Coronavirus – Health and Governance Issues

One country, two viruses

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

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2- What India can learn from China's dealing with the coronavirus outbreak?
Context

China’s handling of coronavirus, in contrast to SARS, has been effective, should be a template for others.

Why lockdown of Wuhan is a big deal?
- A move without precedent: China’s lockdown of roughly 60 million people in Wuhan and other cities in Hubei province for more than a month now is without precedent in the history of public health.
- Best way to stop the virus from spreading: The best way to stop a virus from spreading from person to person, is to give it no place to spread to.
  - This is achieved by isolating those who are infected and quarantining those who might be infected.
- Cordon sanitaire: In China, though, the control has moved beyond traditional quarantine to a cordon sanitaire-an exclusion zone people cannot travel into or get out of.
  - In most countries, this simply would not work for a period this long and a population that large.
- Inconceivable move in other places: Wuhan is a city of 11 million people, slightly larger than Chennai or Bengaluru. It would be inconceivable to think of cutting off transportation in and out of these cities or asking people to stay at home for even a day, let alone a month.
  - No political control nor administrative mechanism: Like India, most countries in the world have neither the political control to impose their will on people this way nor the administrative mechanism to enforce this degree of control.
Human cost and ethic of the lockdown
- The human cost: The human cost of such a strategy is immense.
  - Feeling of being unable to escape: The fear induced by being unable to escape from a place where a new virus is circulating is immense.
  - The worries and stresses of everyday life multiply one hundred-fold when everything from shopping for food to occupying children stuck at home becomes a challenge.
  - The slightest cough, cold or fever can trigger panic.
- Ethics involved in the move: The ethics of the cordon sanitaire in Wuhan, as well as the quarantining by Japanese authorities of the cruise ship Diamond Princess, will be debated for years after this particular outbreak is over.
- Slowing the spread: But whatever its human and financial cost, China’s actions in the first month of the outbreak helped to slow the spread of the virus within the country as well as internationally.
How China’s response this time is different from the SARS
- On December 31, the Chinese government informed the WHO, and the world, of the existence of a form of pneumonia of unknown cause
  - It also told the people of Wuhan to wear masks if they had symptoms and seek medical attention.
- Virus identification: For the world, the big breakthrough from China came on January 7, when researchers in Wuhan identified the virus as a new coronavirus.
- Sharing of the genetic sequence of the virus: Two days later, China shared its genetic sequence with the world.
  - How genetic sequence helped? The sharing of the genetic sequence allowed labs all over the world to develop testing kits to detect the disease.
  - It also put countries on the alert for travellers with the disease, without which the new coronavirus would have spread much quicker and farther than it has so far.
- China’s response to SARS: The Chinese response to SARS in 2003, in contrast to this, was a cover-up.
  - The disease circulated for nearly three months, enabled by government secrecy and censorship.
  - Spread of disease without warning: When travellers from China brought the disease first to Hong Kong and from there to other cities across the globe, there was no warning.
  - It was only after the disease spread in Hong Kong, that scientists and public health experts began to decipher this new virus.
  - Lessons learned: China, fortunately, learned the lessons for SARS and put together systems to identify and respond to this new disease quickly.
What India can learn from China
- Infrastructure with speed: Public health officials all over the world, including in India, should study the speed with which China put together an infrastructure to deal with this new disease.
  - Modern, well-equipped hospitals dedicated to coronavirus patients were constructed in weeks.
- Centralised information and logistic system: Centralised information and logistics systems and systems to ensure coordination between multiple levels of government -from the central government to provincial and municipal governments, were put into place.
  - All the systems seem to have worked reasonably smoothly, given the chaotic and complex atmosphere of a disease outbreak.
- Unique approach: The way China has tackled this disease has been an “all of government, all of the society approach”, in the words of Bruce Aylward, the leader of the WHO team that recently spent two weeks in the country.
  - It was, as he described it, “a very old-fashioned approach”, but one that had “prevented at least tens of thousands, but probably hundreds of thousands of cases.”
Conclusion
- In all probability, it is only a matter of time before India sees new cases. The Indian health system, as in China, is multi-layered. Some states like Kerala have strong public health infrastructure and a strong response capability. Many other states like Uttar Pradesh and Bihar do not have strong public health systems. They will find it difficult to respond and will learn that diseases, like the revolution, can be brutal.
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Tax Reforms

No gains for taxpayers

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

Note4Students
From UPSC perspective, the following things are important:
Prelims level: DDT-What is dividend distribution tax?
Mains level: Paper 3- What are the steps taken in the budget in order to simplify the taxation in India.
Context

Loss expected from lower tax rates may be countered by gains from the settlement of cases, higher dividend taxes on top incomes, and the wider scope for taxing international incomes.

Simplification and providing ease to the taxpayers
- Fiscal constraints leaving no room for a lower rate: Ahead of The Union budget, taxpayers had anticipated a wide range of measures that they hoped would stoke demand.
  - These ranged from lower tax rates to a more even tax structure on income from various sources.
  - As the former was less feasible given the fiscal constraints, the budget proposals focused on simplification and providing ease to the taxpayer.
- Simplification in personal tax: The recalibration of personal income tax slabs was suggested as a step towards simplification.
  - However, its uptake is contingent on the preference for new slabs.
  - Who will not opt for a new slab? Switching over to the new slab rates is not beneficial to-
  - An individual currently claiming full exemptions.
  - An individual with incomes comprising largely of capital gains.
  - It is possible, however, that individuals do not claim such exemptions or deductions.
- How switching to new slab impact revenue? An analysis of data published by the Central Board of Direct Taxes suggests that for the assessment year 2018-19, it suggest improvement in the collection.
  - 1% improvement: If individuals do switch over to the new regime, it may translate to a 1 per cent improvement in tax collections, rather than a loss.
- Limited takers of the new slab: It can be inferred that this option may be exercised by few individuals, if at all, since the potential gains from foregoing exemptions and the intended simplification is expected to be limited.
Tax disputes
- The new scheme proposed: A common concern among taxpayers is protracted disputes. To reduce litigation, a new scheme has been proposed.
- Importance of precedence in disputes: 39 per cent of the cases made a reference to a similar case in the previous year. This underscores the importance of precedence.
- In such cases, the settlement is not a superior option as the waiver of the penalty and interest does not offer any advantage against a decision that would impact future assessment.
- Success rates of disputes: The success rate of the tax department is 27 per cent at the Income Tax Appellate Tribunal (ITAT) and the Supreme Court and 12 per cent in appeals filed in high courts.
  - Given the odds of success, an assessee may thus be tempted to pursue litigation.
- Incentivising the settlement: Taxpayers may choose to settle for the waiver of interest and penalty in cases where it is one time and does not set a precedent for future transactions.
Dividend Distribution Tax (DDT)
- What is DDT? It is one of the significant change is in the taxation of dividends.
  - The dividend distribution tax is a unique levy on distributed profits and is payable by the distributing company.
  - What is the shortcoming in DDT? The shortcoming of such tax is that foreign investors can’t claim the credit.
  - Additional 10 % of DDT: In an effort to make the tax progressive, an additional dividend tax of 10 per cent was introduced for domestic investors receiving dividend in excess of Rs 10 lakh.
- Dividend pay-out decreased after DDT: Changes in DDT were accompanied by a decline in dividend pay-out – the proportion of profits paid as dividends declined from 30 per cent in early 2000s to 22 per cent in 2019 (BSE 500 companies).
  - Chance of improvement in pay-outs: It is expected that the reversion to the classical system may improve dividends pay-outs.
  - However, this will benefit individual taxpayers with incomes below Rs 5 lakh as the slab rate applicable is less than the existing rate.
Taxing cross-border income
- In the international arena, India is determined to tax cross-border incomes.
- Taxing digital companies: The addition of explanation 3A to the Income Tax Act reinforces India’s commitment to taxing digital companies.
- What comprises the business with nexus to India: The proposed amendment clarifies that incomes related to the advertisement, sale of data of a person residing in India and sale of goods and services based on the data of a person residing in India, may be attributed to a business with nexus in India.
- Taxing citizen not taxable anywhere: To tax Indian citizens that are not taxable in any other jurisdiction, the Act will now deem such individuals as resident taxable in India.
  - While the application of the law may be challenged giving rise to disputes, it is a step forward.
The proposal of Citizen’s charter
- Charter on rights and obligations: The finance minister also referred to introducing a citizen’s charter that incorporates taxpayer’s rights and obligations.
  - Limits of charters: International experience shows that charters have limited enforceability unless adopted in primary legislation.
- Supporting charters with legislation: Introducing charter to the statutes may, therefore, prove to be a positive initiative.
  - Faith can be built through enforcement of the charter.
  - However, the penal provisions must be well-thought-out so as to avoid adding another contentious element.
Conclusion
- Lack of uniformity: The budget proposals aimed to provide simplicity, yet much remains to be done, given the lack of uniformity in the taxation of incomes such as capital gains.
- Limited revenue implications: The success of schemes proposed is contingent on the traction they gain. As for the revenue implications, the impact of these measures may, in fact, be limited.
- Countering loss through gains from settlements: Loss expected from lower tax rates may be countered by gains from the settlement of cases, higher dividend taxes on top incomes, and the wider scope for taxing international incomes.
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Aadhaar Card Issues

Aadhaar, no standout performer in welfare delivery

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

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2- Aadhaar- how it has fared so far?
Context

Aadhaar-based biometric authentication did not reduce PDS leakages, finds Jharkhand-based empirical study

What was the rationale behind Aadhaar?
- What did the UIDAI’s report say? Aadhaar has curtailed leakages of government subsidies. Through Aadhaar, savings worth ₹90,000 crores have accrued to the government– UIDAI’s2017-18 annual report.
- Plugging the leakages in the schemes: When Aadhaar was conceived a decade ago, the rationale postulated was: India spends nearly three trillion rupees a year across several core welfare programmes such as Public Distribution System (PDS), LPG, Mahatma Gandhi National Rural Employment Guarantee Act etc.
  - Huge leakage due to duplications: Roughly 30-40% of this three trillion is lost in leakages.
  - Leakages are largely due to ‘ghost’ and ‘duplicate’ beneficiaries using fake identities to avail these benefits; a unique identity biometric scheme can eliminate these leakages and vastly improve efficiency in welfare delivery.
- Improve welfare delivery efficiency: In fact, the former Union Minister, Arun Jaitley, even renamed the Aadhaar Bill to ‘Targeted Delivery of Financial and other Subsidies, Benefits and Services’ Bill, making it amply clear that Aadhaar’s primary, if not sole purpose, was to improve welfare delivery efficiency.
What are the findings of study?
- How was the study carried out?
  - Use of RCT and sample of 15 million people: They conducted a scientifically designed study of the PDS system in Jharkhand covering 15 million beneficiaries using the technique of randomised control trials (RCT).
  - In the study, one set of beneficiaries went through the Aadhaar-based biometric authentication while the other group used the old system of procuring their ration.
- The results were then compared to see if Aadhaar-based biometric authentication had any impact in reducing leakages.
- What were the findings of the study?
- No measurable benefit: The study concluded that Aadhaar-based biometric authentication had no measurable benefit.
  - No reduction in leakages: Aadhaar-based biometric authentication did not reduce leakages due to elimination of ghosts and duplicates, as widely perceived.
- Increase in transaction costs for beneficiary: On the other hand, they found that Aadhaar-based biometric authentication increased transaction costs for beneficiaries.
  - 17% extra cost: That is, to claim ration worth ₹40, beneficiaries in the Aadhaar system incurred an additional ₹7 of costs than those in the old system, because of multiple trips to authenticate themselves and the opportunity cost of time spent.
  - This is a whopping 17% extra cost burden of the value of the benefit they were entitled to receive.
- Type 1 error of exclusion: To make matters worse, Aadhaar-based biometric authentication also introduced what empirical scientists call Type I error of exclusion.
  - Aadhaar authentication falsely rejected genuine PDS beneficiaries who were then denied their ration supplies.
  - The study finds that nearly 10% of legitimate beneficiaries were denied their ration either because they did not have their Aadhaar linked to their ration card or due to an exclusion error.
- Summary of the finding: In summary, the study states that there was-
  - No direct impact of Aadhaar in reducing leakages.
  - 2. It denied ration to 10% of genuine beneficiaries and increased costs by 17% to those that were forced to get their ration using Aadhaar.
  - Pain with no gain: They conclude that Aadhaar authentication for PDS in Jharkhand caused “some pain with no gain”.
What premises were wrong about Addhaar?
- No testing of empirical belief: There was a widespread belief among the policy elite that ghosts and duplicates were the scourge of India’s welfare delivery and that Aadhaar would eliminate this.
  - But this belief was never empirically tested.
  - Based on this belief, an entire story was concocted about improving welfare efficiency by eliminating ghosts and duplicates with Aadhaar and a whole new law was enacted to this effect.
- The pilot project not carried out: Many studies now establish that ghosts and duplicates are not the significant cause of leakages.
  - It would have been better to have undertaken a robust pilot project of scale to test the belief about ghosts and duplicates, before embarking on it nationwide.
Conclusion

In a sociologist’s world and in a liberal society, a policy that could run the risk of denying welfare to just a few people, putting their lives at risk, is not worth implementing regardless of how many millions it benefits.
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Water Management – Institutional Reforms, Conservation Efforts, etc.

Debating water quality

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

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2- Jal Jeevan Mission, ensuring quality drinking water.
Context

The competitive politics of Delhi election has brought the issue of drinking water to centre stage.

Controversy over BIS water status report
- Politicising of the report: The controversy started with the release of the BIS report for 21 major Indian cities, in keeping with the objectives of the ‘Jal Jeevan Mission’.
  - The mission aims to provide safe piped water to all households by 2024.
  - The fact that drinking water in Delhi was ranked the most unsafe, as the samples failed in 19 out of 28 parameters, was challenged by the Government of Delhi and the Delhi Jal Board (DJB).
- Compilation of information on the existing status: The study is scheduled to cover all districts in the country within a year. Supply of potable water obviously requires first compilation of information on the existing status
- Water as an urgent concern: The fact that water should be treated as an urgent concern for public health and the ecosystem of the country cannot be denied.
- Imperceptible threat: The threats to human health due to poor water quality, except when they appear as an epidemic, are largely imperceptible.
  - This generally subjects the population to subtle health problems without its knowledge or consent.
Pollution and water crisis in India
- Pollution contributing to water crisis: India is on the throes of a severe water crisis, not only because of a gradual reduction in per capita availability of water due to a rising population but also because of rising and unchecked pollution in the country’s rivers and water bodies.
  - It is a fact which is mostly overlooked in the deliberations on water resources management.
- Only 30% sewage treatment capacity in major cities: As per published estimates of the Central Pollution Control Board, the country has a treatment capacity of only about 30% of sewage generated in the major cities.
  - Not to talk of other urban and rural areas where the sewage finds its way to local water bodies or rivers without treatment.
Impending water stress in the country
- NITI Aayog report: A 2018 Report of the NITI Aayog has observed that currently, 600 million Indians face high to extreme water stress.
  - The report also states that about two lakh people die every year due to inadequate access to safe water.
- Demand twice the supply by 2030: The crisis is only going to get worse.
  - By 2030, the country’s water demand is projected to be twice the available supply, implying severe water scarcity for hundreds of millions of people.
- High methane in Yamuna water in Delhi: For the water coming from the Yamuna released from Haryana, the DJB has to often stop the supply for a few days if the concentration of methane goes up beyond a certain level.
  - This is because the tri-chloromethane that may be produced during the disinfection process is highly carcinogenic.
  - The effect may surface on human health not immediately but over a period of time.
The capital’s high pollutant load and need for improvement in governance
- Contributing 50% pollutant: Delhi, which constitutes less than 1% of the total catchment of the Yamuna, contributes more than 50% of total pollutant load in the river.
  - Delhi has 7,000 km of sewer line as on date, against a requirement of 24,000 km.
  - The 17 sewage treatment plants being operated by the DJB are able to take care of not more than 30% of sewage treatment.
- There is no sewerage system at all for over 45% of the population in unauthorised and even regularised colonies and rural areas.
- As of now, there are 18 major drains carrying sewage, garbage and industrial effluents into the Yamuna.
- Solid waste dumping in Yamuna: It is not only the untreated sewage water and industrial effluents, but also the solid wastes and construction material discharged by individuals, companies and municipal bodies that have caused the suffocation of the Yamuna.
  - Also, floodplains have been encroached upon by settlements.
- Challenge of supplying quality water: Ensuring the supply of quality drinking water is not only expensive, but it also needs improvement in governance.
  - It needs technical knowledge on measurement and regulation of water quality.
  - It is not the fault of the DJB or the Delhi government alone that they have not been able to ensure a 100% supply of quality water to the citizens of Delhi.
  - Given the constraints they face, especially those concerning the water resources management and laws in the country.
Conclusion

The Jal Jeevan Mission, even if it has not been so far structured, conceptualised and funded adequately, has begun the important work of gathering information on the scale and scope of the problem and making it available in an open and transparent manner. The best outcome is that the competitive politics of the Delhi election has ensured a political debate on water quality.
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Important Judgements In News

When a court pronounces a verdict, without giving reasons

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

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2- Supreme Court delivering its judgement without giving the reasons and its implications.
Context

In a highly unusual move, a nine-judge Bench of the Supreme Court resorted to a non-speaking order as it ruled affirmatively on the preliminary issue arising out of the Sabarimala review petition.

Departure from norms
- The importance of a ‘reasoned decision’ in a constitutional democracy committed to the rule of law, is self-evident.
  - Its importance cannot be overstated and this curious departure from the norm merits close analysis.
- Time and again, the Supreme Court has unequivocally endorsed and underlined the requirement of giving reasons in support of the order.
  - The SC has often chastised subordinate institutions for their failure to supplement their orders with reasons.
Importance of ‘reasoned decision’
- The juristic basis for the ‘reasoned decision’: The juristic basis for this has also been explored in a number of cases.
- In various decisions, the court has ruled that speaking orders promote-
  - Judicial accountability and transparency.
  - Inspire public confidence in the administration of justice; and
  - Introduce clarity and minimise the chances of arbitrariness.
- Quotes from various judgements: In addition to being a “healthy discipline for all those who exercise power over others”, recording of reasons has been described by the Supreme Court as the “heartbeat of every conclusion”; the “life blood of judicial decision making”; and a cherished principle of “natural justice”.
- The Madhya Pradesh Industries Ltd case: In this case Justice Subba Rao K. stated:
  - “The condition to give reasons introduces clarity and excludes or at any rate minimises arbitrariness;”
  - “… it gives satisfaction to the party against whom the order is made; and it also enables an appellate or supervisory court to keep the tribunals within bound… Speaking order will at its best be reasonable and at its worst be at least a plausible one.”
Devaluation by the SC and implications
- Implicit rules: The need for a court to provide an intellectual substrate for its decisions is also implicit in the expression “pronounce judgment” in Supreme Court Rules, 2013.
  - According to settled decisions, the same signifies “judicial determination by reasoned order”.
- However, when it came to applying the principle to its own verdict, the apex court has inadvertently devalued the importance of concurrent reporting of reasons.
  - The court seems to have downplayed the fact that it may be coming across as inarticulate at best and indecisive at worst.
- Undermining integrity: Besides undermining institutional integrity, a decision’s authority as a binding precedent is also potentially compromised by this omission.
Culture of justification
- The term “transformative constitutionalism” has recently found currency in constitutional adjudication (Navtej Joharand Joseph Shine).
  - The Supreme Court is yet to articulate a comprehensive theory of the concept but it has been fleshed out in other jurisdictions.
- From authority to justification: For example, Pius Langa, former Chief Justice of the Constitutional Court of South Africa, argued that “transformative constitutionalism” entails a transformation of legal culture from one “based on authority” to the one “based on justification”.
- Karl Klare (the scholar who coined the term) posited that it may be legitimately expected of constitutional adjudication to “innovate and model intellectual and institutional practices appropriate to a culture of justification”.
Conclusion

In light of the above, it can be concluded that the practice of issuing non-speaking orders and giving post-hoc rationalisations later is an anathema to the principle of constitutional governance. Duty to give reasons is an incident of the judicial process and constitutional justice should not be a matter of afterthought.
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Electoral Reforms In India

More psychological than an empowering voter option

op-ed snap | Polity | Mains Paper 2: Representation Of People’s Act

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2- How NOTA has fared so far, what are the shortcomings and scope.
Context

The recently-concluded Delhi Assembly elections were the 45th Assembly polls since the inception of the none of the above (NOTA) option in 2013. And Delhi, although mostly urban, is widely regarded as the microcosm of India.

NOTA in Delhi
- Delhi’s preference to NOTA is less than the national average.
- From 0.63% in 2013, Delhi polled 0.39% of those favouring NOTA in 2015, a statistically significant reduction indeed.
  - It now increased to 46% in 2020; again statistically significant.
- While 96% of the constituencies had a reduced percentage of NOTA votes in 2015 than 2013, the NOTA percentage has increased in 71% constituencies this year.
- In the Lok Sabha elections, Delhi polled 0.47% and 0.52% of those favouring NOTA, in 2014 and 2019, respectively.
- Takeaway: Roughly one in 200 voters of Delhi opted for NOTA in the last six to seven years, with relatively larger support for NOTA in reserved constituencies.
Gujarat and Maharashtra examples
- Interestingly, in the 2017 Gujarat Assembly elections, despite being 1.8%, NOTA got more votes than any political party other than the Indian National Congress and the Bharatiya Janata Party (except the Independents).
- Again, in the 2019 Maharashtra Assembly election, NOTA became a runner-up in two constituencies – Latur (Rural) and Palus-Kadegaon.
- Do these cases mark any significant shift in the voter mindset?
Essence and scope of NOTA
- Not a right to reject: In 2013, India became the 14th country to institute negative voting through NOTA.
  - However, it is not a “right to reject”.
- Toothless option: NOTA in India is a toothless option.
  - Former Chief Election Commissioner of India S.Y. Quraishi, had observed in an article: “Even if there are 99 NOTA votes out of a total of 100, and candidate X gets just one vote, X is the winner, having obtained the only valid vote. The rest will be treated as invalid or ‘no votes’.”
- Not right to select: NOTA enfeebles the electorate as it does not empower to “select” either.
- Democratic means to express resentment: Certainly NOTA provides democratic means to express resentment anonymously rather than boycotting the polls outright.
  - A group of women activists in Kerala out on the road urging people not to elect any candidate if no woman was present in the fray.
  - A youth group in Tamil Nadu that campaigned for NOTA as a protest vote against corruption.
- Pleas to extend the scope of NOTA: There have been pleas to extend the scope of NOTA.
  - Recommendation of re-elections: In 2018, a former CEC, T.S. Krishnamurthy, has recommended holding elections again in those constituencies where the victory margin is less than the total numbers of NOTA.
  - Right to reject in place of NOTA: A PIL has been filed in Madras High Court seeking the full right to reject in place of NOTA.
Cases of extending the scope of NOTA
- Maharashtra SEC order: In June 2018, the Maharashtra State Election Commission (SEC) issued an order that said:
  - “If it is noticed while counting that NOTA has received the highest number of valid votes, the said election for that particular seat shall be countermanded and a fresh election shall be held for such a post.”
- NOTA as a fictional candidate in Haryana: In November 2018, the SEC of Haryana went a step further and issued an order where NOTA is treated like a “fictional candidate” in municipal polls from December 2018.
  - If NOTA gets the maximum vote, none of the “real” candidates will be declared elected, and the elections will be cancelled and held afresh.
  - What is more, the candidates securing votes less than NOTA would be barred from contesting in that re-election.
- Example from Indonesia: Interestingly, in Makassar, Indonesia, the only candidate in the 2018 election for mayor received 35,000 less votes than NOTA, which forced a repeat election in 2020.
The optimism expressed by the Supreme Court on NOTA
- The SC’s anticipation: While introducing NOTA, the Supreme Court anticipated that “there will be a systemic change and the political parties will be forced to accept the will of the people and field candidates who are known for their integrity.”
  - Thus, its percentage should either increase to enforce the political parties to field candidates with “integrity”.
  - Or NOTA percentage should consistently decrease if the electorates feel that the system has achieved the desired level of cleansing.
- No increase or decrease in NOTA votes: In contrast, the share of NOTA votes in India remained around a meagre level of 1% on an average; 1.11% in the 2014 Lok Sabha, and 1.08% in 2019, if we consider constituency-wise averages.
- What this represents? This perhaps represents a confused state of mind of the electorate. Has the perceived cynicism of Indian voters regarding the right to reject been exaggerated?
Would NOTB- None of The Below more advantageous?
- Last option disadvantage? Is NOTA, as the last button of all EVMs in the country, a psychological issue as far as the electorates are concerned?
- First position on ballot advantage: A 2004 article in The Journal of Politics, have discussed the possible advantage of the first position in the ballot, at least in the U.S. context.
- NOTB instead of NOTA: Although there is no such concrete study to gauge the Indian voter’s mindset, one wonders whether using NOTB (‘none of the below’) instead of NOTA- with such an option as the first on the electronic voting machine — might produce a significantly different outcome or not.
  - An experiment, after changing the rule suitably, can be attempted, at least.
Conclusion

Extending the scope of NOTA by empowering it with the right to reject along with other changes like placing NOTA at the top of EVM would help in making the election process clean and fair.
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Citizenship and Related Issues

Rights, duties and the Constitution

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- Conflating duties and rights and its consequences.
Context

At an International Judicial Conference 2020 this weekend, the Chief Justice of India, S.A. Bobde, drew attention to the Constitution’s Fundamental Duties chapter.

The logic of duties
- Wide range of duties: The first thing to note is that as citizens, there exists a wide range of duties that bind us in everyday life.
  - Duties towards the state and individual: These duties are owed both to the state and to other individuals.
- Legal duties: We have a legal duty to pay our taxes, to refrain from committing violence against our fellow-citizens, and to follow other laws that Parliament has enacted.
  - Breach of these legal duties triggers financial consequences (fines), or even time in jail.
- Following the duties is price for living in the society: At any given time, therefore, we are already following a host of duties, which guide and constrain how we may behave.
  - This is the price that must be paid for living in society, and it is a price that nobody, at least, in principle, objects to paying.
- Self-contained whole: Our duties and the consequences we bear for failing to keep them, therefore, exist as a self-contained whole.
  - Co-existence and sacrifice: The peaceful co-existence requires a degree of self-sacrifice, and that if necessary, this must be enforced through the set of sanctions.
The logic of rights
- Understanding the logic through history: Rights, on the other hand, follow a different logic entirely. This is a logic that is best understood through history.
  - Two concerns: At the time of the framing of the Indian Constitution and its chapter on Fundamental Rights, there were two important concerns animating the Constituent Assembly.
  - Treatment as subjects: The first was that under the colonial regime, Indians had been treated as subjects.
  - Their interests did not count, their voices were unheard, and in some cases — for example, the “Criminal Tribes”- they were treated as less than human.
  - Holocaust example: Apart from the long and brutal history of colonialism, the framers also had before them the recent example of the Holocaust, where the dignity of more than six million people had been stripped before their eventual genocide.
- The first role of fundamental rights chapter: To stand as a bulwark against dehumanisation.
  - Dignity and equality guaranteed: Every human being no matter who they were or what they did had a claim to basic dignity and equality that no state could take away, no matter what the provocation.
  - Unconditional right: One did not have to successfully perform any duty, or meet a threshold of worthiness, to qualify as a rights bearer. It was simply what it meant to be human.
- Second role of the fundamental rights: To stand against the hierarchy.
  - Removing the subordination and degradation: The axes of gender, caste and religion had all served to keep masses of individuals in permanent conditions of subordination and degradation.
  - Equalising and democratising: Through guarantees against-
  - Forced labour.
  - Against “untouchability”.
  - Against discriminatory access to public spaces, and others.
  - Fundamental rights were meant to play an equalising and democratising role throughout society, and to protect individuals against the depredations visited on them by their fellow human beings.
- Significance of the above two roles
  - Transformative purpose: The twin principles of anti-dehumanisation and anti-hierarchy reveal the transformative purpose of the fundamental rights chapter.
  - The recognition that true democracy could not exist without ensuring that at a basic level, the dignity and equality of individuals were protected, both from the state as well as from social majorities.
  - Rise from subject to citizen: It was only with these guarantees could an individual rise from the status of subject to that of the citizen.
  - And, as should be clear by now, it was only after that transformation had been wrought, that the question of duties could even arise.
- Importance of the language of the duty:
  - The language of duties can play an important role in a society that continues to be divided and unequal.
  - In such a society, those who possess or benefit from entrenched structural and institutional power (starting with the state, and going downwards) certainly have a “duty” not to use that power to the detriment of those upon whom they wield it.
  - That is precisely what the guarantees against “untouchability”, forced labour, and discriminatory access in the Constitution seek to accomplish.
Issue of conflating duties and rights
- The problem lies in the conflation of rights and duties.
- In that context, it is always critical to remember Dr B.R. Ambedkar’s words in the Constituent Assembly (which were also cited by the CJI in his speech): that the fundamental unit of the Constitution remains the individual.
- If the position of the individual and the Constitution’s commitment to combating hierarchy is kept in mind, then the language of duties can be understood in its proper context.
- Chances of duties leading to unpleasant consequences: Without the moral compass of rights and their place in the transformative Constitutional scheme the language of duties can lead to unpleasant consequences.
  - It can end up entrenching existing power structures by placing the burden of “duties” upon those that are already vulnerable and marginalised.
- The constitution is about rights: It is for this reason that, at the end of the day, the Constitution, a charter of liberation, is fundamentally about rights.
Conclusion

It is only after guarantee to all the full sum of humanity, dignity, equality, and freedom promised by the Constitution, that we can ask of them to do their duty. Perhaps, then, it is time to update Hind Swaraj for the constitutional age: “real duties are the result of the fulfilment of rights”.
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Foreign Policy Watch: India-United States

A U.S. strategy only meant to isolate China

op-ed snap | International Relations | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India,Effect Of Policies & Politics Of World On India’S Interests

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2-Balancing India's interests in the light of US's strategy to contain China in the Pacific.
Context

Since 2017, the United States government has released a few reports and fact sheets on its new Indo-Pacific strategy. Buried in these documents is a much deeper agenda of the U.S. government: to use three large Asian states — Australia, India, and Japan — to isolate China. There is nothing else to it.

The scale of BRI and the US objections
- Objections to BRI: The U.S. government has made it clear that what it finds most objectionable is China’s Belt and Road Initiative (BRI), which has signed on more than 70 countries in the world.
- What BRI aims to achieve? Adopted in 2013, the BRI is intended as a mechanism to-
  - Development of new markets: BRI aims to end China’s reliance upon the markets of the West and to develop new markets in other continents.
  - Building infra: It is also intended to use China’s massive surpluses to build infrastructure in key parts of Africa, Asia, and Latin America.
  - Investment of $ 1.3 trillion: By 2027, according to estimates by Morgan Stanley, China will spend about $1.3 trillion on this ambitious construction project.
  - Involvement of Saudi Arabia: Even Saudi Arabia, a close ally of the U.S., has made the BRI one of the cornerstones of its Saudi Vision 2030 plan.
- Involvement of Pakistan: While China has invested $68 billion to build the China-Pakistan Economic Corridor from Xinjiang to Pakistan’s Gwadar Port.
  - Saudi Arabia has agreed to invest $10 billion in the port itself.
Significance of the BRI and comparison with the US spending
- Staggering scale and participation: The scale of Chinese investment, and the participation of a range of countries with different political identities in the BRI, is staggering.
- Loss of appetite in the US to spend: At the Indo-Pacific Business Forum in July 2018 the U.S. said that it has spent $2.9 billion through the Department of State and the USAID (United States Agency for International Development).
  - It has lined up hundreds of millions of dollars more through its U.S. Millennium Challenge Corporation (MCC) and the Overseas Private Investment Corporation.
  - Inadequate US spending: If one adds up all the money that the U.S. intends to spend for economic projects, it is still a fraction of the amount spent by China.
  - ‘America First’ attitude: There is no appetite in Washington, D.C., with its ‘America First’ attitude, to funnel more money towards investments in the region currently being built by the BRI.
Military Claims of the US and investment
- US investment with military presence: It appears as if U.S. investments will come only with military claims.
  - The case of Nepal: A few years ago, Nepal discovered a large amount of uranium in Mustang, near the Nepal-China border; this has certainly motivated U.S. interest in Nepal’s economy.
  - If the U.S. money comes with U.S. military presence, this will create a serious flashpoint in the Himalayas.
Raising human right and transparency issue against China
- The argument of human rights and transparency
  - Rhetorical argument: Unable to outspend the Chinese, the U.S. government is making a rhetorical argument that it has more respect for “transparency, human rights, and democratic values” than China, which “practices repression at home and abroad”.
- The argument of transparency and the debt trap
  - Debt trap used by the US: It is hard to imagine the U.S. being “transparent” with its trade deals. It is equally hard to imagine the U.S. being able to argue that it would not put countries into debt.
  - Debt crisis created by the US in the 1980s: The U.S. government enabled a massive Third World debt crisis in the 1980s, which was then used by the U.S.-driven International Monetary Fund’s Structural Adjustment Programs to strangle countries in Africa, Asia, and Latin America.
  - This history is alive, and it makes a mockery of the U.S.’s attempt to say that its own approach is superior to that of China’s.
US withdrawal from multilateralism
- Apart from that, the U.S. government has already indicated that it is uninterested in multilateral deals.
- Withdrawal from TPP: The US withdrew from the Trans-Pacific Partnership in 2017, for instance.
  - Australia and Japan shrugged, and then put their energy into the Regional Comprehensive Economic Partnership, which sidelines the U.S.
The claim of free and open Indo-Pacific
- Renaming the Pacific Command: In May 2018, the U.S. military’s Pacific Command was renamed the Indo-Pacific Command, a symbolic gesture that provides a military aspect to the Indo-Pacific Strategy.
- What free and open mean to the US? The U.S. government has made it clear that for all its talk of a “free and open Indo-Pacific”, what it actually wants is an Indo-Pacific with fewer Chinese ships and more U.S. warships.
- Just before this renaming, the U.S. National Security Strategy of 2017 noted that “China seeks to displace the United States in the Indo-Pacific region”, and so the Indo-Pacific Strategy intends for the S. to fight for its dominance in the Pacific Ocean, the Indian Ocean, and in the Asian rim.
- This is a very dangerous war that the U.S. seeks to impose on Asia.
India adopting the US project of Indo-Pacific
- Australia and Japan moving away: As the military aspect of the Strategy increased, both Australia and Japan edged away from full-scale adoption of the U.S. project.
  - Japan has begun to use the term “Indo-Pacific” without the word “Strategy”.
  - Australia has signed onto a “comprehensive strategic partnership” with China.
- Only India adopting the project: Only India remains loyal to the agenda set by U.S. President Donald Trump.
  - No US strategy to contain China: In all the documents released by the U.S. government and in all the speeches by officials, there is no discussion of the strategy to contain China.
  - There is only rhetoric that skates into the belligerent territory.
Conclusion

India would be advised to study the U.S. project rather than jump into it eagerly. Room for an independent foreign policy for India is already narrowed, and room for independent trade policy is equally suffocated. To remain the subordinate ally of the U.S. suggests that India will miss an opportunity to be part of a reshaped Asia.
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Right To Privacy

The issues around data localisation

op-ed snap | Governance | Mains Paper 2: Government Scheme/Policies

Note4Students
From UPSC perspective, the following things are important:
Prelims level: Not much.
Mains level: Paper 2- Data localisation and issues involved.
Context

The contentious clauses on local data storage in the revised Personal Data Protection Bill need re-examination.

What Personal Data Protection Bill contains?
- Greater control to an individual: The draft law is a comprehensive piece of legislation that seeks to give individuals greater control over how their personal data is collected, stored and used.
- The promise of improvement over the current privacy law: Once passed, the law promises a huge improvement on current Indian privacy law, which is both inadequate and improperly enforced.
- Criticism of the bill: The proposed bill has attracted criticism on various grounds such as-
  - The exceptions created for the state.
  - The limited checks imposed on state surveillance, and-
  - Regarding various deficiencies in the structures and processes of the proposed Data Protection Authority.
The issue over the “data localisation”
- Data within the country: The phrase, which can refer to any restrictions on cross-border transfer of data, has largely come to refer to the need to physically locate data within the country.
- Provisions for the transfer of personal data outside India: The PDP Bill enables the transfer of personal data outside India, with the sub-category of sensitive personal data have to be mirrored in the country (e. a copy will have to be kept in the country).
  - Ban on transfer of critical data outside the country: Data processing/collecting entities will, however, be barred from transferring critical personal data (a category that the government can notify at a subsequent stage) outside the country.
  - Different from Justice Srikrishna committee report: These above provisions have been changed from the earlier version of the draft Bill, released by the Justice Srikrishna Committee in 2018.
  - The 2018 draft imposed more stringent measures that required both personal and sensitive personal data to be mirrored in the country (subject to different conditions).
  - Welcome move: The move to liberalise the provisions in the 2019 version of the Bill is undoubtedly welcome, particularly for businesses and users.
How removing the restriction matters?
- Reduction in cost to business: Liberalised requirements will limit costs to business and ensure users have greater flexibility in choosing where to store their data.
- More proportionate approach: The changes in the 2019 draft reflect a more proportionate approach to the issue as they implement a tiered system for cross-border data transfer, ostensibly based on the sensitivity/vulnerability of the data.
- Move-in accordance with the right to privacy: This seems in accord with the Supreme Court’s dicta in the 2017 Puttaswamy case.
- Conditions for interference in privacy: The Court had made it clear that interference in the fundamental right to privacy would only be permissible if inter alia deemed necessary and proportionate.
Test of proportionality in the bill
- On closer examination, it appears that even the revised law may not actually stand the test of proportionality.
- The three-argument for imposing norms: There are broadly three sets of arguments advanced in favour of imposing stringent data localisation norms:
  - Sovereignty and government functions. Referring to the need to recognise Indian data as a resource to be used to further national interest (economically and strategically), and-
  - To enable enforcement of Indian law and state functions.
  - Accruing benefits to the local industry: The second claim is that economic benefits will accrue to local industry in terms of creating local infrastructure, employment and contributions to the AI ecosystem.
  - Protection of civil liberties: Regarding the protection of civil liberties, the argument is that local hosting of data will enhance its privacy and security by ensuring Indian law applies to the data and users can access local remedies.
- Contradiction in the claim of protection? If data protection was required for the above purposes, it would make sense to ensure that local copies were retained of all the categories of personal data provided for in the Bill (as was the case with the previous draft of the law).
  - Sectoral obligations: In the alternative, sectoral obligations would also suffice as is currently the case with sectors such as digital payments data, certain types of telecom data, government data, etc.
- Will data localisation lead to privacy protection? We note that the security of data is determined more by the technical measures, skills, cybersecurity protocols, etc. put in place rather than its mere location.
  - Localisation may make it easier for domestic surveillance over citizens.
  - Enabler of better exercise of privacy by citizens: It may also enable the better exercise of privacy rights by Indian citizens against any form of unauthorised access to data, including by foreign intelligence.
  - Effectiveness matters: The degree of protection afforded to data will depend on the effectiveness of the applicable data protection regime.
- Protecting privacy through less intrusive measures: Insofar as privacy is concerned, this could be equally protected through less intrusive, suitable and equally effective measures such as requirements for contractual conditions and using adequacy tests for the jurisdiction of the transfer.
  - Such conditions are already provided for in the PDP Bill as a set of secondary conditions.
  - The European Union’s General Data Protection Regulation too uses a similar framework.
  - Extra-territorial operation: The extraterritorial application of the PDP Bill also ensures that the data protection obligations under the law continue to exist even if the data is transferred outside the country.
- Giving an individual a choice: If privacy protection is the real consideration, individuals ought to be able to choose to store their data in any location which afford them the strongest privacy protections.
  - It is arguable that data of Indians will continue to be more secure if stored and processed in the European Union or California.
  - These two jurisdictions have strong data protection laws and advanced technical ecosystems.
Way forward
- Identification of the issues: The joint parliamentary committee ought to, ideally, identify the need, purpose and practicality of putting in place even the (relatively liberal) measures contained in the PDP Bill.
- Broader thinking at policy level: Further, in order for localisation-related norms to bear fruit, either in terms of protecting citizen rights, enabling law enforcement access to data or enabling the development of the local economy, there has to be broader thinking at the policy level.
  - This may include for instance-
  - Reforming surveillance-related laws.
  - Entering into more detailed and up-to-date mutual legal assistance treaties.
  - Enabling the development of sufficient digital infrastructure, and
  - Creating appropriate data-sharing policies that preserve privacy and other third party rights, while enabling data to be used for socially useful purposes.
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Tax Reforms

Making the super-rich pay their fair share

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- Ending the opacity in the financial system and making the multinationals pay their fair share of tax.
Context

It is now beyond obvious that India cannot revive its economy without increasing public spending, and so increasing its fiscal resources is essential. Among other measures, this requires urgent adoption of legislation and institutional reforms to end financial opacity.

The opacity in the data
- Unlikely Budget estimates: The Union Budget was presented, based on numbers for revised estimates for the current year and Budget estimates for the coming year that the Finance Ministry itself knows are
- Where else the opacity in data extends: The opacity of data also extends to cross-border movement of funds generated through a range of activities, including tax evasion, misappropriation of state assets, laundering of the proceeds of crime, and bribery.
  - Even here, India still has a lot to do, as confirmed by the recent publication of the Financial Secrecy Index by the Tax Justice Network, a U.K.-based financial advocacy group.
- Financial Secrecy Index rank: On the surface, India has managed to reduce its contribution to global financial secrecy, with its rank falling from 32 on the 2018 index to 47 in 2020.
  - But this is partly because the new edition of the index covers more countries than it did two years ago.
Transparency Reforms by the government
- Arrangement with Switzerland: It is true that the government has adopted and supported a few transparency reforms, such as the automatic exchange of tax and financial information with other jurisdictions, like Switzerland.
  - What the arrangement with Switzerland mean? If an Indian citizen has an account with a Swiss bank and has a balance over a certain threshold, this information will be sent to the Indian tax authorities automatically.
- Beneficial ownership register: The government did create a beneficial ownership register- which would allow the identification of the beneficial owner of an asset regardless of whose name the title of the property is in.
  - Exemption making the law weak: The law is weak since it exempts a lot of people at the discretion of the authorities.
  - Also, this register is not accessible to the public.
Making multinationals and the super-rich pay their fair share of taxes
- Need to do more: Stopping the financial haemorrhage and making multinationals and the super-rich pay their fair share of taxes requires much more.
- Capital flight and consequence for the country’s development: Capital flight out of India by Indian elites and foreigners alike has been undermining our country’s development for decades.
  - Outdated international system: An important part of these flows is the result of artificial profit shifting by multinational companies taking advantage of an outdated international tax system.
- How the multinationals shifts profits? These multinationals may be making profits in India but can easily declare those profits in a low tax jurisdiction like Hong Kong and justify that transaction as a payment for the use of a patent.
  - The magnitude of loss-$27.5 billion: According to one estimate, this strategy represented a loss of $27.5 billion in 2014 for the Indian government, up from $142 million in 2000.
Onshore financial services and issues with it
- Paradoxical decision: Three years ago, the government took the paradoxical decision to set up onshore international financial services in the country.
  - This is how the International Financial Services Centre in the Gujarat International Finance Tec-City (GIFT-City), Gandhinagar, emerged.
  - It was modelled after offshore financial centres such as Hong Kong, Singapore, the City of London and Dubai.
- Increasing the possibility of regulatory arbitrage: While this has not created much employment, it has led to growing possibilities for regulatory arbitrage by financial firms, with potentially very problematic consequences.
The issue with the policy of tax incentives
- Little evidence of attracting investment: The government keeps granting tax incentives on a discretionary basis, even though there is little evidence that these incentives attract investment.
- What factors matters for investment: Recent research by International Monetary Fund, factors such as-
  - Quality of infrastructure.
  - A healthy and skilled workforce.
  - Market access and-
  - Political stability matters much more.
- Consequences of the policy-reduction in tax revenue: The massive reduction in corporate tax rates has thus far not led to any increase in private investment.
  - But it has meant a significant reduction in tax revenues, with devastating consequences.
  - Implications for health, educations etc.: Reduction in tax revenue translates into a lack of resources for education, healthcare, food and nutrition and infrastructure.
  - Low tax-GDP ratio: India is already an outlier among similarly placed developing countries with its low tax-GDP ratio of 18%.
  - Making the budget dependent on indirect taxes: The government budget is also highly dependent on indirect taxes like the Goods and Services Tax which are regressive and hit ordinary citizens harder.
Way forward
- Legislation to end financial opacity: Adoption of legislation and institutional reforms to end financial opacity- including, for example-
  - Opening the beneficial ownership register to the public and-
  - Stopping the creation of onshore tax havens is the need of the hour.
- Opening the debate on how to make the multinationals pay their fair share: The Government of India must also assume a more vocal role in the international debate about how to make multinationals pay their fair share of taxes.
  - This means continuing to appeal for a United Nations tax body, which is much more legitimate than the Organisation for Economic Co-operation and Development (OECD).
  - The issue with the OECD’s proposal: The OECD’s proposals, published at the end of 2019, are neither ambitious nor fair enough.
- Explore the possibility of going alone: If the organisation continues to remain deaf to the demands of developing countries, India must be prepared to go it alone, thinking unilaterally about how to make multinationals pay what they owe.
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Type: op-ed snap