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Type: op-ed snap

  • Government Budgets

    Budget is constructive, but lack of income support continues

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Budget

    Mains level: Paper 3- Lack of income support in the Budget

    The article takes broad overview of the Budget and highlight the recovery led by the goverment spending.

    Faster and sharper recovery

    • The economy has been recovering sharply and faster in the last two quarters than suggested by official growth numbers.
    • Official growth number remain based on antiquated year-on-year comparisons.
    • Comparisons from a year ago have a serious problem in that they depend on what happened four quarters earlier and tell us very little about growth momentum.
    • J.P. Morgan estimates suggest that, on a quarterly basis, India’s GDP plunged 25 per cent in the second quarter of 2020 and grew 21.5 per cent in the third quarter of the same fiscal year.
    •  This is a narrative markedly different from that portrayed by the official numbers.

    What is the basis of optimis

    • The economy is likely to have grown another 10.5 per cent in the fourth and is expected to deliver a growth rate of negative 6.5 per cent for the full fiscal year and then rise by 13.5 per cent in FY 2022.
    • The basis of this optimism is two-fold.
    • First, by accident or design, India has managed to break the link between infection and mobility.
    • The second is the recent shift in the government’s fiscal stance.
    • After delaying for nearly six months, the government began to speed up spending in September.

    Government spending to boost economy

    • With the economy recovering and the equity market surging, taxes and privatisation would reasonably be expected to rise.
    • The revenue increase could be used to reduce the deficit while keeping spending broadly at its current share of the Gross Domestic Product (GDP).
    • This would allow spending to grow 17-18 per cent, in line with the nominal GDP.
    • The choice really boiled down to where to spend.

    Higher fiscal deficit

    • For this year, the Budget pegged the deficit at 9.5 per cent of GDP, much higher than market estimates of around 7 per cent and a 5 per cent-point rise over the previous year.
    • Instead of funding food procurement through off-balance-sheet borrowing by the Food Corporation of India (FCI), as has been the case in the last few years, this year’s Budget has rightly brought some of that spending back on its accounts.
    • Excluding subsidies and interest payments, the increase in the deficit is just 2 percentage points of GDP.

    Continues lack of income support

    • In the details, while there is a welcome emphasis on public health, infrastructure projects, and on privatisation, the glaring omission is the continued lack of income support.
    • This lack of income support is important.
    • Underlying the strong headline recovery in growth, imbalances in the economy have widened significantly.
    • The scarring in the labour market is extensive and the likely damage to household and SME balance sheets substantial.
    • While a debt moratorium and other regulatory forbearance have concealed the extent of the damage, these measures simply postpone the eventual reckoning.
    • A key risk is that not only is medium-term growth impaired because of the scarring, but also that banks turn risk-averse and do not extend credit exactly when the recovery is expected to gather strength once mobility fully normalises.

    Consider the question “While the Budget for 2021-21 rightly health, infrastructure and privatisation, the lack of income support could threaten the prospects of recovery. Comment.”

    Conclusion

    While the Budget is constructive and has helped to allay fears of excessive fiscal tightening, it did not go far enough to mitigate the tail risk that the current economic recovery does not turn into a “dead cat bounce”.

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  • Finance Commission – Issues related to devolution of resources

    Municipal finance reform through Finance Commission recommendations

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Finance Commission

    Mains level: Paper 2- Transformation of financial governance of municipalities

    Transforming the financial governance of India’s municipalities

    • Interim report of the Fifteenth Finance Commission of India (XV FC) indicates that it could fundamentally transform the financial governance of India’s municipalities.
    • Final report for FY 2021-22 to FY 2025-26 is expected to be tabled along with the forthcoming Budget 2021-22.
    • Building on the track record of previous finance commissions, the XV FC Commission has significantly raised the bar on financial governance of India’s municipalities in the interim report in at least four specific ways.

    4 Provisions in the interim report

    1) Increase in the outlay for municipalities

    •  It has set aside Rs 29,000 crore for FY 2020-21 and indicated the intent to raise the share of municipalities in the total grants’ of local bodies including panchayats gradually over the medium term, from the existing 30 per cent to 40 per cent.
    • This could result in the outlay over five years being in the range of Rs 1,50,000-Rs 2,00,000 crore compared to Rs 87,000 crore during the XIV FC period.

    2) Ensuring financial accountability through conditions

    • Two very important entry conditions have been set for any municipality in India to receive FC grants:
    • 1) Publication of audited annual accounts.
    • 2) Notification of floor rates for property tax.
    • These two entry conditions lay strong foundations for financial accountability of municipalities and own revenue enhancement respectively.
    • Similarly, the Atmanirbhar Bharat Abhiyan links Rs 50,000 crore of additional borrowing limits for states to reforms in property taxes and user charges for water and sanitation.
    • There is also a thrust on municipal bonds and municipal finance reform conditions under AMRUT.

    3) Distinguishing between million-plus urban agglomerations, and other cities

    • The XV FC has adopted an approach of distinguishing between million-plus urban agglomerations, and other cities.
    • This is well-founded, based on the pattern of urbanisation in India, where 53 million-plus urban agglomerations comprising 250-plus municipalities account for approximately 44 per cent of the total urban population.
    • The remaining 4,250-plus municipalities comprise 56 per cent of the total urban population.
    • Of the remaining 56 per cent, there is a “long tail” of approximately 3,900 municipalities with 33 per cent of the total urban population.
    • The XV FC has now provided for 100 per cent outcome-based funding of approximately Rs 9,000 crore to 50 million-plus urban agglomerations (excluding Union Territories) with specific emphasis on air quality, water supply and sanitation and basic grants to the rest of the cities, with 50 per cent of the end-use tied to water supply and sanitation.
    • For the first time, there is also an acknowledgement of the metropolitan area as a unified theatre of action to solve complex challenges of air quality, water and sanitation, with implicit emphasis on inter-agency coordination.

    4) Common digital platform for municipal accounts

    • The report recommends a common digital platform for municipal accounts, a consolidated view of municipal finances and sectoral outlays at the state level, and digital footprint of individual transactions at source, the FC has broken new ground and demonstrated farsightedness.

    Role of the state governments

    • The ultimate responsibility for municipal finance reforms remains with state governments.
    • Constitutional bodies such as the finance commission can, at best, prepare the ground and provide incentives and disincentives.
    • We need municipal legislation to reflect progressive and enabling financial governance of our cities through five reform agendas:
    • 1) Fiscal decentralisation including strengthening state finance commissions.
    • 2) Revenue optimisation to enhance own revenues.
    • 3) Fiscal responsibility and budget management to accelerate municipal borrowings.
    • 4) Institutional capacities towards an adequately skilled workforce.
    • 5) Transparency and citizen participation (for democratic accountability at the neighbourhood level).
    • The first step needs to be predictable fiscal transfers from state governments to municipalities and other civic agencies on a formula-based approach as against the present practice of ad hoc, discretionary grants.
    • State finance commissions would need to emulate the XV FC and its predecessors, and emerge as credible institutions.
    • State governments need to ensure that state finance commissions are constituted on time, resourced right, and their recommendations taken seriously.

    Consider the questions “Financial governance of our cities faces several challenges. Discuss the reforms that could transform the financial governance of municipalities”

    Conclusion

    The state government must act on these reform agenda and ensure the transformation of financial governance of their municipalities.

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  • How PFMS is ensuring transformation via digital inclusion

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: PFMS

    Mains level: Paper 2- Role of PFMS in improving governance

    The article highlights the role played by the Public Financial Management System (PFMS) in promoting the good governance.

    About PFMS

    • With the objective of bringing in transformational accountability and transparency and to further promote good governance, the Indian government envisioned Public Financial Management System (PFMS).
    • PFMS has evolved as an end to end solution for Processing, Monitoring, and reconciling financial flows of Central Govt.
    • Today, PFMS has empowered governance to become more responsive, accountable, and transparent.

    Mandate of PFMS

    • Through Cabinet decision, PFMS has been mandated the following:
    • It acts as a financial management platform for all plan schemes and allows for efficient and effective tracking of fund flow to the lowest level of implementation for the planning scheme of the Government.
    • It is mandated to provide information on fund utilization leading to better monitoring, review, and decision support system to enhance public accountability in the implementation of plan schemes.
    • To result in effectiveness and economy in Public Finance Management through better cash management for Government transparency in public expenditure and real-time information on resource availability and utilization across schemes.

    Achievements of PFMS

    • PFMS can be credited to the transformation of Direct beneficiary transfers space in financial governance in India.
    • An estimated 102 crore DBT transactions were done through PFMS in FY 19-20 amounting to about ₹2.67 lakh crore.
    • Through efficient use of technology, PFMS is estimated to have saved about ₹1 lakh crore in direct beneficiary transfers.

    4 Factors that could determine the successful evolution of PFMS in future

    • Agility in terms of Onboarding/Integrating all Govt. accounts: Only after ensuring significant coverage, the true execution of the concept will take place.
    • Effective data management capabilities: PFMS will have to add significant data management capabilities in order to ensure better monitoring/review to deliver on the idea of a decision support system for effective cash management or management of idle float in the system.
    • Constantly upgrading: Adaption to rapid changes in technology is another key area that would call for a considerable amount of focus both in terms of gradation and monitoring.
    • Collaboration with the banking system: Lastly, one of the most critical factors for the successful execution of PFMS is its integration with the banking systems.
    • The Banks and PFMS will have to actively partner to ensure faster coverage/integration of all the Govt. entities.

    Consider the question “Governance in India has long been marred with structural challenges like transparency, lack of accountability and sustainable and inclusive growth. In light of this, discuss the role played by the Public Financial Management System in tackling these challenges.” 

    Conclusion

    The PFMS has revolutionized the ways public finances are managed in the country. With constant improvement and increasing coverage, the scope of PFMS is ever-increasing. Going ahead, PFMS will not only be seen as a tool for managing planned expenditure but will also add new meanings to Direct Beneficiary transfers, data-driven cash management, and e-Governance in India.

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  • Government Budgets

    An overview of Economic Survey 2020-21

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Terms used in Economic Survey

    Mains level: Paper 3- Overview of the Economic Survey 2020-21

    The pandemic has been leaving its imprint various aspects of our lives and Economic Survey is no different. This year’s Economic Survey focuses on the recovery path of the economy disrupted by the pandemic. The article takes an overview of the survey and also mentions the missing areas.

    Focus on a recovery path

    • The Economic Survey analyses the broad trends at the macro level and the profiling of the initiatives across various economic activities.
    • This year, the Economic Survey focuses on the recovery path after initial derailment and the losses suffered by the Indian economy due to the pandemic.
    • The recovery is expected to follow a V-shaped path.
    • The Survey advocates countercyclical fiscal policies based on the premise that growth leads to debt sustainability.
    • The Survey brings together various relevant factors that have both a short and long-term impact on the economy and the budget.
    • This year’s Survey focuses on enhanced public healthcare spending and demonstrates how effective it has been in slashing out-of-pocket expenditures in the recent past.
    • It also shows the brilliant performance under the Pradhan Mantri Jan Arogya Yojana (PM-JAY) and the improved outcomes in states that have implemented the programme.
    • With focus on basic needs, the Survey has brought back national attention on the fundamental developmental paradigm.
    • The idea of analysing inequalities in times of recovery is a reassuring premise to move on with.

    Comparison with past Economic Surveys

    • If we consider the last two Economic Surveys, the introduction of new concepts and approaches has been quite evident.
    •  In the Survey for 2018-19, the idea of “nudge” helped provide recognition of the importance of social behaviour change for any policy to succeed.
    • This led to the adoption of transformative approach in the Swachh Bharat Mission and Beti Bachao Beti Padhao initiative that integrated behavioural insights.
    • Another powerful idea has been using technology to run and monitor welfare schemes.
    • The Economic Survey 2019-20 talked overwhelmingly about the importance of wealth creation, entrepreneurship, and financial markets in the economic development.

    What the Survey misses

    • The Survey should have focussed on a new narrative for trade.
    • Apart from explaining the missing value chains and integration with South and Southeast Asia, the survey should have analysed the high cost of tariffs when 38 per cent of our exports are import-dependent.

    Consider the question “In the wake of economic disruption caused by the pandemic, India needs a new narrative for trade. However, India faces the challenge of missing value chains and lack of integration with South and Southeast Asia. In light of this, suggest the policies India should adopt as new narrative for trade.“

    Conclusion

    Besides trade, FDI inflows and the accumulation of foreign exchange reserves has been remarkable this year. It is expected that India will emerge as an important link in the global value chain sector which has been visibly disrupted by the pandemic

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  • Important Judgements In News

    POCSO Act

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: POCSO Act

    Mains level: Paper 2- Interpretation of Section 7 of POCSO Act

    In a recent judgement, Section 7 of POCSO Act was interpreted in a controversial way by the Nagpur Bench of the Bombay High Court. 

    Issue of the definition of sexual assault under POCSO Act

    • Recently, the Nagpur Bench of the Bombay High Court held that skin-to-skin contact is essential to constitute the offence defined under Section 7 of the Protection of Children from Sexual Offences Act, 2012 (POCSO Act).
    • Section 354 of the Indian Penal Code, 1860, which deals with outraging modesty of women and which provides for a lesser sentence, was held to be applicable in such cases.
    • This ruling raises several concerns.
    • The National Commission for Protection of Child Rights had asked the Maharashtra government to appeal this decision in the Supreme Court.
    • The Supreme Court has currently stayed the acquittal of the accused under this judgement.

    Concerns with the judgement

    • The Court held that the stringent nature of punishment provided for the offence required stricter proof and serious allegations.
    • The court said the punishment should be proportionate to the seriousness of the crime.
    • Nevertheless, while adjudging the seriousness of the offence the court has not given consideration to the fact that the victim, a minor, is entitled to greater protection.
    • The major concern is that the interpretation of the court seems to defeat the purpose of the POCSO Act.
    • Section 7 of POCSO defines sexual assault as “Whoever, with sexual intent touches the vagina, penis, anus or breast of the child or makes the child touch the vagina, penis, anus or breast of such person or any other person, or does any other act with sexual intent which involves physical contact without penetration is said to commit sexual assault.”
    •  The court has concluded that the touching of the breast without skin-to-skin contact is not similar to the abovementioned acts and, therefore, does not fall within this definition.
    • The court seems to have followed a rather pedantic approach to reach this conclusion.
    • The fact that the trauma of the child whose breasts were groped through a cloth could be of the same nature and severity as direct touching of the breast is not discussed.
    • And if the trauma is the same, the mere existence of cloth should not affect the applicability of the POCSO Act.

    Legislative history and object of POCSO Act

    POCSO Act

    • The POCSO Act was enacted with the specific intention of protecting children from sexual assault and sexual harassment.
    • It took into consideration the standards prescribed by the Convention on the Rights of the Child adopted by the General Assembly of the United Nations to which the Indian government acceded to on December 11, 1992.
    • The Act acknowledges the special vulnerability of children and that special protection, above and beyond that provided in the IPC, is required when the victim is a child.

    Conclusion

    If such an interpretation is followed, there is a threat that the POCSO Act in itself might become redundant as a wide range of sexually violative activities would be excluded from its ambit due to lack of skin-to-skin contact.

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  • Net Neutrality & The Debate Around It

    Global antitrust and the challenge of Big Tech

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Positive Externality

    Mains level: Paper 3- Challenge of Big Tech

    The article deals with the issue of checking the misuse of monopoly power by the Big Tech while encouraging their positive externalities.

    Worldwide Investigations against Big Tech

    • Big Tech firms, especially Facebook and Google have been investigated worldwide, including in the European Union and the United States, on the abuse of monopolistic power.
    •  Comparisons are drawn with investigations in the U.S. on the telecom industry and the break-up of the AT&T.
    • However, there are important differences this time around.
    •  First, the information good that is being provided by the Internet firms of today, is largely non-rival.
    • Second, Internet firms operate globally, therefore, it is often difficult to lay down international rules of obligation and fulfilment.
    • Third, while it is debatable whether the goods and services provided by the Internet firms are excludable.
    • It is this factor that was leveraged by the Internet firms to provide search, navigation, and social connectivity with no charge to the consumers, and, consequently, making these services non-excludable.

    Monetisation model of Big Techs and isseus with it

    • Public goods should be provided by governments, but the information goods as described above are being provided by private firms.
    • This arrangement poses several problems.
    • First, private firms need to have monetisation models to cover the costs of providing their services.
    • So,  the Internet firms have resorted to personalised advertisements and third-party sharing of the personal data of their users for monetisation purposes.
    • Second, the strong network effects present in these Internet platforms warrant increasing the subscriber base and garnering as much market share as possible.
    • This results in near-monopoly of some firms in their defined markets.
    • These firms may resort to anti-competitive behaviour including acquiring rivals to vertically integrate; erecting entry barriers by refusing to interconnect and inter-operate with competing firms, and leveraging their capital base, thereby engaging in predatory pricing, and driving out competitors.

    Positive externalities and consumer surplus

    • Network effects create a huge consumer surplus.
    • Even without our knowledge, these Internet firms have now become an indispensable part of our lives.
    • There are positive externalities as well, for example, Google Maps Application Program Interface (APIs) is being used by almost all logistic transand port companies.
    • Facebook APIs are used for advertisement by almost all firms across the industry.
    • Google, recently announced that its Search is being expanded to provide accurate and timely information on vaccine distribution to enable quick recovery from the COVID-19 pandemic.

    Challenge of regulation

    • The question before policymakers is how to regulate these Internet firms from abusing their monopoly power while encouraging the positive externalities and consumer surplus they create.
    • It is often very difficult to prove that the firms engage in the abuse of their monopoly power.
    • Due to strong network effects, it is not possible to ban or curtail these services.

    Way forward

    • A traditional view is to subsidise the good that creates positive externalities.
    • Governments can provide tax subsidy to these Internet firms in return for their orderly behaviour in the marketplace.
    • Governments could explore mandating sharing of Non-Personal Data (NPD) owned by these firms for societal and economic well-being as pointed out in the expert committee on NPD.
    • The other way to control any abusive behaviour of the Internet firms is to use the power of public voice.
    • The huge public outcry and subsequent government actions have delayed the recent changes to privacy policy relating to the sharing of personal information between WhatsApp and its parent firm, Facebook.

    Consider the question “Services provided by the Internet firms have become indispensable part of our life, this leads to the problem of checking their monopoly power while encouraging their positive externalities and consumer surplus. In light of this, discuss the challenges posed by the Big Techs and suggest the ways to deal with them.”

    Conclusion

    While governments and regulators deal with these dilemmas the Internet firms should adhere to core ethical principles in conducting their businesses as firms that aim at super monopoly profits and are greedy to become powerhouses of the world, often end up in the ditch.

    Back2Basics:What is positive externality

    • A positive externality exists if the production and consumption of a good or service benefits a third party not directly involved in the market transaction.
    •  For example, education directly benefits the individual and also provides benefits to society as a whole through the provision of more informed and productive citizens.

    What is Network Effect

    • The network effect is a phenomenon whereby increased numbers of people or participants improve the value of a good or service.
    • The Internet is an example of the network effect. Initially, there were few users on the Internet since it was of little value to anyone outside of the military and some research scientists.
    • However, as more users gained access to the Internet, they produced more content, information, and services.
    • The development and improvement of websites attracted more users to connect and do business with each other.
    • As the Internet experienced increases in traffic, it offered more value, leading to a network effect.

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  • Government Budgets

    Keep the wheels of economic recovery turning

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: New Monetary Framework

    Mains level: Paper 3- Economic recovery and challenges ahead

    Ahead of the Budget, the article discusses the status of Indian economy and suggests the measures to be adopted in the budget to speed up the recovery.

    Estimates of damages and signs of economic recovery

    • The first advance estimates of national income published on January 7 project a contraction of 7.7% for real GDP.
    • The Q2 GDP estimates published by the National Statistical Office had suggested an economic recovery in India.
    • An improvement in the rate of contraction from 23.9% in Q1 to 7.5% in Q2 was seen as the beginning of a sustained recovery.
    • The Ministry of Finance, in its Monthly Economic Review highlighted it as signifying a ‘V’ shaped recovery and as a reflection of the resilience and robustness of the Indian economy.
    • The Monetary Policy Statement of the Reserve Bank of India (RBI) released on December 4, 2020 also projects positive growth in the remaining quarters of the financial year.

    State of the economy before pandemic

    • Growth rate of the economy had collapsed from 8.2% in Q4 of 2017-18 to a mere 3.1% in Q4 of 2019-20, sliding continuously for eight quarters.
    • The policy stance against this backdrop was premised on the hope that private corporate investment will pick up momentum sooner than later.
    • The RBI did the heavy lifting through five consecutive lowering of repo rate along with liquidity infusion programmes.
    • However, monetary-fiscal linkages are crucial to catalyse the demand.

    Crucial role played by the RBI

    • While being cautious of inflation, the RBI has decided to continue the accommodative stance in its latest monetary policy to support growth.
    • The CPI inflation after crossing 7% has cooled off to 4.6% in December.
    • Still, the real interest rates remain very low.
    • The efficacy of the new monetary framework (NMF) — the agreement between the RBI and Government of India in February 2016 to adopt inflation targeting in India — will be reviewed in March 2021, and we flag the need for revising the framework.
    • The RBI is continuing its liquidity infusion programmes including the on-tap Targeted Long Term Repo Operations (TLTRO).
    • This programme announced on October 9, 2020 for five stressed sectors has been extended to 26 stressed sectors notified under the Emergency Credit Line Guarantee Scheme (ECLGS 2.0).
    • The RBI is also continuing its ‘operation twist’  with Open Market Operations (OMO) of ₹10,000 crore scheduled for December 17, 2020.
    • Nevertheless, the RBI Governor has rightly pointed out that the signs of recovery are far from being broad-based.

    Stimulus for targeted state intervention

    • According to the International Monetary Fund’s Fiscal Monitor Database of Country Fiscal Measures, the fiscal stimulus for India is 1.8% of GDP.
    • The IMF, in its Fiscal Monitor, highlights the need to scale up public investment to ensure successful reopening, boost growth and prepare economies for the future.
    • What we need is stimulus not based on “business cycle” but from the perspective of much needed targeted state interventions in public health, education, agriculture and physical infrastructure, and to redress widening inequalities.
    • As private final consumption expenditure is sluggish, contracting 26.7% and 11% in Q1 and Q2, respectively, a “fiscal dominance” is expected in India for sustained economic recovery.
    • However, India cannot afford fiscal stimulus at the rates of advanced economies, due to a lack of fiscal space.

    Way forward

    • Plummeting private corporate investment in India is a matter of concern.
    • The fear of financial crowding out emanating from high fiscal deficit is misplaced in the context of India.
    • Economic recovery will be determined by the degree of containment of the pandemic and the sustained macroeconomic policies.
    •  Any abrupt withdrawal of ongoing economic policy support, both by the monetary and fiscal authorities, will be detrimental to growth in times of the pandemic.
    • The fiscal rules at the national and subnational government levels need to be made flexible.

    Consider the question “Recovery of Indian economy battered by the pandemic has not been complete. Suggest the fiscal measure to be adopted by the government to speed up the recovery.”

    Conclusion

    The fiscal stimulus needs to continue in FY 2021-22 to speed up India’s recovery along with the measures suggested above.

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  • The right of life and environment

    op-ed snap | Polity | 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: Article 21, 48A, 51A(g)

    Mains level: Paper 2- Constitutional values and climate change

    The article highlights how climate change impacts the constitutional values and promises by affecting the vulnerable disproportionately and suggest the distinctly Indian paradigm of development.

    How democratic values are threatened by climate change

    • Over the last seven decades, India has made distinct progress, but many core development challenges persist and we are yet to fulfill our constitutional promise.
    • Climate change will only exacerbate existing inequalities through a range of cascading and coinciding crises.
    • These words from the Preamble — justice, liberty, equality, and fraternity — serve as reminders of the daunting path to achieving social democracy, especially in a warming world.
    • B R Ambedkar had said that to maintain democracy not merely in form, but also in fact it was essential not to be content with mere political democracy but to strive for social democracy as well.

    How climate change affects democratic values

    • Climate change is profoundly unjust.
    •  It will increasingly impinge upon our freedom of movement, and that it could deny equality of status and opportunity to millions of disadvantaged citizens like the forest-dwelling communities who have contributed least to the crisis and yet stand to be hit the hardest.
    • The evidence is clear that unless we rapidly move to reduce planet-warming greenhouse gas emissions, vast swathes of India could be inhospitable due to floods, droughts, heatwaves, and increasingly erratic and unpredictable monsoon rains.

    Call for action against climate change

    • The fraternity can particularly serve as a call to action for the powerful to direct their resources towards shaping India’s response to climate change and “assuring the dignity of the individual”, as framed in the Preamble.
    • Indian business and philanthropy can play a key role in building resilience by encouraging innovation, complementing the role of the state, and securing citizens’ legislated rights.
    • Climate philanthropy can help develop and pilot new solutions and inspire ambitious political action.
    • A plethora of opportunities are currently on the margins but could become mainstream drivers for the three key pillars of jobs, growth, and sustainability.
    • A distinctly Indian, climate-friendly development paradigm powered by clean energy could play an integral role in fostering social and economic justice by uplifting millions of Indians.
    • Our nation’s welfare depends on healing the broken relationship between a broken economy and a broken ecology.

    Constitutional mandate to protect the environment

    • The right to life enshrined in Article 21 is increasingly interpreted as a right to environment.
    • When this is read together with Articles 48A and 51A(g), there is a clear constitutional mandate to protect the environment that will only grow more important in the coming decades for citizens and the executive, legislature, and judiciary.
    • Central to these considerations is the need for a uniquely Indian climate narrative, one that is both by and for Indians.

    Consider the question “Our constitutional values must guide us to a distinctly Indian, climate-friendly development paradigm to fulfil the constitutional commitment to its citizens. Comment.”

    Conclusion

    India can build its own pathway to become a climate leader aiming to secure a future where both people and nature can thrive. Much of this work can be rooted in the constitutional framework that binds together millions of Indians despite their myriad differences — a framework that is progressive in scope and ambitious in vision.

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  • Foreign Policy Watch: United Nations

    Pursuing national interests, at the UN high table

    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:

    Mains level: Paper 2- India's agenda at the UNSC in its 2 year stint

    The article highlights India’s challenges at the UNSC in its 2 year stint.

    India’s agenda at the UNSC

    • India’s two-year non-permanent stint at the UNSC should be viewed as a once-in-a-decade opportunity to clearly identify and pursue its national interests regionally and globally.
    • India’s entry into the UNSC coincides with the emergence of a new world order.
    • Under new world order, there is systemic uncertainty, little care for global commons, absence of global leadership, the steady division of the world into rival blocs, pursuit of narrow national interests.
    • Efforts by Biden administration in the United States may go on to ameliorate some of the harsh impact of this global order.
    • The UNSC has also reached a point wherein its very relevance is in serious doubt.
    • India too is no longer an ardent believer in the fantastical claims about a perfect world at harmony with itself, nor is it a timid observer in global geopolitics.
    • India’s pursuit of its interests at the UNSC should, therefore, reflect its material and geopolitical limitations, and its energies should be focused on a clearly identified agenda.

    Factors determining India’s agenda at the UNSC

    1) Rivalry with China

    • India’s tenure at the UNSC comes in the wake of its growing military rivalry with China.
    • China’s opposition to having India chair the Counter-Terrorism Committee (CTC) in 2022 was a precursor to the things to come ahead.
    • The next two years will be key to ensure checking further Chinese incursions along the Line of Actual Control and building up enough infrastructure and mobilising sufficient forces in the forward areas.

    2) Relations with Russia

    • Greater Indian alignment with the West at the UNSC, an unavoidable outcome, could, however, widen the growing gulf between Russia and India.
    • It might not be possible for India to sit on the fence anymore.
    • Fence sitting would bring more harm than goodwill in an international system where battlelines are sharpening by the day.

    3) Terrorism issue

    • Terror is likely to be a major focus for India at the UNSC.
    • External Affairs Minister’s statement at the UNSC Ministerial Meeting on the 20th Anniversary of Security Council Resolution 1373 and the establishment of the Counter Terrorism Committee has set the stage for New Delhi’s approach on the issue.
    • India recently assumed the chair of the Taliban sanctions committee which assumes significance given the fast-moving developments in Afghanistan.
    • India must formulate its policy towards terrorism with far more diplomatic finesse and political nuance especially given that it is chairing the Taliban sanctions committee while courting the very same Taliban.

    4) Coalition of like-minded states and setting the agenda for next decade

    • India should use the forum and its engagement there to build coalitions among like-minded states and set out its priorities for the next decade — from climate change to non-proliferation.
    • India should use its bargaining power at the UNSC to pursue its national interests in other forums and domains as well.
    • India’s UNSC strategy should involve shaping the narrative and global policy engagement vis-à-vis — the Indo-Pacific.
    • Given India’s centrality in the Indo-Pacific region and the growing global interest in the concept, New Delhi would do well to take it upon itself to shape the narrative around it.
    • In doing so, it should, through the UNSC and other means, court Moscow once again and assuage its concerns about the Indo-Pacific.

    Way forward

    • India’s pursuit of its national interest at UNSC must also be tempered by the sobering fact that the UNSC is unlikely to admit new members any time soon, if ever at all.
    • A glance at the recent debates on UNSC reforms and the state of the international system today should tell us that bending over backwards to please the big five to gain entry into the UNSC will not make a difference.

    Consider the question “What agenda should India pursue at the UNSC in its two year non-permanent stint? What are the challenges in pursuing such agenda?”

    Conclusion

    India must focus its energies on what it can achieve during the short period that it would be in the UNSC rather than what it wishes happened.

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  • Leveraging government-private thought partnerships

    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- Thought partnership for informed policymaking

    Thought partnership between government and the external players can aid in informed policymaking. The article deals with these issues and suggest forging of more of such partnerships. 

    Government working together with external partners

    • Policymaking requires multiple rounds of consultations and co-working with different entities, including collaboration between the government and external partners.
    • Over the last few years, there has been increasing evidence of the government and external partners working together on complex policy problems.
    • The government has formalized the induction of private individuals into the system by opening up lateral entry.
    • Several central government ministries and entities, such as NITI Aayog, routinely recruit private individuals as consultants, officers on special duty, or young professionals.
    • Given the staggering vacancies in the central government, such support is critical since civil servants are generally overburdened and under-resourced.

    What is thought partnership and how it works

    • Thought partnerships are a structured mechanism for private entities to lend relevant strategic expertise to the government on policy design, evaluation, and implementation.
    • It is also not always feasible for the government itself to fund projects involving private partners, more so when such projects are unconventional thought partnerships.
    • Several domestic and international philanthropies and impact investing firms are already investing in critical sectors in developing countries including India.
    • However, much of this funding goes into supporting projects or interventions that work in limited, contextual settings rather than systemic or sectoral transformation programs.
    • It is here that philanthropies and impact investing firms can make a huge difference.

    Past thought partnerships

    • In 2005, the Ashok Lahiri Committee report stated that there was not enough knowledge about external capital flows and controls in India.
    • The committee’s recommendation resulted in the establishment of the National Institute of Public Finance and Policy, Department of Economic Affairs research program.
    • The program led to the creation of a rich body of world-class research on capital controls and flows in India that was used to inform government policy on the matter.
    • In 2015, the Ministry of Corporate Affairs constituted a research secretariat headed by the Vidhi Centre for Legal Policy, to support the Companies Law Committee to make “informed decisions”.
    • The National Institute of Financial Management is working with the Department of Economic Affairs to provide legal research and technical assistance on Indian and foreign financial markets, policy analysis, formulation as well as the conduct of impact assessment studies on decisions taken by the Securities and Exchange Board of India.

    Consider the question “What is thought partnership and how it could help in making informed policymaking? What are the challenges in forging thought partnerships?”

    Conclusion

    It is in the public interest that more thought partnerships are forged and funded to channel external expertise and skills towards finding scalable solutions to the pressing policy challenges the country faces.

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