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Type: Op-ed

  • Challenges ahead for the RBI

    With the Indian economy showing green shoots, RBI has to face some fundamental challenges while withdrawing the expansionary measures. 

    Expansionary policy as a response to pandemic

    • To manage the financial pressures unleashed by COVID-19, the RBI unleashed several measures.
    • It reduced policy interest rates aggressively.
    • It released an unprecedented amount of liquidity in the market.
    • It instituted a slew of measures for targeted assistance to, especially distressed sectors.

    Time to roll back the expansionary monetary policy

    • As the Indian economy is showing the signs of recovery, the RBI must be planning for a non-disruptive exit out of the easy money regime.
    • Reversing a crisis-driven expansionary policy has to be a deliberative process, with the timing and sequencing carefully planned.
    • A big lesson of the global financial crisis is that any missteps on the exit path by way of commission, omission, or importantly communication, can be costly in macroeconomic terms.

    Challenges RBI will face on the way out of expansionary monetary policy

    1) Restraining inflation while supporting the recovery

    • Inflation remained above the RBI’s target band for the past several months.
    • According to the RBI’s own estimates, inflation is expected to remain above the band for the next several months.
    • Yet, the MPC, in its recent review, decided against any rate action out of concerns for growth and financial stability.
    • The MPC expects inflation to soften on its own in the weeks ahead.
    • That outcome is not inevitable.
    • Inflation could be pressured upwards by several factors even though there could be some apparent softening purely because of base effects.
    • There is the risk that persistent high inflation expectations would result in food inflation getting more generalised.
    • Core inflation could firm up because of rising input prices.
    • ‘Excessive margins’, among the factors cited by the MPC as one of the causes of high inflation, may not disappear.
    • Equally, there are concerns that the recovery, for all the positive signals, is still fragile. 
    • And there is heightened concern about an aggravated unemployment problem caused by big firms retrenching labour to cut costs.

    2) Impact on savings

    • RBI should also be concerned about the plight of savers who are being shortchanged by low-interest rates at a time of high inflation.
    • Low-interest rates, its impact on inflation and economic recovery taken together make a complex cocktail of dilemmas for the RBI as it seeks to normalise the policy rates.

    3) Withdraw excess liquidity at right time and to avoid ‘taper tantrum’

    • Another related challenge will be to withdraw the ‘excess’ liquidity in good time.
    • Banks are routinely depositing trillions of rupees with the RBI every day, evidencing that all the money that the central bank injected into the system is not doing much good anymore.
    • Every financial crisis can be traced back to mispricing of risk.
    • Mispricing of risk results when there is too much liquidity sloshing around the system for too long.
    • It will drive investors into dodgy ventures and threaten financial stability.
    • As the RBI seeks to guard financial stability by normalising liquidity, it will have to contend with possible market tantrums.
    • The lesson from the taper tantrums in the U.S. is that the RBI will have to manage its communication as carefully as it does the liquidity withdrawal.

    4) Stability of the rupee

    • Next challenge for the RBI will be to restrain the rupee from appreciating out of line with fundamentals.
    • Here, the RBI is confronted with a classic case of ‘the impossible trinity’.
    • The impossible trinity deals with allowing free capital flows while simultaneously maintaining a stable exchange rate and restraining inflation.
    • The current account surplus this year together with massive capital flows has meant an excess of dollars in the system putting upward pressure on already overvalued rupee.
    • The RBI has absorbed nearly $90 billion this fiscal year to prevent exchange rate appreciation and to maintain the competitiveness of the rupee.
    • The RBI’s ability to continue to intervene in the forex market will be constrained by its anxiety about how the resultant liquidity might aggravate inflation and the risk to financial stability.

    Consider the question “What are the challenges ahead for the RBI while winding down the expansionary monetary policy measures that were announced to deal with the economic disruption of caused due to pandemic and subsequent lockdown.

    Conclusion

    It is better to be rough right, as Keynes said, than be precisely wrong. That should be the guiding principle for RBI as it navigates its way out of the crisis driven easy money policy.

    Back2Basics: What is taper tantrum?

    • Taper tantrum refers to the 2013 collective reactionary panic that triggered a spike in U.S. Treasury yields, after investors learned that the Federal Reserve was slowly putting the breaks on its quantitative easing (QE) program.
    • The Fed announced that it would be reducing the pace of its purchases of Treasury bonds, to reduce the amount of money it was feeding into the economy.
    • The ensuing rise in bond yields in reaction to the announcement was referred to as a taper tantrum in financial media.

  • Social sector: the post-Covid priority

    The article highlights the need for more focus on the social sector in the post-Covid society and suggest ways to do the same.

    Why focus on social sector

    • No country has progressed without investing in the social sector.
    • India is committed to achieving the Sustainable Development Goals (SDGs) by 2030, and social sector development is important in reaching them.
    • Progress in this sector has intrinsic (for its own sake) and instrumental (for higher growth) value.
    • It is needed even to build a $5 trillion economy faster.

    India’s social sector expenditure

    • India’s progress in the social sector has been much slower compared to its GDP growth.
    • In the social sector expenditure, the share of education as a percentage of GDP has been stagnant around 2.8-3 per cent during 2014-15 to 2019-20.
    • In the case of health, the expenditure as a percentage of GDP increased from 1.2 per cent to 1.5 per cent.
    • This is lower than the required 2-3 per cent of GDP.
    • An increase in health expenditure is also important to take care of the present and future pandemics.
    • There are supply side problems regarding the health infrastructure.
    • It is essential to have a huge increase in public expenditure on health and provide accessible, affordable and quality health coverage to all.

    Following are some key issues in the social sector India needs to focus on.

    1) The problem of undernutrition

    • The NFHS-5 report shows that malnutrition level has reduced marginally in a few states and has worsened in some other states between 2015-16 and 2019-20.
    • We can’t have a society with 35 per cent of our children suffering from malnutrition.
    • Apart from undernutrition, obesity seems to be increasing in both rural and urban areas.
    • There is a need to raise allocations for ICDS and other nutrition programmes.
    • The determinants of nutrition are agriculture, health, women’s empowerment, including maternal and child practices, social protection, nutrition education, sanitation and drinking water.
    • The Poshan Abhiyan is a good programme, but has to cover all these determinants with a multi-pronged approach to reduce undernutrition.

    2) Quality education

    • Quality education is key for raising human development.
    • The pandemic has enhanced inequalities in education and has revealed the widening digital gap.
    • Equality of opportunity in terms of quality education is the key for raising human development and for reducing inequalities in the labour market.
    • Several committees have recommended that public expenditure on education should be at 6 per cent of GDP.

    3) Social safety nets

    •  It is known that migrant workers were the most affected during the pandemic and that they do not have any safety nets.
    • There is a need to have safety nets like an employment guarantee scheme for the urban poor and facilities for migrants.
    • Similarly in rural areas, allocations to MGNREGA have to be increased because of the reverse migration.

    4) Programs for vulnerable section need to be continued

    • The government has done well in providing cooking gas through Ujjwala Yojana and electricity through Saubhagya Yojana, introducing programmes such as Swachh Bharat Abhiyan and initiatives for housing, financial inclusion and providing loans to the self-employed.
    • These programmes have helped the vulnerable sections, particularly women.
    • Another initiative of the government was to facilitate direct benefit transfers (DBT) for welfare schemes.
    • These initiatives have to be continued.

    Way forward

    • The government should give more focus to the social sector with better policies and implementation.
    • It has to work closely with the states in revitalising the social sector as major expenditures particularly on health and education are met by them.
    • The 15th Finance Commission also seems to have mentioned that health expenditure should be increased to 2.1 per cent of GDP.
    • The Commission may also suggest some incentives for states to increase health expenditure.
    • Both Centre and states should have a five-year vision on the social sector.

    Consider the question “No country has progressed without investing in the social sector. In the post pandemic world India needs to chart the plan to invest more in the sector. In light of this, examine the challenges in the social sector and suggest the ways to deal with them.

    Conclusion

    India, aspiring to be a global power, should have a harmonious and inclusive social sector development. This is also important for achieving the SDGs, reducing inequalities and building a $5 trillion economy faster.

  • Salary to women for domestic work

    Recently, a political party promised salaries to housewives as a part of its electoral campaign in Tamil Nadu. This led to the debate on the issue. The article deals with the issue.

    Salary for housework: Historical background

    • Demand for wages against housework was first raised at the third National Women’s Liberation conference in Manchester, England.
    •  In 2012, the then minister for Women and Child development announced that the government was considering mandating a salary for housework to wives, from husbands.
    •  The purpose, once again, was to empower women financially and help them live with dignity.

    Recognising the value of unpaid domestic work

    • Time-use data from 2019 gathered by the National Sample Survey Organisation revealed that only about a quarter of men and boys above six years engaged in unpaid household chores, compared to over four-fifths of women.
    • Every day, an average Indian male spends 1.5 hours per day in unpaid domestic work, compared to about five hours by a female.
    • Housework demands effort and sacrifice, 365 days a year, 24/7.

    Issues with paying for domestic work

    •  Asking men to pay for wives’ domestic work could further enhance their sense of entitlement.
    • It may also put the additional onus on women to perform.
    • There is a risk of formalising the patriarchal Indian family where the position of men stems from their being “providers” in the relationship.

    Way forward

    • Despite a legal provision, equal inheritance rights continue to be elusive for a majority of women.
    • More than creating a new provision of salary for housework, we need to strengthen awareness, implementation and utilisation of other existing provisions.
    • Starting from the right to reside in the marital home, to streedhan and haq meher, to coparcenary and inheritance rights as daughters and to basic services, free legal aid and maintenance in instances of violence and divorce.
    • Women should be helped to reach their full potential through quality education, access and opportunities of work, gender-sensitive and harassment-free workplaces and attitudinal and behaviour change within families to make household chores more participative.

    Conclusion

    Just like we do not want women to commodify their reproductive services because of their inherently exploitative nature — we have, therefore, banned commercial surrogacy in the country — let us not allow commodification of housework and personal care.

  • Misunderstanding the MSP

    The article explains the purpose of Minimum Support Price (MSP) and reasons for insecurity in farmers regarding its continuance.

    Relation between MSP and time-bound procurement through PPS

    • MSP, public procurement system (PPS) and a strict time-bound purchase of output brought to the PPS(through APMCs) form a package deal.
    • Take out one aspect, the deal falls apart.
    • For example, if you have MSP but not compulsory PPS, the support price becomes redundant.
    • If you have MSP and PPS/APMC mandi but not strict time-bound purchase of the product brought to the PPS, the deal will fail.

    Purpose of MSP

    • At the launch of the Green Revolution, MSP and PPS were designed to assist the country in achieving its goal of food self-sufficiency, which was met by the early Seventies.
    • The purpose of MSP and PPS/APMC is now two-fold.
    • One, to maintain food self-sufficiency because crop diseases and weather conditions such as droughts.
    • The second purpose is to ensure a reasonable, assured income to the farmers.
    • The recommendation to dismantle FCI public procurement, made by the Shanta Kumar Committee in its 2015 report, displayed a lack of recognition of the importance of these two purposes.

    Issues with the Farm bills

    • The government’s assurance that MSP/APMC can co-exist with the big agro-business-controlled private markets is not tenable.
    • A farmer who has reached a contract will not be legally allowed to take the product to APMC if the APMC mandi offered him/her a better price.
    • The agro-business entity will take the non-compliant farmer to court, where the dispute resolution mechanism is stacked against the farmer due to the structural inequities of legal resources and social-cultural capital.
    • The proposed dispute resolution mechanism increases the choice of the trader to trade and not of the farmer to sell.
    • The central law will prevail in the private markets, while state laws will prevail in the APMC mandis.
    • Two markets with two regulatory frameworks will create conditions for perpetual Centre-state conflicts.
    • MSPs are announced for 23 crops but compulsory and timely public procurement, are provided mainly for two crops, wheat and rice, the support price does not work for the remaining 21 crops. 

    Challenge in defining MSP

    • Farmers’ organisations are insisting on the Swaminathan Committee formula of C2+50 per cent.
    • The MSP announced by the government is based on the A2+Fl+50 per cent formula.
    • Unlike the C2+50 per cent formula, A2+Fl+50  formula does not cover all the costs of farming.

    Conclusion

    Agrarian reforms that recognise the importance of ecologically and economically sustainable agriculture are an absolute necessity. Such reforms would require more than merely changing the trade emphasis of existing laws. They will involve the creation of inclusive, transparent and well-informed laws compatible with these reforms.

    Back2Basics: Understanding the cost formula

    • M S Swaminathan committee recommended minimum support prices (MSP) for crops at levels “at least 50 per cent more than the weighted average cost of production”.
    • The National Commission on Farmers did not elaborate on what really constituted “weighted average cost of production” in its report submitted in October 2006.
    • The Commission for Agricultural Costs and Prices (CACP), on the other hand, gives three definitions of production costs: A2, A2+FL and C2.
    • A2 costs basically cover all paid-out expenses, both in cash and in kind, incurred by farmers on seeds, fertilisers, chemicals, hired labour, fuel, irrigation, etc.
    • A2+FL cover actual paid-out costs plus an imputed value of unpaid family labour.
    • C2 costs are more comprehensive, accounting for the rentals and interest forgone on owned land and fixed capital assets respectively, on top of A2+FL.

  • Personal Data Protection Bill 2019

    The Personal Data Protection Bill (2019) has several provisions which could have implications for the privacy of an individual. The article examines such provisions and highlights the need for further debate on the Bill.

    Evolution of privacy as a fundamental right

    • The Supreme Court in MP Sharma v. Satish Chandra (1954) and Kharak Singh v. Uttar Pradesh (1962) had declared that while in certain circumstances the privacy of individuals was to be protected, there was no constitutional right to privacy in and of itself.
    • However, in Puttuswamy v India (2017) the Supreme Court accepted privacy as a fundamental right.
    • This was an important development.

    Rising importance of data

    • The rising importance of data has pushed over 80 countries to pass national laws protecting the collection and use of their citizens’ data by companies and the government.
    • The DPB will have huge commercial and political consequences for India.
    • In India, the Personal Data Protection Bill 2019 (DPB) is currently under consideration by a parliamentary committee.
    • According to Ernst and Young, emerging technologies in India will create $1 trillion in economic value by 2025.
    • Much of this value will be founded on the creation, use, and sale of data, and the DPB will have immense implications as firms scramble to meet new privacy regulations.

    Conditions for access to data and issues

    • The bill establishes a number of conditions for companies to follow.
    • For one, it would require digital firms to obtain permission from users before collecting their data.
    • It also declares that users who provide data are, in effect, the owners of their own data.
    • So that the users will be able to control the data their online selves produce, and may request firms to delete it, just as European internet-users’ “right to be forgotten”.
    • But the bill stipulates that critical or sensitive personal data, related to information such as religion, or to matters of national security, must be accessible to the government if needed to protect national interest.
    • Critics have suggested that such open-ended access could lead to misuse.
    • Even B N Srikrishna, who chaired the committee that drafted the original bill has also expressed concerns about this provision.
    • Other major concern is about Data Protection Authority (DPA).

    Concerns about Data Protection Authority

    • The bill outlines the establishment of a Data Protection Authority (DPA).
    • The DPA will be charged with managing data collected by the Aadhaar programme.
    • It will be led by a chairperson and six committee members, appointed by the central government on the recommendation of a selection committee.
    • But this selection committee will be composed of senior civil servants, raising questions about the board’s independence.
    • The government’s power to appoint and remove members at its discretion also stokes fears about its ability to influence this independent agency.
    • Unlike similar institutions, such as the Reserve Bank of India or the Securities and Exchange Board, the DPA will not have an independent expert or member of the judiciary on its governing committee.

    Consider the question “Discuss the various provision of Personal Data Protection Bill 2019 for the protection of individual’s privacy. What are the concerns over the various provisions of the Bill?”

    Conclusion

    The DPB is a unique opportunity for India, a country with some 740 million internet users, to forge a pathbreaking agenda that will act as a standard-setter in the still-developing field of national data protection legislation.

  • Need to focus on the well-being of the child from womb to first five years

    The article analyses the data of NHFS-5 and try to factors responsible for the outcomes.

    Analysing health and nutrition of child through NHFS-5

    • The recently released fifth round of the National Family Health Survey (NFHS-5) provide insights into some dimensions of micro-development performance before COVID struck.
    • The latest round only has data for 17 states and five Union territories.
    • Madhya Pradesh, Uttar Pradesh, Punjab, Rajasthan and Tamil Nadu are notable exclusions.
    • Many of the child-related outcomes are also determined by state-level implementation, therefore neither success nor failure can be attributed to state or the centre alone.

    Let’s understand the data

    • The NFHS has 42 indicators related to child’s health and nutrition.
    • Indicators fall into nine categories and each of these can be divided into outcomes and inputs.
    • For example, neonatal, infant and under-5 mortality rates can be thought of as outcomes.
    • Similarly, all the nutrition indicators —stunting, wastage, excess wastage, underweight and overweight can also be classified as outcomes.
    • In contrast, the post-natal care indicators relating to visits made by health workers and the extent and nature of feeding for the child can be classified as inputs.

    Outcomes of the survey

    • On the front of wasting (weight for height of children) these is an improvement because even though the gains were marginal, they reversed a negative trend between 2005 and 2015. 
    • India continues to be successful in preventing child deaths, but the health and nutrition of the surviving, living child has deteriorated, somewhat worryingly.
    • India continued to make progress in preventing child-related deaths (neonatal, infants and under-5).
    • The pace of improvement in child mortality slowed down relative to the previous 10 years (Fig.1).
    • Figure 2 shows the six indicators where outcomes have deteriorated. These all relate to what happens after survival:
    • The health (anaemia, diarrhoea, and acute respiratory illness (ARI)) and nutrition (stunting, and overweight) of the child deteriorated between 2015 and 2019.
    • The absolute deterioration in health and nutrition indicators must be seen against the fact that they reversed the historic trends of steady improvements.

    What explains the outcomes

    • Implementation capacity of individual states probably played an important role.
    • Sector-specific factors such as changing diets are also implicated.
    • A broader deterioration in outcomes hints at the likelihood of a common factor, namely the macro-economic growth environment, which determines employment, incomes and opportunities.
    • At the least, it is safe to conjecture that some of these outcomes are inconsistent with the narrative of a rapidly growing economy.

    Conclusion

    As discussed in Chapter 5 of the Economic Survey of 2015-16, perhaps the next big welfare initiative of the government should be a mission-mode focus on the well-being of the early child (and of course the mother), from the womb to the first five years, which research shows is critical for realising its long run potential as an individual.

  • Agricultural research in India

    The article highlight the need for more emphasis on agricultural R&D as a solution to the woes of the farmers.

    India needs low-input high-output agriculture

    • Amid farmers protest against farm acts, the current debates focus mainly on MSP, reducing farmers’ debt liabilities, reducing post-harvest losses, cash transfers and marketing reforms.
    • India with entrenched poverty requires low-input, high-output agriculture; low input in terms of both natural resources and monetary inputs.
    • Very little attention is being given to reducing the natural resource inputs — most critical being water —and agricultural R&D.
    • This cannot be achieved without science and technology.

    Following are the areas in which Indian agriculture needs R&D to reduce agriculture inputs

    1) Water usage for agriculture

    • India receives around 4,000 billion cubic meters (bcm) of rainfall, but a large part of it falls in the east.
    • Moreover, most of the rain is received within 100 hours of torrential downpour, making water storage and irrigation critical for agriculture.
    • India has one of the highest water usages for agriculture in the world — of the total 761 bcm withdrawals of water, 90.5 per cent goes into agriculture.
    • In comparison, China uses 385.2 bcm (64.4 per cent) out of the total withdrawals of 598.1 bcm for agriculture.
    • China’s per-unit land productivity in terms of crop production is almost two to three times more.
    • The total estimated groundwater depletion in India is in the range of 122-199 bcm .
    • The depletion is highest in Punjab, Haryana, and western UP.

    2) Increasing the yields of coarse-grain crops and oilseed crops

    • Years of intense research on yield increase and yield protection by breeding varieties and hybrids resistant to pests and pathogens have made wheat, rice and maize stable high yielders.
    • Environmentalists suggest replacing rice with coarse grain crops — millets, sorghum etc.
    • However, the yields of these crops are not comparable to those of wheat and rice even when protective irrigation is available.
    • These crops have a serious R&D deficit leading to low yield potential as well as losses to pests and pathogens.
    • This leaves us with pulses and oilseeds.
    • In the 2017-18 fiscal year, India imported around Rs 76,000 crore worth of edible oils.
    • Three oilseed crops (mustard, soybean, and groundnut) are already grown very extensively.
    • Soybean and groundnut are legume crops and fix their nitrogen.
    • All three crops not only provide edible oils but are also an excellent source of protein-rich seed or seed meal for livestock and poultry.
    • Unfortunately, yields of the three crops are stagnating in India at around 1.1 tons per hectare, significantly lower than the global averages.

    3) Genetic improvements of crops

    • Pests and pathogens can be best tackled by agrochemicals or by genetic interventions.
    • A recent global level study on crop losses in the main food security hotspots for five major crops showed significant losses to pests — on average for wheat 21.5 per cent, rice 20 per cent, maize 22.5 per cent, potato 17.2 per cent, and soybean 21.4 per cent.
    • India is one of the lowest users of pesticides.
    • In 2014, comparative use of pesticides in kilograms per hectare in some select countries/regions is as following: Africa 0.30, India 0.36, EU countries 3.09, China 14.82, and Japan 15.93.
    • A more benign method for dealing with pests is through breeding.
    • The Green Revolution technologies were based on the effective use of germplasm and strong phenotypic selections.
    • Recombinant DNA technologies since the 1970s have brought forth unprecedented opportunities for genetic improvement of crops.
    • Since 2000, genomes of all the major crops have been sequenced.
    • The big challenge is in the effective utilisation of the enormous sequence data that is available.
    • India’s efforts in all three areas are half-hearted.

    Way forward

    • Over the last 20 years, India has been spending between 0.7 to 0.8 per cent of its GDP on R&D.
    • This is way below the percentage of GDP spent by the developing countries and Asia’s rapidly growing economies.
    • There are structural issues like lack of competent human resources and lack of policy clarity.
    • However, the biggest impediment to agricultural R&D has been overzealous opposition to the new technologies.

    Consider the question “India needs low-input, high-output agriculture. This cannot be achieved without science and technology. In light of this, examine how R&D could play a role in the advancement of agriculture in India.”

    Conclusion

    Maybe the present crisis in agriculture would lead to a greater appreciation of the need for strong public supported R&D in agriculture.

  • New horizon of India-U.S. ties

    The article explores the area of cooperation for India and the U.S. under a new administration in U.S. amid changing geopolitical realities.

    China: Shared cause of concern

    • The Biden administration’s approach to India will be shaped by its position towards China.
    • There is a bipartisan change in the US’s attitude to China.
    • The Biden administration will continue Trump administrations trade policy- reducing the trade deficit, ensuring a level-playing field, keeping a keen eye on technology rivalry etc.
    • There are parallels in the concerns of India and the U.S. — invigorating the domestic economy and dealing with a rising rival.
    • These concerns can translate into opportunities for both countries.

    How India and U.S can convert concerns into opportunities

    1) Cooperation in healthcare

    • Healthcare is clearly an area that India can play up in bilateral relations.
    • The two countries can also work with multilateral agencies across the spectrum of vaccine (including Covid vaccine) development, logistics and distribution.
    • India produces around 20 per cent of the global requirement for generic drugs by volume and every third tablet of generics consumed in the US.
    • The President-elect has indicated his commitment to providing better and affordable healthcare
    • This could be an opportunity for the Indian pharma sector to play a role in reducing health costs of the American consumer.
    • India can benefit from advancements in medical technologies, devices, new medicines and R&D capabilities, presenting opportunities for American companies.

    2) Job creation through trade and exports

    • Biden has set an ambitious target for US-India trade.
    • Businesses in both countries are also looking for diversifying their manufacturing supply chains.
    • This portends well for the creation of employment in manufacturing.
    • An area where strategic considerations and imperatives of job creation converge is defence, especially since India has been designated a Major Defence Partner of the US.

    3) Focus on infrastructure in both countries

    • For the US, this can mean opportunities in India in transportation, power and other urban amenities.
    • The US’s renewed focus on climate change should lead to greater cooperation with India in energy-related areas.
    • Cooperation in energy-related areas includes more efficient energy dissemination and management (such as smart grids) to renewable energy technologies.

    4) Enhance opportunities in 5G tech

    • There is potential to enhance mutual opportunities in the 5G tech sector.
    • Increased partnership between the two nations can accelerate the development of technology solutions, promote vendors in the 5G open ecosystem and drive economic growth.
    • The two countries should engage in shaping the rules of a new order in this space.
    • This also has an important strategic element when seen in the light of developments in the Indo-Pacific as well as China’s Belt and Road Initiative.

    5) Multilateralism for cooperation in wider areas

    • Once the Biden administration assumes office, we should expect the U.S.’s return to multilateralism.
    • The Trans-Pacific Partnership aimed to create a rules-based order that all parties could subscribe to.
    • With the ascendancy of the Indo-Pacific paradigm and the Quad and Quad Plus, a successor to the TPP could include a wider canvas.
    • For India, this could mean cooperation beyond defence and security, including economics, technology and developments pertaining to the regional order.

    Conclusion

    Both countries should treat the economic and commercial dimension with as much priority as the strategic dimension. Both governments should embrace the prosperity-creating potential of such an approach.

  • Blueprint of post covid development model

    The article discusses the themes of the post-covid world which will be somewhat more aware and mindful of the dangers of global dimension.

    Collaborative model and public-private partnership

    • A few weeks back, Prime Minister visited the private companies involved with the formulation of the anti-COVID vaccine.
    • The PM’s visit was one more reminder of the critical importance of public-private partnerships.
    • The PM signalled the government’s receptivity to external expert advice.
    • The CEOs reaffirmed their commitment to partnering with the state to help address not just this medical crisis but also the many other social and humanitarian problems.
    • The government has appreciated that the model for sustainable development in a post-COVID world must be a collaborative one.
    • Businesses will repurpose their goals and look beyond profits.

    Working together to deal with the crises of global dimensions

    • COVID-19 was not the first, nor will it be the last crisis of global dimensions.
    • The threat of global warming, for instance, hangs over our heads.
    • Its impact is less immediate and for the present, at least less palpable.
    • But it looms and its consequences are existential.
    • COVID has offered, it is the tangible evidence that no one entity or group — the state, markets, businesses, entrepreneurs, scientists — can tackle existing and emergent economic and social problems on their own.
    • They have to work together to resolve them.

    Business uncertainties

    • Businesses has been the uncertainty of operating in the post-COVID digital world.
    • Every business leader has, in some form or other, expressed three types of uncertainties.
    • 1) Is their business facing a hinge moment, necessitating the reimagining and re-engineering of their strategy and product portfolio?
    • Or are they witnessing no more than another turn of the business cycle and that, once the vaccine is developed and distributed, the market will return to business as usual?
    • Or will conditions necessitate a middle of the road approach: Stay the pre- COVID course but at the same time, speed up the pivot toward a new business model.
    • Most business leaders are adopting this third hybrid path.
    • The key to corporate success in a digital world in which a distinct incident could influence it, is the capability of leaders to think out of the box and to handle the unexpected.
    • Financial, technological and human resources will be necessary, but they will not be sufficient.

    Consider the question “The post-covid development model must be based on the cooperation underscored by the public-private partnership as the challenges that could emerge are not possible to be tackled by any on entitiy. Comment”

    Conclusion

    COVID has “obliterated the one remaining obstacle to a digital future — human attitudes”. Covid forced them to adopt and adapt. The challenge for our business leaders will be to navigate a pathway that sustains the benefits of these tools but without deepening the existing social and economic inequalities. Life is not digital for millions in our country.

  • Carrying out transformational reforms in military

    The article examines issues of national security like the recent creation of a Department of Military Affairs (DMA) and a Chief of Defence Staff (CDS) and also some focus areas like Threatre Command. 

    Understanding the significance of  DMA and CDS

    • Through the creation of Chief of Defence Staff (CDS), the management of the armed forces, so far which was assigned to the civilian Defence Secretary, was brought under a military officer, the CDS.
    • The designation of CDS as Secretary DMA made him the first military officer to be recognised as a functionary of the Government of India (GoI).
    • With the DMA is now a part of the GoI, it would aid the resolution of organisational, hierarchical and financial issues faced by the military.

    Recent steps taken by DMA

    • The responsibility for accruing savings to fund defence expenditure has been placed on the DMA.
    • DMA has floated two schemes aimed at reducing the defence pensions bill.
    • One penalises officers seeking early release from service and another envisages a three-year “Tour of Duty” for jawans.
    • Issues with these ideas:
    • Penalising officers for early release is likely to harm morale.
    • “Tour of Duty” will degrade the military’s combat-capability in today’s technology-intensive battle-space.
    • The need here is that DMA must focus on military matters and leave the plans of financing national defence to finance ministry or the Niti Aayog. It will better serve it’s purpose.

    Another area of needed reform – Theatre Command

    • Theatre Commands stands for jointness and integration in the Indian military are varying degrees of synergy and cross-service cooperation between the military wings of Indian armed forces.
    • Objectives of the creation of theatre command should be:
    • To hand over the military’s warfighting functions to the Theatre Commanders, while retaining the support functions with service HQs.
    • To combine India’s 17 widely-dispersed, single-service Commands into four or five mission/threat-oriented, geographically contiguous “Joint” or “Theatre Commands”.
    • To place the appropriate warfighting resources of all three services directly under the command of the designated Theatre Commanders; and
    • To achieve efficiency/economy by pooling of facilities and resources of the three services.

    Advantages of Theatre Commands

    • The Theatre Commanders and their staff will be trained and groomed in jointness.
    • With that jointness, they will be able to plan operations and to employ land, maritime and air forces, regardless of the service to which they belong.
    • For this to happen, radical changes are required in the content of our system of professional military education.
    • The Theatre Commander will also have the benefit of advice from commanders representing each service.

    Issues with Theatre Commands

    • Two thorny issues are the chain of command of the Theatre Commanders and the relationship of the CDS (or his equivalent) with the service Chiefs.
    • To avoid over-concentration of power in any single military functionary, the system followed by the US ensures that the chain of command runs from the President to the Secretary (Minister) of Defence and then, directly to the Theatre Commander.
    • In India, the peacetime management of the armed forces is left to the MoD and the Chiefs of Staff Committee (COSC).
    • However, during war, strategic guidance to the military,  has always come from the PM.
    • In the system of higher defence under implementation, ideally, the Defence Minister needs to be brought into the command/operational chain of the Theatre Commanders, with the CDS acting as his adviser.
    • Due to frequency of elections and intensity of politics in India that no Defence Minister has had the time or inclination to devote his/her undivided attention to complex national security issues.

    Consider the question “Examine the implications of the creation of Theatre Commands. What are the challenges in its creation.”

    Conclusion

    India’s military reforms are complex, the GoI needs to seriously consider the constitution of a Parliamentary Committee, with military advisers, to oversee and guide this transformational process.