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[op-ed snap] Green is cool

May 16, 2019May 16, 2019 | The Indian Express

Mains Paper 3 : Conservation, Environmental Pollution & Degradation, Eia |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : ICAP

Mains level : Analysis of ICAP

CONTEXT

India — as the fastest growing and rapidly urbanising economy — is projected to have the strongest growth in cooling demand worldwide. While India’s soaring demand in this sector is in line with the country’s developmental needs, it does portend significant environmental, social and economic concerns.

India Cooling Action Plan (ICAP)

The government’s launch of the India Cooling Action Plan (ICAP) on March 8 is a bold response to addressing India’s future cooling needs while neutralising its impacts.
ICAP most visibly is about enhancing access to cooling amenities, optimising demand and efficient cooling practices and technologies.

Space cooling sector – The space cooling sector, which represents a dominant share of India’s current and future cooling needs, the underlying thrust is to enable thermal comfort and well-being for all citizens by providing affordable and reliable cooling options, maintaining reliable electricity grids, and enhancing climate resilience of buildings and homes.

Focus on Vulnerable Section – The thrust is on ensuring that the vulnerable populations, particularly children and the elderly, are not exposed to undue heat stresses.

Energy efficient approach – To maximise the cooling load reduction and possible benefits for this sector, ICAP proposes an approach that first reduces the cooling energy demand through climate appropriate and energy efficient building design, then serves the demand through energy efficient appliances and finally, controls and optimises the demand through demand-side and user adaptation strategies, such as adaptive thermal comfort.

Climate appropriate designs for affordable housing – The plan lays special emphasis on enabling thermal comfort for the economically-weaker sections through climate-appropriate designs of affordable housing, and low-cost interventions to achieve better thermal insulation (such as cool roofs).

Benefits of ICAP

Enhancing Productivity – The benefits of the proposed actions extend to enhancing nationwide productivity, reducing heat-islands in urban areas, mitigating peak-load impacts and reducing the stress on the power systems — much of this would also free up capital for other developmental priorities.

2. Integrated Cold chain Infrastructure –

Within the cold chain sector, ICAP proposes development of an integrated cold chain infrastructure with the appropriate market linkages, supported by adequate training and up-skilling of farmers and professionals.
The co-benefits include economic well-being of farmers and reducing food losses thus strengthening food security and alleviating hunger-related issues.

3. Training and certification –

Driving skill-building of the services sector through training and certification is an important target identified by the plan.
It also presents an opportunity for providing increased employment, better livelihoods, and safer working practices for the HVAC (heating, ventilation and air conditioning) sector.

4. Building R&D ecosystem –

ICAP’s emphasis on an innovative R&D ecosystem aims to drive the nation towards better utilisation of public-funded R&D efforts that solve pressing issues related to the environment — and quality of life.
The plan also positions India’s cooling challenge as an opportunity for the nation to demonstrate leadership in areas related to innovation. It also supports the Make in India campaign through indigenous production of cooling equipment and refrigerants.

5. Impact on SDGs –

The benefits of ICAP could impact several SDGs — good health and well-being, decent work and economic growth, sustainable cities and communities, reduced inequalities, affordable and clean energy, responsible consumption and production, and climate action.
The onus is now on the various stakeholders to work collaboratively, with the right policy and market levers, to lead the country towards a cooling transformation that exemplifies sustainable and responsible cooling for all.

Climate Change Impact on India and World – International Reports, Key Observations, etc.

[op-ed snap] IBC hits and misses

May 16, 2019May 16, 2019 | The Indian Express

Mains Paper 3 : issues relating to planning, mobilization of resources |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : IBC

Mains level : Gains and losses of IBC

CONTEXT

Even as the time taken for resolution under the Insolvency and Bankruptcy Code (IBC) continues to exceed the outer limit prescribed under the law, the process is yielding better outcomes in a shorter time frame as compared to the erstwhile regime.

Background

In FY19, financial institutions recovered close to Rs 70,000 crore through resolution under the IBC, estimates rating agency Crisil.
This works out to a recovery rate of 43 per cent.
In comparison, recoveries under the preceding regime through various channels — debt recovery tribunals, securitisation and reconstruction of financial assets, and enforcement of the securities interest act (SARFAESI) and Lok Adalats — stood at Rs 35,000 crore in FY18.

Cause of concerns

The time taken for successful resolution continues to exceed that envisaged in the law.
Under the law, the insolvency resolution process is to be completed in 180 days, which can be extended by another 90 days to a maximum of 270 days. But, of the 1,143 cases that are currently outstanding under the IBC, 362 cases or 32 per cent are pending for more than 270 days.
In a few of the big ticket cases, the resolution process has exceeded 400 days.

Reasons For delay

Part of the delay in resolution can be attributed to the absence of buyers, differences between members of the committee of creditors, as well as legal challenges mounted by existing promoters not willing to let go of their companies.
Then, there are issues of institutional capacity which need to be addressed.

Conclusion

However, despite these delays, Crisil estimates that it takes around 324 days for cases to be resolved under the IBC — in comparison, as per the World Bank’s Doing Business Report 2019, it took 4.3 years under the earlier regime.
In the months after the IBC kicked in, operational creditors had taken the lead in initiating the corporate insolvency resolution process (CIRPs) against errant debtors.
But thereafter, financial institutions stepped up.
In fact, in the quarter ended March 2019, the number of CIRPs initiated by financial creditors exceeded those initiated by operational creditors. But it is difficult to say whether this trend will continue after the Supreme Court ruling on the RBI’s February 12 circular.
The quashing of the circular has opened the door for banks to tackle the issue of bad loans outside the IBC process, a route they might prefer.

Banking Sector Reforms

[op-ed snap] No apology, please

May 15, 2019 | The Indian Express

Mains Paper 2 : Indian Constitution - historical underpinnings, evolution, features, amendments, significant provisions and basic structure |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Court's order for apology for a political meme might affect freedom of speech.

CONTEXT

The Supreme Court vacation bench has granted bail to Priyanka Sharma of the Bharatiya Janata Yuva Morcha (BJYM) in West Bengal. This was scrupulously correct, because bail is a right except in special circumstances, where the accused is deemed to be likely to misuse her freedom to interfere with the course of justice. The Supreme Court has always expanded the contours of free speech. Its insistence on an apology on a political meme is distressing.

Background

Initially, the bail granted was conditional upon Sharma tendering an immediate apology for sharing a bizarre meme online, showing West Bengal chief minister Mamata Banerjee.
The final order was softened to restore Sharma’s liberty without a pre-condition, but it required her to apologise after being set free.

Problem with such conditions

This rider was deeply problematic on multiple counts.

1.Situation based Order –

First, the court appears to have asked for an apology because the post was made by a political worker during elections, though situational matters generally do not concern the process of justice.
What is deemed to be just today should be deemed so for all time.

2. Second, Sharma’s counsel has argued that she had only re-posted a pre-existing meme.

3. Harming Liberal space

The judicial remand of Sharma for 14 days was a travesty of justice, especially by a government that, ironically, claims to be pushing for a more liberal space.
The judicial action, without doubt, was out of proportion with the act of forwarding a meme, and the demand for an apology by the highest court, as a condition following her release, heaps insult upon injury.
While the court is correct in observing a principle of natural justice, which requires a balance in the rights of individuals, Sharma’s alleged transgression cannot have been probed sufficiently in a single hearing.
To require her to apologise when her transgression has not been sufficiently established militates against natural justice.

Setting A Dangerous Precedent

Though the order states that “it shall not operate as a precedent”, if the need for an apology is eventually upheld, the effects would be catastrophic, for all satire is political in nature and intent.
Cartoonists would have to publicly repent every morning, shortly after newspapers land on the doorsteps of readers.
Stand-up comics could apologise in the evenings, after the show.
Theatre and cinema producers and directors dealing in political issues (and what is drama if it is not political?) would have to send pre-emptive apologies to the powers that be before their shows opened.
And satire would be declared dead on arrival.

Conclusion

The meme shared by Sharma was merely bizarre, even if it involved a political personality. If producers of real political satire could be prosecuted until they apologised, it would be the death of free speech.

Freedom of Speech – Defamation, Sedition, etc.

[op-ed snap] Missing demand: on economic slowdown

May 15, 2019May 16, 2019 | The Hindu

Mains Paper 3 : Effects Of Liberalization On The Economy, Changes In Industrial Policy and their effects on Industrial Growth |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : New GDP series

Mains level : Industrial slowdown and it's effects

CONTEXT

A welter of data collectively and individually point to one worrying conclusion: economic momentum across sectors is slowing in the widening absence of that key ingredient, demand.

Slowdown across the economy

The decline in the automobile sector –

Domestic sales of cars, commercial vehicles and two wheelers all contracted in April, from a year earlier, the Society of Indian Automobile Manufacturers (SIAM) has reported.
The decline of almost 16% in total automobile industry sales is an indication that consumption demand across markets — urban and rural, institutional and individual — is petering out.
While sales of commercial vehicles, a fair proxy for overall economic activity, slid 6% last month, a 16.4% drop in demand for two-wheelers extended the segment’s slump into the new financial year, mirroring the rippling rural distress.
The data on passenger vehicles, which saw the steepest drop in almost eight years, add to the gloom.
Car sales shrank almost 20% amid a protracted slump that shows no signs of a reversal.

Output decline in various sector

The latest industrial output figures from the government serve to underscore the widespread nature of the demand drought.

The decline in IIP – The Index of Industrial Production (IIP) for March shows output fell 0.1% from a year earlier to a 21-month low, with the use-based classification revealing a weakening that spared none of the six segments.

Shrink in capital Goods sector – The capital goods sector shrank by 8.7% on the back of an 8.9% contraction in the preceding month.

Fall in consumer durables – Output of consumer durables fell 5.1% from a year earlier, and growth in consumer non-durables production slid to 0.3% from the 14.1% pace in March 2018.

Drag in manufacturing – Manufacturing, which has a weight of almost 78% in the index, continues to be the biggest drag, with output contracting by 0.4% after shrinking by a similar extent in February.

Overall, the sector’s growth slowed to 3.5% in the last fiscal, from 4.6% in 2017-18.

Conclusion by data

Overly optimistic GDP growth Rate – The composite picture that emerges from all these numbers belies the CSO’s implicit fourth-quarter GDP growth assumption of 6.5%, and paints it as overly optimistic.
Unstable global conditions – With global headwinds strengthening in the backdrop of an escalating trade war between the two largest economies, the U.S. and China, and rising tensions in West Asia beginning to push up energy costs from the top oil-exporting region, Indian policymakers have to contend with an external sector that would likely only add to the domestic pressures, most certainly in the near term if not in the longer.
Need for a normal monsoon – The distress in the farm sector may just ease marginally if the monsoon does turn out to be “near normal” as forecast last month, and could help spur a demand revival in the rural hinterland.

Conclusion

Still, the new government that emerges after May 23 must spare little time in drawing up appropriate policy measures that not only help reinvigorate demand but also ensure that such a revival is robust, across-the-board and enduring.

Economic Indicators-GDP, FD,etc

[op-ed snap] Facing the climate emergency

May 15, 2019 | The Hindu

Mains Paper 3 : Conservation, Environmental Pollution & Degradation, Eia |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : There is need of radical change in bringing awareness regarding impacts of climate change.

CONTEXT

A recent paper in the Proceedings of the National Academy of Sciences of the U.S.A. shows that global warming during the past half century has contributed to a differential change in income across countries.

Changes due to global warming

Already wealthy countries have become wealthier and developing countries have been made poorer in relative terms during this time.
India’s GDP growth penalty between 1961 and 2010 is in the order of 31% for the period, whereas Norway gained about 34% on a per capita basis.
More recently, the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services has reported that, worldwide, the abundance of species has reduced by at least one-fifth, about a million species are under threat of extinction in the next few decades and 85% of wetlands have been lost.

Instances of collusion against climate change warnings

What we have, moreover, are numerous instances of elite networks that are taking advantage of the situation to consolidate their control.
Collusion among corporations – These networks often involve governments actively or quiescently colluding with fossil fuel companies, agro-industrial elites, financial elites and other big businesses that are ignoring climate change and making a fast buck often even from the growing disasters.
Subsidy to fossil fuels – The International Monetary Fund estimates in a recent working paper that fossil fuel subsidies were $4.7 trillion in 2015 and estimated to be $5.2 trillion in 2017.
Power Struggle in the Arctic – The Arctic is melting rapidly and the tenor of the recent discussions among Arctic countries suggests that even as increasing glacier melt is responsible for opening up shipping in the area, superpowers are angling to access wealth from the oil, gas, uranium and precious metals in the region.
Case study – Recent example is the draft Indian Forest Act of 2019, which enhances the political and police power of the forest department and curtails the rights of millions of forest dwellers.

Movement to bring changes

Luckily we are witnessing is a large-scale movement for “planet emergency”, climate and ecology.
Greta Thunberg has been leading this among school-going children, and Extinction Rebellion has been organising “die-ins” in many parts of Europe and now in Asia.
Their non-violent civil disobedience is just what is needed and it is indeed inspiring to see children and grandparents protest together.
People’s movements, whether made up of students or adults, cannot be ignored for long and governments will have to pay attention.

Spread of misinformation

The atmosphere now has concentrations of over 415 parts per million (ppm) of carbon dioxide, compared to 280 ppm in pre-industrial times.
But then, fossil fuel companies and politicians have known about climate change for at least 30 years.
They have funded misinformation regarding climate directly, taking lessons from tobacco companies that propagated lies for decades about cigarettes being safe.

Conclusion

We are now at a stage where we need major overhaul of our lifestyles and patterns of consumption.
The U.K. Parliament became the first recently to declare a climate emergency.
It remains to be seen if appropriate actions will follow this declaration.
When a 16-year-old speaks with far greater clarity and conviction than the thousands of dithering policy wonks who have been debating for over three decades, we know the politics of the climate crisis must undergo a radical transformation.

Climate Change Impact on India and World – International Reports, Key Observations, etc.

[op-ed snap] Redactive pricing audit and the CAG’s duties

May 14, 2019 | The Hindu

Mains Paper 2 : Constitutional Bodies |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : CAG

Mains level : Redactive Pricing approach in CAG's Report harm transparency in democratic institutions.

CONTEXT

The Supreme Court’s observations in connection with the Rafale fighter aircraft deal by citing the Comptroller and Auditor General of India’s (CAG’s) report on redacted pricing, and subsequent media reports and the controversy over “stolen files” brought back into the spotlight the role of the supreme audit institution of India.

Questions surrounding the report

What is redactive pricing?
Does the constitutional mandate provide redactive pricing to be included in the CAG’s audit reports submitted to the President to be placed before Parliament?
Do any supreme audit institutions (SAIs) such as the National Audit Office, the Government Accountability Office or Commonwealth countries follow redactive pricing in audit reports?

Redaction

Redaction is the selection or adaption by ‘obscuring or removing sensitive information’ from a document prior to publication.

Duties of CAG

The CAG is mandated to audit all receipts and expenditures of the three-tier governments in India and report to the legislature judiciously, independently, objectively in compliance with applicable laws, rules and regulations, without fear and favour.
He conducts financial compliance and performance audits and submits his reports to the legislature to help people’s representatives in enforcing legislative oversight and public accountability of the executive.
Legislative committees such as the Public Accounts Committee and Committee on Public Undertakings examine the CAG’s selected reports.

Explanations regarding redactive Pricing

In the preface of the audit report, the CAG stated that redactive pricing was unprecedented but had to be accepted due to the Ministry’s insistence citing security concerns.
Consequently, the full commercial details were withheld and the figures on the procurement deal were blackened.

Not Transparent measure

It was unprecedented that an audit report submitted by the CAG to the President under Article 151 of the Constitution suppressed relevant information.
Whether the Ministry’s insistence citing security concerns could have been accepted by the CAG can be examined only by the Supreme Court in the light of the constitutional provisions on the CAG’s duties and parliamentary privileges and prerogatives.
Redactive pricing is nowhere used in SAI audit reports.
It does not seem to have been used in a government audit by any SAI of any country.
Redactive pricing in the ‘Performance Audit Report of the Comptroller and Auditor General of India on Capital Acquisition in Indian Air Force (Union Government – Defence Services, Air Force, Report No. 3 of 2019)’ suppresses more than it reveals.
For example, in the Rafale deal, Parliament, its committees, the media and other stakeholders of the CAG’s reports cannot obtain complete, accurate and reliable information due to redactive pricing.
The reduction in the original requirement, to 36 aircraft, a waiver of the earlier decision to involve Hindustan Aeronautics Limited, observations of the Indian Negotiating Team, cost escalation due to inclusion of bank guarantee and performance guarantee were not compared properly to arrive at the audit conclusion.

Pricing is Pivotal to procurement

Pricing is an integral part of the procurement decision-making process of any equipment, product, goods or service.
Therefore, price integrity and comparative competitiveness are at the heart of any procurement decision.

Way Forward

Given the dynamics of international competition in competitive products and pricing in today’s modern market scenario, pricing, delivery and post-delivery service and other conditions are essentially covered in an SAI audit.
It is a complex audit, demanding exceptional insight, expertise, knowledge and skills.
Seek expertise – In case the CAG’s office lacks expertise to conduct a performance audit, expertise can be sought from the pool of resources or credible organisations to be coopted in the audit team.
No resorting to redactive Pricing – Pricing decisions must be subjected to detailed analysis, without resorting to redactive pricing.
The privilege of Parliament – Parliament is constitutionally privileged to know what the executive had done and how and under what conditions a procurement was decided. The CAG’s audit is expected to highlight value for money in purchase decisions.

Conclusion

A performance audit is done to establish whether the procurement activity was executed keeping in mind economy, efficiency, effectiveness, ethics and equity. Only a thorough pricing audit can bring out the credibility and integrity of a purchase decision, thereby achieving an SAI’s constitutionally mandated responsibilities.

Government Budgets

[op-ed snap] If food prices rise

May 14, 2019 | The Indian Express

Mains Paper 3 : Issues Related To Farm Subsidies & Msp |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Inflation

Mains level : Low inflation in food prices is affecting well being of farmers and trend might revers soon.

CONTEXT

For 32 months running (from September 2016 to April 2019), consumer food inflation has been trailing general retail inflation.

Background

To understand its significance, rewind to the preceding 32 months (from January 2014 to August 2019), when in as many as 25 months the annual increase in food prices exceeded overall consumer inflation.
Food prices aren’t pinching as before and have also not been a hot-button issue in the current Lok Sabha elections — unlike in 2014, when they were one of the key reasons for the then Congress-led ruling alliance’s rout.
Bringing down retail food inflation from near double-digit to low single digit levels — even negative in many months — has, indeed, been a signal achievement of the government.

Impact of Low inflation

However, it hasn’t been an unmixed blessing.
While consumers have benefitted, the same cannot be said about farmers, for whom flat or falling prices of food and other agri produce have spelled disaster.

Reversal of trend –

Meanwhile, there are also signs of a trend reversal.
The last couple of months have seen prices of a host of farm commodities — from coarse grains, cattlefeed ingredients and cotton to tomatoes and seasonal vegetables — going up significantly.
Even milk and sugar are beginning to shake off a prolonged bear phase.

Reasons for reversal

The immediate trigger for this seems to be drought in large parts of Maharashtra, Gujarat, Karnataka, Andhra Pradesh and Telangana.
But there could be structural reasons as well.

Disastrous for farmers –

Cutting down crop acreages – It is not difficult to believe that sustained low produce realisations have broken the backs of many farmers, leading them to cut down crop acreages or underfeed their cattle.

2. Impact on yields – These are bound to impact yields and supply at some point. In that case, a normal monsoon alone, as forecast by the Met Department, may not be enough.

3. Long time to overcome the decline in productivity – Farmers aren’t going to ramp up output overnight, just as insufficiently nourished bovines will take time to calve and produce close to their genetic potential.

4. Return of food inflation – If structural supply constraints combine with a not-so-great monsoon, the result may well be a return of food inflation.

Way forward

That, on the face of it, may not be good news for the next government.
The mistake it should avoid is to clamp the usual restrictions on exports, internal trade and stocking, even while allowing unlimited imports at zero duty.
On the contrary, this is the time to scrap the Essential Commodities Act and laws allowing agricultural produce trade only in government-controlled wholesale mandis.
The current food inflation, if at all, is a necessary price correction that will help restore farmer confidence.
Improved price realisations would also create an environment to phase out wasteful government spending, whether through market-distorting minimum support price procurement operations or under-pricing of fertilisers, water and electricity.
Farmers deserve remunerative prices, not handouts.

Food Procurement and Distribution – PDS & NFSA, Shanta Kumar Committee, FCI restructuring, Buffer stock, etc.

[op-ed snap] Efficiency and quota in promotions — what Supreme Court has said

May 13, 2019 | The Indian Express

Mains Paper 2 : Laws, Institutions & Bodies Constituted For The Vulnerable Sections |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Recent judgement on quota in promotion tries to balance efficiency and social Justice.

CONTEXT

The order by a two-Judge bench of Justices D Y Chandrachud and U U Lalit held that a Karnataka statue allowing for reservation in promotions of SCs/STs is valid — the court had, in September 2018, held there was no need to revisit the M Nagaraj case (2006) which spoke of quantifiable data being necessary to decide on reservation.

Background

In agitations and annoyance among Dalits and Scheduled Tribes about the “next stage” in the debate over quotas, reservations in promotions have been a big bone of contention.
While the Central government has maintained it is now in favour of reservations in promotions, the Supreme Court had, in a series of orders over the years, verged on the conservative.

Latest order

The order by a two-Judge bench of Justices D Y Chandrachud and U U Lalit upheld a Karnataka statute, allowing for reservations in promotion.
The order stated that inclusive development, and not meritocracy, that were key to ensuring meaningful and substantive equality.

2. Article 335 – Article 335 of the Constitution states that the “claims of the members of the Scheduled Castes and the Scheduled Tribes shall be taken into consideration, consistently with the maintenance of efficiency of administration, in the making of appointments to services and posts in connection with the affairs of the Union or of a State”.

3. Forming a well-governed society – Since inclusion is inseparable from a well-governed society, there is, in our view, no antithesis between maintaining the efficiency of administration and considering the claims of the SCs and STs to appointments to services and posts in connection with the affairs of the Union or of a State.”

4. No reduction in efficiency by reservations – The Constitution does not define what the framers meant by the phrase efficiency of administration. Article 335 cannot be construed on the basis of a stereotypical assumption that roster-point promotees drawn from the SCs and STs are not efficient or that efficiency is reduced by appointing them.”

5. No abstract criteria for measuring efficiency – The benchmark for the efficiency of administration is not some disembodied, abstract ideal measured by the performance of a qualified open category candidate,” the judges said.

6. Definition of efficiency –

Efficiency of administration in the affairs of the Union or of a State must be defined in an inclusive sense, where diverse segments of society find representation as a true aspiration of governance by and for the people.
If, as we hold, the Constitution mandates realisation of substantive equality in the engagement of the fundamental rights with the directive principles, inclusion together with the recognition of the plurality and diversity of the nation constitutes a valid constitutional basis for defining efficiency.

Conclusion

Our benchmarks will define our outcomes.
Efficiency not by exclusion – If this benchmark of efficiency is grounded in exclusion, it will produce a pattern of governance which is skewed against the marginalised.
Root in equal access – If this benchmark of efficiency is grounded in equal access, our outcomes will reflect the commitment of the Constitution to produce just social order.
Otherwise, our past will haunt the inability of our society to move away from being deeply unequal to one which is founded on liberty and fraternity.”

Minority Issues – Dalits, OBC, Reservations, etc.

[op-ed snap] Of shells, companies and GDP

May 13, 2019 | Custom

Mains Paper 3 : Indian Economy |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : New GDP series

Mains level : NSSO finding of shell companies inclusion in MCA-21 might impact gdp data.

CONTEXT

About a third of non-government non-financial companies in the services sector are not traceable is the finding of a National Sample Survey Office (NSSO) survey for 2016-17 that has just been released. Since such entities could be shell/fake/bogus companies included in the MCA-21 database of “active” companies used for estimating the gross domestic product (GDP), the new finding could imply that private corporate sector GDP is being currently overestimated, denting the official growth narrative.

The background

Change in the base year – In 2015, the Central Statistics Office (CSO) issued a new GDP series with 2011-12 as the base year, replacing the earlier series with the 2004-05 base-year as a routine matter.
Usually, the revision leads to a slight expansion of the absolute GDP in the base year, but its growth rate does not change, implying that the underlying pace of economic expansion in the two series has remained the same.
Change in growth rate – This time was different, however. The absolute GDP size — the sum of the value of all (unduplicated) goods and services produced in a year — got diminished slightly in the base year, and its growth rates went up subsequently.
Application of global template – Faced with public scrutiny and scepticism, the CSO defended the revision by claiming that it had followed the latest global template (the System of National Accounts 2008), applying improved methodologies to a newer and larger data set.
Inclusion of MCA-21 financial returns – In a first, the new series estimated private corporate sector (PCS) GDP directly using the Ministry of Corporate Affairs’ (MCA) statutory filing of financial returns, MCA-21.
Effect on industries – Accounting for over a third of GDP, as the non-financial PCS now spans widely, the revision has affected the estimates of many industries and services. Hence the GDP debate has mostly centred on the PCS.

Screening and setback

To redress the shortcoming, the CSO is committed to launching an annual survey of services (on the lines of the ASI).
As a first step, the NSSO carried out a survey of non-government and non-financial companies/establishments in 2016-17.
The NSSO report says, “About 45% of MCA units were found to be out-of-survey/causality
The inference could be that such companies are likely to be shell/fake/spurious entities that remain legally registered (but merely on paper), without actually producing goods and services.

Impact of estimation

The survey findings could bring down the growth estimates.
However, those knowledgeable have dismissed such an apprehension on two counts:
- One, shell companies add value to the economy, hence their deletion would underestimate GDP.
- Two, as all active companies are said to submit their audited accounts at least once in three years, the contribution of shell companies is well captured in the MCA database.
Both arguments seem questionable.
- Shell companies, by definition, do not produce goods and services; they help the promoter/owner to hide profits or evade taxes/regulation.
- The argument that all active companies under the MCA have filed statutory returns at least once during the last three years is a bureaucratic fiction.

Case for scrutiny

In sum, the NSSO’s survey of active companies in the services sector discovered that 45% of them could not be traced or misclassified; hence they could represent or be shell/fake/bogus companies.
The finding throws into sharp relief the poor quality of the MCA-21 data set, which has formed the backbone of the new GDP series.
The NSSO survey results have added more questions about the beleaguered GDP series.

Way forward

As a first step towards dispelling the growing distrust in the new GDP series, the government should put up the MCA-21 data for public scrutiny and lift the opacity of the methodology used in estimating corporate sector output.

Economic Indicators-GDP, FD,etc

[op-ed snap] Gulf warning

May 11, 2019 | The Indian Express

Mains Paper 2 : Bilateral, Regional and Global Groupings and agreements involving India |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Us Iran tensions might disturb peace in middle east.

CONTEXT

Tehran’s decision to stop adhering to some of the provisions of the landmark 2015 nuclear agreement with the international community is a sharp reminder that dark clouds are gathering again in the Middle East.

Reasons for Tehran’s Decision

When US President Donald Trump pulled out last year from the nuclear deal negotiated by his predecessor, Barack Obama, Iran had the option of walking out too. It did not.
Tehran had hoped that the European powers as well as Russia and China might help limit the effects of America’s renewed hostility.
The Europeans had criticised the US withdrawal, affirmed that Iran was in compliance with the nuclear agreement, and offered to sustain economic engagement with Iran if Tehran stayed true to the deal. China and Russia had criticised the US decision as unilateral and arbitrary.
But Iran’s hopes of exploiting the cracks among the great powers are looking increasingly unreal as the actions of Europe, China and Russia have not matched their words. Iran’s “strategic patience”, in the words of President Hassan Rouhani, is wearing thin.

Hostile Actions by USA

Meanwhile, the Trump Administration is ratcheting up pressure on Iran.

1.Terming Iran’s armed forces as terrorist Organisation –

Last month, it designated the Iranian Islamic Revolutionary Guard Corps (IRGC) as a terrorist organisation.
This is the first time the US has labeled the entire wing of a country’s armed force as “terrorist”.

2.Dispatching Aircraft towards Gulf

Citing an unexplained threat from Iran, President Trump has despatched the USS Abraham Lincoln aircraft carrier strike group towards the Gulf.

3. Sanctions impacting Iran -Meanwhile, US sanctions aimed at choking Iran’s oil exports and squeezing its finances are beginning to bite.

Tehran’s apprehensions

Tehran has no reason to believe that the Trump Administration is open to a reasonable compromise that might include a revised nuclear deal to address any real US concerns.
It is no secret in Washington that regime change in Tehran is the Trump Administration’s real goal.

Implications of this decision

Iran’s partial withdrawal from the nuclear agreement is aimed at convincing Washington’s allies in Europe as well as its competitors that time is running out to save the deal.
Tehran is conscious of Europe’s difficulty in effecting a real break with the US in the Middle East.
It also knows that China and Russia have their own fish to fry with America and are unlikely to challenge the US on Iran.
Worse still, Moscow and Beijing could use Tehran as a lever in their bargaining with the US.
Iran might lack real friends among the major powers, but it has the capacity to bring the house down in the Middle East.
With armed proxies across the region, Tehran is well placed to launch an asymmetric war against the US and its allies.
Iran has also threatened to close the Straits of Hormuz — the strategic waterway that moves oil from inside the Gulf to the rest of the world — if its own oil sales remain blocked.
With neither side ready to step back, the conflict between the US and Iran might well be headed for a costly showdown.

Foreign Policy Watch: India-Iran

[op-ed snap] A fraught moment: U.S.-China trade war

May 11, 2019 | The Hindu

Mains Paper 2 : Bilateral, Regional and Global Groupings and agreements involving India |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Trade War

Mains level : US-China Trade war will impact global Economy harshly.

CONTEXT

The U.S.-China trade war has flared up again after a deceptive lull over the last few months, when both sides were trying to negotiate a deal.

Present Situation

Out of nowhere, President Donald Trump tweeted that he would raise the 10% tariff imposed on $200-billion worth of Chinese goods to 25%, starting Friday. That the Trump administration pressed ahead with the increase even as China’s Vice Premier Liu He was still in Washington for a second day of talks with U.S. trade officials only underscores the businessman-turned-President’s ‘take no prisoners’ approach to negotiations.
China promptly promised retaliatory action, but was yet to spell out the measures.
With Mr. Trump tweeting that “the process has begun to place additional tariffs at 25% on the remaining” Chinese goods worth $325 billion, the U.S. administration unambiguously signalled it was not going to be the first to blink.

Implications for the global economy

The increase in tariffs imposed on goods crossing international borders essentially represents a new tax on a global economy already facing a slowdown.
Last month, the International Monetary Fund trimmed its projection for global growth in 2019 to 3.3%, from a 3.5% forecast made in January, citing slowing momentum in “70% of the world economy”.
IMF Chief Economist Gita Gopinath had at the time projected a pick-up in global growth momentum in the second half, predicated substantially on the “improved” outlook for U.S.-China trade tensions.
IMF chief Christine Lagarde and Ms. Gopinath, however, presciently warned that the world economy was poised at “a delicate moment”.
Were tensions in trade policy to flare up again, it could result in large disruptions to global supply chains and pose downside risks to global growth, the IMF warned.
Barely a month later, the world economy faces the very real risk of an escalation in this trade war where other countries, including India, can largely only wait and watch as the U.S. and China raise the pitch.

implications for American Economy

While the U.S. may have genuine concerns about Chinese protectionism, the overall economic logic behind Mr. Trump’s trade policy still remains weak.
The cost of these tariffs will, after all, eventually be borne by American consumers and could result in U.S. job losses too as the import of Chinese parts become uneconomical for smaller businesses.

Implications for India

Indian policymakers would do well to closely monitor how the latest escalation in trade tensions pans out for global demand and international energy prices, given that the RBI has flagged oil price volatility as a factor that would have a bearing on India’s inflation outlook.

Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy, etc.

[op-ed snap] Resolving India’s banking crisis

May 11, 2019 | The Hindu

Mains Paper 3 : issues relating to planning, mobilization of resources |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : NPA

Mains level : Resolving NPA crisis

CONTEXT

The government that assumes office after the general election will have to crack a serious and unresolved problem: India’s banking sector.

Background

Non-performing assets (NPAs) at commercial banks amounted to ₹10.3 trillion, or 11.2% of advances, in March 2018. Public sector banks (PSBs) accounted for ₹8.9 trillion, or 86%, of the total NPAs.
The ratio of gross NPA to advances in PSBs was 14.6%.
These are levels typically associated with a banking crisis.

Origin of the crisis

1. Credit Boom –

The answer lies partly in the credit boom of the years 2004-05 to 2008-09. In that period, commercial credit (or what is called ‘non-food credit’) doubled. I
Indian firms borrowed furiously in order to avail of the growth opportunities they saw coming.
Most of the investment went into infrastructure and related areas — telecom, power, roads, aviation, steel. Businessmen were overcome with exuberance, partly rational and partly irrational.

2.Problems with projects

Thereafter, as the Economic Survey of 2016-17 notes, many things began to go wrong.
Thanks to problems in acquiring land and getting environmental clearances, several projects got stalled.
At the same time, with the onset of the global financial crisis in 2007-08 and the slowdown in growth after 2011-12, revenues fell well short of forecasts. Financing costs rose as policy rates were tightened in India in response to the crisis.
The depreciation of the rupee meant higher outflows for companies that had borrowed in foreign currency.
This combination of adverse factors made it difficult for companies to service their loans to Indian banks.

3.Tightening norms

The year 2014-15 marked a watershed.
The Reserve Bank of India (RBI), acting in the belief that NPAs were being under-stated, introduced tougher norms for NPA recognition under an Asset Quality Review.
NPAs in 2015-16 almost doubled over the previous year as a result. It’s just that the cumulative bad decisions of the past were now coming to be more accurately captured.

Impact of higher NPAs

Higher NPAs mean higher provisions on the part of banks.
Provisions rose to a level where banks, especially PSBs, started making losses. Their capital got eroded as a result. Without adequate capital, bank credit cannot grow.
Even as the numerator in the ratio of gross NPAs/advances rose sharply, growth in the denominator fell.

Reason for high NPAs in Public Sector Banks

PSBs had a higher exposure to the five most affected sectors — mining, iron and steel, textiles, infrastructure and aviation.
These sectors accounted for 29% of advances and 53% of stressed advances at PSBs in December 2014.
For private sector banks, the comparable figures were 13.9% and 34.1%. Our rough calculations show that PSBs accounted for 86% of advances in these five sectors.

Plans to prevent such crises

1. Resolve NPAs –

One immediate action that is required is resolving the NPAs.
Banks have to accept losses on loans (or ‘haircuts’).
They should be able to do so without any fear of harassment by the investigative agencies.

2. Loan Resolution Authority – An alternative is to set up a Loan Resolution Authority, if necessary through an Act of Parliament.

3. Recapitalising Banks – Second, the government must infuse at one go whatever additional capital is needed to recapitalise banks — providing such capital in multiple instalments is not helpful.

4. Monitoring macro-prudential indicators –Over the medium term, the RBI needs to develop better mechanisms for monitoring macro-prudential indicators.

5.Governance strengthening at PSBs – Actions needs to be taken to strengthen the functioning of banks in general and, more particularly, PSBs. Governance at PSBs, meaning the functioning of PSB boards, can certainly improve.

6.Risk management

Other aspects of concentration risk remain to be addressed. We need to induct more high-quality professionals on PSB boards and compensate them better.
Succession planning at PSBs also needs to improve.

Conclusion

The task of accelerating economic growth is urgent. This is not possible without finding a solution to the problems that confront the banking system. There is ample scope for improving performance within the framework of public ownership. It can be done. What is needed is a steely focus on the part of the government.

NPA Crisis

[op-ed snap] From Idai to Fani

May 10, 2019 | Custom

Mains Paper 1 : Climatic Change |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Cyclone Fani

Mains level : Why frequency of high intensity cyclones is increasing in Indian Ocean.

CONTEXT

The Indian Ocean has made its mark on the global news cycle this year. In March, tropical cyclone Idai made headlines as one of the most severe storms to have made landfall in Mozambique.

Recent instances of severe cyclones

After Idai, Eline was the strongest – though not the deadliest – cyclone to have hit the southern east African cost.
This ranking as the strongest was soon after challenged by tropical cyclone Kenneth, a category 4 tropical cyclone that made landfall over the border of Mozambique and Tanzania six weeks after Idai.
Most cyclones in the region occur from January to March.It was also unusual for the Mozambique Channel to experience two severe tropical cyclones that made landfall within one season.
The third major cyclone to emerge out of the Indian Ocean came a few weeks after Kenneth, when cyclone Fani, a tropical cyclone on the border of Category 5 intensity wind speeds, hit the east coast of India.
Category 5 tropical cyclones were only first recorded in the North Indian Ocean from 1989 so, again, this storm is unusually severe in the context of the longer historical records.

Reason for high-intensity storms

1.Warm Sea surface –

These high intensity storms have been tied to the very warm sea surface temperatures in the Indian Ocean. Temperatures of 30°C are occurring more often and over longer periods of time.
This is a result of gradual warming on a global scale, which has resulted in a net increase in ocean temperatures.

2.Formation of stronger storms and El Nino

Warmer ocean temperatures allow stronger storms to form.
These conditions are exacerbated by global forcing mechanisms including El Niño and the Indian Ocean Dipole, which concentrates warm ocean waters in smaller geographic areas.
High intensity storms have been a frequent feature along the coast of the US throughout recorded history.
Their increased frequency in the Indian Ocean should be raising alarm bells because countries like the US are much better equipped to help people prepare ahead of time and to handle the fallout.

Measuring intensity

Tropical cyclone intensity is classified according to the Saffir Simpson scale.
Categories are measured on the basis of the sustained wind speed and the storm’s central pressure.
Each category is accompanied by estimates of the likely severity of damage and possible storm surge height.
Tropical cyclones form and intensify due to a combination of seven primary climatological conditions. Among other things, these include warm sea surface temperatures, high humidity levels and atmospheric instability.
For a storm to intensify, these conditions have to be maximised while the storm remains over the ocean.

Optimal Conditions

Warming of South Africa –

Tropical cyclones require a sea surface temperature of 26.5°C to form, while the highest intensity storms require much warmer sea surface temperatures of 28°C-29°C.
This is important because it’s one of the reasons why southern Africa is experiencing more intense tropical cyclones.

Warming of the South Indian Ocean –

Increase in temperature ranges – The regions that previously experienced the temperatures of 26.5°C that facilitated tropical cyclone formation are now experiencing temperatures as warm as 30°C-32°C.
More common landfall – This increases the range in which these storms occur, making storms like tropical cyclone Dineo, which made landfall in February 2017 in southern Mozambique, more common.

Difference in Impact of severe cyclones

Lower-lying, relatively flat areas are more prone to flooding than higher elevation regions or those with rugged topography.
And when flooding does occur, some regions are better able to warn and evacuate people to prevent or minimise the loss of life.
Another factor which determines the devastation resulting from a tropical cyclone is the population density of the area of landfall.
The higher the population density, the more people who are at threat of losing their life, their homes and livelihoods.
This also means more people who would need to be evacuated in a short period, and more people who need shelter until the storm’s immediate effects have subsided.

Conclusion

This is why Idai and Eline resulted in far greater losses and fatalities than the stronger intensity Kenneth, and why the total damage from Fani is projected to be particularly devastating. We need to start measuring storm destructiveness in addition to climatological metrics.

Climate Change Impact on India and World – International Reports, Key Observations, etc.

[op-ed snap] Endless war

May 10, 2019 | The Hindu

Mains Paper 2 : Bilateral, Regional and Global Groupings and agreements involving India |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Current situation of afghanistan Peace Process

CONTEXT

A call by Afghanistan’s Loya Jirga, a grand assembly of senior politicians and tribal and religious leaders, for a ceasefire between government troops and the Taliban underscores the mood in Kabul.The U.S. must put pressure on the Taliban to heed the Afghan government’s concerns.

Background

Afghanistan’s leaders, from its rulers to tribal chieftains, want to resolve the 17-year-long conflict.
Over a four-day meeting that ended on May 2, the Jirga asked the government to set up a negotiating team with members from the assembly for talks with the insurgents.
It also backed women’s rights, a critical issue being debated by the political class amid the Taliban’s rising clout.
President Ashraf Ghani has said his government would honour the assembly’s proposals, but wants the ceasefire to be mutual.
The Taliban, for its part, immediately shot down the proposal, vowing to continue attacks through the Ramzan month.
Without the Taliban’s reciprocity, no ceasefire will hold.

Current Situation

The group controls half of Afghanistan and has shown its capacity to strike anywhere, including in the most fortified of locations.
It has also been engaged in direct talks with the U.S. for months.
But the peace talks haven’t prevented the Taliban from carrying out its summer offensive against the government.
By rejecting the Loya Jirga proposal, the Taliban has once again made it clear that it is not ready yet to engage with the government in Kabul.

Us Stance

The talks between Taliban representatives and Zalmay Khalilzad, the U.S. special representative, are primarily focussed on withdrawing foreign troops from Afghanistan.
The U.S. seeks, in return, an assurance that Afghanistan will not provide a safe haven to transnational terrorist groups such as al-Qaeda and the Islamic State.

Stalemate situation

But for an eventual settlement of the Afghan crisis, the government and the Taliban need to talk. The war has long been in a stalemate.
But the government and the Taliban see different ways out.
The government is willing to engage the insurgents, a move which has now been endorsed by the Loya Jirga as well.
But the Taliban, like any other successful insurgent group, wants to prolong the conflict, hoping that it can weaken the government’s morale and reduce its military strength.
The Taliban will change track only if it is forced to do so militarily or through pressure.
The government lacks the resources to accomplish either.
It cannot defeat the Taliban militarily, as the 17 years of the war suggest.
It cannot forge peace on the Taliban’s terms as it would mean endangering whatever few freedoms the Afghans enjoy right now.
This resource deficit can be bridged only with the help of the international community.

Way Forward

The U.S., which is in talks with the Taliban, should not overlook the interests of Kabul. It must put pressure on the Taliban to cease hostilities and engage with Mr. Ghani’s government.

Foreign Policy Watch: India-Afghanistan

[op-ed snap] Loud and clear

May 10, 2019 | The Hindu

Mains Paper 2 : Bilateral, Regional and Global Groupings and agreements involving India |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : GPS

Mains level : India US trade ties are needed to be normalised by taking prudent and swift measures.

CONTEXT

After a scathing speech by U.S. Commerce Secretary Wilbur Ross in New Delhi this week, it is no longer possible for the government to brush under the carpet its differences with Washington.

Tensed situation

1. The accusation of restrictive barriers – Speaking to Indian and U.S. businesspersons, Mr. Ross lashed out at what he called India’s unfair trade practices and “overly restrictive market access barriers”.

His comments followed a series of measures by the U.S. that have affected India.

2.Harsh measures – These include a refusal to revoke or waive tariff increases made last year on steel and aluminium, an ultimatum that India “zero out” oil imports from Iran by May 2 even without securing comparable alternatives, and the decision to withdraw India’s GSP (Generalised System of Preferences) trade status.

3. Labeling India as Tariff king – Mr. Ross repeated President Donald Trump’s accusation that India is a “tariff king”, and threatened India with “consequences” if it responded to U.S. tariffs with counter-tariffs, something New Delhi had threatened but not yet implemented in the hope of hammering out a comprehensive trade package.

4.Elusive solution – Despite rounds of talks, however, a package has remained elusive, and it is time for the government to articulate the problem on its hands.

Need for strategic action –

Clearly, the strategy of the past year, to ignore the differences in the hope that the problems would be resolved or that the U.S.’s trade war with China would occupy the Trump administration more, has not worked.

1.Working on tariffs –

New Delhi and Washington need to make a more determined attempt to sort out issues, starting from scratch if required, with tariffs.
While the 50-60% duties on motorcycles and cars and 150% duties on American liquor that India imposes need a second look, the U.S. must see that average tariffs imposed by India (13.8%) are not much higher than those levied by economies such as South Korea and Brazil.

2.E-commerce regulation and medical devices – In addition, the government will need to revisit some of its decisions like data localisation requirements and new e-commerce regulations, which were declared suddenly, while the U.S. must show some flexibility on India’s price caps on coronary stents and other medical devices.

3.Labelling of non-vegetarian dairy products – The U.S. must understand the cultural differences over the labelling of non-vegetarian dairy products.

Conclusion

Building alternative financial Structures – It is unlikely that the Trump administration will temper its “my way or the highway” approach to Iranian oil sales, and New Delhi will have to work closely with other countries to build alternative financial structures to avoid U.S. sanctions.

Push back on unreasonable demands – Where a compromise is not possible, the government should be ready to push back on unreasonable demands.

Foreign Policy Watch: India-United States

[op-ed snap] No courts for women

May 9, 2019 | The Indian Express

Mains Paper 1 : Role Of Women & Women Organization |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Improving women's representationin Judiciary.

CONTEXT

In the context of the apathy shown towards the woman complainant by an all-male bench (headed by the CJI) in the immediate aftermath of the allegations, and by the in-house committee which has given a clean-chit to the CJI, one cannot help but ponder: Would this incident have been handled differently if the judiciary was not as male-dominated as it always has been?

Gender disparity in judiciary

The judiciary is one of the least diverse institutions in India, with the lack of gender diversity being the most visible yet ignored aspect.
Since 1950, the SC has had only eight female judges out of 239, with the present three out of 27 being the highest concurrent representation women have ever had on the SC bench.
In the subordinate judiciary, merely 27.6 per cent of the judges are female.
This lack of women on the bench, at all levels of the judiciary, is at the very root of the impunity with which the top court has, in a single stroke, destroyed decades worth of progress made in deterring sexual harassment of women from all walks of life.

Collegium system as a barrier

Even if a female advocate crosses these barriers to continue and thrive in her profession, the current collegium system for the appointment of judges is simply not designed to ensure her elevation to the bench.
At present, the appointment of a judge to a high court is based on a recommendation made by a collegium of the three senior-most judges of that HC, and approved by a collegium of the three senior-most judges of the SC.
Although the state and central governments have a role to play in the process, the final say, for all practical purposes, rests with the SC collegium.

In 25 HC collegiums across the country, there are just five senior female judges with 19 of the collegiums having no female judge at all.
Only one woman so far has been a member of the SC collegium (Justice Ruma Pal), with Justice R Banumathi set to become the second later this year; and, at least until 2025, no female judge is going to occupy the CJI’s position.

Self perpetuating phenomenon

This nearly all-male composition of the highest decision-making bodies in the judiciary has made gender disparity a self-perpetuating phenomenon .
The data shows that out of the 363 persons recommended for elevation, merely 39 were female (just over 10 per cent). Of these, only 21 were confirmed with the remaining 18 names either being remitted to the HCs or deferred for later appointments.

The only way out of this vicious cycle is for the nearly all-male collegiums to go beyond their inherent biases and take affirmative measures to improve gender diversity on the bench.
More recommendations by collegium – The HC collegiums should consciously recommend more female names for elevation and the SC collegium must consider such recommendations more favourably.
Early elevation in career – Further, the female judges should be elevated early enough in their careers so that they make it to the collegiums and become decision makers (the average age of the 19 female judges elevated since October 2017 is 53 years).

Conclusion

Not a perception problem – Lack of gender diversity is not just a perception problem.

The real impact on proceedings – It is seen to have a real impact on the manner of proceedings and the nature of the final verdict — as is evident in the present instance.

Reinforcing trust in judiciary – specially in the judiciary, gender diversity is a virtue in itself — it reassures litigants that diverse opinions are taken into consideration and re-instils their trust in the justice-delivery system.

Opportunity for course correction – The present calamity in the judiciary, as unfortunate as it is, also provides an unprecedented opportunity to course correct on several accounts. Here’s hoping the men in power have the wisdom to seize it.

Women empowerment issues: Jobs,Reservation and education

[op-ed snap] Taking tensions seriously

May 9, 2019 | The Hindu

Mains Paper 2 : Bilateral, Regional and Global Groupings and agreements involving India |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : India- Us ties are not progressing much instead of promises.

CONTEXT

The U.S.’s decision to not extend Iran sanctions waivers, including the one provided to India, has notable implications for India-U.S. relations, given the importance of New Delhi’s energy relationship with Tehran.

Deleterious Development in bilateral ties

1.Economic Sector –

It comes on the heels of many other deleterious developments for bilateral ties including the U.S.’s decision to withdraw GSP benefits for Indian exports (in retaliation for Indian tariffs that the U.S. deemed to be prohibitively high) and the Trump administration’s discontent deepening over India’s policies on e-commerce, intellectual property rights and data localisation.
These India-U.S. trade and economic tensions aren’t new; the non-security dimension of the relationship has long lagged behind the fast-growing defence side.

Reactions by both sides

Both sides have played down these differences and offered reassuring data points:
India will scale up oil imports from other top producers;
the GSP withdrawal will have minimal impact on India’s economy;
the two capitals are working actively on high levels,
Most recently through the U.S.-India CEO Forum and the India-U.S. Commercial Dialogue, to ease tensions; and above all the strength of the bilateral relationship can easily withstand all these headaches.

Concerns

1. long-standing disconnects – A full-fledged strategic partnership, which both countries endorse, will be difficult to achieve amid such multiple and long-standing disconnects on the trade and economic side.

2. One-sided relationship – Indeed, if bilateral ties are largely driven by technology transfers, arms sales, joint exercises, and foundational agreements on defence, this amounts to a deep but one-sided security relationship, and not a robust and multifaceted strategic partnership.

3. Promises of cooperation – Recent joint statements have dwelt on the potential for cooperation on initiatives ranging from clean energy to innovation.And despite the problems, bilateral trade in goods and services has increased over the last decade.

4.Difficulty in transition – Still, so long as the non-security nuisances affect the bilateral relationship, the shift from a strong security relationship to a bonafide strategic partnership will be difficult.

5. The difference from other partners – After all, one rarely hears complaints or concerns about trade and economic matters in the U.S.’s relations with the U.K., Australia, or Israel, some of its other strategic partners.

Way Forward

The U.S. and India have long struggled to agree on what a strategic partnership should look like.
Still, no matter how it is defined, any strategic partnership must be broad-based, with trust and cooperation present across a wide spectrum of issues and not just limited to close collaborations in the guns-and-bombs category.
In this regard, a true strategic partnership remains, at least for now, elusive between India and the U.S.

Foreign Policy Watch: India-United States

[op-ed snap] One million species face extinction: Why biodiversity report matters

May 8, 2019 | The Indian Express

Mains Paper 3 : Conservation, Environmental Pollution & Degradation, Eia |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : IPBES

Mains level : Threat to biodiversity due to human interferrence

CONTEXT

Among the findings that are making global headlines is the assessment that as many as 1 million different species, out of a total of an estimated 8 million plant and animal species, are facing the threat of extinction, more than at any previous time, because of changes brought about in natural environments by human activities.

What is IPBES

IPBES is a global scientific body very similar in composition and functioning to the better-known Intergovernmental Panel on Climate Change (IPCC) that makes periodic reviews of scientific literature to make projections about the earth’s future climate.
IPBES is mandated to do a similar job for natural ecosystems and biodiversity. Formed in 2012, this is the first global assessment report by the IPBES .
Like IPCC, IPBES does not produce any new science, it only evaluates existing scientific knowledge to make assessments and projections.

Findings of the report

Among the findings that are making global headlines is the assessment that as many as 1 million different species, out of a total of an estimated 8 million plant and animal species, are facing the threat of extinction, more than at any previous time, because of changes brought about in natural environments by human activities.
The report says that 75% of Earth’s land surface and 66% marine environments have been “significantly altered”, and that “over 85%” of wetland area had been lost.

Implications of findings of the report

The two UN Conventions — Convention on Biological Diversity that addresses biodiversity issues, and the Convention on Combating Desertification that deals with sustainable land management — are likely to be guided by this report in future.
It is possible that so would be a host of other international agreements and processes, like the Ramsar Convention on wetlands, the Convention on International Trade in Endangered Species, or the Cartagena Protocol on Biosafety.

Indian Connection

The report does not have country-specific information.
But as a major biodiversity hotspot, vast areas, especially the coastline, of which are under tremendous stress due to large population, India can identify with most of the trends pointed out in the report.
For example, it says 23% of global land area had shown a reduction in productivity due to degradation, and that between 100 to 300 million people were at an increased risk of floods and hurricanes because of loss of coastal habitats and protection.
It says plastic pollution had increased 10 times from 1980, the number of large dams (those with a height of 15 m or more) had reached almost 50,000, and that human population had more than doubled since 1970s, and the number of urban areas had doubled since 1992.

Conclusion

All these trends have been clearly visible in the case of India, and bring with them the associated risks to natural ecosystems highlighted in the report.

Climate Change Impact on India and World – International Reports, Key Observations, etc.

[op-ed snap] Not Justice

May 8, 2019 | The Indian Express

Mains Paper 2 : Executive & Judiciary |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Supreme court upholder of right is falling short of maintaining Justice in its own courtyard.

CONTEXT

CJI. In a report submitted on Monday, the panel has given a clean chit to CJI Gogoi.

Background

Onus on Panel

The three-member panel probing charges of sexual harassment against Chief Justice Ranjan Gogoi had a task much broader and more critical than its stated remit.
Given that it was investigating allegations levelled against the highest office of the country’s apex court, the panel needed to answer questions that pertained, inevitably, to the integrity of the institution itself.
Upon it also lay the onus of instituting procedures that mitigated the unequal power relations in a case where a former junior employee of the court was ranged against the CJI.
In a report submitted on Monday, the panel has given a clean chit to CJI Gogoi. It has “found no substance” in the charges.
But this denouement — an ex parte report, which will not be made public — raises more questions than it answers.

Proceedings

Complaints regarding Procedure

The committee comprising Justices S A Bobde, Indira Banerjee and Indu Malhotra wrapped up the inquiry in sittings over four days, three of which were devoted to questioning the complainant.
On the third day, the complainant withdrew from the probe alleging that the panel did not adopt “a procedure that would ensure fairness and equality”.
She accused the committee of not informing her about its procedures, denying her legal help, not recording its proceedings and not providing her with a copy of her depositions before it.

Power Asymmetry

Each of these four points raises issues of power asymmetry.
The committee’s task was, no doubt, complicated by the fact that the SC’s “in-house procedures” do not have provisions to deal with charges against the CJI.
But the apex court has, over the years, also interpreted and re-interpreted Articles 14, 15, 19 and 21 of the Constitution to lay down the rights of working women.
The probe was a chance to extend such jurisprudence to a situation inside the institution of the court.

Concerns with ex parte investigation

The panel’s recourse to an ex-parte investigation is problematic.
Aside from the fact that such a probe is against the principles of natural justice..
And by not making its report public, the panel has come up short on the requirement of transparency .
It has argued that the verdict in Indira Jaising vs Supreme Court of India does not enjoin placing in public “the report of a committee constituted as a part of the In-House Procedure”.
But surely a probe into an issue where the institutional propriety of the SC is in question cannot hearken to pre-RTI jurisprudence — which Indira Jaising is.

Conclusion

The panel’s verdict goes against the Court’s tradition of interpreting the law creatively for the sake of upholding and strengthening constitutional morality. The Court has corrected itself in the past. It should do so again.

Judiciary Institutional Issues

[op-ed snap] Surveillance wars in space

May 8, 2019 | The Hindu

Mains Paper 3 : Awareness In The Fields Of It, Space, Computers, Robotics, Nano-Technology, Bio-Technology |

Note4Students

From UPSC perspective, the following things are important :

Prelims level : RPO, mission shakti

Mains level : Space defence activities and it's relevance

CONTEXT

Mission Shakti is a giant leap for India, but only a small step in the world of counter space.Years after Russia, the U.S., and China (referred to here as the Big Three) made a mark in this area, India too has shown that it can hit back at enemies attacking from space.

The relevance of mission Shakti

Military experts say that possessing the highly difficult capability to conduct such a test is important and essential for ensuring national security in space.
Mission Shakti, as it is called, has earned India a place in an exclusive club of ‘space defenders’.
However, a peek into counterspace, the world where such dangerous space activities are practised covertly by the Big Three, shows that while Mission Shakti is a giant leap for India, it is only a small step in that world.

Playground for confidential activities

Secret Activities in space – According to academic reports, policymakers and those tracking the military space, for several years now, the space between 600 km and 36,000 km above the earth has been the playground for such secret activities.

2. Report’s finding – Around the time Mission Shakti took place, the Center for Strategic and International Studies based in Washington, D.C. and the Secure World Foundation came out with reports detailing counterspace capabilities that different countries have today and their sense of threat to space assets.

3. Instances of activities –

The reports document that satellites have been launched to sidle up to other satellites in the same orbit.
Satellites with robotic arms or handles have touched or nudged their siblings in orbit.
Mother (or nesting) spacecraft have gone up to ‘deliver’ baby spy satellites in orbit.
Satellites have sneaked up to high perches to see, overhear and sense all that happens in space and on the ground.

The intent of such activities –

The intent of being in counterspace is thus surveillance and espionage.
In times of war, the intent could even be to capture or disable a rival’s space assets in orbit.

Concerns with such activities

Loud concerns have been raised over rendezvous and proximity operations (RPO) in space.
The actor countries neither acknowledge nor discuss such activities and give them other names.
In an RPO event, one country sends a satellite that clandestinely sits next to one of its own (or another country’s) orbiting satellites.
The motive could be to inspect and assess the target’s nature, eavesdrop on it, or even subvert its functions.
The fear is that in extreme cases, the target may even be ‘abducted’ or taken control of.

Loitering in orbit

Satellites of each of the Big Three has been caught loitering in orbit at different times, and the victims have cried foul.
In September 2018, French Defence Minister Florence Parly was reported to have charged that Russian satellite Luch-Olymp was lurking too close to — and spying on — a Franco-Italian military communications satellite, Athena-Fidus, in 2017, that is, the previous year.
The U.S. has reportedly had its share of RPOs and other acts.
Countries are also honing non-kinetic, electronics and cyber-based methods to prevent satellites of other countries from spying on their regions.
Cyber attacks can destroy, steal or distort other satellites or ground stations. The attacker gains control of the space asset.

Conclusion

“No one will declare that they are pursuing these kind of technologies but all are doing it, all have to do it, specially major players. In times of war no one is spared, and a country must be ready with its counter-security tactics.

ISRO Missions and Discoveries