The Himalaya are a major water source for much of South Asia: Most countries in the region, including India, China, Nepal, Bhutan, and Pakistan, have built or are planning to build hydropower projects in the Himalaya.
- Hydropower one of the key renewable energy sources of India: In India, the government has identified hydropower as a key renewable energy source. Many hydropower projects are under construction or in the planning stages in the Indian Himalaya, including the Subansiri Lower Hydroelectric Project in Arunachal Pradesh and the Teesta Low Dam Hydroelectric Project in Sikkim.
- Nepal has also identified hydropower as a major source of energy: Nepal has many hydropower projects in the planning and development stages, including the Arun III Hydroelectric Project and the West Seti Hydroelectric Project.
- Main source of revenue for Bhutan: In Bhutan, hydropower is the main source of revenue, and the government has set a target to export surplus electricity to India. The country has built several hydropower projects, including the Chukha Hydropower Project and the Tala Hydropower Project.
Concerns about the potential conflicts over water resources in the region
- Fragile ecosystem of Himalaya already under stress: The Himalaya is a fragile ecosystem and home to a diverse range of flora and fauna. It is already threatened by deforestation, overgrazing, and construction activities that harm the environment and local communities that depend on it.
- Construction of dams can disrupt the characteristics of river flow: The construction of dams can disrupt the flow of rivers, leading to changes in water temperature and chemistry. It can also cause erosion, landslides, and sedimentation which can have a negative impact on the local environment.
- Construction disrupts well-being of the local population: Dams also disrupt the migration patterns of fish and other aquatic species and impact the local wildlife, particularly if the dam’s construction leads to habitat loss. Large-scale hydroelectric dams displace local communities, affecting their livelihoods and cultural heritage and impacting the overall well-being of the local population.
Micro hydro systems as an alternative to hydropower
- Micro hydro system of 100 kilowatts (kW): It is a small-scale hydroelectric power generation system that typically generates up to 100 kilowatts (kW) of electricity.
- Applications: These systems use the energy of falling water to turn a turbine, which, in turn, generates electricity. They can be used for various applications, including powering homes, businesses, and small communities.
- Less expensive and smaller environmental footprint: They are typically less expensive to build and maintain than large hydroelectric dams and have a smaller environmental footprint.
- Can be located at inaccessible areas: They can be located even in inaccessible areas where it is difficult to transmit electricity from larger power stations, and they can provide a reliable source of energy to communities that are not connected to the grid.
- Two types : Micro hydro systems can be classified into two main types i.e., run-of-river and storage systems. 1. Run-of-river systems use the natural flow of water in a stream or river to generate electricity. 2. In contrast, storage systems use a reservoir to store water and release it as needed to generate electricity.
Conclusion
- The environmental impact of hydropower can vary depending on projects and the ways in which they are implemented. Micro hydro systems can be tailored to minimize the ecosystem’s negative impact and provide sustainable energy solutions. However, it also can have some impact on the environment and local communities. A detailed assessment should be carried out to evaluate the potential impact before proceeding with the project.
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Child Rights – POSCO, Child Labour Laws, NAPC, etc.

Crackdown against child marriage in Assam

op-ed snap | Governance | Mains Paper 2: Laws, Institutions & Bodies Constituted For The Vulnerable Sections

Note4Students
From UPSC perspective, the following things are important:
Prelims level: POCSO
Mains level: Child marriage issue and associated problems
Context
- The United Nations Sustainable Development Goals call for global action to end human rights violations by 2030. There has been tremendous development in India on that front, as seen, for example, in the decline in child marriage from 47.4 per cent in 2005 to 23.3 per cent in 2021. The year 2021 also marked a 50 per cent decline in child marriage in South Asia.
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Why in news?
- Assam Chief Minister Himanta Biswa Sarma has launched a state-wide crackdown against child marriage.
- Booking men marrying girls below 14 years of age under the Protection of Children from Sexual Offences (POCSO) Act, and those marrying girls aged 14-18 under the Prohibition of Child Marriage Act.
- The CM has also announced that the police will retrospectively book people who participated in child marriage in the last seven years.
Background: Data from Assam
- Maternal mortality rate in Assam: According to data given by the Registrar General of India in 2022, Assam has the highest maternal mortality rate in the nation, with 195 fatalities per one lakh live births in the years 2018 to 2020.
- Infant mortality rate in Assam: With 32 newborn deaths for every 1,000 live births, Assam has the third highest infant mortality rate, according to the National Family Health Survey-5.
- Government’s aim to address the issue: The Assam government has declared that its aim is to confront the high maternal mortality and infant mortality rates in the state, which it has linked to early motherhood.
What is Child Marriage?
- Child marriage refers to any formal marriage or informal union between a child under the age of 18 and an adult and another child.
- The Prohibition of Child Marriage (Amendment) Bill, 2021, fixes 21 years as the marriageable age for women.
Effect of Covid-19 Pandemic
- According to estimates by UNICEF, 10 million more girls were at risk of becoming child brides globally because of the pandemic, affecting the prosperity and growth of communities and nations for generations.
- India has been working to ensure it doesn’t lose the momentum gained in dealing with the scourge of child marriage.
How child marriage is negatively correlated to national development?
- Impact on basic rights: Child marriages deny a child his/her basic right to education, health, and the freedom to build full, thriving lives.
- Increased susceptibility to abuse and violence: There is overwhelming evidence that child marriage renders girls more susceptible to abuse, violence, and exploitation.
- Gender Inequality: Child marriage is a gendered form of violence a cause and effect of gender inequality and discrimination and is a significant challenge facing girls and their families throughout the developing world.
- Disturbed childhood: Child marriage conclusively devastates a girl’s childhood, saddling her with adult responsibilities before she is physically and mentally mature.
- Increased risk of forced pregnancy and maternal mortality: With little bodily autonomy, child brides are more likely to undergo forced pregnancy, increasing the likelihood of maternal and infant mortality.
- Negative effect on education: A girl’s education is less likely to be valued evidence is clear that girls with less education are more likely to marry young, and child marriage typically ends a girl’s education.
- Support systems declines: The lack of education and isolation from peers further shrink a child bride’s support systems. Without skills or mobility, her ability to overcome poverty for herself and her children is hindered.
- Negative impact on community and national development: These social and economic vulnerabilities that child brides live with impinge on their ability to contribute to their community’s and country’s growth and development.
- Intergenerational consequences: They are also more likely to experience intimate partner violence and have worse economic and health outcomes than their single peers, which eventually trickles down to their own offspring, placing further strain on the nation’s ability to offer quality healthcare and education.
Prevalence of child marriage in India
- Though legislation prohibiting child marriage in India has been in place since 1929, the majority of child brides in the world 223 million of them, or one-third of the total live in India.
- Despite it being illegal for girls under the age of 18, and for boys under the age of 21, to marry in India under the Prohibition of Child Marriage Act, 2006, the UNFPA-UNICEF estimates indicate that at least 1.5 million underage girls get married annually here.
- Ending the practice of child marriage is crucial to address the several human rights violations that stand in the way of gender equality for girls.
Understanding the key drivers behind child marriage is necessary to combat it
- Common reasons: While the origins of the practice differ across nations and cultures, it is perpetuated by poverty, lack of educational opportunities, and limited access to healthcare.
- Financial burden: Some families choose to marry off their daughters in order to reduce their financial burden. Other reasons cited are shrinking living spaces and increasing concerns about adolescent girls’ safety.
- Mentality of securing daughter’s future: Families also act in this manner because they think it will protect their daughters’ futures. The practice is also supported by gender roles and marriage-age norms, stereotypes, and the socioeconomic risks of unmarried pregnancies.
Conclusion
- Though legal protections and their strict implementation are important, they form only one part of the solution. To end child marriages, state and non-state actors alike must put girls, across the diverse spectrum of society and marginality, at the centre of the solution. The state can penalise and criminalise the act, but society at large has the important role to play.
Mains question

Q. Highlight the key drivers behind child marriage and Discuss how child marriage is negatively correlated to national development?

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Goods and Services Tax (GST)

Budget and the Health expenditure

op-ed snap | Governance | Mains Paper 2: Health & Education

Note4Students
From UPSC perspective, the following things are important:
Prelims level: NA
Mains level: Government’s Budget and Healthcare
Context
- In her 2023-24 Union Budget speech, the finance minister announced that the total central government budget for health (not including research) will be roughly Rs 86,175 crore ($10 billion) that is, roughly Rs 615 for every citizen. This is a 2.7 per cent increase from the previous fiscal year and lower than the rate of inflation.
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Government’s current Health spending
- Current health spending lower than middle income countries: India currently spends about Rs 8 lakh crore ($100 billion) or about 3.2 per cent of its GDP on health. This is much lower than the average health spending share of the GDP at around 5.2 per cent of the Lower- and Middle-Income Countries (LMIC)
- Health expenditure in India compared to other countries: Of this, the government (Centre and states put together) spends about Rs 2.8 lakh crore (about $35 billion) roughly 1.1 per cent of the GDP. Contrast this with the government health expenditure in countries like China (3 per cent), Thailand (2.7 per cent), Vietnam (2.7 per cent) and Sri Lanka (1.4 per cent).
How health expenditure affects people especially poor?
- Hospitalisation cost for a day: A Day of hospitalisation at a public hospital is estimated at Rs 2,800. At a private hospital, it is Rs 6,800.
- Disproportionate financial impact on poor households: A greater proportion of disposable incomes is taken away from a poor household as compared to a non-poor one, further broadening the gap between the two.
- Impact of Health expenditure on employment and income: If sickness hits a working member of the household, she/he must often withdraw from active employment and their main source of income dries up at the time when they urgently need more money for treatment.
- Sell or mortgage of assets to cover treatment costs: Households have to often sell or mortgage their productive assets, such as land and cattle, to cover the treatment costs.
- Burden of health expenditures on vulnerable populations: The poor, elderly and sick are already at a disadvantage and the burden of health expenditure makes this even worse.
- Falling into poverty due to health expenditures: This further reduces their capacity to bounce back. According to the WHO, 55 million people fall into poverty or deeper poverty every year due to catastrophic expenditures on health.
Areas where greater spending by the government could help in the immediate term
- Focus should be balanced for both communicable and noncommunicable: The National Health Mission allocates less than 3 per cent (Rs 717 crore) to non-communicable diseases (NCDs) compared to communicable diseases and reproductive and child health services, despite NCDs causing more than half of the total burden of disease and this proportion further increases in both rural as well as urban areas.
- Public health and primary health care focus on rural areas: Urban areas have poorly developed infrastructure for primary care even if secondary and tertiary health care services are better. For example, immunisation coverage is now lower in urban India than in rural India. A third of the country now lives in urban areas and greater resources are needed to improve health here.
- Health research has been neglected for too long: The allocation for the Department of Health Research in this year’s budget is Rs 2,980 crore, flat from last year. Spending Rs 20 per Indian is inconsistent with the need for innovations and technologies in the sector. The bulk of the resources provided to the Indian Council of Medical Research goes towards maintaining a large payroll of scientists and the output is poor.
Way forward
- Maximizing India’s potential: India stands on the brink of a massive opportunity. Quality education and health for the 26 million children born each year and the 65 per cent of the population under the age of 35 could help provide a workforce that would propel India forward.
- Harnessing the Demographic Dividend: India has a growing working-age population, but needs urgent action to harness the demographic dividend and potentially become a developed country within a generation.
- Adopting Competitive funding System for health research: India should adopt a competitive grant system for government-funded health research like other successful countries, to encourage top-notch research. The Wellcome Trust/DBT-India Alliance is a successful example of this system.
Conclusion
- The health (and education) of Indians is the most important determinant of what the country can achieve during the next 25 years of Amrit Kaal. We must find ways to both find more money for health, and also more health for the money to ensure that all Indians achieve their true potential.
Mains question

Q. Highlight the present status of Government’s healthcare spending. How out of pocket health expenditure affects people especially poor? Suggest what government must do and areas where it must focus in the immediate term?

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Artificial Intelligence (AI) Breakthrough

Artificial intelligence(AI): An immediate challenge flagged by ChatGPT

op-ed snap | Science Tech | Mains Paper 3: Awareness in various sc and tech fields

Note4Students
From UPSC perspective, the following things are important:
Prelims level: ChatGPT and other such AI tools
Mains level: AI, advantages, concerns and policies
Context
- With the launch of Open AI’s ChatGPT late last year, the impending changes in the nature of work, creativity and economy as a whole have moved from being the subject of futuristic jargon to an immediate challenge.
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Background
- Since at least 2015 when Klaus Schwab popularised the term Fourth Industrial Revolution at that year’s World Economic Forum terms like 4IR, Artificial Intelligence (AI), Internet of Things, Future of Work, entered the lexicon of politicians, bureaucrats, consultants and policy analysts.
Sample developments over just the last few days
- A judge in Colombia included his conversations with ChatGPT in a ruling;
- Microsoft is integrating the bot with its search engine, Bing, and other products;
- Google is reportedly trying to launch a similar tool and there are reports that ChatGPT can already code at entry level for Google engineers.
What are the Concerns?
- Lifestyle may become redundant: Concerns about plagiarism in universities and beyond, as well as the fear that many white-collar jobs may become redundant in the coming years, as AI becomes more ubiquitous and sophisticated.
- Implications on labour, education and authenticity: The AI revolution is likely to have serious implications on labour, education, authenticity of content and its authorship, and much else.
- Case of Social media’s influence in US elections: The concerns around social media’s influence on politics and society became sharp in the aftermath of the 2016 US presidential elections and accusations of voter manipulation by foreign agents. Much of the world is still struggling with the questions raised then.
Do you what exactly ChatGPT is?
- Simple definition: ChatGPT is a chatbot built on a large-scale transformer-based language model that is trained on a diverse dataset of text and is capable of generating human-like responses to prompts.
- A human like language model: It is based on GPT-3.5, a language model that uses deep learning to produce human-like text.
- It is more engaging with details: However, while the older GPT-3 model only took text prompts and tried to continue on that with its own generated text, ChatGPT is more engaging. It’s much better at generating detailed text and can even come up with poems.
- Keeps the memory of the conversations: Another unique characteristic is memory. The bot can remember earlier comments in a conversation and recount them to the user.
- Human- like resemblance: A conversation with ChatGPT is like talking to a computer, a smart one, which appears to have some semblance of human-like intelligence.
Anticipating possible futures requires engagement with the opportunities
- The Struggle to keep up with technology in policymaking:
1. Governments worldwide face a challenge in creating policies that keep up with the rapid pace of technological advancement.
2. Policymakers should understand that they must work to bridge the gap between technology and regulation, as a growing divide could lead to problems.
- Preparing for technological change in education and workforce:
1. In addition to creating regulations that support innovation, it’s crucial to plan for the changes that new technology will bring to education and employment.
2. This includes anticipating new job types and skills required, as well as updating the education system to prepare future workers.
- Importance of Preparing for technological change for India:
1. India has been facing the challenge of balancing privacy and regulation in the handling of data for several years.
2. Successfully adapting to technological changes is crucial for India to make the most of its large, young workforce. If not addressed in time, the consequences could be severe
Conclusion
- The transformations the new technology is bound to bring about must be met with swift adjustments in the broader national and international legal and policy architecture. The lag between technology innovation and policy that was seen with the rise of Big Data and social media can serve as a lesson.
Mains Question

Q. With the rapid innovations and launching of Artificial intelligence models everyday will change the nature of work, creativity and economy as a whole. comment
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Type: op-ed snap

Context

What is Indus Water Treaty (IWT)?

Why such move?

The role of World Bank?

Mistrust and mismanagement

Conditions that underlie any successful transboundary water negotiation process

Climate change is often neglected in politicization of the water issues

Conclusion

Context

Balloons for surveillance

How The US responded?

Similar experiments

Global geopolitical struggle

India as peacemaker

Conclusion

Context

Gender inequality in cities

Do you know: The concept of a 15-minute city?

Focus areas of development

Way ahead

Conclusion

Context

First aspect: standard accounting exercise of the government’s revenues and expenditures

Second aspect: Government’s assessment of the economic challenges and ways to overcome

The pandemic effect:

Supply-side interventions in demand constrained economy

Conclusion

Context

Background: The Google case of anti-competitive contracts

What is the grievance appellate committee (GAC)?

Are GACs well equipped to deal with grievances?

Conclusion

Context

What is wealth tax?

Why in news?

Crafting good tax policy starts with a question: How much will it distort economic behaviour?

Way ahead

Conclusion

Context

What is hydropower

Hydropower Projects in Himalayan region

Concerns about the potential conflicts over water resources in the region

Micro hydro systems as an alternative to hydropower

Conclusion

Context

Why in news?

Background: Data from Assam

What is Child Marriage?

Effect of Covid-19 Pandemic

How child marriage is negatively correlated to national development?

Understanding the key drivers behind child marriage is necessary to combat it

Conclusion

Context

Government’s current Health spending

How health expenditure affects people especially poor?

Areas where greater spending by the government could help in the immediate term

Conclusion

Context

Background

Sample developments over just the last few days

What are the Concerns?

Anticipating possible futures requires engagement with the opportunities

Conclusion