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  • Foreign Policy Watch: India-China

    The Indo-Pacific opportunity

    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: AUKUS

    Mains level: Paper 2- Indo-Pacific challenge

    Context

    The geopolitics of the Indo-Pacific, which is changing fast. As it moves into 2022, the region will carry the imprint of the past five years, and will have to chart a course through inter-state tensions and crises, using both diplomacy and military preparedness.

    What will shape the geopolitics and geoeconomics of the Indo-Pacific?

    • Key players in the region: The region is central to world economy and peace, and nine countries are key players: the US, China, Japan, India, Germany, the UK, Russia, Australia and France.
    • The geopolitics and geo-economics of the Indo-Pacific will be largely shaped by the interplay of relations among these nations.
    • US-China relations: Of paramount importance is the US-China equation.
    • Expect this relationship to be marked by continually adversarial, competitive and cooperative traits.
    • Beijing’s south/east China policy, aggressive postures towards Taiwan, human rights violations in Xinjiang, the subjugation of Hong Kong’s citizenry and assertive economic outreach in the Indo-Pacific — these will weigh heavily on US-China relations.

    A significant role of groupings and individual nations

    • In this standoff, the role of new groupings and individual nations is significant.
    • Role of Quad: Foremost are the Quad, a strategic partnership between the US, India, Japan and Australia and the militaristic AUKUS (Australia, UK, US). 
    • India-Australia ties: Meanwhile, India and Australia are on track to deepen ties, not only bilaterally but also with the other two Quad powers.
    • The next Quad summit, probably hosted by Japan, will cement the grouping.
    • EU’s role: The EU’s Indo-Pacific strategy, announced last September, aims at increasing its economic and security profile in, and linkages with, the region.
    • UK’s role: Only by being more strategic and less mercantilist, more candid and assertive with China, and more cooperative with partners such as India, can the EU — and its former member the UK — hope to become vital players in the Indo-Pacific.
    • ASEAN, located in the middle of the Indo-Pacific waters, faces the heat of China’s aggression and the sharpening great power rivalry.
    •  It must enhance its realism and shed its tendency of wishing away problems.

    Suggestions for India

    • 1]Strengthen the Quad – especially by ensuring that the grouping fulfils its commitment to deliver at least one billion vaccine doses to Indo-Pacific nations by December 2022.
    • India must protect its established relationship with Russia, and show some resilience in dialogue with Beijing.
    • 2] Enhance relations with ASEAN nations: It must enhance cooperation with key Southeast Asian partners —Indonesia, Vietnam, Philippines and Thailand — while humouring ASEAN as a grouping.
    • 3] Give attention to African and Indian Ocean island states: The eastern and southern planks of Africa and the Indian Ocean island states need continued high policy attention and financial resources.
    • A clear economic and trade agenda to follow the flag in this vital region, is certain to yield long-term dividends.

    Consider the question “Indo-Pacific will present India strategic and economic opportunities that India must not miss. However, the region will have to chart a course through inter-state tensions and crises. Comment.”

    Conclusion

    India has done well by fulfilling its humanitarian duties during the pandemic. Learning how to convert them smartly into economic and strategic opportunities in its periphery is the focused task for the nation in 2022.

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  • Foreign Policy Watch: India-ASEAN

    China does not have it all its way in the South China Sea

    op-ed snap | International Relations | Mains Paper 2: Effect Of Policies & Politics Of World On India’S Interests

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Countries involve in South China sea dispute

    Mains level: Paper 2- South China sea issue

    Context

    South-East Asian countries are increasingly wary of their giant neighbour.

    Background of dispute

    • Disputes in the South China Sea go back decades.
    • But it was only ten years ago that China, which makes maritime claims for nearly the whole sea, greatly upped the ante.
    • Countries involved: They involve Brunei, China, Malaysia, the Philippines, Taiwan and Vietnam, all with contesting claims.
    • China provoked a stand-off that left it in control of an uninhabited atoll, Scarborough Shoal, which under un maritime law clearly belongs to the Philippines.
    • Then China launched a massive terraforming exercise, turning reefs and rocks into artificial islands hosting airstrips and bases.

    China’s strong-arm tactics

    • China’s long-term aim is to project Chinese power deep into the South China Sea and beyond, and to hold the Americans away during any conflict.
    • The immediate aim, though, is to dominate politically and economically as much as militarily.
    • China has challenged oil-and-gas activity by both Indonesia and Malaysia, and sent drilling rigs to both countries’ eezs and continental shelves.
    • It has bullied foreign energy companies into dropping joint development with Vietnam and others.

    Implications

    • China has paid a diplomatic price.
    • Impact on relations with ASEAN: Had Mr Xi engaged in none of the terraforming and bullying, China would be better admired among members of the ten-country Association of South-East Asian Nations (ASEAN).
    • Naval presence of the US: The United States and its Western allies have upped their naval presence in the sea, welcomed by most ASEAN members.

    Negotiation on Code of conduct on South China Sea

    • For years China dragged its feet on agreeing with ASEAN a code of conduct on the South China Sea, a principle agreed on 20 years ago in order to promote co-operation and reduce tensions.
    • These days, China likes to play willing.
    • China is demanding, in effect, the right of veto over ASEAN members’ naval exercises with foreign powers.
    • It also wants to keep out foreigners from joint oil-and-gas development.
    • Such demands are unacceptable to members.

    Conclusion

    Despite China’s efforts to establish its wild claims of sovereignty, China has been facing sustained resistance from the ASEAN countries.

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  • A new form of socialism powered by cooperative economic enterprises is required

    op-ed snap | Economics | Mains Paper 3: Inclusive Growth & Issues

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 3- Need for democratic socialism based on cooperative economic enterprises

    Context

    Inequalities of wealth have increased around the world and India is becoming one of the world’s most unequal countries.

    Role of globalisation and privatisation in increasing economic distress

    • Economic despair is feeding the rise of authoritarianism, nationalism, and identity politics.
    • Role of Globalisation: Opening national borders to free trade became an ideology in economics in the last 30 years.
    • Taxes of incomes and wealth at the top were also reduced.
    • The ideological justification was that the animal spirits of ‘wealth creators’ must not be dampened.
    • With higher taxes until the 1970s, the U.S. and many countries in Europe had built up their public health and education infrastructure and strengthened social security systems.
    • The rich are now being taxed much less than they were.
    • The pie has grown larger but the richest few have been eating, and hoarding, most of it themselves.
    • Role of privatisation: ‘Privatisation’ of everything became another ideological imperative in economics by the turn of the century.
    • Selling off public enterprises raises resources for funds-starved governments.
    • Another justification is efficiency in delivery of services, setting aside ethical questions of equity.
    • When ‘public’ is converted to ‘private’, rich people can buy what they need.
    • The gaps between the haves and the have-nots become larger.

    How liberal economic policies are creating illiberal societies

    • Liberal economists, promoting free markets, free trade, and privatisation, are worried by nationalism and authoritarian governments.
    • They rail against “populist” policies of governments that subsidise the poor and adopt industrial strategies for self-reliance and jobs for their citizens.
    • Liberals must re-examine their ideas of economics, to understand their own culpability in creating authoritarian and identitarian politics.

    The failure of capitalism and communism

    • While communism had lifted living standards, and the health and education of masses of poorer people faster than capitalism could, communism’s solution to the “property” question — that there should be no private property — was a failure.
    • It deprived people of personal liberties.
    • Capitalism’s solution to the property problem — replacing all publicly owned enterprises with privately owned ones (and reducing taxes on wealth and high incomes) has not worked either.
    • It has denied many of their basic human needs of health, education and social security, and equal opportunities for their children.
    • The private property solution has also harmed the natural environment.

    Way forward

    • Climate change and political rumblings around the world are both warnings that capitalism needs reform.
    • Economic policies must be based on new ideas.
    • Thought leaders and policymakers in India must lead the world out of the rut of ideas in which it seems to be trapped.
    • Principles of human rights must not be overpowered by property rights.
    • A new form of “Gandhian” democratic socialism, powered by cooperative economic enterprises, is required in the 21st century, to create wealth at the bottom, not only at the top, and save humanity and the planet.

    Conclusion

    A new form of ‘Gandhian’ democratic socialism powered by cooperative economic enterprises is required.

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  • Freedom of Speech – Defamation, Sedition, etc.

    How to deal with hate speech

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 2- Dealing with hate speech

    Context

    On January 12, 2022 , the Supreme Court of India agreed to hear petitions asking for legal action to be taken against the organisers of, and speakers at, the “Hardwar Dharma Sansad”.

    What constitutes hate speech

    • Hate speech is speech that targets people based on their identity, and calls for violence or discrimination against people because of their identity.
    • There is an absence of any legal or social consensus around what constitutes “hate speech.”
    • As societies around the world have long understood, the harm in hate speech is not restricted to direct and proximate calls to violence.
    • Inciting discrimination is part of hate speech: Hate speech works in more insidious ways, creating a climate that strengthens existing prejudices and entrenches already-existing discrimination.
    • This is why – with the exception of the United States of America – most societies define hate speech in terms of both inciting violence, but also, inciting discrimination.

    Challenges in dealing with hate speech

    • Legal challenge: Our laws – as they stand – are unequipped to deal with the challenges of hate speech.
    • The laws commonly invoked in such cases are section 295A of the Indian Penal Code (blasphemy) and section 153A of the Indian Penal Code (creating enmity between classes of people).
    • Hate speech will not always be self-evident: Hate speech, by its very nature, will not always trumpet itself to be hate speech.
    • Rather, it will often assume plausible deniability – as has been seen in the Hardwar case, where statements, worded with the right degree of ambiguity, are now being defended as calls to self-defence rather than calls to violence.
    • Any comprehensive understanding of hate speech is a matter of judgment, and must take into account its ambiguous and slippery nature.
    • Lack of social consensus against hate speech: No matter how precise and how definite we try to make our concept of hate speech, it will inevitably reflect individual judgment. 
    • If, therefore, social and legal norms against hate speech are to be implemented without descending into pure subjectivity, what is needed – first – is a social consensus about what kind of speech is beyond the pale.
    •  In Europe, for example, holocaust denial is an offence – and is enforced with a degree of success – precisely because there is a pre-existing social consensus about the moral abhorrence of the holocaust.

    Conclusion

    Achieving this social consensus is an immense task, and will require both consistent legal implementation over time, but also daily conversations that we, as a society need to have among ourselves.

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  • How the Seventh Schedule affects delivery of public goods

    op-ed snap | Polity | Mains Paper 2: Federalism,Indian Constitution – historical underpinnings, evolution, features, amendments, significant provisions and basic structure

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Article 246

    Mains level: Paper 2- Need for review of the Seventh Schedule

    Context

    Without delegation of funds, functions and functionaries, local governments are unable to respond to pressure from citizens who demand greater efficiency.

    Background of the Seventh Schedule

    •  Article 246 of the Constitution mentions three lists in the Seventh Schedule — union, state and concurrent lists.
    • The present Seventh Schedule and union (at that time Federal) list, state (at that time Provincial) list and concurrent lists are inherited from that 1935 piece of legislation.
    • It states that “Notwithstanding anything in the two next succeeding subsections, the Federal Legislature has, and a Provincial Legislature has not, power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule to this Act.”

    Delivery of public goods

    • Ignoring that narrow and technical definition of public good, loosely, we understand “public good” as something that must be delivered by the government.
    • It cannot, or should not, be delivered by the private sector.
    • Notwithstanding the use of private security guards, most people will agree “law and order” is a public good.
    • Most public goods people will think of are efficiently delivered at the local government level, not Union or state level.
    •  There is a Seventh Schedule issue that is thus linked to the insertion of a local body list.
    • Countervailing pressure by citizens increasingly demands efficient delivery of such public goods.
    • But without delegation of funds, functions and functionaries, presently left to the whims of state governments, local governments are unable to respond.

    Need for the review of the Seventh Schedule Lists

    • No local body list: Most public goods people will think of are efficiently delivered at the local government level, not Union or state level.
    • There is a Seventh Schedule issue that is thus linked to the insertion of a local body list.
    •  But without delegation of funds, functions and functionaries, presently left to the whims of state governments, local governments are unable to respond.
    • The Rajamannar Committee — formally known as Centre-State Relations Inquiry Committee suggested constitution of a High Power Commission to examine the entries of Lists I and III in the Seventh Schedule to the Constitution and suggest redistribution of the entries,”.
    • Changes in the past led to greater centralisation: Items have moved from the state list to the concurrent list and from the concurrent list to the union list.
    • Such limited movements have reflected greater centralisation, such as in 1976.
    •  N K Singh, Chairman of 15th Finance Commission has also often made this point, in addition to scrutiny of Article 282.

    Conclusion

    For the sake of better governance, it’s not an issue that should be ducked and the basic structure doctrine doesn’t stand in the way.

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  • Electoral Reforms In India

    Need to recast the selection process of the ECs

    op-ed snap | Polity | Mains Paper 2: Statutory, Regulatory & Various Quasi-Judicial Bodies

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Article 324

    Mains level: Paper 2- Need to change the selection process of Election Commissioners

    Context

    The attendance of the Chief Election Commissioner (CEC) and his Election Commissioner (EC) colleagues at an “informal” meeting with the Principal Secretary to the Prime Minister has brought renewed focus on the independence and impartiality of the Election Commission of India (ECI).

    Need for changes in the appointment process

    • The changes in the appointment process for ECs can strengthen ECI’s independence, neutrality and transparency. 
    • The appointment of ECs falls within the purview of Article 324(2) of the Constitution, which establishes the institution.
    • Article 324(2) contains a ‘subject to’ clause which provides that both the number and tenure of the ECs shall be “subject to provisions of any law made in that behalf by Parliament, be made by the President.”
    • Apart from enacting a law in 1989 enlarging the number of ECs from one to three, Parliament has so far not enacted any changes to the appointment process.
    • In 1975 itself, the Justice Tarkunde Committee recommended that ECs be appointed on the advice of a Committee comprising the Prime Minister, Lok Sabha Opposition Leader and the Chief Justice.
    • This was reiterated by the Dinesh Goswami Committee in 1990 and the Law Commission in 2015.
    • The 4th Report (2007) of the Second Administrative Reforms Commission additionally recommended that the Law Minister and the Deputy Chairman of the Rajya Sabha be included in such a Collegium.
    • Violation of Article 14 and 324: Three Writ Petitions, with one pending since 2015, are urging the Supreme Court to declare that the current practice of appointment of ECs by the Centre violates Article 14, Article 324(2), and Democracy as a basic feature of the Constitution.
    • Precedent does exist in the case of Rojer Mathew v South Indian Bank Ltd, to argue against the Executive being the sole appointer for a quasi-judicial body.
    • The Supreme Court had recognised that “Election Commission is not only responsible for conducting free and fair elections but it also renders a quasi-judicial function between the various political parties including the ruling government and other parties.”
    • In such circumstances, the executive cannot be a sole participant in the appointment of members of Election Commission as it gives unfettered discretion to the ruling party.

    Way forward

    • Establishing a multi-institutional, bipartisan committee for fair and transparent selection of ECs can enhance the perceived and actual independence of ECI.
    • Such a procedure is already followed with regard to other Constitutional and Statutory Authorities such as the Chief Information Commissioner, Lokpal, Vigilance Commissioner, and the Director of the Central Bureau of Intelligence.

    Consider the question “What is the procedure for the appointment of Election Commissioners? What are the issues with this procedure? Suggest the way forward.”

    Conclusion

    ECI’s constitutional responsibilities require a fair and transparent appointment process that is beyond reproach, which will reaffirm our faith in this vital pillar of our polity.

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  • Reaping India’s demographic dividend

    op-ed snap | Economics | 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: Not much

    Mains level: Paper 1- Demographic dividend

    Context

    Countries like Singapore, Taiwan and South Korea have already shown us how demographic dividend can be reaped to achieve incredible economic growth by adopting forward-looking policies and programmes.

    The window of demographic opportunity

    • With falling fertility (currently 2.0), rising median age (from 24 years in 2011, 29 years now and expected to be 36 years by 2036), a falling dependency ratio (expected to decrease from 65% to 54% in the coming decade taking 15-59 years as the working age population), India is in the middle of a demographic transition.
    • This provides a window of opportunity towards faster economic growth. India has already begun to get the dividend.
    • As fertility declines, the share of the young population falls and that of the older, dependent population rises.
    • If the fertility decline is rapid, the increase in the population of working ages is substantial yielding the ‘demographic dividend’.
    • The smaller share of children in the population enables higher investment per child.
    • Therefore, the future entrants in the labour force can have better productivity and thus boost income.
    • With the passage of time, the share of the older population rises and that of the working age population begins to fall and hence the dividend is available for a period of time, ‘the window of demographic opportunity’.

    Need for forward-looking policies

    • Without proper policies, the increase in the working-age population may lead to rising unemployment, fueling economic and social risks.
    • This calls for forward-looking policies incorporating population dynamics, education and skills, healthcare, gender sensitivity, and providing rights and choices to the younger generation.

    Lessons for India

    • Countries like Singapore, Taiwan and South Korea have already shown us how demographic dividend can be reaped.
    •  There are important lessons from these countries for India.
    • 1) NTA data: The first is to undertake an updated National Transfer Accounts (NTA) assessment.
    • Using NTA methodologies, we find that India’s per capita consumption pattern is way lower than that of other Asian countries.
    • A child in India consumes around 60% of the consumption by an adult aged between 20 and 64, while a child in China consumes about 85% of a prime-age adult’s consumption.
    • The NTA data for India needs to be updated to capture the progress made on such investments since 2011-12.
    • 2) Invest more in children and adolescents: India ranks poorly in Asia in terms of private and public human capital spending.
    • It needs to invest more in children and adolescents, particularly in nutrition and learning during early childhood.
    • 3) Make health investments: Health spending has not kept pace with India’s economic growth.
    • The public spending on health has remained flat at around 1% of GDP.
    • Evidence suggests that better health facilitates improved economic production.
    • Hence, it is important to draft policies to promote health during the demographic dividend.
    • 4) Make reproductive healthcare services accessible on a rights-based approach: We need to provide universal access to high-quality primary education and basic healthcare.
    • The unmet need for family planning in India at 9.4% as per the latest National Family Health Survey-5 (2019-21) is high as compared to 3.3% in China and 6.6% in South Korea, which needs to be bridged.
    •  5) Bridge gender differentials in education: The gender inequality of education is a concern.
    • In India, boys are more likely to be enrolled in secondary and tertiary school than girls. This needs to be reversed.
    • 6) Increase female workforce participation: As of 2019, 20.3% of women were working or looking for work, down from 34.1% in 2003-04.
    • New skills and opportunities for women and girls befitting their participation in a $3 trillion economy is urgently needed.
    • It is predicted that if all women engaged in domestic duties in India who are willing to work had a job, female labour force participation would increase by about 20%.
    • 7) Address the diversity between StatesWhile India is a young country, the status and pace of population ageing vary among States.
    • Southern States, which are advanced in demographic transition, already have a higher percentage of older people.
    • These differences in age structure reflect differences in economic development and health – and remind us of States’ very different starting points at the outset of the 2030 Sustainable Development Goals Agenda.
    • But this also offers boundless opportunities for States to work together, especially on demographic transition, with the north-central region as the reservoir of India’s workforce.
    • 8) Governance reform: A new federal approach to governance reforms for demographic dividend will need to be put in place for policy coordination between States on various emerging population issues such as migration, ageing, skiling, female workforce participation and urbanisation.

    Conclusion

    In India, the benefit to the GDP from demographic transition has been lower than its peers in Asia and is already tapering. Hence, there is an urgency to take appropriate policy measures.

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  • Goods and Services Tax (GST)

    Extending GST compensation as a reform catalyst

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Tax buoyancy

    Mains level: Paper 3- GST and issues

    Context

    In 2020-21, the compensation payment episode plunged the Union-State relationship to a new low, creating humongous mistrust.

    Background of the compensation to the States

    • To allay the fears of States of possible revenue loss by implementing GST in the short term, the Union government promised to pay compensation for any loss of revenue in the evolutionary phase of five years.
    • This was estimated by taking the revenue from the merged taxes in 2015-16 as the base and applying the growth rate of 14% every year.
    •  To finance the compensation requirements, a GST compensation cess was levied on certain items such as tobacco products, automobiles.
    • Period of five years: The agreement to pay compensation for the loss of revenue was for a period of five years which will come to an end by June 2022.
    • Mistrust between Centre and the State: In 2020-21, due to the most severe lockdown following the novel coronavirus pandemic, the loss of revenue to States was estimated at ₹3 lakh-crore of which ₹65,000 crore was expected to accrue from the compensation cess.
    • Of the remaining ₹2.35 lakh-crore, the Union government decided to pay ₹1.1 lakh-crore by borrowing from the Reserve Bank of India.
    • The entire compensation payment episode plunged the Union-State relationship to a new low, creating humongous mistrust.

    GST reform is still in transition

    • Misuse of input tax credit: The technology platform could not be firmed up for a long time due to which the initially planned returns could not be filed.
    • This led to large-scale misuse of input tax credit using fake invoices.
    • Revenue uncertainty faced by the States: This is the only major source of revenue for the States.
    • Considering their increased spending commitments to protect the lives and livelihoods of people, they would like to mitigate revenue uncertainty to the extent they can.
    • They have no means to cushion this uncertainty for the Finance Commission which is supposed to take into account the States’ capacities and needs in its recommendations has already submitted its recommendations.
    • Changes needed: More importantly, the structure of GST needs significant changes and the cooperation of States is necessary to carry out the required reforms.

    Changes needed in GST structure

    • Reducing exemption items: Almost 50% of the consumption items included in the consumer price index are in the exemption list; broadening the base of the tax requires significant pruning of these items.
    • Bringing petroleum products, real estate etc under GST: Sooner or later, it is necessary to bring petroleum products, real estate, alcohol for human consumption and electricity into the GST fold.
    • Single rate: The present structure is far too complicated with four main rates (5%, 12%, 18% and 28%).
    • This is in addition to special rates on precious and semi-precious stones and metals and cess on ‘demerit’ and luxury items at rates varying from 15% to 96% of the tax rate applicable which have complicated the tax enormously.
    •  Multiple rates complicate the tax system, cause administrative and compliance problems, create inverted duty structure and lead to classification disputes.

    Way forward

    • Extending the compensation period: Reforming the structure to unify the rates is imperative and this cannot be done without the cooperation of States.
    • Thus, extending the compensation payment for the next five years is necessary not only because the transition to GST is still underway but also to provide comfort to States to partake in the reform.
    • Reforming the structure is important not only to enhance the buoyancy of the tax in the medium term but also to reduce administrative and compliance costs to improve ease of doing business and minimise distortions.
    • New rate of compensation: It has been pointed out by many including the Fifteenth Finance Commission that the compensation scheme of applying 14% growth on the base year revenue provided for the first five years was far too generous.
    • The issue can be revisited and the rate of growth of reference revenue for calculating compensation can be linked to the growth of GSDP in States.

    Conclusion

    The transition to GST is still in progress and an extension will provide comfort to States to help roll out crucial changes.

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  • Freedom of Speech – Defamation, Sedition, etc.

    Hate speech in the time of free speech

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 2- Free speech vs hate speech

    Context

    The growing incidence of hate speeches, especially those targeting minorities, in combination with the judicial ambiguity has provided an opportunity to chart legislative reforms.

    Current legal provisions to deal with hate speech

    • Not defined in legal framework: Hate speech is neither defined in the Indian legal framework nor can it be easily reduced to a standard definition due to the myriad forms it can take.
    • The Supreme Court, in Pravasi Bhalai Sangathan v. Union of India (2014), described hate speech as “an effort to marginalise individuals based on their membership in a group” and one that “seeks to delegitimise group members in the eyes of the majority, reducing their social standing and acceptance within society.”
    • The Indian Penal Code illegalises speeches that are intended to promote enmity or prejudice the maintenance of harmony between different classes.
    • Specifically, sections of the IPC, such as 153A, which penalises promotion of enmity between different groups;
    • 153B, which punishes imputations, assertions prejudicial to national integration;
    • 505, which punishes rumours and news intended to promote communal enmity, and
    • 295A, which criminalises insults to the religious beliefs of a class by words with deliberate or malicious intention.
    • Summing up various legal principles, in Amish Devgan v. Union of India (2020), the Supreme Court held that “hate speech has no redeeming or legitimate purpose other than hatred towards a particular group”.
    • Lack of established legal standard: Divergent decisions from constitutional courts expose the lack of established legal standards in defining hate speech, especially those propagated via the digital medium.

    Suggestions

    • The Law Commission of India, in its 267th report, recommended the insertion of two new provisions to criminalise and punish the propagation of hate speech.
    • The 189th Report of the Parliamentary Standing Committee on Home Affairs, in 2015, recommended the incorporation of separate and specific provisions in the Information Technology Act to deal with online hate speech.
    • Specialised legislation for social media: Much of the existing penal provisions deal with hate speech belong to the pre-Internet era.
    • The need of the hour is specialised legislation that will govern hate speech propagated via the Internet and, especially, social media.
    • Recognise hate speech as reasonable restriction to free speech: Taking cue from best international standards, it is important that specific and durable legislative provisions that combat hate speech, especially that which is propagated online and through social media.
    • Ultimately, this would be possible only when hate speech is recognised as a reasonable restriction to free speech.

    Consider the question “What is hate speech? What are the challenges in dealing with hate speech? Suggest a way forward.”

    Conclusion

    It is important that specific and durable legislative provisions be enacted to combat hate speech.

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  • Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc

    Issues with India’s GDP data

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 3- Issues with India's GDP data

    Context

    There are three major reasons why the GDP data, and hence any narrative of economic recovery based on it, are questionable.

    Background

    • The NSO released the current GDP series in 2015, using 2011-12 as its base year.
    • Some have argued that the problem in the new series is the real growth rate. This is debatable.
    • Scholars have pointed to measurement problems, both in the nominal and real GDP growth rates.

    Three issues with the GDP data, and  narrative of economic recovery based on it

    [1] Double deflation problem

    • The new series entailed a shift from a volume-based measurement system to one based on nominal values, thereby making the deflator problem more critical.
    • Simply put, the NSO calculates real GDP by gathering nominal GDP data in rupees and then deflating this data using various price indices.
    • The nominal data needs to be deflated twice: Once for outputs and once for inputs.
    • But the NSO — almost uniquely amongst G20 countries — deflates the nominal data only once.
    • It does not deflate the value of inputs.
    • To see why this is a problem, consider what happens when the price of imported oil goes down.
    • In that case, input costs will fall and the profits recorded by Indian firms will rise.
    • This increase in profits is merely the result of a fall in input prices, so it needs to be deflated away.
    • But the NSO doesn’t deflate away the increase in profits.
    • Since the cost of inputs is measured by the WPI (wholesale price index), a crude measure of the overestimation caused by the absence of “double deflation” is given by the gap between the WPI and the CPI (consumer price index).
    • In the 2014-2017 period, oil prices plunged, causing the WPI to fall sharply relative to the CPI.
    • This meant that real growth was probably overstated.
    • In the last few months, the exact opposite has been happening. WPI inflation is soaring.
    • The rapid increase in the WPI relative to the CPI is imparting an upward bias to the deflator.

    [2] Sectoral weight not updated

    • When it calculates GDP, it takes a sample of activity in each sector, then aggregates the figures by using sectoral weights.
    • To make sure that the weights are reasonably accurate, the NSO normally updates them once a decade.
    • It has now been more than 10 years since the weights were changed, and there are no signs of a base year revision.
    • As a result, the sectoral weights are still based on the structure of the economy in 2010-11, when in particular the information technology sector was much smaller.

    [3] Measurement of unorganised sector

    • Measurement of the unorganised sector has always been difficult in India.
    • Once in a while, the NSO undertakes a survey to measure the size of the sector.
    • In the meantime, it simply assumes that the sector has been growing at the same rate as the organised sector.
    • However, starting in 2016 the unorganised sector has been disproportionately impacted by a series of shocks.
    • In 2018, the NBFC sector reported serious problems, which in turn impacted unorganised sector firms since they were heavily dependent on NBFCs for funds.
    • From 2020 onwards, the pandemic has impacted the unorganised sector more than the organised sector enterprises.
    • Despite these shocks, the NSO does not seem to have made any adjustments to its methodology for estimating the growth of the unorganised sector.

    Consider the question “Elaborate the issues with India’s GDP data. Suggest the way forward.”

    Conclusion

    There are serious problems with India’s GDP data. Any analysis of recovery or growth forecast based on this data must be taken with a handful of salt.

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