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Type: op-ed snap

  • Capital Markets: Challenges and Developments

    Investors should not be tempted to ignore macroeconomic factors

    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- Stock market and risks involved for individual investors

    Despite gloom in the economy, financial markets are scaling new highs. The situations calls for diligence on the part of individual investors. The deals with this issue.

    What influences investors’ decision

    • Investors may not necessarily be always sensible or even capable of perceiving the larger picture.
    • Nobel laureate Daniel Kahneman argues that humans usually use the ‘first system’ of ‘fast thinking’ to hurriedly act and perceive their environment.
    • Consequently, they are susceptible to the ‘priming effect’, ‘framing bias’, ‘anchoring effect’, ‘overconfidence bias’ and ‘availability heuristic’.
    • These phenomena, thus, play their part in pervading optimistic market conditions.
    • As a result, investors often end up ignoring or overlooking uncertainties and risks involved in their decision.
    • At the same time, investors’ decision choices could be significantly influenced by ‘nudging’.
    • It is a deliberate tactics and method of behaviour modification by which it is the ‘choice architect’ that decides who does what and who does so, as argued by the Nobel laureate, Richard H. Thaler.
    • The present surge in the Indian stock market is indeed nudging individual investors to trade more.

    What makes individual investors vulnerable

    • National Stock Exchange data indicate following trends:
    • The share of the non-institutional individual investors in equity trading volume has risen to one half of the total turnover. in 2021.
    • It was around a third in 2016.
    • In contrast, the share of Foreign Institutional Investors (FIIs) in the total trading volume has shrunk to just about a tenth, it used to be one fifth in 2016.
    • Trading in the stock market, the sudden rise, the intraday moves, etc., are, thus, attributable largely to individual traders now. 
    • However, despite their large trading volumes, individual investors have actually contracted their holding of the market capitalisation.
    • The FIIs currently own around half of the free float of all Indian companies.
    • Apparently, the retail investors have constantly sold their stake to end up holding less than 20% shares now.
    • Trading, thus, seems to be the mainstay of retail investors and this is what makes them more vulnerable to the vagaries of the market.

    Market is ignoring macroeconomic factors

    • Centre for Monitoring Indian Economy Pvt. Ltd. data of the listed companies reveal a rise in their profit, due to rationalisation and cost-cutting.
    • Investors might be tempted to ignore macroeconomic factors and invest in such stock believing that it is the profit that impels the stock prices.
    •  In reality, however, share price is expected to ascend if a company declares to cut its wage bill.
    • This probably explains why stock markets around the world have been on the rise amidst the novel coronavirus pandemic; demand may have declined but profits have been least impacted.
    • At the larger economic level, however, real wages have plunged.
    • Clearly, the market has not entirely decoupled itself from the economic indicators.
    • Established wisdom suggests that corporates cannot sustain contraction in the economy for long.
    • Sustained decline in demand caused by waning disposable household income would catch them soon.
    • Robert J. Shiller attributes this phenomenon of creating a possible bubble to irrational exuberance.
    • When bubbles burst, they cause a kind of financial earthquake, in turn destabilising public trust in the integrity of the financial system.
    • Critically, as the past portrays, individual investors, with all their vulnerabilities, suffer the most devastating consequences.
    • Retail investors are as well susceptible to overreaction when negative news hits the market.

    Consider the question “What are the factors driving the financial markets up despite the weak macroeconomic foundations? What are the risks involved in such situation for the individual investors?”

    Conlcusion

    History of financial markets is replete with bubbles and bursts. Most affected in such burst are the individual investors. Informed decisions based on information and risks involved should form the basis of investment by individual investors.

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  • Rule of Law vs Rule by Law

    op-ed snap | Polity | Mains Paper 2: Executive & Judiciary

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: What is rule of law?

    Mains level: Paper 2- Rule of law and role of judiciary

    What makes the Rule of Law different from the Rule by Law? It is the idea of justice and equity that separates the two. The article explains the principles that emerge as the basis of the Rule of law and the role of the judiciary in ensuring their constitutionality.

    Understanding law

    • Law, in its most general sense, is a tool of social control that is backed by the sovereign.
    • However, such a definition of law can be used not only to render justice, it can also be used to justify oppression.
    • Therefore it is argued that a law cannot really be classified as a “law” unless it imbibes within itself the ideals of justice and equity.
    • So, any law backed by a sovereign must be tempered by certain ideals or tenets of justice.
    • Only a state that is governed by such law, can be said to have the Rule of Law.
    • The British colonial power used the law as a tool of political repression, enforcing it unequally on the parties, with a different set of rules for the British and for the Indians.
    •  It was an enterprise famous for “Rule by Law”, rather than “Rule of Law.

    Four principles of rule of law

    • Clarity and accessibility: Laws must be clear and accessible, the people at least ought to know what the laws are.
    • Another implication of this principle is that they should be worded in simple, unambiguous language.
    • Equality: An important aspect of equality before law is having equal access to justice.
    • This guarantee of equal justice will be rendered meaningless if the vulnerable sections are unable to enjoy their rights because of their poverty or illiteracy or any other kind of weakness.
    • Another aspect is the issue of “gender equality”.
    • Participation of people: The third principle, the “right to participate in the creation and refinement of laws”.
    • The very essence of a democracy is that its citizenry has a role to play, directly or indirectly, in the laws that govern them.
    • In India, it is done through elections.
    • The idea that people are the ultimate sovereign is also to be found in notions of human dignity and autonomy
    • Strong independent judiciary: The fourth principle stemsp from the idea that the judiciary is the “guardian” of the Constitution.
    • The judiciary is the primary organ which is tasked with ensuring that the laws that are enacted are in line with the Constitution.

    Independent judiciary and role of media

    • The judiciary cannot be controlled, directly or indirectly, by the legislature or the executive, or else the Rule of Law would become illusory.
    • At the same time, judges should not be swayed by the emotional pitch of public opinion either, which is getting amplified through social media platforms.
    • Judges have to be mindful of the fact that the noise thus amplified is not necessarily reflective of what is right and what the majority believes in.
    • Therefore, media trials cannot be a guiding factor in deciding cases.
    • It is, therefore, extremely vital to function independently and withstand all external aids and pressures.
    • While there is a lot of discussion about the pressure from the executive, it is also imperative to start a discourse as to how social media trends can affect the institutions.

    Conclusion

    The importance of the judiciary shouldn’t blind us to the fact that the responsibility of safeguarding constitutionalism lies not just with the courts. All the three organs of the state, i.e., the executive, legislature and the judiciary, are equal repositories of constitutional trust.

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  • Telecom and Postal Sector – Spectrum Allocation, Call Drops, Predatory Pricing, etc

    Can India avoid a telecom duopoly?

    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 2- Threat of duopoly in telecom sector

    The Indian telecom sector faces the prospect of duopoly due to the impending exit of Vodafone-Idea. This has several implications.

    India’s telecom sector: From monopoly to hyper-competition

    • India’s telecom market has seen monopoly as well as hyper-competition.
    • Twenty-five years ago, the government alone could provide services.
    • Ten years later, there were nearly a dozen competing operators. Most service areas now have four players.
    • However, the possible exit of the financially-stressed Vodafone Idea would leave only two dominant players-Airtel and Jio in the telecom sector.
    • A looming duopoly, or the exit of a global telecommunications major, are both worrying.
    • They deserve a careful and creative response.

    Why it matters

    • Competition has delivered relatively low prices, advanced technologies, and an acceptable quality of services.
    • There is a long way to go in expanding access as well as network capacity.
    • For example, India is ranked second globally—after China—in the number of people connected to the internet.
    • However, it is also first in the number of people unconnected.
    • Over 50% of Indians are not connected to the internet, despite giant strides in network reach and capacity. India tops aggregate mobile data usage.
    • However, its per capita or device data usage is low.
    • It has an impressive 4G mobile network, however, its fixed network—wireline or optical fibre—is sparse and often poor.
    • 5G deployment has yet to start and will be expensive.
    • Filling the gaps in infrastructure and access will require large investments and competition.
    • The exit of the Vodafone-Idea will hurt both objectives.
    • The closure of Vodafone Idea is an arguably greater concern than the fading role of BSNL and MTNL.
    • The government companies are yet to deploy 4G and have become progressively less competitive.
    • Vodafone Idea, on the other hand, still accounts for about a quarter of subscriptions and revenues and can boast of a quality network.

    Way out

    1) Strategic partnership with BSNL-MTNL

    • A possible way out could be to combine the resources of the MTNL and BSNL and Vodafone Idea through a strategic partnership.
    • Creative government action can save Vodafone Idea as well as improve the competitiveness of BSNL and MTNL.
    • It could help secure government dues, investments, and jobs.

    2) Develop resale market

    • Global experience suggests that well-entrenched incumbents have massive advantages.
    • New players are daunted by the large investments.
    • However, regulators and policymakers have other options to expand choice for telecom consumers.
    • Their counterparts in mature regulatory regimes—e.g., in the European Union—have helped develop extensive markets for resale. 
    • Recognising the limited influence of smaller players, regulators mandate that the incumbent offer wholesale prices to resellers who then expand choice for end-users.
    • A key barrier to resale is India’s licence fee regime which requires licence-holders to share a proportion of their revenues with the government.

    Conclusion

    It would be tragic if India’s telecom-access market was to be reduced to only two competing operators, as we have a long way to go. The government needs to consider the implications of the situation arising due to the exit of one of the major players in the sector.

    Source:

    https://www.financialexpress.com/opinion/failing-to-connect-can-india-avoid-a-telecom-duopoly/2281486/

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  • Police Reforms – SC directives, NPC, other committees reports

    How police can serve citizens better

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: CCTNS

    Mains level: Paper 2- Technology driven service delivery mechanism by

    The article highlights the necessity of adopting the technology driven service delivery mechanism by the police.

    SC mandated police reforms of 2006

    Cost of inefficient criminal justice system

    • There is a reluctance to implement the Supreme Court-mandated police reforms of 2006.
    • The economic cost of the failed criminal justice system is reflected in the reluctance of foreign companies to set up manufacturing and commercial ventures in India for want of quick settlement of criminal, labour and civil disputes.
    • The social implications can be gauged from the report, “Crime in India 2019”, published by the National Crime Records Bureau.
    • Investigation and prosecution need improvement and all criminal trials must be completed within a year.
    • Technology-driven service delivery mechanisms can help achieve this.

    Need to ensure time-bound delivery of services

    • Along with prevention and detection of crime and maintenance of law and order, police stations in India undertake numerous daily tasks.
    • These tasks include providing verifications and no objection certificates of different kinds to citizens.
    • In criminal and non-cognisable cases, police stations provide copies of FIRs, complaints and final reports.
    • Police stations also verify domestic help/employees of central and state governments/public sector undertakings/students going abroad for studies.
    • The Bureau of Police Research & Development (BPR&D) had identified 45 such tasks in 2017.
    • Ease of business means police stations dispose of these requests in a transparent and time-bound manner.
    • The procedures are non-transparent and timelines are often blurred which encourage corrupt practice.
    • Even as police reforms are pursued by the Supreme Court, a definite attempt can be made to ensure time-bound delivery of the above-mentioned services to citizens.

    Use of technology for service delivery

    • These e-portals of various state police seek to provide citizen-centric services such as requests for issue/renewal of various NOCs, verification requests for servants, employment, passport, senior citizen registrations etc.
    • The India Justice Report (IJR) 2020 supported by Tata Trusts has studied the e-portals of various state police organisations.
    • The report mentions that “despite the push for digitisation, no state offered the complete bouquet of services…
    • The report also mentions that users face numerous problems of accessibility to these services.
    • The IJR 2020 audit confirms that states need to invest more resources to upgrade their e-portals for providing the 45 identified basic services to the citizens

    Way forward

    • This highlights that technology for service delivery to citizens has not been prioritised by the police leadership.
    • . This is a task that police leadership can concentrate on without any political interference.
    • The Bureau of Police Research had worked out the timeline for each service and the hierarchy/levels involved.
    • The recommendations have been shared with the state police organisations.
    • Adhering to a defined process with a timeline and clear delineation of the levels of police officers involved can ensure transparent and non-corrupt service delivery.
    • It will reduce the number of fruitless visits a citizen makes to a police station chasing different officers.
    • Along with ease of use, the language of e-portals needs attention too.
    • Citizens seeking clearances may not be very educated.
    • The Ministry of Home Affairs (MHA) earmarked about Rs 20,000 crore for the modernisation of police (2017-2020), for schemes such as crime and criminal tracing networks and system (CCTNS), police wireless and e-prisons.
    • States can take up this crucial service delivery mechanism.

    Conclusion

    Life for Indians would be transformed if government departments, including the police, provide maximum information and services through their portals respecting the defined processes and timelines

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  • Higher Education – RUSA, NIRF, HEFA, etc.

    Ed-tech in India

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: ShaGun platform

    Mains level: Paper 2- Technology based learning in India

    The article suggests a policy formulation for future of the learning with the adoption of technology.

    Learning crisis facing and finding solutions through technology

    • India was facing a learning crisis, even before the Covid-19 pandemic, with one in two children lacking basic reading proficiency at the age of 10.
    • The pandemic worsened it with the physical closure of 15.5 lakh schools that has affected more than 248 million students for over a year.
    • With the Fourth Industrial Revolution — the imperative now is to reimagine education and align it with the unprecedented technological transformation.
    • The pandemic offers a critical, yet stark reminder of the impending need to weave technology into education.

    Is India prepared for integrating technology in learning?

    • India’s new National Education Policy (NEP) 2020envisions the establishment of an autonomous body, the National Education Technology Forum (NETF).
    • The NETF will spearhead efforts towards providing a strategic thrust to the deployment and use of technology.
    • India is well-poised to take this leap forward with increasing access to tech-based infrastructure, electricity, and affordable internet connectivity.
    • Flagship programmes such as Digital India and the Ministry of Education’s initiatives, including the Digital Infrastructure for School Education (DIKSHA), open-source learning platform and UDISE+  will help in this direction.
    • However, we must remember that technology cannot substitute schools or replace teachers.
    • It’s not “teachers versus technology”; the solution is in “teachers and technology”.
    • In fact, tech solutions are impactful only when embraced and effectively leveraged by teachers.

    Four key elements for ed-tech policy architecture

    • A comprehensive ed-tech policy architecture must focus on four key elements:
    • Access: Providing access to learning, especially to disadvantaged groups.
    • Enable: Enabling processes of teaching, learning, and evaluation.
    • Teacher training: Facilitating teacher training and continuous professional development.
    • Governance: Improving governance systems including planning, management, and monitoring processes.

    Ed-tech ecosystem in India

    • With over 4,500 start-ups and a current valuation of around $700 million, the ed-tech market is geared for exponential growth.
    • There are, in fact, several examples of grassroots innovation.
    • The Hamara Vidhyalaya in Namsai district, Arunachal Pradesh, is fostering tech-based performance assessments.
    • Assam’s online career guidance portal is strengthening school-to-work and higher-education transition for students in grades 9 to 12.
    • Samarth in Gujarat is facilitating the online professional development of lakhs of teachers in collaboration with IIM-Ahmedabad.
    • Jharkhand’s DigiSATH is spearheading behaviour change by establishing stronger parent-teacher-student linkages.
    • Himachal Pradesh’s HarGhar Pathshala is providing digital education for children with special needs.

    Way forward

    1) Short term policy formulation

    • In the immediate term, there must be a mechanism to thoroughly map the ed-tech landscape, especially their scale, reach, and impact.
    • The policy formulation and planning process must strive to:
    • 1) Enable convergence across schemes– education, skills, digital governance, and finance.
    • 2) Foster integration of solutions through public-private partnerships, factor in voices of all stakeholders.
    • 3) Bolster cooperative federalism across all levels of government.
    • Special attention must be paid to address the digital divide at two levels: access and skills.
    • Thematic areas of the policy should feature infrastructure and connectivity; high-quality software and content; and global standards for outcome-based evaluation, real-time assessments, and systems monitoring.

    2) Long-term policy measures

    • In the longer term, as policy translates to practice at local levels a repository of the best-in-class technology solutions, good practices and lessons from successful implementation must be curated.
    • The NITI Aayog’s India Knowledge Hub and the Ministry of Education’s DIKSHA and ShaGun platforms can facilitate and amplify such learning.

    Conclusion

    With NEP 2020 having set the ball rolling, a transformative ed-tech policy architecture is the need of the hour to effectively maximise student learning.

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  • Important Judgements In News

    Taking note of the Delhi High Court’s judgment on ‘defining terrorism’

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: UAPA

    Mains level: Paper 2- Misuse of anti-terror laws

    The recent Delhi High Court order granting bail to the student activists charged with the UAPA has brought into focus the issue of misuse of anti-terror laws by the policy. The article deals with this issue.

    Misuse of anti-terror laws

    • In the period 2015-2019, as many as 7,840 persons were arrested under the UAPA (Unlawful Activities (Prevention) Act) 1967 but only 155 were convicted by the trial courts.
    • Under TADA, till 1994, though 67,000 people were detained, just 725 were convicted in spite of confessions made to police officers being made admissible.
    • In Kartar Singh (1994), the Supreme Court of India had observed that in many cases, the prosecution had unjustifiably invoked provisions of TADA.
    • It added that such an invocation of TADA was ‘nothing but the sheer misuse and abuse of the Act by the police’.

     The definition of terrorism

    • There is no universal definition of the term ‘terrorism’ either in India or at the international level.
    •  Accordingly, neither TADA nor UAPA has a definition of the crucial terms ‘terror’ and ‘terrorism’.
    • Section 15 of UAPA merely defines a terrorist act in extremely wide and vague words: ‘as any act with intent to threaten or likely to threaten the unity, integrity, security, or sovereignty of India or with intent to strike terror or likely to strike terror in the people….’.
    • In Yaqoob Abdul Razzak Memon (2013), the Supreme Court said that terrorist acts can range from threats to actual assassinations, kidnappings, airline hijacking, car bombs, explosions, mailing of dangerous materials, use of chemical, biological, nuclear weapons etc.
    • In Hitendra Vishnu Thakur (1994), the Supreme Court had defined terrorism as the ‘use of violence when its most important result is not merely the physical and mental damage of the victim but the prolonged psychological effect it produces … on the society as a whole’.
    • In Kartar Singh (1994), the Supreme Court held that a mere disturbance of public order that disturbs even the tempo of the life of community of any particular locality is not a terrorist act.
    • By this interpretation, the CAA protests in a few localities of Delhi cannot be termed as terrorist activity.
    • In the PUCL judgment (2003), the Supreme Court included within its meaning amongst other things the ‘razing of constitutional principles that we hold dear’, ‘tearing apart of the secular fabric’ and ‘promotion of prejudice and bigotry.
    • Accordingly, in the CAA protest case the Delhi High Court concluded that since the definition of a ‘terrorist act’ in UAPA is wide and somewhat vague, it cannot be casually applied to ordinary conventional crimes.
    • The Delhi High Court said that the act of the accused must reflect the essential character of terrorism.

    Distinction between ‘law and order’, ‘public order’ and ‘security of state’

    • In Ram Manohar Lohia (1966), the Supreme Court explained the distinction between the above three terms.
    • Law and order represents the largest circle within which is the next circle representing ‘public order’, and the smallest circle represents the ‘security of state’.
    • Accordingly, an act may affect ‘law and order’ but not ‘public order’.
    • Similarly, an act may adversely affect ‘public order’ but not the ‘security of state.’
    • In most UAPA cases, the police have failed to understand these distinctions and unnecessarily clamped UAPA charges for simple violations of law and order.

    Conclusion

    Radicalisation generally succeeds only with those who have been subjected to real or perceived injustices. Let us remove injustice to combat terrorism. The creation of a truly just, egalitarian and non-oppressive society would be far more effective in combating terrorism.

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  • Freedom of Speech – Defamation, Sedition, etc.

    Testing the constitutionality of section 124A of IPC

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 2- Testing the constitutionality of section 124A

    The article highlights the issues with section 124A of the Indian Penal Code and suggests a review of its constitutionality in Kedar Nath judgement by a larger bench.

    About section 124A of IPC

    • Section 124A of the IPC contains the law of sedition.
    • This law was enacted by the British colonial government in 1870 with the sole object of suppressing all voices of Indians critical of the government.
    • The gist of the offence is: bringing or attempting to bring the government into contempt or hatred, or exciting or attempting to excite disaffection towards the government.
    • It categorises four ways sources of seditious acts: spoken words, written words, signs or visible representations.
    • There are three explanations attached to this section.
    • The first explanation says that ‘disaffection’ includes disloyalty and all feelings of enmity.
    • The second and third explanations say that one can comment on the measures of the government without bringing or attempting to bring it into contempt or hatred or exciting or attempting to excite disaffection towards the government.

    What did Supreme Court say in Kedar Nath case (1962)

    • In the ultimate analysis, the judgment in Kedar Nath which read down Section 124A and held that without incitement to violence or rebellion there is no sedition.
    •  It says that ‘only when the words written or spoken etc. which have the pernicious tendency or intention of creating public disorder’ the law steps in.
    • So if a policeman thinks that a cartoon has the pernicious tendency to create public disorder, he will arrest that cartoonist.
    • The Kedar Nath judgment makes it possible for the law enforcement machinery to easily take away the fundamental right of citizens.

    Violation of Article 19

    • Sedition, as defined in Section 124A of the IPC, clearly violates Article 19(1)(a) of the Constitution which confers the Fundamental Right of freedom of speech and expression.
    • Further, this section does not get protection under Article 19(2) on the ground of reasonable restriction.
    • However, the Supreme Court invoked the words ‘in the interest … of public order’ used in Article 19(2) and held that the offence of sedition arises when seditious utterances can lead to disorder or violence.
    • This act of reading down Section 124A brought it clearly under Article 19(2) and saved the law of sedition from being declared unconstitutional.

    Consider the question “What are the issues with section 124A of Indian Penal Code? Examine the interplay between Article 19 and section 124 of IPC.”

    Conclusion

    People will display disaffection towards a government which has failed them. The law of sedition which penalises them for hating a government which does not serve them cannot exist because it violates Article 19(1)(a) and is not protected by Article 19(2). Therefore, an urgent review of the Kedar Nath judgement by a larger Bench has become necessary.

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  • Disinvestment in India

    Privatisation of public sector enterprises in India

    op-ed snap | Economics | Mains Paper 3: Effects Of Liberalization On The Economy, Changes In Industrial Policy and their effects on Industrial Growth,Indian Economy

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 3- Privatisation of PSUs

    The article suggests the privatisation of public sector enterprises by analysing their performance and devising strategy for privatisation accordingingly.

    Three categories of public sector enterprises

    1) Sick for long time and beyond redemption

    • There is the category of enterprises which have been sick for a long time.
    • Their technology, plants and machinery are obsolete. 
    • They should be closed, and assets sold.
    • The labour in these enterprises have had a political constituency which has prevented closure.

    What should be done with these enterprises?

    • The Government should close these in a time-bound manner with a generous handshake for labour.
    • After selling machinery as scrap, there would be valuable land left.
    • Prudent disposal of these plots of lands in small amounts would yield large incomes in the coming years.
    • All this would need the creation of dedicated efficient capacity as the task is huge and challenging.
    • These enterprises may be taken away from their parent line Ministries and brought under one holding company.
    • This holding company should have the sole mandate of speedy liquidation and asset sale.

    2) Financially troubled but can be turned around

    • Private management through privatisation or induction of a strategic partner is the best way to restore value of these enterprises.
    • Air India and the India Tourism Development Corporation (ITDC) hotels are good examples.

    What should be done with these enterprises?

    • Air India should ideally be made debt free and a new management should have freedom permitted under the law in personnel management to get investor interest.
    • As valuation rises, the Government could reduce its stake further and get more money.
    • If well handled, significant revenues would flow to the Government.

    3) Profitable enterprises

    • Pragmatism instead of ideology should guide thinking about them.
    • The Chinese chose to nurture their good state-owned enterprises as well as their private ones to succeed in the domestic and global markets by increasing their competitiveness in cost, quality, and technology.
    • The Chinese chose to promote both their public as well as their private sector enterprises to rise.
    • Both have made China the economic superpower that it is today.

    What should be done with profitable enterprises?

    • The Government can continue to reduce its shareholding by offloading shares and even reducing its stake to less than 51% while remaining the promoter and being in control.
    • Calibrated divestment to get maximum value should be the goal instead of being target driven to get a lower fiscal deficit number to please rating agencies.
    • In parallel, managements may be given longer and stabler tenures, greater flexibility to achieve outcomes, and more confidence to take well-considered commercial risks.

    Challenges

    • First, the number of Indian private firms which can buy out public sector firms are very few.
    • Their limited financial and managerial resources would be better utilised in taking over the large number of private firms up for sale through the bankruptcy process.
    • Then, these successful large corporates need to be encouraged to invest and grow both in brownfield and greenfield modes in the domestic as well as international markets.
    • Sale at fair or lower than fair valuations to foreign entities, firms as well as funds, has adverse implications from the perspective of being ‘Atma Nirbhar’.
    • Again, greenfield foreign investment is what India needs and not takeovers.
    • Public sector enterprises provide for reservations in recruitment.
    • With privatisation, this would end and unnecessarily generate social unrest.

    Conclusion

    Would it be in India’s interest to lose the strategic capacity that its ownership of public enterprises including financial ones provide it? It would be better to think carefully now.

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  • Agricultural Sector and Marketing Reforms – eNAM, Model APMC Act, Eco Survey Reco, etc.

    Fighting hunger needs fighting climate change

    op-ed snap | Agriculture | Mains Paper 3: Agriculture and related issues,Conservation, Environmental Pollution & Degradation, Eia

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: SDGs

    Mains level: Paper 3- Climate change and its implications for hunger

    The article suggests pathways to achieve SDG-2 by the adoption of climate-friendly agriculture practices.

    Food and SDG

    • Food is a common thread linking all 17 UN Sustainable Development Goals (SDGs) and critical to achieving overall goals within the timeframe.
    • NITI Aayog recently released the SDG India Index 2020-21, highlighting the national and states’ progress on SDGs.
    • The report states that 34.7% children aged under five in India are stunted.
    • 40.5% of children between 6-59 months are anaemic.
    • 50.3% of pregnant women between 15-49 years are anaemic.
    • India shares a quarter of the global hunger burden.
    • Four out of 10 children in India are not meeting their full human potential because of chronic undernutrition or stunting.
    • NFHS-5 shows many states have not fared well on nutrition indicators.
    • In addition to the malnutrition challenges, India’s food system faces negative consequences of the Green Revolution technologies.

    Pathways to follow in meeting the targets under SDG-2 (Zero Hunger)

    • Crop diversification especially in those areas where the existing practices are ecologically unsustainable should be promoted.
    • While Indian agriculture is a significant contributor to GHG emissions.
    • As per third Biennial Update Report submitted by Government of India to UNFCCC, agriculture sector contributes 14% of the total emissions.
    • Some of the climate-smart interventions like conservation agriculture, organic farming and agro-ecological approaches can effectively address the environmental concerns while ensuring food security and nutrition.
    • Crop-residue burning has become a huge problem in parts of the country.
    • This is mainly propelled by monoculture and a package of subsidies.
    • Conservation agriculture offers solutions to such problems with good agronomy and soil management such as zero-tillage or no-till farming, crop rotation, in-situ crop harvest residue management/mulching, etc, and industrial uses like baling and bio-fuel production.
    • Use of botanical pesticides, green-manuring, biological pest control, etc. are nature-friendly and such practices lead to eco-conservation.
    • The organic movement, fortunately, is catching up in Sikkim, Himachal Pradesh, and a few other states.
    • Modifying consumer behaviour forms an essential ingredient to transform Indian food systems and correlate positively with crop and diet diversity.
    • POSHAN Abhiyaan, India’s national nutrition mission, can play an effective role in addressing the issues of persistent malnutrition.
    • According to FAO estimates, 40% of the food produced in India is either lost or wasted in every stage of supply chain.
    • Winning the fight against food loss and waste can save India $61 billion in 2050 through increased industry profitability and reduced food insecurity, as well as reduced GHG emissions, water usage, and environmental degradation.
    • Shifting towards a circular economy can enable India progress towards the SDGs including halving food waste by 2030 and improving resource efficiency.

    Conclusion

    India’s success is essential to achieve the planetary goal of Zero Hunger. There is a need for transformation towards sustainable, nutritious and resilient food systems to achieve the goal of zero hunger.

    Source:-

    https://www.financialexpress.com/opinion/fighting-hunger-needs-fighting-climate-change/2279369/

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  • Foreign Policy Watch: India-Africa

    India-Africa relations

    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: India-Africa Forum Summit

    Mains level: Paper 2- India's policy for African countries

    The article deals with India’s strategy to deepen the ties with African nations and suggest a critical review of the implementation of India’s strategy.

    Need for review of India’s foreign policy for Africa

    • Africa is considered a foreign policy priority by India.
    •  Even as the COVID-19 era began in March 2020, New Delhi took new initiatives to assist Africa through prompt despatch of medicines and later vaccines.
    • But now the policy implementation needs a critical review.

    Four factors that explain need for a review of policy implementation

    1) Declining trade

    • Declining trade: Bilateral trade valued at $55.9 billion in 2020-21, fell by $10.8 billion compared to 2019-20, and $15.5 billion compared to the peak year of 2014-15.
    • Decline in investment: India’s investments in Africa too saw a decrease from $3.2 billion in 2019-20 to $2.9 billion in 2020-21.
    • The composition of the India-Africa trade has not changed much over the two decades.
    • Mineral fuels and oils, (essentially crude oil) and pearls, precious or semi-precious stones are the top two imports accounting for over 77% of our imports from Africa.
    • India’s top five markets today are South Africa, Nigeria, Egypt, Kenya and Togo.
    • The countries from which India imports the most are South Africa, Nigeria, Egypt, Angola and Guinea.

    2) Covid impact

    • COVID-19 has brought misery to Africa.
    • As on June 24, 2021, Africa registered 5.2 million infections and 1,37,855 deaths.
    • A recent World Health Organization survey revealed that 41 African countries had fewer than 2,000 working ventilators among them.
    • Despite these shortcomings, Africa has not done so badly.
    •  Sadly though, with much of the world caught up in coping with the novel coronavirus pandemic’s ill effects, flows of assistance and investment to Africa have decreased.
    • While China has successfully used the pandemic to expand its footprint by increasing the outflow of its vaccines.
    • Unfortunately India’s ‘vax diplomacy’ has suffered a setback. 

    3) Global competition for influence

    • Africa experienced a sharpened international competition, known as ‘the third scramble’, in the first two decades of the 21st century.
    • A dozen nations from the Americas, Europe and Asia have striven to assist Africa in resolving the continent’s political and social challenge.
    • These nations, in turn, stand to benefit from Africa’s markets, minerals, hydrocarbons and oceanic resources, and thereby to expand their geopolitical influence.

    4) Geopolitical tensions in Asia

    • Geopolitical tensions in Asia and the imperative to consolidate its position in the Indo-Pacific region have compelled New Delhi to concentrate on its ties with the United Kingdom, the EU, and the Quad powers, particularly the U.S.
    • Consequently, the attention normally paid to Africa lost out.
    • This must now change.

    Way forward for India-Africa relation

    • For mutual benefit, Africa and India should remain optimally engaged.
    • The third India-Africa Forum Summit was held in 2015.
    • The fourth summit, pending since last year, should be held as soon as possible, even if in a virtual format.
    • Fresh financial resources for grants and concessional loans to Africa must be allocated, as previous allocations stand almost fully exhausted.
    • The promotion of economic relations demands a higher priority.
    • Industry representatives should be consulted about their grievances and challenges in the COVID-19 era.
    • To impart a 21st-century complexion to the partnership, developing and deepening collaborations in health, space and digital technologies is essential.
    • India should continue its role in peacekeeping in Africa, in lending support to African counter-terrorism operations, and contributing to African institutions through training and capacity-enhancing assistance.
    • To overcome the China challenge in Africa, increased cooperation between India and its international allies, rates priority.
    • The recent India-EU Summit has identified Africa as a region where a partnership-based approach will be followed.
    •  When the first in-person summit of the Quad powers is held in Washington, a robust partnership plan for Africa should be announced. 

    Conclusion

    India should review the policy implementation and make changes in line with the changing geopolitical realities.

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