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  • Terrorism and Challenges Related To It

    [10th February 2025] The Hindu Op-ed: Keeping a watch on the growing arc of violence

    op-ed snap | International Relations | Mains Paper 2: Important International Institutions

    PYQ Relevance:

    Q. The scourge of terrorism is a grave challenge to national security. What solutions do you suggest to curb this growing menace? What are the major sources of terrorist funding? (2017)

    Q. Discuss the impediments India is facing in its pursuit of a permanent seat in the UN Security Council. (2015)

    Mentor’s Comment:   UPSC mains have always focused on grave challenge to national security (2017), and ‘pursuit of a permanent seat in the UN Security Council ’ (2015)

    Wars are raging, global institutions are failing, and terrorism is evolving in new, digital, and decentralized forms. While conflicts like the Ukraine war and Gaza crisis dominate headlines, subterranean threats such as radicalization and lone-wolf terrorism are quietly reshaping global security risks.

    Today’s editorial highlights why the world is in a volatile state, how extremist groups are adapting, and why counterterrorism efforts must evolve to meet these new challenges. This content will help in GS paper 2 (Security issues).

    Why in the News?

    The world is going through an unpredictable phase, with wars, conflicts, and terrorism on the rise. The post-1945 global order has collapsed, and international institutions like the United Nations Security Council (UNSC) and the International Court of Justice (ICJ) are failing to prevent violence. At the same time, terrorism is evolving, using digital tools and decentralized networks to survive and grow.

    Why is the Present Period Unpredictable?

    • Wars in Europe and West Asia:
      • The Ukraine war continues with no clear end in sight.
      • The Gaza conflict and tensions in Lebanon have led to large-scale civilian casualties.
    • Failure of Global Institutions:
      • The UNSC and ICJ have become powerless observers, unable to stop wars.
      • The principles of international law are now ignored by major powers.
    • Moral and Political Decline:
      • Nations are acting in self-interest, with no common moral framework.
      • Peace efforts are temporary and do not address the root causes of conflicts.

    What are the Recent Subterranean Activities?

    • False Sense of Stability in West Asia:
      • Some believe that Israeli military actions have weakened Iran’s regional influence.
      • However, underground resistance movements are growing, keeping tensions high.
    • Resurgence of Islamist Extremism:
      • Jihadist groups are reorganizing, using online radicalization.
      • “Lone wolf” attacks are increasing, making them harder to predict.
    • Digital Radicalization:
      • Terrorist groups are recruiting and training people online.
      • Social media and encrypted messaging apps are used to spread extremist ideologies.

    How Terrorism is Witnessing a Revival?

    • Terrorism is Adapting:
      • Since 1979, terrorist networks have evolved.
      • Al-Qaeda and ISIS have used both military and digital strategies to stay active.
      • Now, terrorism is shifting towards smaller, more frequent attacks.
    • Al-Qaeda and ISIS Regrouping:
      • Al-Qaeda is training militants in Afghanistan, under Taliban rule.
      • ISIS-Khorasan (ISKP) is expanding its operations beyond Afghanistan and Pakistan.
      • Attacks have been reported in Moscow, Türkiye, and Iran.
    • More Small-Scale Attacks:
      • Instead of large bombings, modern terrorism relies on:
        • Lone-wolf attacks (one person acting alone).
        • Vehicle attacks, knives, or simple explosives.
        • AI-driven propaganda to recruit supporters.
    • Recent Terror Attacks in the U.S.:
      • Las Vegas Cyber Truck Explosion: A Tesla exploded outside a hotel where President-elect Donald Trump was staying.
      • New Orleans Vehicle Attack: A former soldier drove a truck into a crowd, killing 14 people while displaying an ISIS flag.
      • Virginia Terror Plot: Authorities foiled a planned attack in early 2025.
    • Warnings for the Future:
      • Experts warn of a new wave of terror attacks using digital tools.
      • Security agencies worldwide are on high alert to prevent further incidents.

    Conclusion

    A technology-driven and cooperative global approach is essential to counter rising conflicts and terrorism. Nations must strengthen international institutions, use AI for surveillance, and enforce stricter digital regulations to prevent online radicalization. Community engagement and de-radicalization programs can help address extremism at its roots. Stronger border security, cyber-tracking, and intelligence-sharing will be key to preventing future attacks. As threats become more decentralized and digital, proactive measures and global collaboration are the only paths to lasting peace.

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  • Primary and Secondary Education – RTE, Education Policy, SEQI, RMSA, Committee Reports, etc.

    [8th February 2025] The Hindu Op-ed: Technology and the challenge of equitable education

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

    PYQ Relevance:

    Q) How have digital initiatives in India contributed to the functioning of the education system in the country? Elaborate your answer (UPSC CSE 2020)

    Q) Despite the consistent experience of high growth, India still goes with the lowest indicators of human development. Examine the issues that make balanced and inclusive development elusive.  (UPSC CSE 2019)

     

    Mentor’s Comment: UPSC mains have always focused on National Education Policy (2020), and Significance of Primary Education (2016 and 2022).

    Did you know that, the Budget Allocation for the FY 2024-25 of ₹ 73,498 cr is the highest ever for the Department of School Education & Literacy. On the other hand, while science and technology have integrated countries, education can generate the need for profit and can widespread use of innovations.

    Today’s editorial discusses the major observations from the ASER 2024 Report. This content can be used in Mains answer to present the Digital divide in Rural and Urban Area. Further this content also tells you the Potential of Digital infrastructure and Implementation that India needs to build. 

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    Let’s learn!

    Why in the News?

    According to the recent ACER Survey 2024, India lacks a road map in the field of education that allows the promise of technology to be harnessed for those who need it the most.

    What are the Key Highlights given by ASER 2024?

    The Annual Status of Education Report (ASER) is a citizen-led survey that provides estimates of schooling and learning levels in rural India. Published by the NGO Pratham, ASER has been conducted since 2005. After 2016, the survey transitioned to an alternate-year model, with the “basic” ASER conducted in all rural districts every other year. In the intervening years, a smaller survey focuses on specific age groups and domains. The “basic” ASER tracks enrollment for children aged 3-16 and assesses the reading and arithmetic skills of children aged 5-16 through household surveys.
    • Academic Observations and Reporting: Since 2006, private school enrollment in rural India has been increasing, plateauing at 30.8% in 2014 and remaining there in 2018.
      • Basic arithmetic abilities in Class 3 have risen to 33.7% in 2024, exceeding both 2022 and 2018 rates. Class 5 reading levels are also up, nearly matching 2018 figures, although private schools have not yet reached their pre-pandemic reading levels.
      • Attendance for both teachers and students in government elementary schools has improved. Several states have pre-primary enrollment rates above 90%.
    • Focus on Foundational Literacy and Numeracy: The big push for foundational literacy and numeracy (FLN) under NEP 2020 and the NIPUN Bharat Mission has helped to improve foundational learning through better resources, learning materials, and teacher training which appears to be a major contributor to the improvements noted in the ASER 2024 report.
    • Emphasis on Early Childhood Education: NEP 2020’s emphasis on early childhood education is expected to further improve access, as ASER 2024 reported increased enrollment in early childhood education, with almost 80% of children aged 3 to 6 years enrolled in some form of pre-primary education.
    • Improved Accessibility and Potential: In 2018, approximately 90% of rural households possessed basic mobile phones, while 36% owned smartphones. By 2022, smartphone ownership in these households increased to over 74%, and further to 84% in 2024, but educational use is limited to 57%.
      • Among children aged 14-16, smartphone ownership rose from 19% to about 31% within a year.
      • Smartphones were mainly used to send texts, worksheets, and videos during the pandemic as a substitute for textbooks. Digital skills from the pandemic remained relevant, and artificial intelligence (AI) generated new interest.
    • Reversing Pandemic Losses: The ASER 2024 report suggests a rebound from the learning losses during the COVID-19 pandemic, especially in government schools, where reading and arithmetic skills have reached or exceeded pre-pandemic levels.
      • The improvement in standard III implies that some of its credit can go to the NIPUN Bharat Mission.

    What are the present challenges of digital divide in India according to ASER Report 2024?

    • Gender Disparity: Boys outpace girls in access, ownership, and smartphone usage, which puts girls at a disadvantage and exacerbates existing inequalities. Even when smartphones are available, girls face systemic barriers that limit their access, such as social norms, parental control, and prioritization of boys’ education.
    • Access vs. Usage: While nearly all children between 14 and 16 have access to cell phones, only 57% use smart devices for education-related activities, while about 76% use them for social media.
    • Variations Across States: ASER 2024 indicates wide variations in digital literacy across states.
    • Digital Literacy Skills: While smartphone access is widespread, structured digital education programs can enhance meaningful use of technology for learning.
      • There is a gender gap in digital skills, with 85.5% of boys and 79.4% of girls reporting that they know how to use a smartphone.
    • Smartphone Ownership: There is a gender gap in smartphone ownership, with only 36.2% of boys and 26.9% of girls reporting owning a smartphone.
      • This lack of personal ownership limits access and curtails opportunities for girls to explore and learn independently.

    How can technology be leveraged to bridge the digital divide and ensure equitable access to educational resources?

    • Targeted distribution of school-owned devices: Schools can monitor device-to-student ratios to decide how each device can best support specific learning activities within the curriculum.
      • Distribution can be based on the individual needs of the student, ensuring that each device is allocated where it can have the most significant impact on learning.
    • Embrace pedagogically-led technology integration: Prioritizing integrating technology in a way that enhances the learning experience as a whole can ensure that every student benefits from the transformative potential of digital tools.
      • This includes how educators are trained in technology as a means to achieve equitable learning outcomes.
    • Assess Needs and Resources: Survey families to understand current technology access at home and take inventory of existing school technology equipment and infrastructure. Identify areas that need upgrades to support 1:1 device programs.
    • Provide Multiple Access Options: Offer devices that students can use at school and take home and create a community technology center with free WiFi, computers, and printers. Partner with community organizations to provide access outside of school

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  • Government Budgets

    [6th February 2025] The Hindu Op-ed: A Budget that is mostly good but with one wrong move

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

    PYQ Relevance:

    Q) Distinguish between Capital Budget and Revenue Budget. Explain the components of both these Budgets. (UPSC CSE 2021)

     

    Mentor’s Comment: UPSC mains have always focused on the Capital Budget and Revenue Budget (2021), and the objectives of Union-Budget (2017).

    The Union Budget’s forecast of 10.1% nominal GDP growth for 2025-26 seems reasonable, based on the Economic Survey’s prediction of 6.3%-6.8% real GDP growth. Although capital spending has gone up, it’s similar to last year’s budget. The Budget aims to drive growth towards becoming a developed nation, though some measures, like tax relief, could have come sooner.

    Today’s editorial talks about the measures taken in the Budget. This content would help in GS paper 3 in the economy section.

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    Let’s learn!

    Why in the News?

    Some measures in the Budget should have been introduced earlier and replacing ‘fiscal deficit’ as a key indicator is a wrong decision.

    How realistic are the government’s tax revenue growth assumptions?

    • Gross Tax Revenue (GTR) Trends: The growth in the Government of India’s GTR has been trending downwards in recent years. The buoyancy of GTR has fallen for three successive years from 1.4 in 2023-24 to 1.15 in 2024-25 (RE) and then to 1.07 in 2025-26 (BE). As a result, growth in the Government of India’s GTR has kept falling from 13.5% in 2023-24 to 11.2% in 2024-25 (RE), and to 10.8% in 2025-26 (BE). Within the government’s tax revenues, the growth rate of Goods and Services Tax (GST) has also fallen from 12.7% in 2023-24 to 10.9% in 2025-26 (BE).
    • Shift to Direct Taxes: The structure of the government’s taxation has moved from indirect to direct taxes, with the share of direct taxes in the government’s GTR increasing from 52% in 2021-22 to 59% in 2025-26 (BE).
    • Personal Income Tax: There has been a fall in growth from 25.4% in 2023-24 to 20.3% in 2024-25 (RE) and 14.4% in 2025-26 (BE). This fall in growth in 2025-26 (BE) is partly due to the announced income-tax concessions.
    • Corporate Income Tax: The growth in 2024-25 (RE) is quite low at 7.6%. This growth has been raised to 10.4% in 2025-26 (BE).

    Is the level of government expenditure appropriate, and is its composition efficient?

    • Overall Expenditure: The government is estimated to spend Rs 50,65,345 crore in 2025-26, 7.4% higher than the revised estimate of 2024-25. The size of government expenditure as a percentage of GDP has been reduced from 14.6% in 2024-25 (RE) to 14.2% in 2025-26 (BE). Growth in total expenditure, at 7.6% in 2025-26 (BE), is lower than the budgeted nominal GDP growth at 10.1%.
    • Capital Expenditure: Capital expenditure has been raised from 11.11 lakh crore rupees in the current fiscal year to 11.21 lakh crore rupees for the oncoming fiscal year1. There has been a steady improvement in the quality of government expenditure as the share of capital expenditure in total expenditure has been improving. This share has improved by 10% points over the period from 2020-21 to 2025-26 (BE).
    • Investment in Key Areas: Investment remains a central theme in the Budget, categorized into three key areas—people, economy, and innovation.
      • Investment in people: Includes the establishment of Atal Tinkering Labs, broadband connectivity for schools and health centers, Centers of Excellence for Skilling, and initiatives for Gig workers.
      • Investment in the economy: Focuses on infrastructure projects, interest-free loans to states for capital expenditure, asset monetization, and urban redevelopment projects.
      • Investment in innovation: Allocates funds to private sector-driven R&D initiatives and missions to support urban planning and knowledge systems.
    • AI Infrastructure: The Government of India has to build up large-scale Artificial Intelligence (AI) infrastructure in order to facilitate the adoption of emerging technologies.

    ⁠Is the shift away from using fiscal deficit as a primary indicator of fiscal prudence a positive step?

    • Change in Indicator: One measure introduced in the Budget is to move away from fiscal deficit as an indicator of fiscal prudence. The practice of giving a glide path in terms of fiscal deficit is being discontinued. It has been stated that from now on, the focus will be on reducing the debt-GDP ratio annually.
    • New Target: The central government aims to reduce its outstanding liabilities to around 50% of GDP by March 2031.
    • Debt-GDP Ratio: In the 2025-26 Budget, the practice of giving a glide path in terms of fiscal deficit is being discontinued. Alternative paths of the debt-GDP ratio with nominal GDP growth assumptions of 10.0%, 10.5% and 11.0% are given.
      • The glide paths are indicated in terms of alternative growth assumptions and alternative assumptions regarding mild, moderate, and high degrees of fiscal consolidation. This makes the whole exercise vague and non-transparent.
    • Fiscal Deficit Target: The fiscal deficit target for FY26 is set at 4.4% of GDP, revised down from 4.8% in the current financial year.

    Way forward: 

    • Restore Fiscal Deficit Transparency: Reintroduce clear fiscal deficit targets with specific timelines, instead of focusing solely on the debt-GDP ratio. This would ensure greater clarity and accountability in fiscal management.
    • Enhance Investment Efficiency: Prioritize strategic investments in key areas like AI infrastructure, R&D, and innovation, while ensuring these investments align with long-term growth goals and contribute to overall economic resilience.

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  • Foreign Policy Watch: India-United States

    [5th February 2025] The Hindu Op-ed: The U.S.’s WHO exit, a chance to reshape global health

    op-ed snap | International Relations | Mains Paper 2: Effect Of Policies & Politics Of World On India’S Interests

    PYQ Relevance:

    Q) Critically examine the role of WHOin providing global health security during the Covid-19 pandemic. (UPSC CSE 2020)

     

    Mentor’s Comment: UPSC mains have always focused on Bridging Healthcare Gaps (2015), and WHO Initiatives (2020).

    The US is the largest contributor to WHO, providing about 18% of its funding. The withdrawal is expected to jeopardize critical health programs, particularly those addressing tuberculosis, HIV/AIDS, and other health emergencies.

    Today’s editorial emphasizes the need for member states to collaborate more effectively in light of reduced US involvement, ensuring that global health priorities remain addressed despite funding challenges. This content can be used to present the significance of multilateral collaboration and its impact on international policy and governance with respect to Health.

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    Let’s learn!

    Why in the News?

    After the USA’s withdrawal from WHO, it is time for the countries in the global south to support WHO and initiate collaborative actions to reshape the global health agenda.

    What are the Potential Impacts of the US Withdrawal from WHO?

    • Disruption of Funding and Programs: The US contributes nearly 18% of WHO’s budget (~$1 billion annually), supporting critical health programs like immunization, tuberculosis control, and pandemic preparedness.
      • The withdrawal will likely disrupt ongoing projects aimed at combating health challenges such as HIV/AIDS and polio eradication.
    • Weakened Global Health Response: WHO’s ability to coordinate responses to health crises will be significantly impaired without US support. This includes reduced resources for disease surveillance and emergency operations in regions facing outbreaks or health threats.
    • Impact on Global Health Leadership and Collaboration: The absence of the US may create a leadership vacuum within WHO, allowing other nations (e.g., China) to increase their influence.
      • This shift could alter international collaboration dynamics and lead to fragmented approaches to public health challenges.
    • Repercussions for Low-Income Countries: Marginalized communities in low-income countries may face disproportionate impacts due to reduced funding from WHO. These communities rely heavily on WHO for access to essential health services, and the withdrawal signals a deprioritization of global health initiatives, exacerbating existing inequalities.
      • The overall effectiveness of global health initiatives may decline as WHO struggles with funding constraints and could slow long-term progress toward key health goals, such as disease eradication and comprehensive vaccination programs, ultimately affecting global health security.

    How might the withdrawal reshape international health diplomacy?

    • Shift in Global Health Leadership: The absence of the US may create a leadership vacuum within WHO, potentially allowing countries like China to increase their influence in global health governance.
      • This shift could alter the dynamics of international collaboration, with other nations stepping up to fill the void left by the US.
    • Increased Geopolitical Tensions: The withdrawal could intensify competition between the US and China for influence in global health matters.
      • China’s initiatives, such as the Health Silk Road, may gain traction as it seeks to position itself as a leader in global health, thereby reshaping alliances and partnerships among countries.
    • Impact on Multilateral Cooperation: The US’s exit may weaken multilateral cooperation on critical health issues, leading to fragmented responses to global health challenges.
      • Countries may become less willing to collaborate on shared health threats without US leadership, which could hinder effective pandemic preparedness and response efforts.
    • Loss of Diplomatic Leverage: By withdrawing, the US relinquishes its role as a key influencer in shaping global health policies and initiatives.
      • This could diminish its ability to advocate for public health programs that align with its interests and values, allowing other nations to take a more prominent role in setting global health agendas.
    • Disproportionate Effects: The low-income countries that rely heavily on WHO for support may face greater challenges without US involvement.

    What reforms or changes might be necessary within WHO in light of this withdrawal?

    • Diversification of Funding Sources: WHO should encourage member states to increase their assessed contributions, which currently cover less than 20% of its budget. This could help reduce reliance on any single donor, particularly the US.
      • WHO can seek to expand its voluntary contributions from other countries and private organizations to fill the financial gap left by the US withdrawal.
    • Strengthening Governance and Accountability: Implementing more transparent financial management practices can help restore trust among member states and ensure that funds are allocated effectively.
      • Establishing an independent oversight body to review WHO’s operations and decision-making processes may help address concerns about political influence and enhance accountability.

    What opportunity do India have in this situation?

    • Increased Leadership Role: India can take a prominent leadership position within WHO, representing the Global South.
      • For Example, through the Vaccine Maitri initiative, India facilitated vaccine exports during the COVID-19 pandemic, demonstrating its commitment to global health equity and influencing health policies.
    • Strengthening Domestic Capabilities: The withdrawal allows India to bolster its healthcare infrastructure and research capabilities.
      • For Example, significant investments in indigenous vaccine production, such as Covaxin and Covishield, have positioned India as a major player in global vaccine supply chains, enhancing self-reliance and healthcare outcomes.
    • Enhanced Collaboration with Emerging Economies: India can forge stronger partnerships with other emerging economies to collaboratively address global health challenges.
      • For Example, engagement with countries like Brazil and South Africa through the IBSA Dialogue Forum can focus on shared issues like antimicrobial resistance and maternal health, enhancing collective responses to public health threats.
    • Leveraging Pharmaceutical Strength: India’s robust pharmaceutical industry can fill gaps left by reduced WHO funding.
      • Known as the “pharmacy of the world,” India supplied affordable vaccines during the pandemic, reinforcing its reputation as a key player in global healthcare by continuing to produce low-cost medications.

    Way Forward: India can not only mitigate the impacts of the US withdrawal but also can significantly contribute to shaping a more equitable global health landscape.

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  • Port Infrastructure and Shipping Industry – Sagarmala Project, SDC, CEZ, etc.

    [4th February 2025] The Hindu Op-ed: Some wind behind the sails of India’s shipping industry

    op-ed snap | Economics | Mains Paper 3: Infrastructure: Energy, Ports, Roads, Airports, Railways Etc.

    PYQ Relevance:

    Q) ‘China is using its economic relations and positive trade surplus as tools to develop potential military power status in Asia’, In the light of this statement, discuss its impact on India as her neighbor. (UPSC CSE 2017)

    Q) The Gati-Shakti Yojana needs meticulous co-ordination between the government and the private sector to achieve the goal of connectivity. Discuss. (UPSC CSE 2022)

     

    Mentor’s Comment: UPSC mains have always focused on Sustainable Development (2016, 2017, 2018 and 2022), and Budget Initiatives (2017 and 2021).

    Currently, India holds only about 0.05% of the global market share in shipbuilding, significantly lower than competitors like China (47%), South Korea (30%), and Japan (17%). This disparity highlights that without addressing inefficiencies in container movement and logistics integration, infrastructure growth alone will not lead to meaningful progress.

    The editorial discusses the recent positive developments in India’s shipping industry, particularly following the government’s announcements in the Union Budget 2025-26. This content can be used to present challenges in the Maritime Sector.

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    Let’s learn!

    Why in the News?

    The Union Budget 2025-26 appears to have met most of the shipping industry’s demands; but it has missed an opportunity to address tax disparities.

     

    What specific government initiatives are being introduced to support the shipping industry?

    • Maritime Development Fund (MDF): This initiative is the establishment of a MDF with an initial corpus of ₹25,000 crore which aims to provide long-term financing for the shipbuilding and maritime sectors, facilitating investment and growth within the industry.
    • Shipbuilding Financial Assistance Policy: The government has announced a revamp of the Shipbuilding Financial Assistance Policy (SBFAP) which aims to address cost disadvantages faced by domestic shipyards by providing direct financial subsidies, thereby encouraging local shipbuilding and enhancing competitiveness.
    • Customs Duty Exemptions and Incentives: This Budget extends customs duty exemptions on inputs and components used for manufacturing ships for more than 10 years.
      • Additionally, credit notes will be issued for shipbreaking activities, promoting a circular economy within the industry in order to make shipbuilding and recycling more competitive.
    • Extension of Tonnage Tax Scheme: The benefits of the existing tonnage tax scheme, which previously applied only to sea-going ships, will now be extended to inland vessels registered under the Indian Vessels Act, 2021.
      • This change aims to promote inland water transport and enhance the overall efficiency of the maritime sector.
    • Establishment of Shipbuilding Clusters: The Indian shipping industry has been advocating for the extension of the Shipbuilding Financial Assistance Policy (SBFAP) for another 10 years under the Amritkaal Maritime Vision 2047.
      • The government plans to facilitate the creation of shipbuilding clusters to increase capacity and capabilities in ship manufacturing.

    How can these initiatives impact India’s position in the global shipping market?

    • Enhanced Global Competitiveness: By establishing the Maritime Development Fund and revamping financial assistance policies, India aims to boost its shipbuilding capabilities and reduce costs associated with ship construction and repair.
      • This could elevate India’s ranking in global shipbuilding from 22nd to potentially within the top 10 by 2030 and top 5 by 2047, thereby increasing its share of global ship tonnage from less than 1% to around 5%.
    • Improved Infrastructure and Efficiency: The government’s focus on port modernization through initiatives like the Sagarmala Programme and Maritime India Vision 2030 is set to enhance port infrastructure, logistics efficiency, and multimodal connectivity.
      • These improvements will reduce turnaround times for vessels and lower logistics costs, making Indian ports more attractive for international shipping lines and increasing cargo handling capacity significantly.
    • Attracting Foreign Investment: With a favorable investment climate that allows 100% Foreign Direct Investment (FDI) in port development, India is positioned to attract significant foreign capital into its shipping sector.
      • This influx of investment can lead to technological advancements, better operational practices, and increased capacity, further solidifying India’s role as a key player in global maritime trade.

    What challenges does the Indian shipping industry face despite these positive developments?

    • High Costs and Financial Constraints: Indian shipyards face significant cost disadvantages compared to global competitors, particularly in terms of higher material and labor costs, as well as expensive financing options.
      • This results in a 25-30% cost disadvantage for Indian shipyards compared to those in countries like China and South Korea.
      • Additionally, the imposition of a 5% Goods and Services Tax (GST) on ship imports, which is not refunded for international operations, further strains financial resources for shipping companies.

    Does the SARFAESI Act impact loan availability?

    • Under Section 31(d) of the SARFAESI Act, banks and financial institutions cannot create a security interest in vessels as defined by the Merchant Shipping Act, 1958.
    • This limitation means that lenders cannot easily seize and auction ships in case of loan defaults, which reduces their willingness to extend credit to shipowners.
    • The ongoing discussions about amending the SARFAESI Act to include provisions for ships indicate a recognition of these challenges.
    • By allowing banks to hold security interests in vessels, the government can enhance loan availability and create a more favorable environment for financing within the maritime sector.
    • Infrastructure Bottlenecks: Major Indian ports are grappling with issues such as congestion, inefficiency, and inadequate infrastructure to support increasing traffic volumes.
      • The growth in cargo traffic has outpaced the development of port facilities, leading to delays and higher operational costs.
      • For example, backlogs for rail freight have increased significantly, impacting the timely movement of goods.
      • Furthermore, labor strikes and outdated technology contribute to lower productivity at ports, making them less attractive to global shipping lines.
    • Dependence on Foreign Suppliers: Indian shipyards heavily rely on foreign suppliers for critical components and technology, which increases costs and complicates supply chains.
      • This dependency results in longer lead times for procurement and vulnerability to supply chain disruptions.
      • The lack of a robust domestic supply chain for high-tech maritime components further exacerbates these challenges, limiting the competitiveness of Indian shipbuilding firms.

    Way Forward:

    To realize its aspirations under the Amritkaal Maritime Vision 2047, India must prioritize investments in infrastructure, streamline regulatory processes, and foster a skilled workforce.

    • The path forward requires a concerted effort from all stakeholders to transform these challenges into opportunities for sustainable development in the maritime sector.
    • Establish a National Port Grid Authority to coordinate development across major and minor ports, promoting specialization and eliminating inter-port competition.
    • Implementing a hub-and-spoke model with mega ports acting as transshipment hubs can optimize cargo movement and efficiency.
    • Deploy Smart Port Infrastructure Management Systems (SPIMS) and introduce blockchain-based Port Community Systems to facilitate paperless and IoT based trade.

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  • Government Budgets

    [3rd February 2025] The Hindu Op-ed: Beyond tax cuts, a closer read of the Union Budget

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

    PYQ Relevance:

    Q) One of the intended objectives of Union-Budget 15-18 is to ‘transform, energize and clean India’. Analyze the measures proposed in the Budget 15-18 to achieve the objective. (UPSC CSE 2017)

    Q) Distinguish between Capital Budget and Revenue Budget. Explain the components of both these Budgets. (UPSC CSE 2021)

     

    Mentor’s Comment: UPSC mains have always focused on Sustainable Development (2016, 2017, 2018 and 2022), and Budget Initiatives (2017 and 2021).

    The Union Budget 2024-25 presents a strategic framework aimed at fostering economic growth while addressing the needs of various sectors, particularly the middle class, agriculture, and employment. While efforts to streamline tax structures and reduce compliance burdens are positive, they must be accompanied by robust strategies to ensure sustainable growth and equitable distribution of resources.

    The editorial emphasizes the urgent need for decisive and equitable action in addressing inclusive and sustained growth. This content can be used to present challenges/criticism for the present Budget 2025-26 in your Mains Answers for Economy and Infrastructure.

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    Let’s learn!

    Why in the News?

    The Union Finance Minister presented the Union Budget on February 1, addressing significant economic challenges while outlining an ambitious plan for ‘Viksit Bharat’ that focuses on various sectors, which although requires careful evaluation.

     

    What are the key highlights from Budget 2025 that would raise the questions?

    • Fiscal Consolidation Target: This target aims to reduce the fiscal deficit from the previous year’s estimate of 4.9% and reflects the government’s commitment to managing public debt while balancing necessary public expenditures and economic growth challenges.
      • The Budget sets a Fiscal Consolidation Target of 4.4% of GDP for FY26, relying on optimistic revenue projections, including 11.2% growth in total tax revenues and 14.4% in income tax revenues, despite significant tax cuts and economic challenges.
    • Second Asset Monetisation Plan (2025-30): This plan aims to generate ₹10 lakh crore by monetizing government-owned assets. The proceeds from this monetization will be reinvested into new infrastructure projects.
      • Success of Second Asset Monetisation Plan (2025-30) after previous underperformance raises concerns, and ₹11.54 lakh crore in net market borrowings may crowd out private capital amid weak credit demand.
      • Additionally, the government has proposed ₹1.5 lakh crore in interest-free loans to states to further support capital expenditure and infrastructure reforms.
    • Personal Income Tax: The revisions in income tax rates that exempt incomes up to ₹12 lakh can lead to a loss of ₹1 lakh crore in direct tax revenue due to the following reasons:
    • Increased Exemptions: By exempting incomes up to ₹12 lakh, more individuals will not be liable to pay income tax, significantly reducing the overall tax base.
    • Reduced Tax Rates: The new tax regime includes lower tax rates for various income brackets, which means that even those who do pay taxes will contribute less than they would under the previous regime.
    • Impact on Government Revenue: The expected loss of ₹1 lakh crore in direct tax revenue will limit the government’s financial resources, constraining its ability to fund developmental initiatives and public services.
    • Declining Household Savings: As the government foregoes this revenue, it may struggle to maintain or increase public investments, which could exacerbate the already declining household savings rate, impacting long-term economic stability.
    • India’s Manufacturing Sector: The Budget aims to bolster India’s manufacturing sector, which currently contributes only 17% to the GDP, through various initiatives. However, significant challenges remain that could hinder the sector’s growth and competitiveness.
      • Regulatory Inefficiencies: By enhancing access to credit for MSMEs, the government aims to foster growth, but the existing regulatory framework often hampers business operations, leading to delays and increased costs that undermine competitiveness.
      • Low Innovation Capacity: The government has introduced PLIs targeting various sectors to encourage domestic production and attract foreign investment. However, the investment in R&D is critically low, currently at just 0.64% of GDP. This lack of focus on innovation limits the ability of Indian manufacturers to compete effectively.
      • Structural Weaknesses: The manufacturing sector has been plagued by structural weaknesses such as high costs of raw materials and logistics, which make it less competitive compared to other nations.
      • For example, steel prices in India are reported to be 20-30% higher than those in China.

    What are the gaps highlighted by the budget that need to be recognized in the Agricultural Sector?

    Significant Agricultural Initiatives taken by the Government in Budget 2025-26:

    1. Prime Minister Dhan-Dhaanya Krishi Yojana:

    • Objective: To enhance agricultural productivity and promote sustainable farming practices in 100 districts characterized by low productivity, moderate crop intensity, and below-average credit access.
    • The initiative is expected to benefit approximately 1.7 crore farmers by providing them with better financial support and resources. The program will be executed in partnership with state governments, leveraging existing schemes and specialized measures to drive focused reforms.
    • Key Focus Areas:
      • Introduce advanced farming techniques and modern equipment.
      • Encourage farmers to grow a variety of crops instead of relying on a single crop.
      • Develop storage facilities at the panchayat and block levels to reduce crop wastage.
      • Enhance irrigation infrastructure to increase agricultural output.
      • Facilitate easier access to both short-term and long-term credit for farmers.

    2. National Mission on High-Yielding Seeds:

    • Objective: This mission aims to improve the availability and use of high-yielding seed varieties to boost agricultural productivity across the country.
    • The mission emphasizes research and development in seed technology, ensuring that farmers have access to superior quality seeds that can lead to better crop yields.
    • It will work in conjunction with other agricultural programs, such as the Dhan-Dhaanya Krishi Yojana, to maximize the impact on food security and farmer income.

    3. Increased Kisan Credit Card (KCC) Limit:

    • The loan limit for KCC has been raised from ₹3 lakh to ₹5 lakh, along with targeted support in 100 low-productivity districts, indicating a shift from blanket subsidies to more precise financial assistance for farmers.
    • Short-Term Loan Focus: The emphasis on credit enhancements primarily through short-term loans may perpetuate farmers’ dependency on debt without resolving underlying issues.
      • Systemic inefficiencies in agricultural markets remain unaddressed, particularly regarding price volatility and market access.
    • Missed Export Opportunities: The lack of concrete measures to promote agricultural exports, especially as India aims to lead in millets and natural farming, represents a significant missed opportunity.
      • Services exports, particularly in IT and business process outsourcing, are growing robustly at a 10.5% CAGR, but efforts to diversify the export portfolio are lacking.
      • While initiatives like Bharat Trade Net (BTN) and export credit support for MSMEs are positive, they lack the scale necessary to effectively address India’s ongoing trade deficits.
      • The depreciation of the rupee and declining foreign exchange reserves highlight the need for a more ambitious export strategy.
      • A fiscal push toward value-added sectors such as pharmaceuticals, electronics, renewable energy, and high-value agricultural products could enhance India’s position in global supply chains and improve export competitiveness.

    What are the questions raised on other transformative and sustainable pushes?

    • Lithium-Ion Battery Recycling: Ace Green Recycling plans to establish India’s largest lithium iron phosphate (LFP) battery recycling facility in Gujarat, with a capacity of 10,000 metric tons per year by 2026. 
    • Incentives for Clean Tech Manufacturing: The Budget introduces tax benefits and policy extensions aimed at supporting electric vehicle (EV) startups and clean tech manufacturing. This includes exemptions on cobalt powder and lithium-ion battery scrap from basic Customs Duty, which is expected to strengthen India’s battery recycling ecosystem.
    • Despite these initiatives, the transition to a low-carbon economy remains fragmented due to insufficient investment in essential areas like grid modernization and energy storage.
    • To achieve a successful transition to a low-carbon economy, India needs a more integrated approach that includes substantial investments in energy infrastructure alongside the current recycling initiatives.
      • For example, enhancing energy storage capabilities is crucial for managing the intermittent nature of renewable energy sources like solar and wind power.

    Way Forward:

    • While the Budget lays a promising foundation for economic progress, it requires a comprehensive approach that not only focuses on immediate tax relief but also addresses long-term challenges in productivity, innovation, and market access.
    • The success of these initiatives will be measured by their ability to create lasting benefits for all segments of society, driving India toward its vision of a prosperous and inclusive economy.

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  • Foreign Policy Watch: India-Myanmar

    [1st February 2025] The Hindu Op-ed: Four years on, Myanmar and its continuing nightmare

    op-ed snap | International Relations | Mains Paper 2: India & Its Neighborhood – Relations

    PYQ Relevance:

    Q) Analyze internal security threats and transborder crimes along Myanmar, Bangladesh and Pakistan borders including Line of Control (LoC). Also discuss the role played by various security forces in this regard. (UPSC CSE 2020)

    Q) ‘India is an age-old friend of Sri Lanka.’ Discuss India’s role in the recent crisis in Sri Lanka in the light of the preceding statement. (UPSC CSE 2022)

     

    Mentor’s Comment: UPSC mains have always focused on Crossborder insurgency (2019), and Role of India in Southeast Asia (2017).

    The ongoing violence in Myanmar, human rights abuses, and political repression have left millions in dire conditions, with over 6,000 civilians killed and 3.5 million displaced. According to the World Bank, by 2025, around 19.9 million people—one-third of the population—are expected to require humanitarian aid, including 6.3 million children in Myanmar.

     

    As Myanmar marks four years since the military coup, today’s editorial highlights the urgent need for global attention and action. The international community’s response has been inadequate, failing to effectively challenge the junta’s grip on power. This content can be used to present Neighbourhood Policy or South Asian Democratic Crises in your Mains Answers.

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    Why in the News?

    There are several significant developments surrounding the ongoing crisis in Myanmar as it marks the fourth anniversary of the military coup.

    [1st February 2025] The Hindu Op-ed: Four years on, Myanmar and its continuing nightmare

    What has been the impact of the military coup on Myanmar’s political landscape?

    The military coup in Myanmar on February 1, 2021, has drastically altered the political landscape, leading to instability and conflict. 

    • Return to Military Rule: The coup reversed a decade-long democratic transition by overthrowing the elected government of Aung San Suu Kyi’s National League for Democracy (NLD), resulting in widespread protests and civil unrest against the junta.
    • Rise in Civil Unrest and Resistance: The coup sparked massive protests and a civil disobedience movement, leading to the formation of a shadow government, the National Unity Government (NUG), by ousted lawmakers.
      • This has resulted in armed conflict with various ethnic groups and newly formed resistance forces, creating a state of civil war.
    • Human Rights Violations and Humanitarian Crisis: The military’s brutal crackdowns have led to widespread human rights abuses, including killings and arbitrary detentions. Millions have been displaced, exacerbating existing ethnic conflicts, particularly affecting the Rohingya population. The international response has largely failed to hold the military accountable.

    What are the prospects for Myanmar’s economy in 2025 considering the current socio political turmoil?

    • The World Bank forecasts a 1% contraction in Myanmar’s GDP for the fiscal year ending in March 2025, marking a significant downgrade from earlier growth expectations.
      • By 2025, around 19.9 million people—one-third of the population—are expected to require humanitarian aid, including 6.3 million children.
    • Since the military coup in February 2021, armed conflicts and natural disasters have disrupted production across sectors like agriculture and manufacturing. Recent floods have further damaged infrastructure.
    • About 25% of the population faces acute food insecurity, driven by high inflation rates projected at 26% annually. Many households struggle to afford basic necessities due to rising food prices.
    • The long-term economic outlook remains grim, with subdued growth expected even if conflict levels stabilize. Further violence or natural disasters could worsen economic conditions.

    How has the role of ASEAN evolved in addressing the Myanmar crisis?

    • Five-Point Consensus: In April 2021, ASEAN introduced a Five-Point Consensus calling for an end to violence, dialogue, humanitarian aid, and a special envoy to mediate. However, its effectiveness has been limited due to lack of inclusivity and pressure on the military junta.
    • Trioka Mechanism: ASEAN created the Trioka Mechanism to monitor the implementation of the Five-Point Consensus. This group includes Indonesia, Laos, and Malaysia but faces concerns about its ability to address Myanmar’s complex issues.
    • Humanitarian Response: ASEAN has held meetings to improve humanitarian aid delivery but struggles with implementation challenges.
    • International Engagement: External influences, like those from the EU and UN, have shaped ASEAN’s approach. Critics argue that ASEAN’s preference for dialogue over sanctions has not produced significant results.

    Way Forward:

    • The UN and ASEAN have struggled to resolve the Myanmar crisis, prompting experts to call on neighboring countries—China, India, Thailand, Bangladesh, and Laos—to take action, as the situation threatens their interests.
      • However, challenges persist: borders with India and Bangladesh are controlled by ethnic armed organizations (EAOs), trust issues exist between India and China, and India-Bangladesh relations are strained.
      • This makes it difficult for these nations to reach a consensus on how to encourage peace.
    • Thailand, as a significant ASEAN member, could play a crucial role but faces its own limitations.
      • Meanwhile, China’s influence has grown since the coup, and experts suggest that Myanmar’s people should not rely on external help; instead, their leaders must prioritize dialogue over violence to avoid further suffering.

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  • Foreign Policy Watch: India-Sri Lanka

    [31st January 2025] The Hindu Op-ed: An opportunity to settle Sri Lanka’s ethnic problem

    op-ed snap | International Relations | Mains Paper 2: India & Its Neighborhood – Relations

    PYQ Relevance:

    Q) ‘India is an age-old friend of Sri Lanka.’ Discuss India’s role in the recent crisis in Sri Lanka in the light of the preceding statement. (UPSC CSE 2022)

     

    Mentor’s Comment: UPSC mains have always focused on India is an age-old friend of Sri Lanka (2022), and ‘India — Sri Lanka relations ’ (2013).

    Over the past 40 years, India’s role in Sri Lanka’s ethnic conflict evolved from mediator to active player, leading to the 1987 Indo-Lanka Accord and the 13th Amendment, which introduced Provincial Councils. The JVP opposed it, calling it an Indian imposition. The LTTE also rejected it and demanded a separate Tamil Eelam, which India never supported.

    Today’s editorial talks about the India Srilanka relation. This content would help in GS Paper 2 International relations.

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    Why in the News?

    Recently, India’s decision to name the Jaffna Cultural Centre after Tamil poet-philosopher Thiruvalluvar is a symbolic way to strengthen its deep ties with Sri Lanka.

     

    What are the historical roots of the ethnic conflict in Sri Lanka?

    • Colonial Legacy: British colonial rule (1815-1948) favoured the Tamil minority in administration and education, causing resentment among the Sinhalese majority.
    • Sinhala-Only Act (1956): The official adoption of Sinhala as the sole national language marginalized Tamil speakers and led to widespread Tamil discontent.
    • Discrimination in Education & Employment: Policies like the standardization of university admissions (1970s) made it harder for Tamils to access higher education and government jobs.
    • Ethnic Violence & Riots: The 1983 anti-Tamil pogrom (Black July) led to mass violence against Tamils, intensifying the demand for Tamil autonomy.
    • Rise of the LTTE: The Liberation Tigers of Tamil Eelam (LTTE) emerged as the dominant militant group demanding an independent Tamil Eelam, leading to a brutal civil war (1983-2009).
    • Indo-Lanka Accord (1987) & 13th Amendment: This attempt at devolution through Provincial Councils failed to fully address Tamil aspirations, leading to continued tensions.

    How can the new government address Tamil aspirations and rights?

    • Full Implementation of the 13th Amendment: The government should prioritize the effective implementation of the 13th Amendment to the Constitution, which allows for provincial councils and limited autonomy for Tamil-majority regions. This step is crucial for addressing Tamil political representation and governance.
    • Engagement in Inclusive Dialogue: Establishing a direct and inclusive dialogue with Tamil political leaders and communities is essential. This dialogue should focus on addressing historical grievances, ensuring that Tamil voices are heard in national policy-making, and fostering reconciliation.
    • Address Land Rights and Resettlement Issues: The government must take action to return lands occupied by the military to their rightful Tamil owners and halt any ongoing land grabs that threaten Tamil communities. Ensuring land rights is vital for restoring trust and dignity among Tamils.
    • Commitment to Human Rights Accountability: The new administration should commit to addressing past human rights violations during the civil war, including accountability for wartime atrocities. This includes repealing repressive laws like the Prevention of Terrorism Act (PTA) that disproportionately affect Tamils.
    • Cultural Recognition and Language Rights: Promoting Tamil culture and ensuring that Tamil is recognized as an official language alongside Sinhala would help foster a sense of inclusion and respect for Tamil identity within the broader national framework, enhancing community cohesion.

    What role does international support play in resolving Sri Lanka’s ethnic issues?

    • Mediation and Pressure: Countries like India have historically acted as mediators in Sri Lankan affairs. Their support can encourage the government to adhere to commitments regarding Tamil rights and autonomy.
    • Development Assistance: International aid can facilitate economic development in Tamil areas, addressing disparities that fuel ethnic tensions. India’s financial assistance for infrastructure projects is an example of how external support can aid reconciliation efforts.
    • Monitoring Human Rights: International organizations can monitor human rights conditions in Sri Lanka, advocating for accountability and justice for past atrocities against Tamils, which is essential for building trust and moving towards lasting peace.

    Way forward:

    • Strengthen Political and Constitutional Reforms: Ensure full implementation of the 13th Amendment, conduct Provincial Council elections, and explore further constitutional reforms to enhance Tamil political representation and autonomy.
    • Promote Inclusive Economic Development and Reconciliation: Invest in infrastructure, employment, and education in Tamil-majority areas while advancing truth, justice, and reconciliation initiatives to address past grievances and build long-term social cohesion.

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

    [23rd January 2025] The Hindu Op-ed: China’s moves must recast India’s critical minerals push

    op-ed snap | Economics | Mains Paper 3: Effects Of Liberalization On The Economy, Changes In Industrial Policy and their effects on Industrial Growth

    PYQ Relevance:

    Q) Discuss the multi-dimensional implications of uneven distribution of mineral oil in the world. (UPSC CSE 2021)

    Mentor’s Comment: UPSC mains have always focused on Chinese dominance in Geopolitics (2024) and Mines and Minerals in Indian Economy (2021 & 2022).

     

    Despite having the fifth-largest reserves of rare earths globally, India currently lags in all stages of rare earth development. India heavily relies on China for critical minerals, with significant import percentages for essential resources such as lithium (82%), bismuth (85.6%), and silicon (76%). This dependency poses risks to India’s economic security. The International Energy Agency predicts that demand could double by 2030 and quadruple by 2040.

     

    Today’s editorial emphasizes the challenges posed by the Critical Mineral industry at national and Global level. This content can be used for presenting the challenges in the Indian Economy with respect to Critical Mines and Minerals and Trade issues.

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    Why in the News?

    China’s recent actions (expanded its export control list by including 28 entities), including potential export restrictions, have heightened fears about India’s reliance on Chinese supplies of critical minerals like lithium, cobalt, and rare earth elements.

    • China controls a substantial portion of the global supply of critical minerals, producing about 60% of rare earth elements, 50% of lithium, and 70% of cobalt.
    • This dominance extends to processing, where China handles approximately 80% of the world’s critical mineral processing, allowing it to influence global prices and availability significantly.

    What are the implications of China’s dominance in the critical minerals supply chain for India’s Economic Security?

    • Supply Chain Vulnerability: India’s heavy reliance on Chinese imports for critical minerals like lithium and cobalt creates significant risks, as China’s control over a large share of global production and processing capacity could lead to supply disruptions or price increases.
    • Geopolitical Leverage: China’s ability to restrict access to critical minerals during geopolitical tensions poses a direct threat to India’s energy transition and economic stability, potentially hindering its renewable energy goals.
    • Need for Strategic Diversification: In response to these challenges, India must pursue strategic partnerships with resource-rich countries and invest in domestic mineral exploration and processing capabilities to reduce dependence on China.
    • Global Competition and Sustainability: As global competition for critical minerals intensifies, India must balance its pursuit of resource independence with sustainable mining practices, ensuring long-term availability while addressing environmental concerns.

     

    What are the key challenges in developing India’s domestic critical mineral production?

    • Limited Exploration and Development: Complex geology, lack of advanced exploration technologies, and regulatory hurdles slow down the discovery and commercial extraction of resources like lithium and cobalt.
    • Processing Capacity Gaps: India lacks sufficient domestic processing and refining facilities for critical minerals. This gap forces the country to depend on foreign processing.
    • Regulatory and Policy Constraints: Existing regulations reserve certain critical minerals for public sector undertakings, limiting private sector participation in exploration and mining.
      • Additionally, the need for an updated list of critical minerals in the Mines and Minerals (Development and Regulation) Act hampers timely exploration efforts.
      • Establishing new exploration and processing activities involves long gestation periods, which can delay India’s efforts to become self-reliant in critical minerals.
    • Skilled Workforce Shortage: There is a shortage of skilled manpower in the materials, minerals, and metals sectors due to gaps in specialized training and advanced skills development.
    • Environmental Concerns: Mining activities can lead to significant environmental degradation, including biodiversity loss, water depletion, and pollution. Addressing these concerns while developing mineral resources poses a challenge for sustainable practices.

    How can India effectively reduce its dependency on Chinese imports for critical minerals?

    • Domestic Exploration and Production: India is focusing on enhancing its domestic mining capabilities by identifying and exploring critical mineral reserves within its territory.
      • For Example, the recent discoveries of lithium deposits in states like Jammu and Kashmir, Rajasthan, and Karnataka highlight the potential for self-reliance in critical minerals essential for renewable energy technologies.
    • Critical Minerals Mission: Government has launched a Critical Mineral Mission aimed at securing domestic production, recycling, and overseas acquisition of critical minerals.
      • This mission includes incentives for private companies to establish processing facilities and aims to reduce import duties on key minerals, thereby promoting local processing and refining.
    • International Partnerships: India is actively seeking to forge strategic partnerships with resource-rich countries, particularly in Africa and Latin America, to secure mineral blocks through government-to-government agreements.
      • This includes investments in countries like Australia, Chile, Ghana, and South Africa to diversify supply sources and mitigate risks associated with over-reliance on China.
    • Regulatory Reforms and Investment: The Indian government is implementing regulatory reforms to attract private investment in the critical minerals sector.
      • This includes auctioning critical mineral blocks to both state-owned and private companies, establishing entities like Khanij Bidesh India Ltd. (KABIL) for overseas acquisitions, and enhancing the National Mineral Exploration Trust (NMET) to support exploration efforts.

    Key Significant Features of the Mines and Minerals (Development and Regulation) Amendment Act, 2023 

    • Private Sector Involvement: The amendment allows the private sector to explore and mine six critical minerals previously restricted to state agencies, including lithium, beryllium, niobium, titanium, tantalum, and zirconium. This shift encourages private investment and expertise in the mining sector.
    • Exploration Licenses (EL): The introduction of Exploration Licenses enables private companies to conduct reconnaissance and prospecting for critical minerals. This is expected to attract foreign direct investment (FDI) and engage junior mining companies, thereby boosting exploration efforts for deep-seated minerals.
    • Exclusive Auctions for Critical Minerals: The central government is empowered to auction mineral concessions for critical minerals such as rare earth elements, cobalt, and nickel. This streamlined auction process is designed to accelerate production and generate revenue for state governments.
    • Revenue-Sharing Mechanism: If resources are proven after exploration, the state government must conduct an auction for mining leases within six months. The exploration licensee will receive a share in the auction value of the subsequent mining lease, incentivizing exploration activities.

    What role do global market dynamics play in shaping India’s critical mineral policies?

    • Geopolitical Influences: The competitive landscape of critical minerals is heavily influenced by geopolitical tensions, particularly with China, which dominates the supply chain.
      • India’s policies need to be increasingly designed to mitigate reliance on Chinese imports by fostering partnerships with countries like the U.S., Australia, and members of the Quad, aiming for a more diversified and secure supply chain.
    • Investment in Domestic Capabilities: To counteract dependency on imports, India should  implement regulatory reforms to attract private investment in the mining sector.
      • This includes auctioning mineral blocks and promoting initiatives like the National Critical Minerals Mission, which aims to strengthen the entire value chain from exploration to processing.
    • Need for Strategic Sourcing: Global market fluctuations can lead to price volatility for critical minerals, prompting India to develop a carefully crafted import strategy.
      • This strategy focuses on establishing stable relationships with resource-rich nations and diversifying sourcing options to mitigate risks associated with supply disruptions.
    • Fiscal Incentives: A possible remedy is to offer larger upfront fiscal incentives during the exploration phase. In other words, pledging direct capital support early in the construction phase might be to approach critical minerals extraction as a semiconductor fabrication project.

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  • Foreign Policy Watch: India-Sri Lanka

    [20th December 2024] The Hindu Op-ed: Reality check on Sri Lanka’s Tamil question

    op-ed snap | | Mains Paper 2: Bilateral, Regional and Global Groupings and agreements involving India

    PYQ Relevance:

    Q) ‘India is an age-old friend of Sri Lanka.’ Discuss India’s role in the recent crisis in Sri Lanka in the light of the preceding statement. (UPSC CSE 2022)

    Mentor’s Comment: UPSC Mains have focused on ‘India is an age-old friend of Sri Lanka’ (in 2022), and ‘how domestic factors influence foreign policy between India and Srilanka’ (in 2013).

    Sri Lankan President Anura Kumara Dissanayake’s recent visit to India drew significant attention, marking his first foreign trip since taking office. The visit highlighted the shift in Sri Lanka’s political landscape, with the National People’s Power’s surprising electoral success. India’s priorities have also evolved, focusing on countering China’s influence in the region.

    Today’s editorial highlights the importance of Sri Lanka for India. This content can be used to substantiate the challenges and significance due to Srilanka for India in UPSC IAS mains paper GS2.

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    Let’s learn!

    Why in the News?

    The joint statement released by New Delhi and Colombo during the Sri Lankan President’s visit to India shows what is currently important to both countries.

    What is the joint statement released by New Delhi and Colombo during the Sri Lankan President’s visit?

    • Bilateral Cooperation: The statement emphasizes the deep-rooted cultural ties and geographical proximity that underpin the India-Sri Lanka partnership. 
      • Both leaders reaffirmed their commitment to enhancing cooperation in areas such as parliamentary exchanges, development cooperation, debt restructuring, energy cooperation, trade and investment, and strategic defense engagement.
    • Economic Support and Stability: President Anura Kumara Dissanayake expressed gratitude for India’s support during Sri Lanka’s economic crisis, highlighting India’s provision of nearly USD 4 billion in aid. 
      • The leaders agreed on an investment-based approach to assist Sri Lanka’s economic recovery and growth, while also addressing shared security interests in the Indian Ocean Region

     

    What is 13th Amandment?

    • The 13th Amendment to the Constitution of Sri Lanka, passed in 1987, was introduced as part of the Indo-Sri Lanka Accord signed between Indian Prime Minister Rajiv Gandhi and Sri Lankan President J.R. Jayewardene. 
    • Its primary aim was to provide a framework for the devolution of power to provincial councils, thereby addressing the demands for greater autonomy from the Tamil minority, particularly in the Northern and Eastern provinces.

    What is the current status of the 13th Amendment’s implementation in Srilanka?

    • Stagnation in Implementation: The 13th Amendment, which was designed to provide power devolution to provincial councils in Sri Lanka, has seen little progress in its implementation. 
      • The recent joint statement from India and Sri Lanka did not address the amendment or the political solutions for Tamil aspirations, highlighting a lack of commitment from the current government led by President Anura Kumara Dissanayake.
    • Political Hesitance: The Dissanayake administration has avoided explicitly referencing the 13th Amendment due to its association with “Indian imposition,” which is viewed negatively by the Sinhala-Buddhist majority. Instead, the government’s focus has shifted towards broader promises of provincial council elections and constitutional reforms without a clear plan for implementing the amendment.

    How do historical grievances impact contemporary Tamil-Sinhala relations?

    • Historical Conflict: Historical grievances from the civil war and ongoing issues related to Tamil rights significantly affect Tamil-Sinhala relations. The Tamil community continues to seek justice for wartime atrocities and greater political agency, while many in the Sinhala majority often view discussions about devolution and federalism with scepticism.
    • Political Dynamics: The recent electoral success of the National People’s Power (NPP) signifies a shift in Tamil political engagement, as Tamils have shown support for a party that traditionally opposed Indian intervention. 
      • However, this shift raises concerns about how effectively the NPP will address Tamil issues without alienating its base among Sinhala nationalists.

    What are the prospects for genuine reconciliation and autonomy for Tamils in Sri Lanka?

    • Need for Clarity: There is an urgent need for the NPP to clarify its position on Tamil rights and reconciliation. While the party’s manifesto promises provincial council elections and constitutional reforms, it lacks a concrete strategy for addressing historical grievances or ensuring autonomy for Tamils.
    • Challenges Ahead: Genuine reconciliation remains uncertain as long as past grievances are not adequately addressed. The Tamil polity must engage more directly with its constituents rather than relying on international actors. 
      • The NPP’s ability to foster inter-ethnic peace will depend on its willingness to confront historical failures and implement meaningful policies that reflect the aspirations of all communities in Sri Lanka.

    Way forward: 

    • Clear Political Vision: The NPP should outline a concrete plan for addressing Tamil rights, implementing the 13th Amendment, and ensuring provincial autonomy, while balancing the demands of both Tamil and Sinhala communities.
    • Inclusive Dialogue: Engage in direct, inclusive dialogue with all ethnic groups, focusing on national reconciliation and addressing past grievances, to foster a durable peace and meaningful political solution for all communities in Sri Lanka.

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