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Type: Op-ed

  • Riding on data for mobility

    Context

    Data-based governance can assist in reducing traffic congestion, as illustrated by a pilot study in Hyderabad.

    How the Digital revolution is transforming lives

    • Seamless and efficient interaction: The digital revolution has made interactions between humans and machines, and among citizens, governments and businesses, seamless and efficient.
    • Helping efficient delivery of services: Today, e-governance enables and empowers citizens to directly engage with the state, thereby eliminating barriers in the delivery of public services.
    • The next wave of transformation: The next wave of transformation in digital governance is at the intersection of data and the public good.
      • Data as a strategic asset: The key to this transformation lies in incorporating data as a strategic asset in all aspects of-
      • Policy.
      • Planning.
      • Service delivery and-
      • Operations of the government.

    Transportation system improvement by leveraging Digital revolution

    • Loss caused by the congestion
      • Congestion caused an estimated $24 billion to the four metro cities in India in 2018.
      • Given the limited land resources available, the key to solving congestion lies in improving the efficiency of existing transportation systems.
    • How can Digital revolution help tackle the problem?
      • An efficient transportation system would help ease congestion, reduce travel time and cost, and provide greater convenience.
      • How it will work? Data from multiple sources such as-
      • CCTV cameras.
      • Automatic traffic 
      • Map services and-
      • Transportation service providers could be used.
    • Results of the previous studies
      • London example: A study by Transport for London estimates that its open data initiative on sharing of real-time transit data has helped add £130 million a year to London’s economy by improving productivity and efficiency.
      • Results from China: In China, an artificial intelligence-based traffic management platform developed by Alibaba has helped improve average speeds by 15%.

    Hyderabad Open Transit Data portal

    • Hyderabad Open Transit Data, launched by Open Data Telangana, is the country’s first data portal.
      • What does it do? It publishes datasets on bus stops, bus routes, metro routes, metro stations, schedules, fares, and frequency of public transit services.
    • The objective of the portal: The objective is to empower start-ups and developers to create useful mobility applications.
      • The datasets were built after an intensive exercise carried out by the Open Data Team and Telangana State Road Transport Corporation to collect, verify and digitise the data.
    • Collaboration with the private sector: Hyderabad has also begun collaborating with the private sector to improve traffic infrastructure.
      • MoU with Ola Mobility Institute: One such partnership followed a Memorandum of Understanding signed between the Telangana government and Ola Mobility Institute.
      • Monitoring the quality of roads in the city: Under this collaboration, Ola has developed a tool, Ola City Sense, to provide data-based insights that can monitor the quality of Hyderabad’s roads and identify bad quality patches.
      • Other areas in which the data is used: The information thus given is useful not only for carrying out road repairs, it also helps officials take initiatives to improve road safety, monitor quality of construction, and study the role of bad roads in causing congestion.
    • A pilot project to prioritisation of repairs: A pilot was implemented in a municipal zone to gauge the efficacy of the data in supporting road monitoring and prioritisation of repairs.
      • The early results of this pilot project were encouraging. The dashboard helped city officials plan the pre-monsoon repair work and budget for repairs last year.

    Conclusion

    • The willingness of the government to apply data-based insights: The Hyderabad project and the pilot demonstrated the willingness of government departments to apply data-based insights for better decision making.
      • This could also serve as a model for other cities to emulate.
    • Making the departments data-centric: The Hyderabad example also shows that governments can make their departments data-centric by-
      • Institutionalising data collection.
      • Building technology platforms.
      • And helping the departments develop the capacity to handle the insights generated from the data.
      • Smart cities as a starting point: Command and control centres under the ‘smart cities’ initiative can be an ideal starting point.
      • Data security and privacy: Such interventions, however, also need to address genuine concerns around data security and privacy.

     

     

  • Nutrition and the Budget’s fine print

    Context

    There are well-equipped schemes to address the malnutrition, plugging the policy gaps is the problem.

    Nutrition and hunger in India

    • Global Hunger Index rank 102: A few months ago, the Global Hunger Index, reported that India suffers from “serious” hunger, ranked 102 out of 117 countries.
    • Only one-tenth of children getting proper diet: Just a tenth of children between six to 23 months are fed a minimum acceptable diet.
    • Urgency reflected in the budget: The urgency around nutrition was reflected in the Union Finance Minister’s Budget speech, as she referred to the “unprecedented” scale of developments under the scheme for Holistic Nutrition, or POSHAN Abhiyaan, the National Nutrition Mission with efforts to track the status of 10 crore households.
    • The Economic Survey notes that “Food is not just an end in itself but also an essential ingredient in the growth of human capital and therefore important for national wealth creation”.
    • How malnutrition affects? Malnutrition affects cognitive ability, workforce days and health, impacting as much as 16% of GDP (World Food Programme and World Bank).

    Addressing Nutrition through Agriculture

    • Multiple dimension of malnutrition: There are multiple dimensions of malnutrition that include-
      • Calorific deficiency.
      • Protein hunger.
      • Micronutrient deficiency.
    • Addressing the issue through Agriculture: An important approach to address nutrition is through agriculture.
      • The Bharatiya Poshan Krishi Kosh which was launched in 2019 is a recent attempt to bridge this gap.
      • The krishi kosh was launched by Ministry of Women and Child Development along with Bill & Melinda Gates Foundation (BMGF).
      • Existing schemes can well address India’s malnutrition dilemma. Following is the analysis of budgetary allocation and expenditure in the previous year.

    First- Calorific deficiency

    • The Integrated Child Development Services (ICDS) scheme provides a package of services including-
      • Supplementary nutrition.
      • Nutrition and health education.
      • Health check-ups and
      • Referral services addressing children, pregnant and lactating mothers and adolescent girls, key groups to address community malnutrition, and which also tackle calorific deficiency and beyond.
      • Underutilisation of funds: For 2019-20, the allotment was ₹27,584.37 crore but revised estimates are ₹24,954.50 crore, which points to an underutilisation of resources.
      • Which area needs the emphasis: The allocation this year is marginally higher, but clearly, the emphasis needs to be on implementation.
    • Mid-Day Meal Scheme: Another pathway to address hunger is the Mid-Day Meal Scheme, to enhance the nutrition of schoolchildren.
      • Here too, the issue is not with allocation but with expenditure.
      • The 2019-20 Budget allocation was ₹11,000 crore and revised estimates are only ₹9,912 crores.

    Second-Protein Hunger

    • Contribution of pulses: Pulses are a major contributor to address protein hunger.
      • Underutilisation of funds: A scheme for State and Union Territories aims to reach pulses into welfare schemes (Mid-Day Meal, Public Distribution System, ICDS) has revised estimates standing at just ₹370 crores against ₹800 crore allocation in the 2019-20 Budget.

    Third-micronutrient deficiency

    • Horticulture Mission: The Horticulture Mission can be one of the ways to address micronutrient deficiency effectively, but here too implementation is low.
      • Revised estimates for 2019-20 stand at ₹1,583.50 crores against an allocation of ₹2,225 crores.
    • National Millet Mission: In 2018-19, the Government of India launched a national millet mission which included renaming millets as “nutri-cereals” also launching a Year of Millets in 2018-19 to promote nutritious cereals in a campaign mode across the country.
      • This could have been further emphasised in the Budget as well as in the National Food Security Mission (NFSM) which includes millets.
      • Under-utilisation of funds: The NFSM strains to implement the allocation of ₹2,000 crores during 2019-20, as revised expenditures stand at ₹1,776.90 crore.
      • Need to sustain the momentum: As millets have the potential to address micronutrient deficiencies, the momentum given to these cereals needs to be sustained.

    POSHAN Abhiyan and issues involved

    • 72% expenditure on technology: The National Nutrition Mission which is a major initiative to address malnutrition, had 72% of total expenditure going into “Information and Communication Technology.
      • Misplaced focus: The focus of the bulk of the funding has been on technology, whereas, actually, it is a convergence that is crucial to address nutrition.
      • Under-utilisation of funds: Only 34% of funds released by the Government of India were spent from FY 2017-18 to FY 2019-20 till November 30, 2019.
      • Limiting the possibility of an increase in the allocation: With underspending, allocations for subsequent years will also be affected, limiting the possibility of increasing budgets and the focus on nutrition schemes.

    Agriculture-nutrition link

    • The agriculture-nutrition link is another piece of the puzzle.
    • Link not explicitly mentioned: While agriculture dominated the initial Budget speech, the link between agriculture and nutrition was not explicit.
      • Why the link is important: The link is important because about three-fifths of rural households are agricultural in India (National Sample Survey Office, 70th round)
      • The malnutrition rates, particularly in rural areas are high (National Family Health Survey-4).
      • Need for greater emphasis: Agriculture-nutrition linkage schemes have the potential for greater impact and need greater emphasis.

    Way forward

    • Focus: Focus on nutrition-related interventions, beyond digitisation.
    • Bring all departments in one place: Intensify the convergence component of POSHAN Abhiyaan, using the platform to bring all departments in one place to address nutrition.
    • Nutrition based activities by farmer-producer: Direct the announcement to form 10,000 farmer producer organisations with an allocation of ₹500 crores to nutrition-based activities.
    • Youth schemes: Promotion of youth schemes to be directed to nutrition-agriculture link activities in rural areas.
    • Emphasis on fund allocation: Give explicit emphasis and fund allocation to agriculture-nutrition linked schemes.
    • Early disbursement and utilisation of funds: Ensure early disbursement of funds and optimum utilisation of schemes linked to nutrition.

    Conclusion

    Nutrition goes beyond just food, with economic, health, water sanitation, gender perspectives and social norms contributing to better nutrition. This is why the implementation of multiple schemes can contribute to better nutrition.

     

  • A new approach on investment

    Context

    When Prime Minister Narendra Modi welcomes U.S. President Donald Trump to India this month the two leaders are expected to sign a first-ever trade agreement.

    What will be on the agenda of the trade deal?

    • GSP issues: The restoration of India’s Generalised System of Preferences benefits,
    • Pricing of medical devices.
    • And agriculture trade are all important.
    • Incremental outcomes: If the two sides continue efforts to achieve incremental outcomes, the start of negotiations on a comprehensive free trade agreement (FTA) could even be a credible scenario. Presently, this is not the case.

    What could be the incremental outcomes?

    • The most obvious candidates are-
      • Intellectual property rights (IPR).
      • IPR has historically been an area of contention between the two, but discussions on IPR have progressed well in recent years.
      • Digital trade.
      • Both are grappling with the appropriate scope and approach for regulating electronic commerce issues in this digital age.
      • Ideally, there should be room to seriously consider better ways to encourage skilled professionals to work in the other’s economy.
    • Progress on the investment

    There are already some shared interests in the area of investment.

    • For example, India invests in the U.S. and continues to seek U.S. investment in India.
    • FDI issue: Foreign direct investment (FDI), this is an important moment to do more to encourage it than simply welcoming it.
    • Need to negotiate o investment: Ideally, the two sides should move ahead to negotiate an agreement on investment matters that can provide greater transparency, predictability, and regulatory certainty to investors from the other country.
    • Negotiation on FDI off the table: It appears that the traditional approach through which countries pursue commitments on FDI, bilateral investment treaties, or ‘BITs’ (bilateral investment treaties) is off the table.
    • The Trump administration has put a hold on negotiating additional BITs and appears to be suspicious of how well they balance U.S. interests.
    • The Indian government is similarly sceptical of BITs, having cancelled all existing ones soon after it came into office.

    Need for the new approach on the investment issues

    • Until they resume their work on BITs, the two sides may find common ground in devising a new approach to investment issue.
    • What the new approach involve?
    • Taking cues from their respective FTAs: A starting point should be to review what they have done in their recent FTAs.
    • Abandonment of investor-state dispute settlement: The recently concluded U.S.-Mexico-Canada Agreement contains a novel approach on investment notably its abandonment of investor-state dispute settlement with respect to the U.S. and Canada.
      • Similarly, the Regional Comprehensive Economic Partnership, which India had been negotiating with ASEAN, Australia, China, Japan, Korea, and New Zealand, does not include investor-state dispute settlement.
      • While India chose not to join the Regional Comprehensive Economic Partnership when it was concluded at the end of last year, it appears to have been on board with the FTA’s investment provisions.
    • Where the agreement focus as of now? For now, however, both countries should focus on what is doable. A U.S.-India investment agreement could focus on-
      • Fair treatment for investors from the other country.
      • Regulatory transparency and predictability.
      • And approaches for resolving concerns short of investor-state dispute settlements.
    • At a later stage: At a later stage-
      • Most likely when the two are prepared to negotiate a more comprehensive bilateral FTA, they can go further on investment matters.

    Conclusion

    A new, hybrid approach on investment would be a substantial step in the right direction. It will be critical to sustaining momentum coming out of a first trade deal when the two leaders meet in Delhi. If India and the U.S. fail this test, the trade relationship is more likely to languish than blossom.

     

  • Shun fiscal adventurism

    Context

    In the run-up to the budget, there was enormous pressure on the finance minister to launch a fiscal stimulus so as to pump-prime the economy. That she did not succumb to the temptation is a big relief.

    Why fiscal stimulus is unwarranted?

    • There is already considerable stimulus in the system. 
    • Excessive fiscal deficit: To her credit, the finance minister took a step towards transparency by admitting to off-balance-sheet borrowings of 0.8 per cent of GDP for both the current and next fiscal year.
      • Acknowledging that the fiscal deficit would actually be higher at 4.6 per cent and 4.3 per cent of GDP respectively. This is already excessive.
    • Unrealistic projection of revenue growth: Add to this the unrealistic projections of revenue growth and disinvestment proceeds for next year and we have a potentially unsustainable fiscal situation.
      • Any stimulus on top of this would have been clearly

    Possibility of undermining the RBI’s efforts

    Fiscal pressure could harm the RBI’s efforts to revive the economy in the following ways-

    • Harming long term investment rates: Fiscal pressures will undermine the Reserve Bank of India’s struggle to revive investment by bringing down long-term interest rates.
    • Rating downgrades: It could result in a sovereign rating downgrade and jeopardise efforts to attract foreign capital.
    • Increase in inflationary pressure: It can stoke inflationary pressures, something we cannot afford when inflation is above the RBI’s target rate.
    • Pressure on the external sector: And most importantly, it can lead to pressures on the external sector.
    • Past experiences: The balance of payments crisis of 1991 and the near crisis of 2013 in the wake of taper tantrums were, at their heart, a consequence of extended fiscal profligacy.

    Counter-arguments of the supporters of the stimulus and fallacies in it

    • Low Debt-to-GDP ratio: It is argued that our debt-to-GDP ratio is low in international terms.
      • Misleading comparison: The data don’t bear this out. In any case, our experience, as well as research, shows that international comparisons of debt-to-GDP ratios, without reference to other parameters, are misleading.
    • Debt in domestic currency: It is also argued that we do not need to worry because our debt is mostly in domestic currency unlike that of many emerging economies.
      • The fallacy in this argument: Our debt in the domestic market didn’t protect us from previous crises, and there is no reason to believe that it will protect us from the next one, especially as our foreign debt is proportionally higher than before.
    • Robust foreign exchange reserves: It is argued that our foreign exchange reserves are robust and a balance of payments crisis is improbable. Such complacency is misplaced.
      • Fallacy- No forex is large enough in bad times: We should not forget the lesson that in good times any amount of forex reserves looks like it is too large, but in bad times no amount of reserves is large enough.

    Quality of fiscal consolidation

    • Quality a cause for concern: As much as the headline fiscal deficit numbers are a cause for concern, the underlying quality of fiscal consolidation is a bigger concern.
    • Increasing revenue deficit: Conveniently off the radar, the revenue deficit, far from coming down, is actually going up.
      • Two-third borrowing to finance revenue expenditure: This year, more than two-thirds of what the government is borrowing is going to finance current expenditures like salaries, pensions, interest payments and subsidies.
      • That ratio will rise to three-quarters next year.
      • Crowding out of the expenditure: This debt-financed revenue expenditure is simply unsustainable as it will increasingly crowd out capital expenditure.
    • Red flags on the state finances.
      • Another dimension of the quality of fiscal consolidation is the combined fiscal position of states which is, in fact, the big elephant in the room.
      • Together, states spend one-and-a-half times more than the Centre.
      • Larger development impact than Centre: Studies show that how efficiently states spend their money has a much greater development impact as compared to the Centre.
      • Red flags by the RBI on states finances: The states are not doing a good job. In its latest annual report on state finances, the RBI raised several red flags on state finances-
      • states’ increasing weakness in their own revenue generation.
      • Their unsustainable debt burdens.
      • And their tendency to retrench capital expenditures in order to accommodate fiscal shocks such as farm loan waivers, power sector loans under UDAY and a host of income transfer schemes.
      • Consequences in the market: The market will penalise mismanagement of public finances; it does not care who is responsible — the Centre or states — for an unsustainable fiscal stance.

    Conclusion

    • The fear of one-off fiscal stimulus becoming permanent: By far the biggest fear about a fiscal stimulus is that it is tempting to plunge into a spending programme saying it is a one-off and will be withdrawn when the pressure eases. Experience shows that it is very difficult to bail out. It is good that the finance minster avoided doing any such thing.
      • As Milton Friedman famously said, there is nothing more permanent than a temporary government programme.
    • Need to kick-start the private investment: What the economy needs for a sustained turnaround is kick-starting private investment.
      • Implementation of reforms: A necessary condition for inspiring investor confidence is the implementation of structural and governance reforms. This will be a long-haul.
      • That the budget did not launch the journey is a big disappointment. But, at least, the budget did not make a bad situation worse by embarking on fiscal adventurism.
      • It’s better, as Keynes said, to be roughly right than precisely wrong.

     

     

  • A mix Indian health care can do without

    Context

    In India, multiple policy pronouncements over the last few years have expressed an implicit intent to emulate certain features of the U.S. health system which is one of the most prodigal health systems, and it is a well-known reality that it is infamously poor-performing.

    Emulating the U.S. health system in India and problems in this approach

    • Implicit intent to emulate the U.S. system: In India, multiple policy pronouncements over the last few years have expressed an implicit intent to emulate certain features of the U.S. health system like-
      • Enhance private initiative.
      • And uphold the insurance route as the way to go for health care.
    • AB-NHPS scheme: These are being largely envisaged while riding on the back of the Ayushman Bharat-National Health Protection Scheme (AB-NHPS).
      • AB-NHPS aims to provide insurance cover to nearly 50 crores poor Indians.
      • The mechanism to check insurance frauds: The AB-NHPS affirmed strong mechanisms to check insurance fraud which was commonplace in its precursor programme, the Rashtriya Swasthya Bima Yojana (RSBY).
      • New of fraud in AB-NHPS: Recently, 171 hospitals were reported to have been de-empanelled from the AB-NHPS on charges of fraud.
    • How are the frauds in AB-NHPS sought to be tackled? The response to these has been envisaged through an unprecedented bolstering of administratively-heavy and technology-driven mechanisms.
      • Anti-fraud units: National- and state anti-fraud units have been established and partnerships with fraud control companies conceived.
      • One would ask this question: what is wrong in all of this?
    • What is wrong with this approach? Let us return to the U.S. once again.
      • Administrative intensive: Multiple layers of complex arrangements and concomitant complex regulatory provisions have made the U.S. system one of the most administratively and technologically intensive systems in the world.
      • 50% spending going for the wages: More than 50% of health-care spending in the U.S. in 2010 went into health worker’s wages, with a large chunk of the growth in health-care labour taking place in the form of non-clinical workers.
      • Very little going into improving health: What this entails is that for every penny spent on health care, very little goes into actually improving health.

    What are the concerns in emulating the U.S. system?

    • Sub-satisfactory operations at the large cost: The new system necessitates-
      • A battery of new structures.
      • Personnel cadres.
      • Data systems.
      • And working arrangements only in order to sub-satisfactorily operate an insurance scheme that would cover less than half the population.
      • Disregarding the death spiral that policy-driven over-reliance on private health care could lead to considerable costs which would not primarily contribute to improving health outcomes.
      • Ethical concerns over unnecessary spending: While a besottedness with cutting-edge technology and state-of-the-art systems can help garner eyes and promote businesses, each unnecessary penny incurred this way raises significant ethical concerns.
    • Problems of inadequate funding
      • Funding sufficient only for a quarter of beneficiary: Gupta and Roy have shown how the allocation for the AB-NHPS for 2019-20 would have covered less than a quarter of the targeted beneficiaries.
      • Paltry increase in allocations: For 2020-21, there has been a paltry increase in health-care sector allocation (5.7% above 2019-20 RE), while the allocation for the AB-NHPS is unchanged.
      • It is very possible that the AB-NHPS continues to remain insufficiently funded and incapable of extending considerable financial risk protection to the poor.
    • Diversion of limited funds to wasteful areas
      • Attractive on face: Embracing the complexities associated with robust regulation of the insurance programme and making the requisite technological and administrative investments appear attractive and commendable on the face.
      • Diversion of limited fund: However, these complexities entail diverting highly limited resources towards wasteful and dispensable high-end areas.
      • These funds could have been set aside for much more pressing and productive domains, such as public hospitals and health centres.
      • Improvements in these areas would have strongly reflected in terms of tangibly better health outcomes.
      • AB-NHPS reinforcing contradictions: Rather, the AB-NHPS appears attuned to reinforcing a stark contradiction wherein trailblazing but unproductive high-end structures thrive alongside decrepit but potentially fructuos basic structures.

    Conclusion

    The fanfare with which AB-NHPS was launched, can hide the pressing concerns which lie underneath. The government must ensure that every penny spent on improving healthcare is used in the most optimal way and ensure that India’s AB-NHPS won’t end up the US healthcare way.

  • The battle in Beijing

    Context

    The coronavirus epidemic poses a challenge to China’s place in global affairs, its political leadership.

    The possible implications of coronavirus crisis

    • The Chines leadership might not be able to escape the blame: If the epidemic turns into a pandemic, as some analysts bet, China’s all-powerful leader Xi Jinping might not be able to escape the blame.
      • And will likely come under considerable political pressure.
    • It could also turn into a systemic threat: Some also speculate that the backlash against the government’s mishandling of the crisis could turn into a systemic threat against the dominance of the Chinese Communist Party.
    • Speculations as perennial hope among China’s critics: Sceptics, however, dismiss above speculation as merely reflecting the perennial hope among Beijing’s harshest critics who can’t wait to see a China without the CCP.
      • Realist’s stand: Realists point to the massive mobilisation of state power by President Xi in limiting the spread of the virus.

    Handling of the crisis by China

    • Initial faltering response: To be sure, there were major failures in the initial faltering response to the crisis.
      • Cover-up attempts from the lower level: The attempts at the lower levels to cover-up or underplays the crisis and the inadequate appreciation at the higher levels of the potential consequences are common to all large bureaucracies. The party-state in China is not an exception.
    • Praise for handling the crisis: China’s handling of the crisis had drawn much respect, grudging or otherwise, from the international community.
      • Whether it is the lockdown of Hubei province and its capital Wuhan, from where the virus began to spread.
      • Or in deploying thousands of doctors and health workers in the province and building massive hospitals for treating the infected.
    • Possibility of some political impact: Yet, there is no question that a crisis of this magnitude -will have some political impact.
      • The party-state is certainly having some difficulty in containing the public outrage against the initial failures.
    • Efforts to shield top leadership from blame: The CCP, however, is bound to shield the supreme leader from any damaging criticism and in fact, celebrate a triumph in containing the spread through a determined effort.
      • Responsibility will be affixed on provincial officials in Hubei and a purge of some kind may have already begun.

    Addressing the economic consequences of the crisis

    • International dimension: Nearly two decades after the SARS epidemic -China is now a much larger economy and its interdependence with the world has only deepened.
      • This interdependence, in turn, lends a strong international dimension to China’s crisis.
    • Optimist’s hope of future uptick: Optimists hope that a sharp drop in economic activity in the current quarter will be followed by a steep uptick in growth in the next when the virus is contained and normalcy returns.
    • Pessimist’s fear of economic disruption: Pessimists suggest that the economic disruption — in terms of the impact on internal and external trade and the breakdown of the global supply chains- could have lasting effects.
      • Reinforcing the disruption: Some suspect that the disruption could reinforce the slowdown driven by a number of other internal and external factors including the trade war with the US.

    China’s response to the rest of the world

    • Channelling of resentment against the West: Some in the West hope that a prolonged economic crisis might turn the people against the CCP. For now, though, Beijing is channelling the resentment against the West.
    • Terming evacuation as an over-reaction: Beijing has criticised the advisories from various countries against travel to China and the cancellation of flights as over-reaction.
      • Lukewarm response to evacuation efforts: China has also been lukewarm to efforts of various countries to evacuate their citizens from Wuhan and Hubei.
      • India evacuated students: India has managed to convince Beijing to let India airlift its students from Wuhan.
      • Pakistan has declared that it will not evacuate its students as a gesture of political solidarity with China in a time of crisis.
      • South Asian neighbour’s response: Many of India’s other South Asian neighbours are torn between the reluctance to offend Chinese sentiment and the mounting domestic pressures to bring students back.
      • Cooperation with the US: While being critical of the US travel restrictions against China, Beijing has certainly been open to cooperation with the US in dealing with the crisis.
    • India’s offer to help other countries in evacuation: The external affairs minister Subrahmanyam Jaishankar said last week that India has been willing to bring back students from all the neighbouring countries.
      • Balancing between Delhi and Beijing: The logic of balancing between Delhi and Beijing has prevented most of the smaller neighbours from requesting Indian assistance.
      • The Maldives has been the only exception.
    • The response of the East and Southeast Asia: Beyond South Asia, many countries in East and Southeast Asia have been hesitant to be seen as rushing to cut themselves from China.
      • What is making these countries hesitant: Deep economic interdependence and massive flows of Chinese tourists led to much dithering among the East Asian countries in their early responses to the crisis.

    Conclusion

    India must explore all potential cooperative engagement with Beijing as well as its other international partners on pandemics-an important but the under-addressed challenge for national, regional and international security.

  • Seeking a more progressive abortion law

    Context

    The Medical Termination of Pregnancy Bill doesn’t do enough to secure women’s choices and interests.

    Deaths due to unsafe abortion and previous attempts to legislate

    • Deaths due to unsafe abortions: Recent reports have shown that more than 10 women die every day due to unsafe abortions in India.
      • And backward abortion laws only contribute to women seeking illegal and unsafe options.
    • The Cabinet has recently approved the Medical Termination of Pregnancy (Amendment) Bill, 2020 (MTP Bill, 2020) which will soon be tabled in Parliament.
      • It seeks to amend the Medical Termination of Pregnancy Act, 1971 (MTP Act) and follows the MTP Bills of 2014, 2017 and 2018, all of which previously lapsed in Parliament.

    Provisions of the current law

    • Foetus-age based division: The MTP Act divides its regulatory framework for allowing abortions into categories, according to the gestational age of the foetus.
      • Up to 12 weeks: Under Section 3, for foetuses that are aged up to 12 weeks-
      • Only one medical practitioner’s opinion is required to the effect that the continuance of the pregnancy would pose a risk to the life of the mother or cause grave injury to her physical or mental health.
      • Or there is a substantial risk that if the child is born, it would suffer from such physical or mental abnormalities as to be seriously handicapped.
      • Between 12 weeks and 20 weeks: But if the foetus is aged between 12 weeks and 20 weeks-
      • At least two medical practitioners’ opinions conforming to either of the two conditions are required.
      • What beyond 20 weeks? Beyond 20 weeks, termination may be carried out where it is necessary to save the life of the pregnant woman.
    • Definition of grave injury: The MTP Act also specifies that ‘grave injury’ may be explained as
      • The anguish caused by a pregnancy arising out of rape, or the anguish caused by an unwanted pregnancy arising out of the failure of a contraceptive used by a married woman or her husband.

    What are the issues with the current law?

    • Several issues arise from the current framework under the MTP Act.
    • First-Lac of autonomy of women: At all stages of the pregnancy, the healthcare providers, rather than the women seeking an abortion, have the final say on whether the abortion can be carried out.
      • It is true that factors such as failure of contraceptives or grave injury are not required to be proved under the MTP Act.
      • However, to get the pregnancy terminated solely based on her will, the woman may be compelled to lie or plead with the doctor.
      • Thus, at present, pregnant women lack autonomy in making the decision to terminate their pregnancy and have to bear additional mental stress, as well as the financial burden of getting a doctor’s approval.
      • On request abortion in 67 countries: Indian’s law is unlike the abortion laws in 67 countries, including Iceland, France, Canada, South Africa and Uruguay, where a woman can get an abortion ‘on request’ with or without a specific gestational limit (which is usually 12 weeks).
    • Second-Prejudice against unmarried women: The MTP Act embodies a clear prejudice against unmarried women.
      • According to ‘Explanation 2’ provided under Section 3(2) of the Act, where a pregnancy occurs due to failure of any birth control device or method used by any “married woman or her husband”, the anguish caused is presumed to constitute a “grave injury” to the mental health of the pregnant woman.
      • While the applicability of this provision to unmarried women is contested, there is always the danger of a more restrictive interpretation, especially when the final decision rests with the doctor and not the woman herself.
    • Third-Restriction of 20 weeks’ limit: Due to advancements in science, foetal abnormalities can now be detected even after 20 weeks.
      • Danger to mother’s life only condition after 20 weeks: The MTP Act presently allows abortion post 20 weeks only where it is necessary to save the life of the mother.
      • Problem with this restriction: The above restriction means that even if a substantial foetal abnormality is detected and the mother doesn’t want to bear life-long caregiving responsibilities and the mental agony associated with it, the law gives her no recourse unless there is a prospect of her death.

    What does the bill fail to address?

    • While the MTP Bill, 2020, is a step in the right direction, it still fails to address most of the problems with the MTP
    • First, it doesn’t allow abortion on request at any point after the pregnancy.
    • Second, it doesn’t take a step towards removing the prejudice against unmarried women by amending the relevant provision.
    • And finally, it enhances the gestational limit for legal abortion from 20 to 24 weeks only for specific categories of women such as survivors of rape, victims of incest, and minors.
      • This means that a woman who does not fall into these categories would not be able to seek an abortion beyond 20 weeks, even if she suffers from a grave physical or mental injury due to the pregnancy.

    What are the provisions for the case of foetal abnormality in the bill?

    • Limit irrelevant if the foetal abnormality is diagnosed by the Medical Board: The Bill does make the upper gestational limit irrelevant in procuring an abortion if there are substantial foetal abnormalities diagnosed by the Medical Board.
      • This means that even if there is no threat to the mother’s life, she would be able to procure an abortion as soon as a substantial foetal abnormality comes to light.
      • While this is an important step and would have in the past helped many women who fought long battles in Court without recourse.
      • Rules against unnecessary delays: It is crucial that this provision is accompanied by appropriate rules for the Medical Boards that guard against unnecessary delays, which only increase the risks associated with a late abortion.

    Conclusion

    • Recognition of women’s right: The Supreme Court has recognised women’s right to make reproductive choices and their decision to abort as a dimension of their personal liberty (in  X v. Union of India,2017) and as falling within the realm of the fundamental right to privacy (in K.S. Puttaswamy v. Union of India, 2017). Yet, current abortion laws fail to allow the exercise of this right.
    • The bill does not do enough: While it is hoped that MTP Bill, 2020 will not lapse in Parliament like its predecessors, it is evident that it does not do enough to secure women’s interests, and there is still a long road ahead for progressive abortion laws.

     

     

     

  • Victim justice is two steps forward, one step back

    Context

    The recent judgment in Rekha Murarka vs The State Of West Bengal, the SC has held that the victims’ private counsel cannot orally examine or cross-examine the witnesses.

    Place of the victim in the present criminal justice system

    • Removed from the proceedings: Under our criminal justice system, victims find themselves removed from the proceedings.
      • Their identities are reduced to being mere witnesses.
      • The harm they suffer is reduced to being aggravating or mitigating factors at the time of sentencing.
      • Stage props in a larger scheme: With the state appropriating their victimisation, the actual victims become mere stage props in a larger scheme.
    • Need of The victim-centric notion of justice-Law Commission suggestion: In 1996, the 154th Law Commission Report suggested a paradigm shift in India’s criminal justice system towards a victim-centric notion of justice.
      • Partial acceptance: The Code of Criminal Procedure (Amendment) Act, 2009 partially accepted the Law Commission suggestion and granted some rights to the victims of crime.
      • The Act introduced victims’ right to a private counsel under Section 24(8).
      • Move toward victim’s participation: The Code of Criminal Procedure already allowed for pleaders engaged by private persons to submit written arguments with the permission of the court under Sections 301(2) and 302 allowed a person to conduct the prosecution with permission of the court.
      • These sections were read together to partially secure the victims’ right to participation.

    Steps take  towards securing justice for victims

    • Right to legal assistance to victims of sexual assault: In the case of Delhi Domestic Working Women’s Forum v. Union of India (1994), the SC called for the extension of the right to legal assistance to victims of sexual assault at the pre-trial stages.
    • The SC opinion over asymmetry in rights of victims and the accused: In Mallikarjun Kodagali (Dead) … vs The State Of Karnataka (2018), the Court accepted that under the criminal justice system, the rights of the accused far outweigh the rights of the victim.
    • Introduction of victim impact statement right to appeal against the adverse order: The Supreme Court not only called for the introduction of a victim impact statement in order to guarantee the participation of the victim in the trial proceedings.
      • The SC also reinstated the victims’ right to appeal against an adverse order.

    Provisions on the international level for the victim’s participation

    • Despite these advances, the scheme of victim participation remains far removed from the ideals embedded in the Declaration of Basic Principles of Justice for Victims of Crime and Abuse of Power; India is a signatory.
      • What does the declaration require? It requires that the views and concerns of victims should be allowed and considered at all appropriate stages without prejudice to the accused.
    • Need to increase the victims’ advocate’s role: Presently, the victims’ advocate has an extremely limited role to play wherein he “assists” the prosecutor rather than represent the interests of the victim before the court.
      • The only substantial opportunity provided to a private counsel is after the closing of evidence when written arguments may be submitted to the court only after seeking the permission of the court.
    • Contrast with ICC: In contrast, the International Criminal Court (ICC) provides for victim participation at the stage of-
      • First, a challenge to the jurisdiction of the ICC.
      • Second, framing of charges.
      • Third, opening and closing statements.
      • Fourth, making a written submission wherever the personal interests of the victims are affected.
      • And finally, for presenting witnesses to give evidence on issues relating to the personal interests of the victims.

    What the SC judgement means

    • Missed opportunity: The Supreme Court in Rekha Murarkahas missed the opportunity to forward the jurisprudence on victim justice and rectify the lacunae in our laws.
      • Instead, the judgment goes against the jurisprudential current specified above.
      • Indeed, the victim’s right to participation cannot be secured by restricting the rights of the accused.
    • Why the victim’s advocate is not allowed the right to participate in the SC’s opinion: According to the judgment, a victim’s advocate cannot be allowed the right to participate because-
      • First- Insistence by the victim’s counsel to examine a witness deliberately left out by the prosecution may weaken the prosecution’s case;
      • Second– The trial will derogate into a “vindictive battle” between the victim’s counsel and the accused.
      • Third- A lack of experience on the part of the victim’s counsel may lead to lapses.
    • The problem in the SC ruling: The judgment further assumes that prosecutions effectively take the victim’s needs into account.
      • SC ignored why the need for private counsel arise: The judgement ignores the fact that the need for a private counsel arises precisely because intentional or unintentional prosecutorial lapses directly lead to injustice to the victims.
      • The court expects the victim’s counsel to make the prosecutor aware of any aspects that have not been addressed in the examination of witnesses or the arguments advanced by the public prosecutor.
      • In the process, it assumes that the prosecutor will address such lapses.

    Conclusion

    Under the role currently envisaged in our criminal justice system, the public prosecutor cannot sufficiently take into account the interests, needs and requirements of the victims. The cause of victim justice would be greatly served if the Supreme Court decided to revisit its reasoning and assumptions to appropriately amend this provision in light of the above.

     

     

  • RBI’s growth push

    Context

    February signalled a new dynamic-Monetary policy is no longer driven by MPC.

    What changed after December MPC review

    • Pause in the rate cut by MPC: In its December policy, the Reserve Bank of India suddenly paused on cutting rates, putting the ball in the government’s court to support growth.
    • Conservative union budget: With last week’s Union Budget belying expectations of short-term growth boosters, the ball was back in the RBI’s court.
      • The Budget opted for fiscal conservativism over activism, consolidating the fiscal deficit to 3.5 per cent of GDP in 2020-21 from 3.8 per cent in 2019-20– bypassing any ambitious expenditure boost or significant tax cuts.
    • Rise in the inflation in Dec-Feb interval: Meanwhile, the policy arithmetic turned more complicated for the MPC.
      • At the time of the December policy meeting, CPI inflation was trending close to 5 per cent (the October reading was 4.6 per cent).
      • Since then a combination of supply-side shocks, which led for example to unseasonally high vegetable and protein prices, buoyed inflation to over 7 per cent, nearly 140 basis points above the RBI’s upper bound comfort zone of 6 per cent.
      • As a primarily inflation-targeting central bank, this effectively stopped the MPC from easing further. 

    Key takeaways from February MPC meeting

    • The February policy meeting removed two key uncertainties in the current policy scenario.
    • First, the RBI is still very concerned about growth and the burgeoning negative gap between the current growth trajectory and potential growth.
    • Second, monetary policy is no longer strictly limited to the MPC’s decision-making.
      • Because of the risk of supply-side shocks hitting inflation, it is understandable that the RBI has summarised its outlook on inflation as “highly uncertain”.
      • Hence, of the policy measures that the RBI has at its disposal, the MPC’s “conventional” arrow of rate cuts was left unused.
      • Instead, the RBI has opted for macroprudential intervention, unveiling two other “unconventional” policy arrows.

    RBI opting for macroprudential intervention in two ways

    • Policy transmission via LTRO-the first arrow: The primary macro challenge has been transmission via the credit channel — banks are not lowering their deposit rates.
      • Why? This is due to competition from the small savings rate and to protect saver, and in turn are keeping lending rates high.
      • How it impacts economy: Sectors considered higher risk (real estate, MSMEs) find themselves credit-starved.
      • In a move that seems inspired by the European Central Bank’s quantitative easing in 2011, the RBI’s announcement on long term repo operations (LTROs) has been aimed at promising banks longer-duration liquidity at the repo rate, which is cheaper relative to their current deposit rates.
      • The aim is to nudge them to kick-start the credit cycle.
      • The exemption of cash reserve ratio for incremental loans to MSMEs and the retail sector is also aimed at lowering costs for banks, which ideally should be passed onto these sectors.
    • Managing the stress in financial system-the second arrow: It is aimed at managing the looming stress in the financial system from bad loans, especially as deleveraging becomes more difficult during an economic slowdown.
      • Extension to restructuring durations: The extension of the restructuring scheme on MSME loans and projects in the commercial real estate sector is aimed at releasing capital for banks in the short term.
      • Though banks will ultimately need to recognise loans that are non-performing.
      • Easing guidelines on the classification of loans: Similarly, easing guidelines on the classification of loans for projects in the commercial real estate sector that have been delayed is essentially designed to provide some breathing space to banks.

    What does this mean for the macro outlook?

    • Recovery in demand is a must: The RBI’s new macroprudential measures, its “unconventional” policy arrows, while well-meaning, are ultimately supply-side measures.
      • For the RBI to attain its goals, be it on asset quality or transmission, there eventually needs to be a recovery in demand conditions.
      • ECB’s LTRO experience: To be fair, even the ECB’s LTRO programme has had mixed success — a central bank can flood the market with liquidity, but the ultimate onus on releasing it to the real economy rests with banks.
      • So far, excess liquidity has not benefitted segments considered high risk (real estate developers, MSMEs).

    Conclusion

    The ECB introduced the LTRO programme when growth was weak and the euro area was struggling with a severe sovereign debt crisis. With the RBI embarking on something similar, albeit on a smaller scale, the niggling concern is if there is more financial instability lurking around the corner but not yet evident in the current data.

     

  • A weak rebuke: It’s unfortunate EC didn’t punish hate speech in Delhi campaign

    Context

    Campaign for the Delhi Assembly election in which the development debate was overshadowed by hate-mongering and outpouring of communal vitriol underscores need to do more.

    Understanding the Model Code of Conduct (MCC)

    • Behavioural guidelines: It is a set of behavioural guidelines for political parties and candidates for-
      • The peaceful conduct of elections.
      • To prevent hate speech.
      • Malpractices.
      • Corruption and
      • Misuse of government machinery by the ruling party.
    • Not judicially enforceable: Since it is not an Act passed by Parliament, the Code is not judicially enforceable.
      • The action against a violator usually takes the form of an advice, warning or censure.
      • No punitive action can be taken.
      • No wonder, many consider the Code as toothless.
    • Moral authority: It is not toothless though. Its moral authority far outweighs its legal sanctity.
      • Political leaders worth their salt are scared of inviting a notice for a violation, as it creates negative public opinion.
      • Besides, unlike the legal processes, its impact is instant.

    The legality of the MCC

    • Test of legality in the courts: The legality of the code has been judicially tested.
      • First legal acceptance: Its first judicial acceptance came in 1997 when the Punjab and Haryana High Court gave the EC the power to enforce the code.
      • “Such a code of conduct when it is seen that it does not violate any of the statutory provisions can certainly be adopted by the Election Commission for the conduct of free and fair election, which should be pure as well,” the Court said.
      • The SC has repeatedly held that this must be enforced strictly.

    Parallels between the MCC and other legal provision

    • The first section of the MCC lays down that-Part 1 (1) “ No party or candidate shall include in any activity which may aggravate existing differences or create mutual hatred or cause tension between different castes and communities, religious or linguistic.”
    • “…Criticism of other parties or their workers based on unverified allegations or distortion shall be avoided.”
    • Parallels with RPA: The Representation of the People Act (1951) categorically defines the above two as corrupt practices in Section 123 (3A) and Section 123 (4) respectively.
      • Section 125 of RPA provides for punishment for similar violations.
    • Parallels with IPC: It is important to note that Section 153A of the Indian Penal Code has a similar provision:
      • Promoting enmity between different groups on ground of religion, race, place of birth, residence, language, etc., and doing acts prejudicial to maintenance of harmony.

     Refreshing change

    • Prompt action: It must be appreciated that the EC was prompt in its action against the leaders accused of hate speech in Delhi election campaign.
      • While it instantly, suo moto, deprived the two leaders of their star campaigner status, it also punished them with a gag order, using the ultimate weapon provided by Article 324.
      • The EC flexing its muscle outside the so-called “toothless” MCC and invoking Article 324 is indeed a refreshing change.
      • In earlier instances, it often had to let the culprits go with a mere “warning, caution or censure”.
      • In its notice to a leader, the EC cited Sections 123 and 125 of the RP Act.

    Conclusion

    • Historically, the EC has always taken simultaneous action under the Model Code of Conduct and the other two provisions. While the MCC produces instant results, the penal provisions involve endless judicial processes. Not taking action under the IPC encouraged violators to commit repeat offences.