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THE GIST of Editorial for UPSC Exams : 10 June 2020 (Keeping India’s payments market competitive (Indian Express))



Keeping India’s payments market competitive (Indian Express)



Mains Paper 3:Economy 
Prelims level: WhatsApp Pay
Mains level: Strength and limitations of the Unified Payments Interface platform

Context:

  • WhatsApp is reportedly set to launch its payments service, “WhatsApp Pay”. 
  • The entry of a new heavyweight in India’s payments market will concern users, technology players, service providers and even regulators. 
  • India’s payments market owes its success to a design that encourages service providers to compete and innovate. 
  • This suggests that the key to delivering value to consumers and protecting them is regulators prioritising innovation and robust competition in the market.

About:

  • WhatsApp Pay, like its competitors PhonePe, Paytm, Google Pay, etc, 
  • It will operate on the UPI platform. 
  • The National Payments Corporation of India (NPCI) created and runs the UPI platform. 
  • It also approves Payment Service Providers (PSPs) who use its platform.

Why WhatsApp Pay is different from others?

  • WhatsApp’s foray into payments is significant. Its existing services have a large and diverse user base globally. 
  • An estimated 75% of its 400 million subscribers in India start and end their day with WhatsApp. Several enterprises already use WhatsApp for Business. 
  • The wide familiarity with its platform would be a big advantage for combining two key functions, viz messaging and money transfer. 
  • One could expect more innovation..................

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Market presence: 

  • WhatsApp will join over 150 PSPs already in the market. 
  • This reveals the continuing commercial attraction of India’s market for payments and, by extension, that for digital communications. 
  • Equally, it also reflects the strength of the UPI platform.

Role of UPI platform:

  • The transfer of a bank customer’s funds to another account, which three years ago, could take days, now takes just seconds. 
  • Almost 100 million users can access UPI. The platform is available on 148 banks, ranging from small rural banks to major national and international banks. 
  • The global players including Google, Amazon, Samsung, along with many more Indian companies, provide numerous third-party apps access to the platform. The number of apps available is over 70 and rising.

Rise of UPI platform:

  • UPI has grown exponentially in the three years of its use. A look at UPI’s monthly data shows the success achieved. 
  • In March 2020 alone, it completed 1.2 billion transactions amounting to over Rs 2 lakh crore in value. (These numbers slipped about 6-8% in April. It is unclear if Covid-19 contributed to this. However, the April data is no less impressive).
  • UPI hasdone more for digital India and financial inclusion than many other standalone projects. Innovation by market players is expanding access as well as the range of features and services to meet consumers’ needs.

Role in setting global standards:

  • The UPI platform also highlights India’s emerging role in setting global standards. It has attracted several global majors to adopt it to compete in the Indian market. 
  • The UPI experience with standards would be invaluable for India as it seeks a larger footprint in the global technology space. Recall India’s aspirations to be a player in 5G standards.

Key strength of UPI:

  • A key strength of UPI is that it supports competition. 
  • It is agnostic to size, ownership, national origin of players. It attracts diverse players by making its infrastructure accessible to any entity regulated by RBI. 
  • The players can leverage their unique strengths: Smaller players have unique knowledge of local communities and their needs. Bigger ones can scale faster. 
  • International players like Google, WhatsApp, etc, have a history of innovation and pricing, which enables them in the delivery of services at a global scale. 
  • This diversity of players is as relevant to India’s goals.............................

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Focus on maintaining and securing payment infrastructure:

  • NPCI has rightly focused on creating and maintaining its secure switching infrastructure for payments, offering interoperability across the PSPs. 
  • It has avoided conflicts of interest with users of its infrastructure. 
  • It has continually upgraded the platform. UPI 2.0 offers even higher levels of security and new features.
  • NPCI is an impressive proof of India’s ability to deliver advanced technology solutions at scale.

Risk of monopoly:

  • However, the impressive achievements of the NPCI and UPI must not blind us to accompanying risks: NPCI is, in effect, a monopoly despite having a mix of private and public, small and large, Indian and international promoters. 
  • The UPI platform is itself a monopoly, despite being open to competing players in almost every segment. India’s consumers cannot transfer money ‘instantly’ without the UPI platform or NPCI’s switch.
  • The risks of monopolies are well known: fewer incentives to innovate, improve quality of service or, lower prices. 

Future challenges for improvement: 

  • Consumers have an obvious stake in competitive markets. A post-Covid-19 world could make the use of cash even less practical. 
  • More enterprises, service providers and public agencies will need to move to online payments. Consumers too would demand greater flexibility and convenience in accessing and transacting with their money. 
  • They would want a greater range of financial products and services, e.g., loans, overdrafts, rolled payments, etc. 
  • People with lower income or those who are less digitally literate, may need an altogether new level of customer responsiveness as they transition to digital. 
  • Pressure from consumers and effective competition will spur greater innovation.
  • Safeguarding competition in the payment space is, therefore, a high priority. 
  • The Competition Commission of India (CCI) has an important responsibility. 
  • It must identify and eliminate anti-competitive behaviour, such as monopoly pricing, cartelisation by players, customer-locking, and any other market abuse.

Way forward: 

  • The stakeholders in India’s payment ecosystem have their work cut out. 
  • It will take alert consumers, competitive players, and vigilant regulators to deliver the full potential of a truly competitive payments market. 
  • If they succeed, India would have made giant strides in its journey towards two important goals..........

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THE GIST of Editorial for UPSC Exams : 10 June 2020 (Being vocal on the right local (Indian Express))



Being vocal on the right local (Indian Express)



Mains Paper 3:Economy 
Prelims level: Vocal for Local strategy
Mains level: What is ‘vocal for local’ strategy, How India can become self-reliant, and what steps needed to make Indian industry globally competitive.

Context: 

  • On May 12, Prime Minister Narendra Modi called upon Indians to be “vocal for local”. 
  • The way in which we, as citizens and professionals, interpret the local will have far-reaching effects on the country’s landscape and prosperity.

Origin of the ‘vocal for local’ strategy:

  • We could transform ourselves into a greener and more humane society, with access to affordable health care, functioning public schools, choices over where we work and live, and support for those who cannot work. 
  • Cities could breathe again and families could move to opportunity rather than be forced out of their homes by drought and desperation. or,
  • We could rapidly roll backwards, buying umbrellas with easily broken frames, toasters whose levers have to be held down, office chairs with castors that grip rather than slide, researchers who find it difficult to equip their laboratories and avoid reading research at the disciplinary frontier because they are too far from being able to produce it.
  • There will be people with experience and skills..................................

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A pointer:

  • COVID-19 has brought many countries to an unexpected fork in their development trajectories. 
  • It has made visible new facts, figures and the feelings of citizens towards these facts and figures.

What is ‘vocal for local’ strategy?

  • Village demographics have changed dramatically. Pockets of virtually empty villages in the Himalayan foothills have become re-populated and many of the poorest parts of the country have experienced the largest inflows. 
  • After the trauma of the last two months, re-united families would like to stay together. They will search for local livelihoods and they desperately need immediate and substantial social transfers. 
  • Strengthening these communities would show a real commitment to the right kind of local. This requires making our safety nets wide, accessible and fair. 
  • It involves building schools, clinics and hospitals within easy reach, and opening windows of credit to those with ideas without first asking them to label themselves as farmers or micro-entrepreneurs. 
  • If we imagine villages as consisting only of farmers and labourers, hit periodically by cyclones and drought, our support to them will not move beyond Kisan credit cards and employment guarantees. 
  • Those returning home are from many walks of life and have travelled far and wide. Development policy should help them use their skills and new perspectives to reimagine their communities while they earn a living.

How to get it right?

  • The wrong kind of local would be to promote goods that are made in India through tariffs, quotas and new government procurement rules. 
  • We have attained global competitiveness over the last two decades in many new fields such as software development, pharmaceuticals and engineering products. 
  • All of these have flourished through international collaboration and feedback from foreign consumers. 
  • It would be short-sighted to imagine that we would reach these consumers if we restricted access to our own markets. 

Steps needed to make Indian industry globally competitive:

  • Many of our sustainable energy initiatives have also depended on government action elsewhere. 

Case study:

  • Solar energy was subsidised in Germany and in California when it was far more expensive than fossil energy.
  • China mass produced solar panels and costs of production came down enough for other countries, including ours, to start adopting them. 
  • The pandemic should have made us aware, like never before, of our interdependencies, of the limits of our knowledge and the need for global engagement.
  • Sustainable and resilient communities cannot be built on a fiscal and regulatory structure that is highly centralised. 
  • The Centre would have to devolve to the States and the States to locally elected representatives. 
  • If we adequately fund, support and trust local governments and remain open to absorbing both the knowledge and products that others produce better than us, we can create a society where all, not just a few, matter. 

Conclusion:

  • If we insist that everything can be “made in India” and close borders because a crisis sealed them temporarily, we open ourselves to mediocrity and isolation, continued mass poverty and greater vulnerability to future pandemics. 
  • We have the capacity to refocus on......................

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THE GIST of Editorial for UPSC Exams : 10 June 2020 (The critical role of decentralised responses (The Hindu))



The critical role of decentralised responses (The Hindu)



  • Mains Paper 2:Governance 
  • Prelims level: Fifteenth Finance Commission
  • Mains level: Empowering local government and resource mobilisation development 

Context:

  • The novel coronavirus pandemic has brought home the critical role of local governments and decentralised responses. 
  • This article makes some suggestions to improve local finance and argues that the extant fiscal illusion is a great deterrent to mobilisation.

Advantages to the local government:

  • In terms of information, monitoring and immediate action, local governments are at an advantage, and eminently, to meet any disaster such as COVID-19. 
  • While imposing restrictive conditionalities on States availing themselves of the enhanced borrowing limits (3.5% to 5% of Gross State Domestic Product, or GSDP) for 2020-21 is unwarranted.
  • The recognition that local governments should be fiscally empowered immediately is a valid signal for the future of local governance. 

Core issues

  • COVID-19 has raised home four major challenges: 
  • economic, 
  • health, 
  • welfare/livelihood and 
  • resource mobilisation. 

Critical areas for local government empowerment: 

  • Own revenue is the critical lever of local government empowerment. 
  • The several lacunae that continue to bedevil local governance have to be simultaneously addressed. 
  • The new normal demands a paradigm shift in the delivery of health care at the cutting edge level. 
  • The parallel bodies that have come up after the 73rd/74th Constitutional Amendments have considerably distorted the functions-fund flow matrix at the lower level of governance. 
  • There is yet no clarity in the assignment of functions....................

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Resource mobilisation issues under three heads:

  • A few suggestions for resource mobilisation are given under three heads: 
  • Local finance, 
  • Members of Parliament Local Area Development Scheme, or MPLADs, and
  • The Fifteenth Finance Commission (FFC).

Local finance:

  • Property tax collection with appropriate exemptions should be a compulsory levy and preferably must cover land. 
  • The Economic Survey 2017-18 points out that urban local governments, or ULGs, generate about 44% of their revenue from own sources as against only 5% by rural local governments, or RLGs. 
  • Per capita own revenue collected by ULGs is about 3% of urban per capita income while the corresponding figure is only 0.1% for RLGs. 
  • There is a yawning gap between tax potential and actual collection, resulting in colossal underperformance. 
  • When they are not taxed, people remain indifferent. LGs, States and people seem to labour under a fiscal illusion. 
  • In States such as Uttar Pradesh, Bihar and Jharkhand, local tax collection at the panchayat level is next to nil. Property tax forms the major source of local revenue throughout the world. 
  • All States should take steps to enhance and rationalise property tax regime. A recent study by Professor O.P. Mathur shows that the share of property tax in GDP has been declining since 2002-03. This portends a wrong signal. 
  • The share of property tax in India in 2017-18 is only 0.14% of GDP as against 2.1% in the Organisation for Economic Co-operation and Development (OECD) countries. 
  • If property tax covers land, that will hugely enhance the yield from this source even without any increase in rates.

Land monetisation:

  • Land monetisation and betterment levy may be tried in the context of COVID-19 in India. To be sure, land values have to be unbundled for socially relevant purposes.
  • Municipalities and even suburban panchayats can issue a corona containment bond for a period of say 10 years, on a coupon rate below market rate but significantly above the reverse repo rate to attract banks. 
  • We are appealing to the patriotic sentiments of non-resident Indians and rich citizens. 
  • Needless to say, credit rating is not to be the weighing consideration. 
  • That the Resurgent India Bond of 1998 could mobilise over $4 billion in a few days encourages us to try this option.
  • MP fund scheme
  • The suspension of MPLADS by the Union government for two years is a welcome measure. 
  • The annual budget was around ₹4,000 crore. 
  • The Union government has appropriated the entire allocation along with the huge non-lapseable arrears. 
  • MPLADs, which was avowedly earmarked for local area development, must be assigned to local governments, preferably to panchayats on the basis of well-defined criteria.

Fifteenth Finance Commission:

  • A special COVID-19 containment grant to the LGs by the FFC to be distributed on the basis of SFC-laid criteria is the need of the hour. 
  • The commission may do well to consider this. The local government grant of ₹90,000 crore for 2020-2021 by the FFC is only 3% higher than that recommended by the Fourteenth Finance Commission. For panchayats there is only an increase of ₹63 crore. 
  • The commission’s claim that the grant works out to 4.31% of the divisible pool and that it is higher than the 3.54% of the FC-XIV is obviously because the size of the denominator is smaller. 
  • Building health infrastructure and disease.....................................................

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Suggestion for fixing grant:

  • The ratio of basic to tied grant is fixed at 50:50 by the commission. 
  • In the context of the crisis under way, all grants must be untied for freely evolving proper COVID-19 containment strategies locally.
  • Further the 13th Finance Commission’s recommendation to tie local grants to the union divisible pool of taxes to ensure a buoyant and predictable source of revenue to LGs (accepted by the then Union government) must be restored by the commission.

Way ahead:

  • Flood, drought, and earthquakes are taken care of by the Disaster Management Act 2005 which does not recognise epidemics, although several parts of India experienced several bouts of various flus in the past. 
  • The new pandemic is a public health challenge of an unprecedented nature along with livelihood and welfare challenges. 
  • ThefirstReport speaks of mitigation funds and even prepared a disaster risk index, to map out vulnerable areas. 
  • These are redundant in the present context. The 2005 Act may have to be modified to accommodate the emerging situation.

Conclusion:

  • COVID-19 has woken us up to the reality that local governments must be equipped and empowered. Relevant action is the critical need.

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THE GIST of Editorial for UPSC Exams : 10 June 2020 (Pincer provocations? (The Hindu))



Pincer provocations? (The Hindu)



  • Mains Paper 2:International Relation
  • Prelims level: Line of Actual Control
  • Mains level: India China relations, ongoing tensions between the Indian and Chinese armed forces in eastern Ladakh, key analysis and what measures need to be adopted to address this

Context:

  • Chinese and Indian forces have begun to disengage in select areas.
  • But this does not detract from the reality that in the past few weeks Beijing and Islamabad are making coordinated efforts to challenge India’s presence in the Kashmir-Ladakh region. 
  • There is stepped-up activity on Pakistan’s part to infiltrate terrorists into the Valley. 
  • China has undertaken provocative measures on the Ladakh front to assert control over disputed areas around the Line of Actual Control (LAC). 

Overlapping interests of both China and Pakistan:

  • In Pakistan’s case the intensification in its terrorist activities is related in part to the dilution of Article 370.
  • Dilution of Article 370 helps India de-link Ladakh from the Kashmir problem. 
  • For China, the division of Ladakh from Jammu and Kashmir allows India a freer hand in contesting China’s claims in the region.
  • Increasing road-building activity on India’s part close to the LAC augments this perception. 
  • In addition to Ladakh borders China’s most restive provinces of Xinjiang and Tibet.
  • Ladakh is contiguous to Pakistan-occupied Kashmir (PoK), Gilgit and Baltistan, where the Chinese have invested hugely under the China-Pakistan Economic Corridor (CPEC) project. 
  • External Affairs Minister S. Jaishankar’s............................................

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Differences in objectives regarding India: 

  • These differences are related to their divergent perceptions of their disputes and their different force equations with India. 

China:

  • For China, Ladakh is primarily a territorial dispute with strategic ramifications. 
  • China also believes it is superior to the Indian militarily and, therefore, can afford to push India around within limits as it has been attempting to do in the recent confrontation. 
  • China is a satiated power in Ladakh having occupied Aksai Chin and wants to keep up the pressure on New Delhi to prevent the latter from trying to change the situation on the ground.

Pakistan:

  • For Pakistan, its territorial claim on Kashmir is based on an immutable ideological conviction that it is the unfinished business of partition and as a Muslim-majority state is destined to become a part of Pakistan. 
  • Islamabad also realises that it is the weaker power in conventional terms and therefore has to use unconventional means, primarily terrorist infiltration, to achieve its objective of changing the status quo in Kashmir. 

Changing the status quo:

  • China’s primary concern with regard to Kashmir is to prevent any Indian move from threatening the CPEC project. 
  • It does not challenge the status quo in Kashmir. Pakistan, on the other hand, is committed to changing the status quo in Kashmir at all cost. 
  • It has been trying to do so since Partition not only through clandestine infiltration but also by engaging in conventional warfare. 
  • Therefore, while it is possible to negotiate the territorial dispute with China on a give-and-take basis.
  • Doing this is not possible in the case of Pakistan which considers Kashmir a zero-sum game. 

Way forward:

  • India should, therefore, distinguish the different objectives on the part of Beijing and Islamabad and tailor its responses accordingly without conflating the two threats to its security. 
  • Lumping the two threats together because of a tactical..................

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(E-Book) YOJANA MAGAZINE PDF - JUN 2020

 (E-Book) YOJANA MAGAZINE PDF - JUN 2020

  • Medium: ENGLISH
  • E-BOOK NAME : YOJANA MAGAZINE PDF -JUN 2020
  • Total Pages: 60
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Content Table

  • Industry 4.0 (Dr Ranjeet Mehta)
  • Aim: Fostering Innovation (R Ramanan, Naman Agrawal, Himanshu Agrawal)
  • Social Media: The Force Multiplier (Amit Ranjan)
  • Digital Platforms (Dr Sheetal Kapoor)
  • Localisation Through AI (Balendu Sharma Dadhich)
  • RTM For Development (Sujoy Mojumdar, Koushiki Banerjee)
  • COVID-19 Virology (Dr Sarah Cherian, Dr Priya Abraham)
  • Migration & Economic Growth (Suchita Krishnaprasad)
  • Online Learning in Lockdown (Dr K D Prasad, Dr Bhanu Pratap Singh)
  • E-NAM For Farmers
  • MSME Champions 
  • Automated UV Systems 
  • R&D Expenditure 
  • S&T Based Innovative Solutions
  • 'GOAL' For Tribal Youth 
  • Swasthya Vayu 

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THE GIST of Editorial for UPSC Exams : 09 June 2020 (Broadband, broad-based(Indian Express))



Broadband, broad-based(Indian Express)



  • Mains Paper 3:Science and Tech
  • Prelims level: Information and Communications Technology
  • Mains level: Need institutional and policy framework for Information and Communications Technology

Context:

  • In 2015, all 193 UN member states affirmed their commitment to the SDG by 2030. 
  • From data collection to analysis, and global cooperation to effective action, the role of ICT is crucial in achieving these 17 goals, as seen in our fight against Covid-19. 

Need institutional and policy framework:

  • We need institutional and policy framework to deliver universal, affordable and quality broadband services, while also enabling individuals to afford, access and use the devices and services.
  • According to the ICT Price Trends 2019 by the ITU, benchmarking 192 countries, India was one of 33 countries where high-consumption mobile data and voice package can be purchased for less than 1% of per capita income. 
  • It is notable given that, in 2019, the Broadband Commission for Sustainable Development set out the target of 2% by 2022.

A cause for celebration? 

  • For a developing country like India with huge infrastructure gap and limited state capacity, progress in telecom over 25 years has been nothing short of stupendous. 
  • Reduction in tariffs, network expansion, availability of low-cost devices and a spurt in audio-visual content led to exponential growth of mobile subscriptions to 1.2 billion, with unique subscribers of 700 million. 

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ITU report:

  • Contrary to general belief, India ranks between 25 and 85 within the ITU report across five price baskets:
  • High-consumption mobile data and voice; Low-consumption mobile data and voice; 
  • Mobile voice basket; 
  • Mobile data; and, 
  • Fixed-broadband. 
  • Even the Alliance for Affordable Internet had put India at the ninth rank in its 2019 report.

Digital divide persists:

  • India presented a strong case at the WTO to invest in digital infrastructure and digital skills in developing and least developed countries to bridge the digital divide between them and developed countries. But, within India, there are fault-lines. 
  • According to TRAI, at the end of 2019, urban teledensity was 156% while the rural one was trailing at 56%.
  • The GSMA’s The Mobile Gender Gap Report 2019 shows that only 59% of adult women in India owned a mobile phone, as against 80% of adult men, representing a 26% gender gap. 
  • Women account for just 35% of all internet users in the country and just 31% in rural areas, and the gap is more than double at 56% in mobile internet usage.

A bridge too far? 

  • ‘Affordable’ services have been the refrain in national policies all along right from the National Telecom Policy in 1994 to the National Broadband Mission in 2018. 
  • It’s time to reorient the policy framework to realise the vision of ‘universally affordable and quality broadband’ by committing to time-bound targets for both affordable tariffs and percentage of internet connected population at the bottom of pyramid. 
  • The USOF has been providing subsidy for infrastructure to telecom operators for expanding access in rural and remote areas.
  • While this is a standard method in many countries, a variant of this is needed in India. 
  • The USOF should provide end-user subsidy both for the device and service, leveraging Aadhaar and the DBT platform, much like the MGNREGA.

Way ahead:

  • This can be done through telcos’ mobile recharge top-up mechanisms and the MNP would offer the requisite flexibility to the users. 
  • It can provide reprieve to the millions returning to their native villages during the lockdown. 

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THE GIST of Editorial for UPSC Exams : 09 June 2020 (Delhi diktat(Indian Express))



Delhi diktat (Indian Express)



Mains Paper 2:Health 
Prelims level: WHO
Mains level: Healthcare infrastructure and related issues

Context:

  • FIR on a hospital for procedural oversight in testing speaks of a high-handedness that is ill-advised, especially in crisis.
  • As India begins to unlock, a steadily rising infection curve and viral load puts it among the world’s most burdened nations. 
  • The capital is a hotspot, and Delhi’s fresh infections have numbered in four figures for days now. 

Testing, Testing, Testing:

  • When the pandemic first spread and the world was bracing for a shock, the WHO had prescribed “testing, testing, testing” as the first line of defence. 
  • As in Delhi, it anticipates a fresh wave of infections triggered by the unlocking, the most visible initiative of the Arvind Kejriwal government is to suspend testing in the respected Sir Ganga Ram Hospital and slap an FIR on it. 
  • The government accuses the hospital of not using the RT-PCR app, which shares test data efficiently with all stakeholders. Suspending testing affects lives more deeply. 

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Accessibility of testing:

  • In many cities, adequate access to testing has become a stumbling block for families with critically ill members. 
  • With facilities defined as COVID and non-COVID, the status of patients must be declared at the time of admission.
  • Patients and their families are finding it difficult to get themselves tested, and as a consequence, there are reports of patients being turned away by hospitals. 
  • Ideally, everyone who has concerns should have the right to be tested. 
  • Denial conveys the public impression that having failed to flatten the infection curve, the government wants to flatten the data curve by limiting access to testing.

Invited controversies:

  • While the Delhi government has worked to make beds available for COVID-19 patients, it has also invited controversies. 
  • Its pandemic data has failed to tally with that of hospitals providing it, and there have been public complaints that government data on free beds does not tally with reality. 
  • A day before filing the FIR, Chief Minister Arvind Kejriwal had accused private hospitals of allotting beds for huge markups, without naming them. 

Why the reticence?

  • If the allegation is true, then they are hoarding a scarce resource and gouging desperate people during a crisis. 
  • They should be named and proceeded against. 

Conclusion:

  • And institutions like Sir Ganga Ram Hospital, whose focus is affordable health rather than commerce, and which are serving the public in this crisis, should be spared the unwelcome attentions of the muscular state.

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THE GIST of Editorial for UPSC Exams : 09 June 2020 (Undoing the damage (Indian Express))



Undoing the damage (Indian Express)



  • Mains Paper 2:International Relations
  • Prelims level: India China border settlement
  • Mains level: To know about India-China bilateral relations, what are the disputed areas between India and China, what is LAC, issues associated with this, key analysis and way forward

Context:

  • On Saturday’s talks between senior Indian and Chinese generals, the ministry of external affairs sounded surprisingly positive about the nature of the conversation.
  • It said there will be more military and diplomatic engagement to resolve the current crisis in Ladakh region. 
  • Saturday’s military talks followed inconclusive local-level engagement between the two armed forces in the last few weeks. 

Diplomatic consultation: 

  • On the eve of Saturday’s talks, there was intensive diplomatic consultation between the two sides that reaffirmed the mutual political interest in a peaceful resolution of the issues at hand. 
  • That the talks between senior generals were held in a “cordial atmosphere” is a relief. 
  • Delhi’s affirmation that the two sides agreed to resolve the situation in accordance with the bilateral confidence-building measures instituted over the last three decades is welcome. 

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Little room:

  • Before Saturday’s talks, Delhi was careful to downplay the prospects for an early breakthrough and suggested an extended process is at hand. 
  • The government’s caution was complemented by widespread pessimism within the Indian strategic community about an immediate resolution. 
  • That scepticism was rooted in the fact that India was taken unawares in April by the big forward push by the People’s Liberation Army across multiple locations along the so-called Line of Actual Control separating the two sides.
  • That the PLA had dug into the new positions and had brought in heavy weapons systems seemed to suggest China was here to stay in the new positions it had secured. 
  • With China having seized some ground that it did not control before, Delhi’s task of getting Beijing to undo the new facts it had created in Ladakh appears rather difficult.
  • But having publicly signalled its case for the restoration of the status quo that existed in April, Delhi has little room to back off. Therefore, the government’s suggestions that the Indian armed forces are in this for a long haul.

Negative implicationsof Delhi’s current engagement with Beijing:

  • The strategic community fears two negative implications of Delhi’s current engagement with Beijing. 
  • One is that Delhi might be tempted to ease the standoff in return for some cosmetic steps from the PLA to defuse the current crisis. 
  • The other is that Beijing might demand rather costly political concessions from Delhi in return for a full restoration of the April status quo. Given the unenviable situation Delhi finds itself in, South Block’s upbeat description of the talks suggests that the outcomes on Saturday may have exceeded initial expectations. But there is no forgetting that the April surprise has given the upper hand to the PLA. 

Conclusion: 

  • Delhi will have to press all its leverages — on the military, diplomatic and political fronts — to persuade Beijing to restore status quo ante in Ladakh. 
  • If Delhi, however, is seen asmaking unreasonable concessions to ease the current crisis, it will face a domestic political backlash and considerable diminution of its regional and international status in relation to Beijing.

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THE GIST of Editorial for UPSC Exams : 09 June 2020 (Who’s afraid of monetisation of the deficit? (The Hindu))



Who’s afraid of monetisation of the deficit? (The Hindu)



Mains Paper 3:Economy 
Prelims level: Public debt 
Mains level: Measures taken to control economic crisis by the government

Context: 

  • As the government began to fight the novel coronavirus pandemic and the economic downturn, some economic pundits urged the government to go out and spend without worrying about the increase in public debt. 
  • They said the rating agencies would understand that these are unusual times. 
  • If they did not and chose to downgrade India, we should not lose too much sleep over it.

Rating and fundamentals

  • Well, the decision of the rating agency, Moody’s, to downgrade India from Baa2 to Baa3 should come as a rude awakening. 
  • The present rating is just one notch above the ‘junk’ category. 
  • Moody’s has also retained its negative outlook on India, which suggests that a further downgrade is more likely than an upgrade.
  • The rationale given by Moody’s should especially make people sit up. 
  • The downgrade, Moody’s says, has not factored in the economic impact of the pandemic. 
  • It has to do with India’s fundamentals before the onset of the pandemic and the extended lockdown with which India responded. 

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Cloud cuckoo land:

  • We should not lose sleep over a further downgrade and simply borrow our way out of trouble? Anybody who thinks so is living in cloud cuckoo land. 
  • Whatever the failings of the agencies, in the imperfect world of global finance that we live in, their ratings do carry weight. 
  • Institutional investors are largely bound by covenants that require them to exit an economy that falls below investment grade.
  • If India is downgraded to junk status, foreign institutional investors, or FIIs, will flee in droves. 
  • The stock and bond markets will take a severe beating. The rupee will depreciate hugely and the central bank will have its hands full trying to stave off a foreign exchange crisis. That is the last thing we need at the moment.

Work towards an upgrade:

  • To do so, we need to note the key concerns that Moody’s has cited in effecting the present downgrade to our rating: slowing growth, rising debt and financial sector weakness. 
  • Many economists as also the Reserve Bank of India (RBI) expect India’s economy to shrink in FY 2020-21. 
  • The combined fiscal deficit of the Centre and the States is expected to be in the region of 12% of GDP. 
  • Moody’s expects India’s public debt to GDP ratio to rise from 72% of GDP to 84% of GDP in 2020-21. 
  • The banking sector had non-performing assets of over 9% of advances before the onset of the pandemic. Weak growth and rising bankruptcies will increase stress in the banking sector.
  • The government’s focus thus far has been on reassuring the financial markets that the fisc will not spin out of control. 
  • It has kept the ‘discretionary fiscal stimulus’ down to 1% of GDP, a figure that is most modest in relation to that of many other economies, especially developed economies. 

Clearing misapprehensions:

  • We need to increase the discretionary fiscal stimulus without increasing public debt. 
  • The answer is monetisation of the deficit, that is, the central bank providing funds to the government. 
  • Mention ‘monetisation of deficit’ and many economic pundits will fear. 
  • These fears are based on misconceptions about monetisation of the deficit and its effects.
  • A common misconception is that it involves ‘printing notes’. But that is not how central banks fund the government. 
  • The central bank typically funds the government by buying Treasury bills. 
  • As proponents of what is called Modern Monetary Theory point out, even that is not required. 
  • The central bank could simply credit the Treasury’s account with itself through an electronic accounting entry.
  • When the government spends the extra funds that have come into its account, there is an increase in ‘Base money’, that is, currency plus banks’ reserves. 

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Objections:

  • What could be the objection to such an expansion in money supply? It could be that the expansion is inflationary. 
  • This objection has little substance in a situation where aggregate demand has fallen sharply and there is an increase in unemployment. 
  • In such a situation, monetisation of the deficit is more likely to raise actual output closer to potential output without any great increase in inflation.
  • Exponents of the Modern Monetary Theory (MMT) make a more striking point. 
  • They say there is nothing particularly virtuous about the government incurring expenditure and issuing bonds to banks instead of issuing these to the central bank. 
  • The expansion in base money and hence in money supply is the same in either route. The preference for private debt is voluntary. 
  • MMT exponents say it has more to do with an ideological preference for limiting government expenditure. But that is a debate for another day.
  • Central banks worldwide have resorted to massive purchases of government bonds in the secondary market in recent years, with the RBI joining the party of late. 
  • These are carried out under Open Market Operations (OMO). 
  • The impact on money supply is the same whether the central bank acquires government bonds in the secondary market or directly from the Treasury. 
  • So why the protest against monetisation of public debt?

About inflation control:

  • OMO is said to be a lesser evil than direct monetisation because the former is a ‘temporary’ expansion in the central bank’s balance sheet whereas the latter is ‘permanent’. 
  • But we know that even so-called ‘temporary’ expansions can last for long periods with identical effects on inflation. 
  • What matters, therefore, is not whether the central bank’s balance sheet expansion is temporary or permanent but how it impacts inflation. 
  • As long as inflation is kept under control, it is hard to argue against monetisation of the deficit in a situation such as the one we are now confronted with. 

Way forward:

  • We now have a way out of the constraints imposed by sovereign ratings. 
  • The government must confine itself to the additional borrowing of ₹4.2 trillion which it has announced. 
  • Further discretionary fiscal stimulus must happen through monetisation of the deficit. 
  • That way, the debt to GDP ratio can be kept under control while also addressing concerns about growth. 
  • The rating agencies should be worrying not about monetisation per se but about its impact on inflation. 

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THE GIST of Editorial for UPSC Exams : 09 June 2020 (Selling space: On SpaceX's mission to space (The Hindu))



Selling space: On SpaceX's mission to space (The Hindu)



Mains Paper 3:Science and Tech 
Prelims level: 
Mains level: 

Context:

  • United States to send American astronauts to space from American soil after a gap of nine years is a milestone in itself. 
  • That this took place at the time of one of the biggest civil rights upsurges since the 1960s makes it almost like an escape to fantasy, riding on the wings of a public-private partnership between NASA and Elon Musk’s SpaceX. 
  • The less expensive journey is a clear financial advantage as the U.S. has been paying the Russians $80 million to put one astronaut into space ever since they stopped NASA’s human space launch programme. 

Advantages in costs, innovation and safety:

  • SpaceX comes in to provide advantages in costs, innovation and safety. 
  • In the 2000s, when Mr. Musk showed off his rockets and lobbied in Washington DC, he was mostly ignored, yet now, NASA wants him to find customers for space flights. This can expand the power of U.S. commerce exponentially. Japanese billionaire Yusaku Maezawa has already signed up as a potential traveller to the moon and back. 
  • With this partnership, Americans have taken yet another leap of faith in creating commerce in space. If his plans get realised, Mr. Musk could make space flights as common as domestic flights. 
  • The collaboration brings in a ‘willingness to fail’ which has kept SpaceX alive. This is coupled to the propensity to ‘qualify every component’, which has been NASA’s strength.

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Innovating, testing and building new technology:

  • NASA has partially outsourced its work of innovating, testing and building new technology to market players such as SpaceX. 
  • It has made clear its desire to invite more such innovative space companies to participate. India under Prime Minister Modi has also opened up the space sector including ISRO facilities to private players. 
  • The emergence of successful partnerships here will likely depend on how well they stand up against the American example of allowing for failure. 
  • ‘Fly, test, fail, fix’ has been the rubric followed by SpaceX. 
  • India has not witnessed such huge experiments in space except by the state-led ISRO, its most recently celebrated one being the Mars Orbiter Mission at the cost of ₹7 per km, which is cheaper than autorickshaw travel as cited by Mr. Modi himself, famously. 
  • ISRO already has a competitive edge in the global market for space technology. The opening up of space technologies could harbour many an innovation of this kind.

Conclusion:

  • However, it calls for a high degree of accountability coupled with a non-partisan approach on the part of all players. 
  • The state’s role as a just arbiter in finding a delicate balance between entrepreneurial adventure and vested interests is a prerequisite to compete in space with the superpowers.

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THE GIST of Editorial for UPSC Exams : 08 June 2020 (Pandemic offers chance to pursue an alternative model of urbanisation(Indian Express))



Pandemic offers chance to pursue an alternative model of urbanisation(Indian Express)



Mains Paper 1:Society 
Prelims level: Not much 
Mains level: Population and associated issues, poverty and developmental issues, urbanization, their problems and their remedies.

Context:

  • Going by present trends, India will build a new Chicago every year to accommodate new urban dwellers. 
  • Between the year 1 CE and the start of the Industrial Revolution (around the early 1800s), the decadal growth of the global population was around 0.8 per cent. 
  • With the advent of concentrated production centres, improved medicine and the era of fossil fuels, the global population has shot up by seven times in the last 180 years, clocking a decadal growth rate of over 11 per cent.

Highlights of the population growth areas across the world:

  • This population growth rate has been largely urban and metro-centred. 
  • Today, cities consume two-thirds of the global energy consumption and account for more than 70 per cent of greenhouse gas emissions. 
  • London became the first modern city to cross the one million population mark around 1800. 
  • By 1960, our planet had 111 cities with over a million inhabitants.
  • In China and India, the number rose from 371 in 2000 to 548 in 2018, with 61 of these cities in India. 
  • Recently, the UN projected that by 2030, 28 per cent of the world population will live in dense, congested spaces, jostling for ever-dwindling space and choked infrastructure. 

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Raised questions due to COVID-19: 

  • Will concentrated, high-investment, high-density cities have a prominent place in the new, emerging world? Are they successful at providing an adequate return on investment? 
  • And, above all, do they provide a quality of life and happiness to all their inhabitants? An average Mumbaikar daily spends 95 minutes commuting between office and home, wasting nearly 10 per cent of his time awake everyday. 
  • Eight people die every day in Mumbai in local train-related accidents, and in Delhi, five people lose their lives in road accidents.

Present trends:

  • India will build a new Chicago every year to accommodate new urban dwellers. 
  • This will require about $2.5 trillion of investment until 2030 — to create more congested urban spaces. 
  • Should we not look at alternative models of habitations, which are more frugal, more sustainable and offer more satisfying lifestyles and higher welfare levels?

Effects due to over population to cities: 

  • Once cities expand beyond one million, they start to experience dis-economies of scale with pressure on every urban amenity increasing exponentially.
  • More people means more vehicles, more vehicles mean need for more roads and increased pollution, which mean more hospitals, more energy and more waste. 
  • Even the most robust megacities can easily witness the “domino” effect where a minor and local failure is compounded into a catastrophe. 
  • In China in 2010, due to some broken cars and road repair work, a minor traffic snarl expanded quickly into a massive jam of 120 kilometres on the highway connecting Inner Mongolia and Beijing. 
  • Drivers were left with nowhere to go for a punishing 12 days. Even in India, we have witnessed smaller but painful versions of the same phenomenon. The truth is that overpopulated cities strain their resources inordinately and leave little room to successfully tackle every contingency.

Causes of natural and man-made disaster:

  • Cities are the most affected by natural and man-made disasters. Nearly every hot-spot of the COVID-19 outbreak is a congested urban centre. 
  • The low-income areas of cities, where anything from drinking water to sanitation can be a shared facility, are the most vulnerable to any disease outbreak. 
  • Congested low-income urban spaces not only bear an inordinately high disease burden, they also bear the brunt of air pollution, water contamination and crime infestation. 
  • In the face of any disaster like a flood, earthquake or, worse still, a pandemic, migrant workers, who throng these megacities, rush to go back to their villages. 
  • India, with its approximately 72 million migrant workers (including their families), is vulnerable to such disruptions as amply demonstrated in recent weeks.

Multi-disciplinary interactions:

  • Some of the principal and strong advantages claimed for megacities with their sky scrapers are the economies of agglomeration and the generation of new ideas and innovations through multi-disciplinary interactions. 
  • These advantages have been largely nullified with advances in digital technologies that have made online interactions numerous, equally rich in content and covering a wider range of disciplines. 
  • The “cloud” is the new interaction space, which can be accessed by innovators from widely-spread geographies. 
  • Digitisation has apparently resulted in the loss of cities’ innovative mojo.

Way ahead: 

  • With this major transformation and with the onset of COVID-19, it is surely the time to reconsider our habitation model. 
  • Gandhiji’s model of gram swaraj, APJ Abdul Kalam’s vision of providing urban amenities in rural areas and Nanaji Deshmukh’s idea of self-reliant village development clearly deserve of fresh and focused attention. 
  • We have vast swathes of land, people and resources located in our over 6,00,000 villages. 
  • These offer another chance for us to pursue an alternative model of development where agriculture, industry and service sectors move in sync for sustainable development, which is in harmony with nature. 
  • This will minimise our carbon footprint. 
  • At the same time, it will also minimise social disruption with jobs coming to people rather than the other way round. 

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THE GIST of Editorial for UPSC Exams : 08 June 2020 (The call for self-reliance asks for a pragmatic development strategy to capitalise on India’s inherent strengths(Indian Express))



The call for self-reliance asks for a pragmatic development strategy to capitalise on India’s inherent strengths(Indian Express)



Mains Paper 2:National 
Prelims level: Atmanirbhar Bharat mission
Mains level: Role and objectives of the Atmanirbhar Bharat mission

Context:

  • One of the most disruptive health challenges in recent history, each country is crafting its strategy to cope with the pandemic. 
  • The subtle balance between protecting lives and restarting economic activities is hard to strike. 
  • India is navigating this complex odyssey with great agility, flexibility, sensitivity and tenacity. 
  • The challenge has engendered a spirit of solidarity and unity. It has shown yet again how resilient we can collectively be.

Unlock 1.0:

  • As India looks at opening up after four phases of lockdown, it is seeking to find new doors and windows of opportunity. 
  • It is aiming to discover possibilities for spurring inclusive, equitable growth, to discover new value chains that would create wealth, to harness the untapped human potential and optimally utilise the natural resources. 
  • It is embarking on a mission that would make the country self-reliant. 
  • The Atmanirbhar Bharat Abhiyan, as it is called, is a mission to galvanise the forces of growth across the country in various sectors of the economy. 
  • It’s a launchpad for fostering entrepreneurship, nurturing innovation and creation of an ecosystem for rural-urban symbiotic development.
  • The decisions taken by the government on June 1 will have a far-reaching impact on the farm and non-farm sectors in rural areas as well as on the development and sustainability of medium, small and micro-enterprises. 
  • It tends to turn the current challenge into an opportunity. If the sound policy intent can be effectively translated into practice, it is bound to have a profound impact on our country’s economy, especially in rural areas.

Intensely interconnected and inter-dependent:

  • The pandemic has created a difficult situation. We had got used to an intensely interconnected and inter-dependent world.
  • As we had to perforce isolate ourselves to break the chain of viral transmission, the global supply chains which we had relied upon have been disrupted, prompting many countries like ours to think of ways to mitigate the negative impact of economic downturn.

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Shortage of health essential elements: 

  • Given the magnitude of the virus’s threat and the size of our population, the hard reality of acute shortage of basic requirements like the masks, ventilators and Personal Protection Equipment came to the fore. 
  • The emergency forced us to scale up the production of essentials needed to fight the virus. 
  • At the same time, medicines made in India like Hydroxychloroquine were in great demand from various nations. India gladly supplied this drug to several countries.

Response to an unprecedented emergency:

  • It was in this context of an effective response to an unprecedented emergency that disrupted most channels of internal and international trade, that Prime Minister gave a clarion call for the country to become self-reliant. 
  • It is not a call for protectionism or isolationism, but for adopting a pragmatic development strategy that would enable the country to recognise and capitalise on its inherent strengths. 
  • It is a trigger for reforms in the policy matrix and charting out the way forward as we reboot and reset our economic trajectory in an uncertain, post-COVID-19 world.
  • As the Prime Minister underscored, “self-reliance also prepares the country for a tough competition in the global supply chain”. 
  • By increasing the efficiency of all our sectors and also ensuring quality, the new thrust on self-reliance is expected to enhance India’s role in the global supply chain. 
  • It is aimed at giving a new boost, a quantum jump to the economic potential of the country by strengthening infrastructure, using modern technologies, enriching human resource, and creating robust supply chains.

Objectives of the self-reliance: 

  • The appeal for self-reliance aims at a serious reflection on whether we are making the best use of our natural, human and technological resources. 
  • It seeks to galvanise our unused and hidden potential.
  • It only underlines the need to be on our own with respect to basic and core necessities based on our ability to meet them with our known available resources and technologies.
  • Our country is blessed with a vast array of natural resources, a huge demographic advantage with over two-thirds of our population under the age of 35 years, a large farming community that indefatigably ensures food security for all of us, dynamic captains of industry who are creating world-class institutions and a set of young, aspirational and entrepreneurial path-breakers.
  • We need to make the connection between these strands to weave the fabric of a new India that not only meets its domestic demand for goods and services but builds global brands that the world will recognise as uniquely Indian.

Provides an opportunity:

  • The new Atmanirbhar Bharat mission provides an opportunity to gradually reduce imports in every sector. 
  • We can convert our demographic advantage into a demographic dividend by providing high-quality technical and vocational training to our youth.
  • We can further simplify procedures for setting up and running businesses.
  • We can focus strategically on the critical bottlenecks that are constricting rapid growth and find solutions to overcome them.
  • We can foster research and innovation, the mission we are embarking on will be able to achieve its transformative potential.

Way ahead:

  • Any mission has to have people at the centre. People must internalise the concept of valuing local products and artefacts and promoting them. 
  • Once the demand is generated and the market expands, the production tries to keep pace and eventually, with a branding effort, the products go global. 
  • Being vocal for “local” can be a stepping stone to a self-reliant India and an India that will add its own unique glow and charm to the vast array of products in the global marketplace.
  • We can certainly chase the dream of transforming “Local” India into a “Glocal” India by using our resources wisely and strategically. 

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THE GIST of Editorial for UPSC Exams : 08 June 2020 (Building a better India (Indian Express))



Building a better India (Indian Express)



Mains Paper 3:Economy 
Prelims level: MGNREGA
Mains level: Indian economic policy paradigm and key challenges 

Context:

  • India seems, in retrospect, to have gone to lockdown early and come out early. 
  • India may yet find that it has adopted suppression, followed by the herd immunity approach unknowingly.

Challenges to doubling the GDP target: 

  • India was supposed to be set upon doubling its GDP from $2.5 trillion to $5 trillion in the five years 2019 onward. 
  • But, in the post-Covid scenario, it seems impossible. 
  • Output could be down 25-30% before bounce-back begins. 
  • As it was, the economy had been on the downswing of a growth cycle, and the last quarter of the most recent financial year has confirmed the continuing downswing despite the July 2019 Budget.

Indian economic policy paradigm:

  • Covid 19 has exposed fundamental structural and secular (i.e., long run) weaknesses of the Indian economic policy paradigm over the last 70 years. 
  • In India, apart from the 10 good years of 1998-2008, income growth has not been steady or adequate to absorb the available labour power. 

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Socialism and self-sufficiency:

  • Two obsessions have hurt India sorely: socialism and self-sufficiency. 
  • Socialism meant state ownership of ‘commanding heights’ of the economy, protection for domestic goods and domestic bureaucrats. 
  • The state capitalism, benefiting the minority, perhaps 15% of the population, employed in the public-sector enterprises or in the government administrative and political machinery. 
  • The crony capitalists, sustained by the nationalised banks. It is not socialism as welfare state for the poor, but bonanza for the privileged.
  • Self-reliance cost the country slow growth and persistent poverty. 
  • Self-sufficiency meant import substitution, discouragement of modern technology and promotion of small enterprise over large ones, thanks to labour legislation.

Misreading of India’s long run of economic history:

  • These ideologies come from a misreading of India’s long run of economic history. 
  • If India was one of the richest countries up until the 17th century, it was because it was a trading nation with an extensive global trade and finance network. 
  • Until the steam power revolution totally changed productivity of labour on machines compared to handicraft, India was at the forefront of technology as well. 
  • But, in mistaking modern capitalist industry with imperialism, the Indian elite subjected its masses to poverty.

Comparing India with East Asia:

  • Just compare India with East Asia, which neither interpreted self-sufficiency as rejection of trade nor capitalism as an alien Western ideology. 
  • The East Asian state was in the vanguard, but it was a smart and pragmatic state rather than an ideologically-rigid state.
  • Japan set the model by cooperation between its big business and the state. It relied on an export strategy pursued by the business houses backed by the government. South Korea copied the Japanese model. 
  • It also pursued smart land reform and literacy reform. Again, exports were the key. Singapore and Taiwan learnt from that. 
  • Even China followed the Japanese example once it gave up Leninist economics.

Way ahead:

  • There is, yet, a scope for learning from Covid 19, especially on where the weaknesses lie. 
  • Apart from MGNREGA which is currently dealing with nearly 30 crore households in rural areas (swelled by migrants returned home), there is no provision of unemployment benefit for the poor.
  • Strong interest groups such as farmers, dalits, OBCs, regardless of their actual economic status, and more due to caste status, enjoy sporadic benefits from the state.
  • What can be done immediately is to create a national version of MGNREGA for urban workers as well. 
  • Give every man and woman above 18 a guarantee of 100-days-work. That will provide a solid floor level of support. Pay for it by selling off publicly-owned assets.

Conclusion:

  • The misery of the migrant workers must never shame India again. 
  • Then, there has to be a systematic completion of a welfare state covering health, housing and education. Some of these areas were covered under Modi 1.0. Time has come to finish that task.

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THE GIST of Editorial for UPSC Exams : 08 June 2020 (Swarms of extremism (The Hindu))



Swarms of extremism (The Hindu)



Mains Paper 3:Science and Tech
Prelims level: Swarm intelligence
Mains level: Function of Swarm intelligence and its effectiveness in political movements 

Context:

  • Clouds of locusts have overrun western India. 
  • As with COVID-19, country borders and barriers put up by proud sovereign nations have been crossed without difficulty, as the locusts have travelled from Africa to South Asia.

Swarm intelligence

Are locusts intelligent? 

  • Individual locusts are not. However, their swarms are swift, focused, responsive to stimuli and dangerously effective in their depredations. 
  • Biologists call this phenomenon ‘swarm intelligence’, where the individuals that make up a colony of living creatures are singularly unintelligent and are driven by programmed instinct, but their collective actions make their entire colony intelligent as an entity by itself. 
  • Swarm intelligence is common amongst insects; bees, ants and locusts demonstrate it amply. Yet, it is not unknown amongst higher animals as well. 
  • Migrating birds and shoals of fish display high degrees of swarm intelligence too.

How does swarm intelligence work? 

  • An important point to note is that they are leaderless. 
  • A queen bee is not a royal in our human sense; she is just a vast progeny-producing machine.
  • It is fascinating to see how a shoal of fish, without a ‘king or queen’ fish, when attacked at one flank by a predator, almost instantly displays an avoidance reaction. 
  • How did the fish furthest away from the attacked flank know that the shoal was in danger in less than a microsecond and veer away from the predator? 
  • Scientists put it down to the fact that within a swarm, individuals are constantly communicating with each other through actions, signals or otherwise, in a binary manner. 
  • Through binary communication, the fact that the swarm is in danger reaches all individuals in an instant and thereby, the instant response. 

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No biological curiosity:

  • This phenomenon is no biological curiosity. It is the very essence of the logic behind understanding brain function, as also the design of artificial intelligence. 
  • If the human brain was considered a colony of independently alive neuron cells, then it can be imagined that all its nuanced thought emerges from simple, binary synapse mediated conversations between individual neurons.
  • The atomisation of complex thinking as emerging from binary signals also lies at the foundation of computer science.

What does the peculiar effectiveness of extremist political movements?

  • They combine swarm intelligence with the more conventional leadership models shown by higher-level animals. 
  • We see all around us, for example, the resurgence of powerful right-wing movements, all fuelled by leaders who provide the focus of attention, then upscaled by swarms of followers, engaged in binary conversations. 
  • A leader signals something, whether it is the need to distort history, create a false sense of assurance in a faltering economy, fuel hate against somebody, or signal success when strategies fail.
  • From then on, the swarms take over the creating of simple messages, fake news, sloganeering and hate. 
  • Individuals down the ladder, shorn of individual capabilities for critical thinking, share messages, amplify them and make hashtags trend.

Is there any political future for the critical, thinking mind then?

  • At first sight, liberals who are ruggedly individualistic are especially unsuited for being a part of any swarm. 
  • They reject binary communications, and see their proximate supporters as competitors rather than as part of a larger, coordinated order. 
  • Yet leaderless movements are not unknown in the liberal, freedom-loving world either. 
  • Think Hong Kong, the Arab Spring, and you have the elements of swarm intelligence backing the flowering and upscaling of pro-freedom movements.

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THE GIST of Editorial for UPSC Exams : 08 June 2020 (Social media needs an independent oversight body (The Hindu))



Social media needs an independent oversight body (The Hindu)



Mains Paper 3:Science and Tech
Prelims level: Independent oversight body
Mains level: Need of an independent oversight body to look into Social media related issues

Context:

  • The public spat involving Twitter, Facebook, and President Donald Trump has once again exposed Facebook’s double standards when it comes to regulating content on its platform. 
  • Twitter ‘fact-checked’ two of Trump’s tweets and labelled another on George Floyd as glorifying violence. 
  • Twitter also disabled a video by the President’s campaign team citing copyright infringement. Facebook, on the other hand, refused to take down a controversial post by Trump despite protests from its own employees. 

Initiatives taken so far:

  • Mark Zuckerberg, Founder of Facebook, defended his decision by saying that though he did not agree with the President’s views, the social network’s free speech principles warranted that the post could not be taken down. 
  • In sharp contrast, ahead of the general elections in India in 2019, Facebook took down 1,000 pages and accounts for allegedly engaging in coordinated inauthentic behaviour or spam. Of this, 687 were associated with entities close to the opposition Congress party. 
  • Facebook based its action on user behaviour, without even going into the content they posted. There were no concerns about free speech expressed by the social media platform while taking down the pages then. 

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Challenges to the Facebook oversight board:

  • Lack of consistency could set a dangerous precedent as pages related to political dissent or a social campaign could be taken down, or left untouched, depending on how Facebook perceives the situation or how vulnerable it is to pressure from governments. 
  • The social media platform recently set up an oversight board in a bid to showcase that it can self-regulate. 
  • However, a big drawback of this board is that, with up to 90 days allowed for a decision, it is simply not designed for an era of instantaneous transmission. 
  • A platform which has been accused of not doing enough to prevent users’ data from being leaked to third party entities cannot be trusted to do its own policing. 
  • Neither can it be left to governments to regulate as this could become a potent weapon to control public discourse. 
  • Given the influence social media platforms wield on public opinion, electoral outcomes and consumer behaviour, it is time to set up an independent regulatory oversight mechanism.

Way ahead:

  • In India, social media is both unregulated and vulnerable to government pressure. 
  • While social media has enhanced the free flow of information and supported freedom of speech, it has also led to the rise of hate-mongering.
  • India leads the world in the number of official “take down” orders issued to social media. 
  • Policymakers must put in a framework that brings in transparency in terms of the responsibilities and rights of all stakeholders — users, intermediaries, and the government.

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(Papers) UPSC Recruitment of Enforcement Officer/ Accounts Officer at EPFO Exam Paper General Ability Test (Held on 25 November 2017)



(Papers) UPSC Recruitment of Enforcement Officer/ Accounts Officer at EPFO Exam Paper

General Ability Test (Held on 25 November 2017)



  • Test Booklet
  • Subject : General Ability Test
  • Year : 2017

1. Consider the following Commissions / Committees:
1. First National Commission on Labour
2. Labour Investigation Committee
3. Royal Commission on Labour
4. National Commission for Enterprises in the Unorganized Sector
Which one of the following is the correct chronology of the above, in ascending order, in terms
of their submission of reports?
(a) 2-4-1-3
(b) 2-1-3-4
(c) 3-2-1-4
(d) 3-4-2-1

2.Family planning became an integral part of labour welfare as per the International Labour
Organization Resolution passed in the year:
(a) 1917
(b) 1927
(c) 1937
(d) 1947

3.Which of the following is / are NOT correct approach with respect to welfare services
undertaken by organizations in the commercial and public organizations?
1. As welfare is provided by the State to all , hence duplication by other organizations is
undesirable
2. Welfare services may be provided for matters concerning employees which may not be
immediately connected with their jobs, though connected with their place of work
3. Welfare services will include special services for retired employees
4. Child care facilities may be provided on a collective basis
Select the correct answer using the code given below:
(a) 1 only
(b) 2 and 4
(c) 1 and 2
(d) 3 and 4

4.Which one among the following is the earliest labour law in India?
(a) Contract Labour (Regulation and Abolition) Act
(b) Trade Unions Act
(c) Employee’s Compensation Act
(d) Factories Act

5.Which one of the following theories of labour welfare is also called efficiency theory?
(a) Functional theory
(b) Public relations theory
(c) Religious theory
(d) Philanthropic theory

6.Which of the following statements with respect to housing is / are NOT correct?
1. It is a basic requirement for living life with dignity
2. According to the Revised Integrated Housing Scheme 2016 for workers, central assistance for a new house may be released in twelve equal installments
3. House Listing and Housing Census data of 2011 is provided by the Office of Registrar General and Census Commissioner
Select the correct answer using the code given below:
(a) 1 and 2
(b) 2 only
(c) 1 and 3
(d) 3 only

7. Which of the following benefits can be combined under the Employees’ State Insurance Act,1948?
(a) Sickness benefit and maternity benefit
(b) Sickness benefit and disablement benefit for temporary disablement
(c) Maternity benefit and disablement benefit for temporary disablement
(d) Maternity benefit and medical benefit

8.Which one of the following is the total period of maternity leave admissible to a woman employee having two or more than two surviving children under the provisions of the Maternity Benefit (Amendment) Act, 2017?
(a) Twenty six weeks
(b) Fourteen weeks
(c) Twelve weeks
(d) Sixteen weeks

9.What is the share of women representatives in the Advisory Committee to be constituted under the Equal Remuneration Act, 1976?
(a) One half of the total members
(b) One third of the total members
(c) One fourth of the total members
(d) Three fourth of the total members

10.The International Labour Organization’s Convention No 102 on ‘Minimum Standards of Social Security’ was adopted in the year:
(a) 1948
(b) 1953
(c) 1952
(d) 1950

11. In case of permanent total disablement, which one of the following is the minimum compensation to be paid under the Employee’s Compensation Act, 1923?
(a) Rs. 1,60,000
(b) Rs. 1,40,000
(c) Rs. 1,20,000
(d) Rs. 1,00,000


12.Which of the following statements with regard to Section 1 of the Employees’ State Insurance Act, 1948, is / are NOT correct?
1. The Act shall apply to all factories including factories belonging to the Government
2. The Act shall not apply to a factory under the control of the Government whose employees are in receipt of benefits substantially inferior to the benefits under this Act
3. The Act extends to the whole of India except the state of Jammu and Kashmir
4. The applicability of the Act in an establishment ceases if the number of persons employed therein falls below the limit specified under the Act Select the correct answer using the code given below:
(a) 1 only
(b) 1 and 2
(c) 2 and 3 only
(d) 2, 3 and 4

13. As per the doctrine of ‘Added Peril’ as applied to Employee’s Compensation Act, a workman cannot hold his employer liable for the risk if at the time of accident the employee:
(a) undertakes to do something which the employee is not ordinarily required to do and involves extra danger.
(b) remains absent from place where he is supposed to work.
(c) is under the influence of alcohol on duty.
(d) is working on an overtime assignment.

14. Which of the following form part of the principles concerning the Fundamental Rights as per ILO’s Constitution?
1. Elimination of all forms of forced and compulsory labour
2. Freedom of association and the effective recognition of the right to collective bargaining
3. Effective abolition of child labour
4. Prevention of major industrial accidents
Select the correct answer using the code given below:
(a) 2 and 3 only
(b) 1, 2 and 3
(c) 1, 3 and 4
(d) 1 and 2 only

THE GIST of Editorial for UPSC Exams : 29 May 2020 (A sobering comparison(Indian Express))



A sobering comparison(Indian Express)



Mains Paper 2:Health 
Prelims level: Not much 
Mains level: Comparison of India’s Covid 19 situation with its neighbours

Context:

  • A comparison of India’s situation with its neighbours is much more meaningful than the comparisons where India is almost always compared to countries in North America or Europe.
  • It is well known that the progression of the COVID-19 pandemic has varied enormously across countries.
  • While there are no conclusive explanations for this variation yet, age-structure, genetic make-up, universal BCG vaccination, and climate might play important roles.
  • In all these respects, India is similar to its neighbours in South Asia.
  • Hence, a meaningful comparison of India with its largest neighbours — Bangladesh, Pakistan and Sri Lanka — is a much better way to understand the spread of the pandemic and assess the effectiveness of responses to contain it.

Different Times:

  • The pandemic came to south Asian countries at very different times.
  • Sri Lanka was the first to report a COVID-19 case, on January 27.
  • The first case was reported within three days in India, on January 30.
  • Pakistan reported its first case on February 26, and Bangladesh on March 8.
  • The progression of COVID-19 has varied across these four nation-states.
  • Hence, from today’s vantage point, the duration of the pandemic varies in these countries.
  • To assess the pandemic at the same stage of its life cycle, we will identify its beginning in a country on the date total number of cases crossed 50 for the first time.
  • Using this method, we see that, on May 24, Bangladesh, India, Pakistan and Sri Lanka were 54, 75, 69 and 66 days into the pandemic.

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Reported Cases:

  • A first indicator to understand the spread of the pandemic is the total number of reported cases.
  • On the day 54 of the pandemic, the total number of reported cases were 39,980 in India, 32,078 in Bangladesh, 27,474 in Pakistan and 869 in Sri Lanka.
  • These countries are very different in terms of population size. If we look at the total number of reported cases per million population on the 54th day of the pandemic, we get quite a different picture.
  • Bangladesh has 195, Pakistan has 124, Sri Lanka has 41 and India has 29 cases per million population.

Fatality Rate:

  • One of the most direct impacts of the pandemic can be measured in terms of lives lost.
  • Dividing the total number of reported deaths by the total number of reported cases, we get what epidemiologists call the case fatality rate.
  • On the 54th day, the case fatality rate was highest in India, at 3.25 per cent, and lowest in Sri Lanka at 1.04 per cent.
  • Pakistan and Bangladesh fell in between, with 2.25 per cent and 1.41 per cent respectively.
  • In terms of total cases per million population, India has done better than most of its neighbouring countries — especially during the early phase of the COVID-19 pandemic.
  • When we look at the impact of the pandemic in terms of direct deaths, the picture is completely reversed.
  • India has lagged behind its neighbours in reducing the fatal impact of the pandemic on the lives of its citizens.

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Ramping Testing:

  • India, and more so Sri Lanka, have ramped up COVID-19 testing to adequate levels.
  • This is suggested by the fact that the test-positive rate, that is, the number of positive cases per 100 persons tested, has been low and stable over the past several weeks — at around 2 per cent for Sri Lanka and 4 per cent for India.
  • The situation in Bangladesh and Pakistan vis-a-vis COVID-19 testing is very different.
  • Not only do these countries have much higher test positive rates, at over 10 per cent, but it has been increasing over the past weeks.
  • Thus, Bangladesh and Pakistan have yet to reach adequate testing levels.

Relative Magnitudes of Fatality Rates:

  • This has an important implication regarding the relative magnitudes of case fatality rates across these countries.
  • Since Bangladesh and Pakistan are not testing at adequate levels, many positive cases are not being reported in these two countries.
  • If they had been reported, the case fatality rates would have been even lower than what we now see.
  • Hence, the “true” gap of Bangladesh and Pakistan vis-a-vis India, concerning the case fatality rate, is higher than currently reported. 

Conclusion:

  • The daily press briefings of the health ministry paint rosy pictures of the situation in India only because of the largely meaningless comparisons with European and North American countries.
  • Looking at our neighbours will have a much-needed sobering effect.

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THE GIST of Editorial for UPSC Exams : 29 May 2020 (What is the problem that monetisation is trying to solve? (Indian Express))



What is the problem that monetisation is trying to solve? (Indian Express)



Mains Paper 3:Economy 
Prelims level: Open Market Operations
Mains level: Significant implications for India’s economic prospects in the short-term, and indeed in the long-term

Context:

  • In her interview to this newspaper last week, the finance minister said that she is keeping her options open on monetisation of the deficit by the Reserve Bank of India (RBI).
  • How the government and the RBI decide on this will have significant implications for India’s economic prospects in the short-term, and indeed in the long-term.

Highlights the Clarifications:

First:

  • Monetisation of the deficit does not mean the government is getting free money from the RBI.
  • If one works through the combined balance sheet of the government and the RBI, it will turn out that the government does not get a free lunch, but it does get a heavily subsidised lunch.
  • That subsidy is forced out of the banks. And, as in the case of all invisible subsidies, they don’t even know.

Second:

  • It is not as if the RBI is not monetising the deficit now; it is doing so, but indirectly by buying government bonds in the secondary market through what are called open market operations (OMO).
  • Note that both monetisation and OMOs involve printing of money by the RBI. But there are important differences between the two options that make shifting over to monetisation a non-trivial decision.

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Historical Context:

  • To understand the issue, some historical context will help. In the pre-reform era, the RBI used to directly monetise the government’s deficit almost automatically.
  • That practice ended in 1997 with a landmark agreement between the government and the RBI.
  • It was agreed that henceforth, the RBI would operate only in the secondary market through the OMO route.
  • The implied understanding also was that the RBI would use the OMO route not so much to support government borrowing but as a liquidity instrument to manage the balance between the policy objectives of supporting growth, checking inflation and preserving financial stability.

Historic Outcomes:

  • In hindsight, the outcomes of that agreement were historic. Since the government started borrowing in the open market, interest rates went up which incentivised saving and thereby spurred investment and growth.
  • Also, the interest rate that the government commanded in the open market acted as a critical market signal of fiscal sustainability.
  • Importantly, the agreement shifted control over money supply, and hence over inflation, from the government’s fiscal policy to the RBI’s monetary policy.
  • The India growth story that unfolded in the years before the global financial crisis in 2008 when the economy clocked growth rates in the range of 9 per cent was at least in part a consequence of the high savings rate and low inflation which in turn were a consequence of this agreement.

Escape Clause:

  • The Fiscal Responsibility and Budget Management Act as amended in 2017 contains an escape clause which permits monetisation of the deficit under special circumstances.
  • What is the case for invoking this escape clause now even if it means potentially jeopardizing the hard won gains of the government-RBI agreement?
  • The case is made on the grounds that there just aren’t enough savings in the economy to finance government borrowing of such a large size.
  • Bond yields would spike so high that financial stability will be threatened.
  • The RBI must therefore step in and finance the government directly to prevent this from happening.

Bond Yields:

  • But there is no reason to believe that we are anywhere close to that situation. Through its OMOs, the RBI has injected such an extraordinary amount of systemic liquidity that bond yields are still relatively soft.
  • In fact the yield on the benchmark 10 year bond which was ruling at 8 per cent in September last year has since dropped to just around 6 per cent.
  • Even on the day the government announced its additional borrowing to the extent of 2.1 per cent of GDP, the yield settled at 6.17 per cent.
  • That should, if anything, be evidence that the market feels quite comfortable about financing the enhanced government borrowing.

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Monetisation and OMOs:

  • Both monetisation and OMOs involve expansion of money supply which can potentially stoke inflation. If so, why should we be so wary of monetisation?
  • Because although they are both potentially inflationary, the inflation risk they carry is different.
  • OMOs are a monetary policy tool with the RBI in the driver’s seat, deciding on how much liquidity to inject and when.
  • In contrast, monetisation is, and is seen, as a way of financing the fiscal deficit with the quantum and timing of money supply determined by the government’s borrowing rather than the RBI’s monetary policy.
  • If RBI is seen as losing control over monetary policy, it will raise concerns about inflation. That can be a more serious problem than it seems.

Inflation Prone:

  • India is inflation prone. Note that after the global financial crisis when inflation “died” everywhere, we were hit with a high and stubborn bout of inflation.
  • In hindsight, it is clear that the RBI, on my watch, failed to tighten policy in good time.
  • Since then we have embraced a monetary policy framework and the RBI has earned credibility for delivering on inflation within the target. Forsaking that credibility can be costly.
  • If, in spite of all this, the government decides to cross the Rubicon, markets will fear that the constraints on fiscal policy are being abandoned and that the government is planning to solve its fiscal problems by inflating away its debt.
  • If that occurs, yields on government bonds will shoot up, the opposite of what is sought to be achieved.

Conclusion:

  • There are cases when monetisation — despite its costs — is inevitable. If the government cannot finance its deficit at reasonable rates, then it really doesn’t have much choice.
  • But right now, it is able to borrow at around the same rate as inflation, implying a real rate of 0 per cent.
  • If in fact bond yields shoot up in real terms, there might be a case for monetisation, strictly as a one-time measure. We are not there yet.

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