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

    Diversification of output to overcome the MSP trap

    op-ed snap | Agriculture | Mains Paper 3: Major Crops & Cropping Patterns,PDS, Buffer Stock & Food Security,Transport & Marketing Of Agricultural Produce

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: MSP

    Mains level: Paper 3- Problems faced by the Punjab farmers and issue of MSP

    The article analyses the state of agriculture in Punjab and the its dependace on the MSP regime and suggest the diversification as a solution to the MSP trap.

    Punjab’s role in Green Revolution

    • India was desperately short of grains in 1965, and heavily dependent on PL 480 imports from the US against rupee payments, as the country did not have enough foreign exchange to buy wheat at global markets.
    • The entire foreign exchange reserves of the country at the time could not help it purchase more than 7 MMT of grains.
    • It is against this backdrop that the minimum support price (MSP) system was devised in 1965.

     India’s current grains management system: Issue of excess grains

    • Today, the Food Corporation of India (FCI) stocks grains touched 97 MMT in June this year against a buffer stock norm of 41.2 MMT.
    • The economic cost of that excess grain, beyond the buffer stock norm, was more than Rs 1,80,000 crore, a dead capital locked in without much purpose.
    • That’s the situation of the current grain management system based on MSP and open ended procurement.

    Decline in Punjab’s economic level

    •  In 1966 Punjab had the highest per capita income.
    • Punjab’s position fell to 13th in 2018-19.
    • There are several reasons behind this deterioration, ranging from lack of industrialisation to not catching up even with respect to the modern services sector like IT, financial services.

    What explains Punjab’s prosperity

    • Punjab’s agriculture is blessed with almost 99 per cent irrigation against an all-India average of little less than 50 per cent.
    • The average landholding in Punjab is 3.62 hectare (ha) as against an all-India average of 1.08 ha.
    • Punjab’s fertiliser consumption per ha is about 212 kg vis-à-vis an all-India level of 135 kg/ha.
    • The productivity levels of wheat and rice in Punjab stand at 5 tonnes/ha and 4 tonnes/ha respectively, against an all-India average of 3.5t/ha and 2.6t/ha.

    Assesing Punjab’s real contribution to income and agriculture

    • In Punjab, the total farm families are just 1.09 million, a fraction of the all-India total of 146.45 million.
    •  The overall subsidy, from just power and fertilisers would amount to roughly Rs 13,275 crores.
    • That means each farm household in Punjab got a subsidy of about Rs 1.22 lakh in 2019-20.
    • This is the highest subsidy for a farm household in India.
    • Let’s not forget that the average income of the Punjab farm household is the highest in India.[2.5 time’s the India’s average].
    • But to assess the real contribution of farmers/states to agriculture and incomes, the metric is the agri-GDP per ha of gross cropped area of the state in question.
    • This is an important catch-all indicator, as it captures the impact of productivity, diversification, prices of outputs and inputs and subsidies.
    • On that indicator, unfortunately, Punjab has the 11th rank amongst major agri-states.

    Way forward: Diversification of crops

    • States in south India like Andhra Pradesh, Tamil Nadu and Kerala have a much more diversified crop pattern tending towards high-value crops/livestock — poultry, dairy, fruits, vegetables, spices, fisheries.
    •  If Punjab farmers want to increase their incomes significantly, double or even triple, they need to gradually move away from MSP-based wheat and rice to high-value crops and livestock, the demand for which is increasing at three to five times that of cereals.
    • Punjab needs a package to diversify its agriculture — say a Rs 10,000 crore package spread over five years.

    Conclusion

    Once farmers diversify their farm output and double their incomes, they will not be stuck in the MSP trap.

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

    The many layers to agricultural discontent

    op-ed snap | Agriculture | Mains Paper 3: Transport & Marketing Of Agricultural Produce

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: APMC Act

    Mains level: Paper 3- Farmers protest against Farms Acts

    Farmers protest against the Farm laws is based on the multiple reasons. The article analyses these concerns of the protesting farmers.

    Three farm laws and response to it

    • Three Farm Bills were passed by the Central government in September 2020.
    • In the process, the regulatory role the state played hitherto with regard to these issues was watered down to a great extent.
    • Apart from complex challenges that rural India confronts today, there is a substantial body of studies that demonstrates how the vagaries of the market and the role of the middlemen reinforce agrarian distress in India.
    • However, organised farmers’ bodies are not in sync with the reasoning of the government.

    Role of the states

    • There is a debate around the constitutional provisions with regard to the respective domains of the State and the Union with regard to agricultural marketing,
    • However, issues affecting the farming community have a far greater bearing on the States relative to the Centre.
    • Ideally, given its immediacy, the States are the apt agencies to respond to a host of concerns faced by the farming community, which includes agricultural marketing.
    • While enacting the Farm Bills, the Centre extended little consideration to the sensitivity of the States.

    Role of APMC

    • In Punjab and Haryana, tweaking the APMC system and its resultant bearing on Minimum Support Price (MSP) is seen by the farmers as a threat to an assured sale of their produce at a price.
    • MSP system provides a cushion, wherein the farmer can anticipate the cost of opting for these crops and tap the necessary supports through channels he has been familiar with.
    • Farmers are apprehensive of the vagaries of a competitive market where he would eventually be beholden to the large players including monopolies.
    • There is widespread apprehension that the measures proposed by the Farm Acts in addition to the existing agrarian distress, are only going to make the lot of the farmer even more precarious.
    • All across the country, the farming community is prone to sympathise with the demand to scrap the new laws, as they have little to offer to them in a positive sense.

    Conclusion

    Those with large holdings and produce for the market — are spearheading the present stand-off against the Farm Bills, as it affects them very deeply. But farming distress is shared in common by the different strata within the farming community, even though it has a differential impact on them.

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

    Perils of profits based economic recovery

    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- Analysis of economic recovery post-Covid

    The economies across the world are showing recovery driven by profits. However, one cannot neglect the implication of such recovery for the long term growth given the pressure such recovery has been exerting on the labour markets. The article deals with this issue.

    3 Ways to look at GDP

    • The first is what they tell us about the past.
    • Here, the news has generally been better-than-expected.
    • The US and India saw a much stronger recovery last quarter than previously envisioned.
    • The second is sectoral, production side-agriculture, manufacturing, services- and the functional, expenditure side consumption, investment, net exports.
    • But there’s a third way — the income side.
    • Value addition must ultimately accrue to the different factors of production.
    • On the income side, therefore, GDP is simply the sum of profits, wages and indirect taxes.

    Profit-driven growth and impact on employment

    • The economic recovery in many parts of the world is driven disproportionately by capital than labour.
    • In India, the net profits of listed companies grew 25 per cent (in real terms) last quarter. This despite revenues shrinking.
    • Revenue shrank because firms aggressively cut costs, including employee compensation.
    • This implies that if listed company profits are growing 25 per cent, and yet GDP contracted 7.5 per cent, it reveals (by construction) significant pressure on profits of unlisted SMEs, wages and employment.
    • Labour market pressures are evident in India too.
    • Household demand for MGNREGA remains very elevated, suggesting significant labour market slack.
    • The employment rate in some labour market surveys still reveal about 14 million fewer employed compared to February, and nominal wage growth across a universe of 4,000 listed firms has slowed from about 10 per cent to 3 per cent over the last six quarters.

    Why this matters

    • It may be rational for any one firm to boost profits by cutting employee compensation.
    • But if every firm pursued that strategy, that simply reduces future aggregate demand and profitability for all firms.
    • This is quintessential fallacy of composition that Keynes enumerated.
    • Weak demand, in turn, disincentivises re-hiring, reinforcing the risks of settling into a sub-optimal equilibrium.

    Need to remain vigilant about labour market

    • Remaining vigilant about labour markets is particularly important for India.
    • Private consumption was increasingly financed by households running down savings and taking on debt pre-COVID-19.
    • Consequently, if job-market pressures induce households into perceiving this shock as a quasi-permanent hit on incomes, households will be incentivised to save, not spend in the future.

    Way forward for fiscal consolidation

    • While economic momentum is expected to slow as pent-up demand wears off, the level of output will progressively reach pre-COVID levels as the economy normalises.
    • The question is what will drive growth after that?
    • India’s fiscal response has been restrained thus far, with the Centre’s total spending similar to last year and state capex under pressure.
    • It’s therefore important for the Centre to step up spending in the remaining months.
    • More importantly, public investment, and a large infrastructure push, must be the leitmotif of the next budget.
    • This will be crucial to boost demand, create jobs, crowd-in private investment and improve the economy’s external competitiveness.
    • If higher infrastructure spending is financed by higher asset sales, the headline fiscal deficit (which matters for bond markets and interest rates) can be slowly reduced, even as the underlying fiscal impulse (which matters for growth and jobs) remains positive.
    • This is the only way to undertake fiscal consolidation without incurring a fiscal drag.
    • Monetary policy has led the charge in 2020. But with inflation continuing to remain sticky and elevated, the RBI has fewer degrees of freedom going forward.

    Conclusion

    The stronger-than-expected GDP print is very encouraging. But this is the start of a long journey back. Much, therefore, remains to be done. The excitement around the vaccine shouldn’t obscure this fundamental premise.

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  • Important Judgements In News

    Personal choices, the Constitution’s endurance

    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: Scope of Article 25

    Mains level: Paper 2- Freedom of conscience under Article 25

    The order delivered by the Allahabad High Court underlines the most cherished values of our Constitution. The order examines the scope of individual choice and personal liberty on the touchstone of constitutional values.

    Background

    • The Allahabad High Court declared last month that religious conversions, even when made solely for the purposes of marriage, constituted a valid exercise of a person’s liberties.
    • The petitioners had approached the High Court seeking orders to quash a First Information Report (FIR) that was lodged against them.
    • The petitioners claimed that they were both adults competent to contract a marriage, and had, in fact, wedded in August 2019, as per Muslim rites and ceremonies, only after the girl had converted to Islam.
    • The State argued that petitioner’s partnership had no sanctity in the law, because a conversion with a singular aim of getting married was illegitimate.
    • In making this argument, the government relied on a pair of judgments of the Allahabad High Court, in particular on the judgment in Noor Jahan v. State of U.P. (2014).
    • There, the High Court had held that a conversion by an individual to Islam was valid only when it was predicated on a “change of heart” and on an “honest conviction” in the tenets of the newly adopted religion.
    • Additionally, the High Court had ruled that the burden to prove the validity of a conversion was on the party professing the act.

    Major takeaways from the High Court order

    • The Allahabad High Courtruled that the freedom to live with a person of one’s choice is intrinsic to the fundamental right to life and personal liberty.
    • It order recognises that a person’s freedom is not conditional on the caste, creed or religion that her partner might claim to profess.
    • And also that every person had an equal dominion over their own senses of conscience.
    • The High Court’s order makes it clear that it is neither the province of the state nor any other individual to interfere with a person’s choice of partner or faith.
    • By invoking the Supreme Court’s judgment in Puttaswamy, the High Court held that an individual’s ability to control vital aspects of her life inheres in her right to privacy.
    • Term privacy includes the preservation of decisional autonomy, on matters, among other things, of “personal intimacies, the sanctity of family life, marriage, procreation, the home, and sexual orientation”.
    •  It Court that the judgment in Noor Jahan was incorrectly delivered.
    • Marriage, the High Court said, is a matter of choice, and every adult woman has a fundamental right to choose her own partner. 

    Freedom of conscience under Article 25

    • Article 25 of the Constitution expressly protects the choices that individuals make.
    • In addition to the right freely to profess, practise and propagate religion, it guarantees to every person the freedom of conscience.
    • The idea of protecting one’s freedom of conscience goes beyond mere considerations of religious faith.

    Conclusion

    When we fail to acknowledge and respect the most intimate and personal choices that people make — choices of faith and belief, choices of partners — we undermine the most basic principles of dignity. Our Constitution’s endurance depends on our ability to respect these decisions, to grant to every person an equal freedom of conscience.

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

    Trade-offs for growth revival: Why India’s policymakers need a new roadmap

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Current account and capital account

    Mains level: Paper 3- Policy options to revive the Indian economy

    The article weighs in the policy options with the Indian policymakers to revive the India economy. This leads to the trilemma of managing the exchange rate, controlling the inflation and maintaining the capital account open all at the same time.

    A brief overview of 1991 economic reforms

    • The crisis in 1991 was centred on the balance-of-payments.
    • Allowing the Indian rupee to fall from an artificially high level  was a key part of the solution.
    • Since the reforms, the Indian rupee has steadily depreciated, roughly according to a market-determined equilibrium.
    • Extraordinarily high tariff barriers were reduced, allowing for welfare gains from greater international trade.
    • Reforms of the domestic economy that increased market orientation was, in some sense, opportunistically combined with these externally-oriented measures.

    What should be India’s foreign economic policy

    • In terms of connections to the rest of the world, however, it is less clear what the right policy mix should be.
    • We can think of three types of international flows: labour, goods and services, and capital.

    1) Internation flow of Indian labour

    • India has benefited from being able to send workers with a variety of skills to different types of economies: construction workers and nurses in the Persian Gulf, software engineers in the US, and so on.
    • Direct benefits came from large remittances back to India.
    • The pandemic and US immigration policy, have had some major impacts on this international connectivity, but new vaccines and a change in the US president are likely to reverse these shocks.
    • In any case, there is not much that Indian policymakers can do or need to do on this front.

    2) Trade in Goods and Service

    • India has been able to grow its exports, both in a variety of agricultural and manufactured commodities and in services, from software services to tourism.
    • It has been reasonably competitive in a range of goods and services.
    • It was only in the last few years, even before the pandemic, have Indian exports struggled to register growth.
    • Whereas the export powerhouses of East Asia consistently ran surpluses on the current account of the balance of payments, India has mostly run deficits, albeit manageable ones.

    3) Capital Flow: Area where policymakers have option

    • Current account deficits have to be covered somehow, though various forms of foreign capital.
    • Whereas economic theory and economic policymakers mostly agree on the benefits of international trade in goods and services there is less of a consensus on the benefits of international capital flows.
    • Capital flows can raise fears of instability if they are reversed, or make exports less competitive if they push up the value of the rupee. 
    • The country is a relatively attractive destination for foreign capital, both FDI and portfolio investment.
    • But, these flows can make Indian exports less competitive if the rupee appreciates too much, requiring domestic demand to do more of the work of absorbing increased output.

    Lesson from Japan

    • Right now, India is trying to build its manufacturing capacity by raising tariffs, in an old-style push for import substitution.
    • It is also providing direct incentives, such as the new scheme rewarding increases in production.
    • Arguably, this did work in Japan in the 1960s, but it is not clear if India is well-off enough to sustain that domestic strategy.
    • In addition, the lack of competitive discipline exporting can hinder the achievement of acceptable quality levels.

    Way forward

    • Capital controls to some extent can help mitigate the risk in this situation.
    • The Reserve Bank of India do more to keep the rupee at competitive levels, by accumulating foreign exchange reserves.

    Consider the question “In terms of links with the rest of the global economy, it is less clear what the right policy mix should be. Do you agree with the view that focus on simultaneously managing the exchange rate and domestic inflation while maintaining an open capital account would help in the revival of India’s economic growth

    Conclusion

    Lurking under the surface of these issues is the trilemma of being unable to simultaneously manage the exchange rate and domestic inflation while maintaining an open capital account, although foreign exchange reserves provide a way of softening the trade-offs. These are not new challenges, but they will need to be a focus for India’s policymakers as they seek renewed economic growth.

    Source:-

    https://www.financialexpress.com/opinion/trade-offs-for-growth-revival-why-indias-policymakers-need-a-new-roadmap/2142900/

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  • Issues related to disability

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

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: The Convention on the Rights of Persons with Disabilities

    Mains level: Paper 2- Provisions for persons with disability

    Legal provisions not turning into reality through their implementation adds to the difficulties faced by persons with disabilities. The article deals with the idea of enabling persons with disability to contribute to society.

    Context

    • December 3 is the annual International Day of Persons with Disabilities, it is also a stark reminder of how far we in India need to go in meeting the needs of the disabled.

    Lack of implementation of provisions

    • The World Bank estimates that there may be well over 40 million Indians living with disabilities.
    • The Rights of Persons with Disabilities Act was passed in 2016 but our country is still largely devoid of ramps on its footpaths or government buildings.
    • The law promises them equality of opportunity and accessibility. Our practices deny them what the law promises.

    Challenges faced by persons with disabilities

    • Indians with disabilities are far more likely to suffer from poor social and economic development.
    •  45 per cent of this population is illiterate, making it difficult for them to build better, more fulfilled lives.
    • This is compounded by the community’s lack of political representation:
    • In our seven decades of independence, we have had just four parliamentarians and six state assembly members who suffer from visible disabilities.
    • This lack of representation, and these general attitudes, translate directly into policy that undermines the well-being of people with disabilities.
    •  Last year, for example, the government inexplicably decided to depart from convention and render people suffering from cerebral palsy ineligible for the Indian Foreign Service.

    Initiatives and steps taken by the government

    • The government has had some admirable initiatives to improve the lot of Indians with disabilities, such as the ADIP scheme for improving access to disability aids.
    • The Sugamya Bharat Abhiyan, or Accessible India Campaign, has aimed to make public transport, buildings and websites more accessible.
    • In 2017, the Mental Healthcare Act recognised and respected the agency of persons with mental-health conditions, expanding the presence of mental-health establishments across the country, restricted the harmful use of electroshock therapy, clarified the mental-health responsibilities of state agencies such as the police, and effectively decriminalised attempted suicide.
    •  In 2007, the UN passed the Convention on the Rights of Persons with Disabilities.
    • India is a state party to the convention.

    Conclusion

    It is critical that the government work with civil society and individuals with disabilities to craft an India where everyone feels welcome and treated with respect, regardless of their disabilities. Only then can we welcome the next International Day of Persons with Disabilities without a sense of shame.

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  • Implications of UP’s ‘love jihad’ ordinance for freedom of conscience

    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: Not much

    Mains level: Paper 2- Freedom of conscience and conversion to other religion

    The U.P. government’s ordinance seeking the prevention of illegal conversion has several provisions that go against the Constitution and restricts the freedom of conscience. 

    Objective of the ordinance

    • The Uttar Pradesh Prohibition of Unlawful Conversion of Religion Ordinance, 2020 seeks to prevent “love jihad” in the state
    • The ordinance makes it a criminal offence for a person to convert another by coercion, misrepresentation, fraud etc, which is unobjectionable.
    • A marriage solemnised for the “sole purpose” of unlawfully converting the bride or the groom is required to be declared void by the competent court.
    • There can be no objection to ordinance’s premise that converting somebody by fraud or misrepresentation is wrong.
    • In fact, though the members of the Constituent Assembly included the right to “propagate” one’s religion they considered it a “rather obvious doctrine” that this would not include forcible conversions.
    • However, the UP ordinance goes beyond this principle and does something quite strange.

    Unconstitutional provisions and issues with the ordinance

    1) Lack of clarity

    • The ordinance makes it a criminal offence to convert a person by offering her an “allurement”.
    • The term “allurement” is defined very broadly, to include even providing a gift to the person who is sought to be converted.
    • The use of the words “or otherwise” in the definition of allurement is puzzling.
    • The essential prerequisite of a criminal law is that it has to be precise.
    • A person cannot be put behind bars for doing something that a penal law does not clearly and unequivocally prohibit.
    • On this touchstone, the definition of “allurement” leaves much to be desired.

    2) Reconversion to a person’s previous religion is not illegal

    • It says that “reconversion” to a person’s previous religion is not illegal, even if it is vitiated by fraud, force, allurement, misrepresentation and so on.
    • In other words, if a person converts from Religion A to Religion B of her own volition, and is then forced to reconvert back to Religion A against her will, this will not constitute “conversion” under the ordinance at all.

    3) Unfairly treating all women in the same way

    • Illegal conversion under the ordinance attracts a punishment of 1-5 years in prison.
    • However, if the victim of the illegal conversion is a minor, a member of the Scheduled Castes or Scheduled Tribes or, strangely, a woman, the punishment is doubled — at 2-10 years behind bars.
    • In other words, it does not matter who the woman is, if somebody converts her against her will, the punishment can go up to 10 years in prison.
    • The ordinance unfairly paints all women with the same brush — assuming that all women are gullible, vulnerable and especially susceptible to illegal conversion.

    4) Buden of proof

    • The burden of proof in criminal cases is on the prosecution, and the presumption is that a person accused of committing an offence is innocent until proven guilty.
    • The Uttar Pradesh ordinance turns this rule on its head.
    • Every religious conversion is presumed to be illegal.
    • The burden is on the person carrying out the conversion to prove that it is not illegal.
    • The offence of illegal conversion is also “cognisable” and “non-bailable”, meaning that a police officer can arrest an accused without a warrant, and the accused may or may not be released on bail, at the discretion of the court.

    Time to revisit the past judgement

    • In Rev Stainislaus v State of Madhya Pradesh (1977), the Supreme Court held that the fundamental right to “propagate” religion does not include the right to convert a person to another religion.
    • In that case, the court had upheld anti-conversion statutes enacted by the states of Orissa and Madhya Pradesh.

    Conclusion

    The ordinance puts an incredible chilling effect on the freedom of conscience and state must reconsider it.

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  • Antibiotics Resistance

    Looming heath crisis in the form of antimicrobial resistance

    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: Factors responsible for AMR

    Mains level: Paper 3- Link between pollution and AMR

    Rapidly rising antimicrobial resistance (AMR) poses the threat of the next health crisis if not addressed with urgency. The article examines the severity of the issue.

    The severity of the antimicrobial resistance (AMR)

    • Globally, about 35% of common human infections have become resistant to available medicines.
    • About 700,000 people die every year because available antimicrobial drugs — antibiotics, antivirals, antiparasitic and antifungals — have become less effective at combating pathogens.
    • Resistance to second- and third-line antibiotics — the last lines of defence against some common diseases — are projected to almost double between 2005 and 2030.
    • In India, the largest consumer of antibiotics in the world, this is a serious problem.

    Responsible factors

    •  Microorganisms develop resistance to antimicrobial agents as a natural defence mechanism.
    • Human activity has significantly accelerated the process.
    • The misuse and overuse of antimicrobials for humans.
    • Livestock and agriculture but other factors also contribute.

    Research points  to role of environment and pollution

    • Once consumed, up to 80% of antibiotic drugs are excreted un-metabolised, along with resistant bacteria.
    • Their release in effluents from households and health and pharmaceutical facilities, and agricultural run-off, is propagating resistant microorganisms.
    • Wastewater treatment facilities are unable to remove all antibiotics and resistant bacteria.
    • In India, there is capacity to treat only about 37% of the sewage generated annually.
    • Water, then, may be a major mode for the spread of AMR, especially in places with inadequate water supply, sanitation and hygiene.
    • Wildlife that comes into contact with discharge containing antimicrobials can also become colonised with drug-resistant organisms.

    Initiative to tackle the AMR

    • The United Nations Environment Programme (UNEP) identified antimicrobial resistance as one of six emerging issues of environmental concern in its 2017 Frontiers Report.
    • UN agencies are working together to develop the One Health AMR Global Action Plan (GAP) that addresses the issue in human, animal, and plant health and food and environment sectors.
    • The Ministry of Environment, Forest and Climate Change (MoEF&CC) issued draft standards which set limits for residues of 121 antibiotics in treated effluents from drug production units.
    • The Ministry of Health and Family Welfare and MoEF&CC constituted the inter-ministerial Steering Committee on Environment and Health, with representation from WHO and UNEP.

    Way forward

    • The Centre and State governments in India can strengthen the environmental dimensions of their plans to tackle antimicrobial resistance.
    • It is important to promote measures that address known hotspots such as hospitals and manufacturing and waste treatment facilities.

    Consider the question “Being the largest consumer of antibiotics in the world, India faces a grave threat from growing anti-microbial resistance. What are the factors responsible for it? Suggest the ways to deal with it.”

    Conclusion

    We saw how quickly a pandemic can spread if we are not ready. This is an opportunity to get ahead of the next one.

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  • Regional Comprehensive Economic Partnership (RCEP)

    Premature membership of RCEP would not serve Indian interests

    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: RCEP countries

    Mains level: Paper 3- India's decision to not join RCEP

    The article analyses government’s decision to stay out of RCEP and factors responsible for it.

    What India chose not to join RCEP

    • By joining RCEP, India would have further risked a flood of cheap Chinese imports in sectors like electronics.
    • India had tried and failed to win substantial concessions in areas like work visas for its information technology-enabled services.
    • Two of India’s proposals—an RCEP business travel card and an RCEP service supplier card—failed to find favour with a majority of the bloc’s members.

    Arguments in favour of India joining the RCEP

    •  First argument made is RCEP would have provided an excellent opportunity for Indian firms to get integrated with regional value chains.
    • However, merely joining a trade bloc does not automatically result in integration with global value chains.
    • The complex nature of global production networks requires a lot of economic and trade policy reforms on the domestic front.
    • Second important argument made is that India would lose an opportunity to access RCEP’s common market.
    • But this argument too doesn’t hold much water if Indian producers are not competitive.
    • Competitiveness is driven by factors both within and beyond the control of domestic industry.
    • So it would be an over-simplification to assume that Indian industry does not have the capability or appetite to be competitive.
    • Often, global competitiveness inside factory gates gets diluted by costs borne outside those gates.

    What past data suggests

    • India’s merchandise exports grew at an annual rate of more than 18% between 2000-01 and 2010-11, which was largely a pre-FTA period.
    • In this period, India activated only two FTAs—with Sri Lanka and Singapore.
    • India joined the FTAs in a big way from 2010 onwards.
    • It operationalized big trade agreements with the 10-nation Association of South East Asian Nations (ASEAN), Japan, Korea, and separately with Malaysia.
    • However, despite these deals, India could realize annual merchandise export growth of only 2.5% between 2010-11 and 2019-20.
    • This disappointing performance shows that FTAs are not conducive for exports.

    Conclusion

    While RCEP may theoretically offer India new opportunities for exports and integration with pan-Asian production networks, we have a lot of work to do internally before we are in a position to make the most of free-trade deals.

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

    Closing the communication gap with the farmers

    op-ed snap | Agriculture | Mains Paper 3: Issues Related To Farm Subsidies & Msp,PDS, Buffer Stock & Food Security

    Note4Students

    From UPSC perspective, the following things are important:

    Prelims level: Not much

    Mains level: Paper 3- Farmers protest against farm laws

    The article suggests the policy options with the government to deal with the protest of the farmers against the recently enacted farm laws.

    Context

    • Farmers have protested against the recently enacted farm laws by converging on Delhi’s highways connected to neighbouring states.

    Why farmers are protesting

    • There is a gross communication failure on the part of the central government to explain to farmers what these laws are, and how they are intended to benefit them.
    • Neither do the laws say anything about it, nor is the MSP/APMC system going to disappear with these laws.
    • Nothing can be further from the truth.

    1) Should government  repeal the laws

    • Punjab farmer leaders, including two major political parties, demand repeal of these laws.
    • However, repealing would mean bringing back controls, licence raj and the resultant rent-seeking.
    • Milk, poultry, fishery, etc. don’t go through the mandi system and their growth rates are 3 to 5 times higher than that of wheat and rice.
    • Overall, almost 90 per cent of the agri-produce is sold to the private sector.

    2) Should the government make MSP legally binding

    • Another demand is making the MSP statutory and legally binding even on the private sector.
    • This is impractical as there are 23 commodities for which MSPs are announced, but in actual practice only wheat and rice enjoy MSPs in any meaningful manner, and that too only in 6-7 states.
    • Punjab is the biggest gainer as its 95-98 per cent of market arrivals of wheat and paddy are procured at MSP by state agencies on behalf of the Food Corporation of India (FCI).
    • The FCI is overloaded with grain stocks that are more than 2.5 times the buffer stock norms.
    • Such high stock indicates massive economic inefficiency in the grain management system.
    • If the government cannot cope up with excess production of just wheat and rice in any meaningful way, think of how it will handle 23 commodities under MSP.
    • In case of excess production the government will not have the wherewithal to buy all and stock them without any viable outlet.
    • It will massively distort markets, make Indian agriculture non-competitive and stocking of these will be financially unsustainable.
    • And then, why only 23 commodities, why not 40?
    • This type of state socialism is a sure path to financial disaster.

    3) Optio of the Price Stabilisation Scheme

    • The third policy option is to use the Price Stabilisation Scheme to give a lift to market prices by pro-actively buying a part of the surplus whenever market prices crash.
    • It can be done directly by NAFED-type agencies that are already active in the case of pulses and oilseeds.
    • Farmers can use Commodity Derivatives Exchanges where farmers can buy “put options” at MSP before they even sow their crops, and if the market prices at the time of harvest turn out to be below MSP, government can compensate them partly for lower market prices.

    4) Decentralise MSP: Let the states decide it

    • The fourth option is to totally decentralise the MSP, procurement, stocking, and public distribution system (PDS).
    • MSP and procurement exist basically to support farmers for supplying grains to the FCI to feed into the PDS.
    • So, the whole money on food subsidy can be allocated to states on the basis of their share in all-India poverty/proportion of vulnerable population, all-India wheat and rice production, all-India procurement of wheat and rice, etc.
    • A step further could include another Rs 1,00,000 crore of fertiliser subsidy and free up fertiliser prices from any controls.
    • Still further, even include another Rs 1,00,000, say, of MNREGA.
    • Let the Finance Commission work out a formula for distribution of this Rs 3,00,000 crore amongst states based on some tangible performance indicators.
    • And the Centre should get off from MSP, PDS, fertiliser subsidy, and MNREGA.

    Conclusion

    This would be true decentralisation, and can be accomplished provided enough ground work is done well in advance. But will this be acceptable to farmer leaders/opposing states/activists? Only time will tell.

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