Mains Paper: 3 | Science & Technology
Prelims level: Biofuels
Mains level: They are practical, given India’s agricultural scenario, efficient in terms of cost and good for the environment
Introduction
The Indian government has set a target to increase energy efficiency in transport and, at the same time, abating the impact of energy on the environment.
This is an objective shared by many other countries around the world.
The first Global Mobility Summit held in New Delhi during the first week of September, discussions concentrated on the best ways to achieve this goal.
Importance of using biofuels
The logical and immediate solution was to invest intensively in mass public transport, shared vehicles and general habit changes.
Beyond that, it was widely recognized by the scientific community that electrification was the way forward to reach higher efficiency levels.
However, there are at least three forms of electrification:
With electric power stored in batteries,
With hydrogen, and
With high-density, low-carbon liquid fuels.
Batteries have an intrinsic limitation related to their low energy density, currently less than 200 Wh per kg.
The industry goal is to reach 330 Wh, and in the future, with new material, it is believed that it could reach 700-800 Wh.
The low energy density restrains the range and determines the cost of this option.
Batteries require the use of power, and are environmentally sound only if the source of power is clean.
There is still the issue of availability and sourcing of metals used in their manufacturing, their limited lifespan, and the economic and environmental costs of discard.
A new infrastructure for power distribution is also needed and India must make massive investments in new forms of power generation, as 75.1% of its current generation is derived from coal, and another 4.2% from other fossil-based fuels such as gas and diesel.
Electrification with hydrogen is costly and risky to produce, store and distribute.
Electrification with low-carbon liquid and gaseous fuels, such as bioethanol and bio-CNG (compressed natural gas), takes advantage of their high energy density, 6,200 Wh per kg in the case of ethanol.
Biofuels must be perceived as high-density solar energy, or hydrogen, captured, stored and distributed in an efficient, economical and reliable manner.
Importance of using ethanol
The advantages of this route are the possibility of its immediate implementation as a blend component to petrol using the current distribution infrastructure.
It provides a sizeable positive impact on agriculture, increasing farm income, providing diversification and greater price stability.
Brazil has saved more than 700 million tonnes of CO2 emissions from ethanol used and over $420 billion in avoided petrol imports.
Ethanol and bio-CNG can be the source of energy for electrification adopted in hybrid, e-electric and fuel cell vehicles.
In urban areas, ethanol reduces emissions of carbon monoxide, reactive hydrocarbons, nitrogen oxides, formaldehydes and particulate matter.
It greatly contributes to reduction of cancer-related toxic emissions.
On a global scale, it’s very low carbon intensity provides a very efficient solution to mitigate global warming.
Conclusion
By 2030, India’s urban population will grow to more than 600 million people.
Urgent policies must be implemented now to increase the efficiency of energy in transport, mitigate environmental impact at local and global scale, and control migration to large cities with a sensible farming strategy.
India has enormous potential for electricity generation with bioethanol and biogas.
The same holds true when it comes to bio-CNG or biomethane from farming and agrindustrial residues for substitution of diesel fuel.
It is a natural solution for India to produce and use more ethanol as the economy continues to grow 7% a year. In addition to affecting the economy, air pollution remains on the rise.
Electrification with biofuels is the sensible, modern and long-term strategy for India and many other countries in similar circumstances.
Q.1) With reference to sources of energy, the term 2nd generation biofuel usually refers to the biofuels
(a) which are made from non food feedstocks.
(b) which are made from feedstocks used for human consumption.
(c) where algae is used as primary energy source for its production.
(d) which are designed to capture large amounts of carbon, with genetically synthesized microbes. Answer:A
UPSC Mains Questions:
Q.1) Is biofuels are optimal solutions for India’s fuels requirement?
Mains Paper: 2 | Polity
Prelims level: Personal Data Protection Bill
Mains level: The draft Personal Data Protection Bill poses a danger to the hard-won right to information
Introduction
The Supreme Court declared the right to privacy a fundamental right, a ruling widely welcomed.
But many transparency advocates also felt apprehension, fearing that the right to privacy.
It meant to protect citizens from arbitrary state and corporate surveillance.
It might be deployed first and foremost to shield authorities from scrutiny by citizens.
Issue of accountability
The Personal Data Protection Bill, 2018, drafted by the Srikrishna Committee.
The Bill identifies “personal data” as any data that directly or indirectly identifies a person.
It calls for amending clause 8.1.j of the Right to Information (RTI) Act, 2005.
The clause currently exempts the following from disclosure: “information which relates to personal information, the disclosure of which has no relationship to any public activity or interest, or which would cause unwarranted invasion of the privacy of the individual unless the Public Information Officer.
It is also satisfied that the larger public interest justifies the disclosure.
Provided that the information which cannot be denied to the Parliament or a State Legislature shall not be denied to any person.
The Srikrishna Committee suggests amending this clause to authorise public information officers, or PIOs, to deny information containing ‘personal data’, if they feel that such disclosure is likely to cause harm to ‘the data principal’, and if such harm outweighs public interest.
The Bill defines ‘data principal’ as whoever the data relates to.
This amendment may seem reasonable on first reading, but for the practical experiences of RTI users in the past years.
Existing RTI Act and it adheres to
The RTI Act’s core aim is to bring accountability by making available public records that disclose the actions and decisions of specific, identifiable members of the political class and the bureaucracy.
The Data Protection Bill extends the cloak of ‘personal data’ over all such information.
It asks PIOs (now overwhelmingly appointed at junior levels) to weigh public interest against the potential for harm to those identifiable in public documents.
The Bill defines harm expansively to include everything from blackmail and bodily injury to loss of reputation, humiliation and “mental injury”.
The Bill ignores that another key aim of the RTI Act is “containing corruption”.
By bringing corruption to light, dogged RTI users have served public interest and caused ‘harm’, in terms of the Bill, to those exposed.
A ‘powerful proviso’
In most public records identify one or more persons. For instance, file notings identify bureaucrats making decisions by their posts, or even initials/names; public records, such as contracts awarded or clearances issued, identify specific private actors.
Under the proposed amendment, PIOs will be forced to test public interest versus potential for harm to multiple “data principals” in just about every request that they handle, and this is a responsibility they will be reluctant to take on.
The nine judges of the Supreme Courtare unable to frame the bounds of privacy.
So can we expect PIOs to assess which information is private, and then weigh the potential harm to individuals due to disclosure, guided all the while by public interest and the cause of accountability?
The amended clause will chill the RTI Act, as PIOs will now have a strong legal ground to play safe, and toss out RTI requests deploying an amended clause 8.1.j.
The Supreme Court has perhaps inadvertently mangled the privacy safeguard provided in the existing Section 8.1.j.
The RTI Act currently provides an acid test to help PIOs respond to requests: “Provided that the information which cannot be denied to the Parliament or a State Legislature shall not be denied to any person.”
This is a powerful proviso, also retained in the proposed amendment.
It implies that PIOs can deny only that information to applicants which they would deny to Parliament or State legislatures.
Way forward
The government should be addressing these alarms raised by the Central Information Commission, the RTI’s apex watchdog.
The precedent created by Deshpande and its widespread abuse by PIOs need to be corrected, to reaffirm the fundamental right to information.
Instead, the government is embarking on a project to legalise such ‘abuse’, by diluting transparency in the guise of an amendment furthering privacy.
If the Bill is passed as is, and the RTI Act amended, it will deal a body blow to India’s hard-won right to information.
The Ministry of Information Technology is accepting public feedback on the Data Privacy Bill until the end of September.
Citizens should use this window to urge the government not to amend the RTI Act.
Q.1) The recently appointed B.N.Srikrishna committee is associated with
(a) reform of Public Sector Banks
(b) data protection laws
(c) Cauvery water dispute
(d) strengthening mechanism for defence procurement Answer:B
UPSC Mains Questions:
Q.1) The draft Personal Data Protection Bill poses a danger to the hard-won right to information. Critically examine the statement
Mains Paper: 2 | Constitution
Prelims level: Aadhaar
Mains level: The Supreme Court finds a pragmatic middle path between the Aadhaar scheme’s excesses and its benefits to the marginalised
Introduction
Anine-judge Bench ruled unanimously last year that privacy is a fundamental right, opinion began to gain ground that the unique identification programme was vulnerable in the face of judicial scrutiny.
It was projected by sceptics, detractors and activists as an intrusion on citizens’ privacy, a byword for a purported surveillance system, a grand project to harvest personal data for commercial exploitation by private parties and profiling by the state.
The government has staved off the challenge by successfully arguing that it is essentially a transformative scheme primarily aimed at reaching benefits and subsidies to the poor and the marginalised.
Four of the five judges on a Constitution Bench ruled that the law enabling the implementation of the programme does not violate the right to privacy of citizens; instead, the project empowers marginalised sections and procures dignity for them along with services, benefits and subsidies by leveraging the power of technology.
Constitutionalvalidity of Aadhaar
The constitutional validity of Aadhaar are upholding and clarifying areas in which it cannot be made mandatory.
The Supreme Court has restored the original intent of the programme: to plug leakages in subsidy schemes and to have better targeting of welfare benefits.
Aadhaar came to mean much more than this in the lives of ordinary people, acquiring the shape of a basic identity document that was required to access more and more services, such as birth and death certificates, SIM cards, school admissions, property registrations and vehicle purchases.
A unique identity number, that could be availed on a voluntary basis and was conceived to eliminate the rampant fraud in the distribution of benefits, had threatened to morph — with the Centre’s tacit acceptance — into something that was mandatory for various aspects of life.
The judgment narrows the scope of Aadhaar but provides a framework within which it can work.
The majority opinion has sought to limit the import of the scheme to aspects directly related to welfare benefits, subsidies and money spent from the Consolidated Fund of India.
Thus, the controversial circulars and rules making it mandatory to link mobile phone numbers and bank accounts to Aadhaar numbers have been declared unconstitutional.
Section 57 of the Aadhaar (Targeted Delivery Of Financial And Other Subsidies, Benefits And Services) Act, 2016, has been struck down to the extent that it authorised body corporates and individuals to use the Aadhaar number to establish someone’s identity.
Schools have been barred from making the submission of the Aadhaar number mandatory to enrol children.
A few other provisions have been read down or clarified.
Aadhaar: Where's it required and where's it not?
Aadhaar, the majority opinion was not oblivious to the impact of disbanding a project that has already completed much ground. For instance,
It’s relying on official statistics, the majority favoured the scheme’s continuance for the sake of the 99.76% of people included under it, rather than fret over the 0.24% who were excluded because of authentication failure.
With enrolment saturation reaching 1.2 billion people, the programme had acquired a scale and momentum that was irreversible.
It was perhaps this pragmatic imperative that led the majority to conclude that the government was justified in the passage of the Aadhaar Act as a ‘money bill’.
It even though under a strict interpretation this is a difficult position to defend, the Centre’s objective being to bypass the Rajya Sabha, where it did not have a majority.
The Court has addressed this issue by accepting the government’s argument that Section 7, which enables the use of Aadhaar to avail of any government subsidy, benefit or service for which expenditure is incurred out of the Consolidated Fund of India, is the core provision in the law, and that this makes it a ‘money bill’.
The technical arguments on the safety of the Aadhaar architecture and the end-to-end encryption that underlies the transmission of captured biometric data to the Unique Identification Authority of India.
The majority opinion has looked at the larger picture beyond the merits or demerits of the Aadhaarprogramme and the arguments for and against it.
Way forward
It held that the Aadhaar Act passes the “triple test” laid down in the ‘Privacy’ judgment under which there ought to be a law.
It is a legitimate state interest and an element of proportionality in any law that seeks to abridge the right of privacy.
Justice D.Y. Chandrachud argued that the Rajya Sabha’s authority has been superseded and that this “constitutes a fraud on the Constitution” — a position that is impossible to fault if one adopts a strict interpretation of what a money bill is.
He also expressed his displeasure at the government passing a series of orders making Aadhaar compulsory for various reasons, in defiance of interim orders from the Supreme Court.
He highlighted the biometric authentication failures that have led to denial of rights and legal entitlements, and located the reason for such failures in the project’s inability to account for and remedy flaws in its network and design.
He ruled that denial of benefits arising out of any social security rights is “violative of human dignity and impermissible under our constitutional scheme”.
Few would disagree with him in that “dignity and rights of individuals cannot be made to depend on algorithms and probabilities”.
Finally, it was the arguments in favour of benefits to the poor and the practical consequences of abandoning the scheme that won the day. Aadhaar possibly was simply too big to fail.
Q.1) With reference to UdhyogAadhar scheme, consider the following statements:
1. It is a facility by which any unregistered company gets a 12 digit unique ID to become a legal entity.
2. The scheme was notified by the Ministry of Industry and Commerce. Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2 Answer:A
UPSC Mains Questions:
Q.1) In the question of constitutional validity about Aadhaarwhere's it is required and where's it’s not?
Mains Paper: 2 | Polity
Prelims level: Representation of the People Act
Mains level: SC puts onus on executive to end criminalisation of politics, insists on disclosures to make voters aware of their candidates
Introduction
The Representation of the People Act (RPA) does not bar individuals who have criminal cases pending against them from contesting elections.
A five-judge bench of Supreme Court refused to disqualify candidates with criminal cases pending against them from contesting elections.
However, the country’s political class would do well take to serious note of the bench’s lament that the “increasing trend of criminalisation of politics… strikes at the very root of democracy”.
While showing a welcome inclination to not step out of its domain, the SC has asked Parliament to come up with a law to check the criminalisation of politics.
It has also issued a slew of directives to ensure that the voters are aware of the antecedents of candidates. Political parties will have to upload details of criminal cases pending against their candidates on their websites.
The candidates will have to furnish such information in their election affidavit and also publish it in a “widely-circulated newspaper”.
Provisions in RPA Act
The Representation of the People Act (RPA) does not bar individuals who have criminal cases pending against them from contesting elections.
It does state that an individual punished with a jail term of more than two years cannot stand in an election for six years after the jail term has ended.
But in cases on drag the courts for years makes this provision virtually ineffective.
Notwithstanding the compelling urgency to decriminalise politics, the SC has always been steadfast that its interventions in the matter should not transgress the principles of separation of powers enshrined in the Constitution.
At the same time, it has been unequivocal that “voters have a right to know about the candidates contesting elections”.
In 2002, in Union of India Vs. Association for Democratic Reforms and Another, the court noted that such information should comprise.
The antecedents of the candidate’s life including whether he was involved in a criminal case and if the case is decided.
The court’s ruling on Tuesday not only affirms such observations, it also underscores its dissatisfaction with the RP Act.
The time has come for a law against criminalisation of politics. The nation eagerly waits for such legislation,” the bench observed. The ball is now in the executive’s court.
Q.1) Which of the following are classified as Electoral Offences under Representation of People Act 1951?
1. Promoting enmity between communities on the basis of religion, class, caste etc.
2. Publishing Exit polls during conduct of elections.
3. Filing false affidavits. Select the correct answer using the code given below.
(a) 1 and 3 only
(b) 1 and 2 only
(c) 2 and 3 only
(d) 1, 2 and 3 Answer: D
UPSC Mains Questions:
Q.1) Why India needs decriminalization in Indian political system?
Mains Paper: 3 | Science and Technology
Prelims level: RNA sequences
Mains level: Bioethicists fear abuse of gene editing by governments and the private sector
Introduction
American biochemist Jennifer Doudna, one of the pioneers of the gene editing tool Crispr-Cas9, woke up in a cold sweat after she dreamt of Adolf Hitler.
He was wearing a pig mask, and wanted to understand the tool’s uses and implications.
Crispr, an acronym for Clustered Regularly Interspaced Short Palindromic Repeats, harnesses the natural defence mechanisms of bacteria to alter an organism’s genetic code.
It’s likened to a pair of molecular scissors, a cut-and-paste technology, that can snip the two DNA strands at a specific location and modify gene function.
The cutting is done by enzymes like Cas9, guided by pre-designed RNA sequences, which ensure that the targeted section of the genome is edited out.
The elegance of this editing tool has transformed medical research.
Can a faulty gene be deleted or corrected at the embryonic stage?
Researchers in China used a variation of Crispr. Instead of snipping strands, they swapped DNA letters to correct Marfan Syndrome.
In an inherited disorder that affects connective tissue. Huang Xingxu, the lead author of the paper, which was published in Molecular Therapy, said it was done on 18 viable human embryos through in-vitro.
Two of the embryos, however, exhibited unintended changes. All were destroyed after the experiment.
American biologist Shoukhrat Mitalipov used Crispr to repair a genetic mutation that could cause a deadly heart condition.
It was done on embryos in such a way that the faulty gene would not be passed down the family tree.
The findings are the focus of an ongoing debate, with several scientists sceptical of whether the gene was corrected. Can accuracy be guaranteed in early stage embryos?
Bioethicists expressed concern over the clinical application of such research. Can we and should we control or dictate evolution?
These are still early days in a new frontier of genome engineering. Researchers are only beginning to understand the power and fallout of gene editing.
Analysing the recent studies
Studies have shown that edited cells can lack a cancer suppressing protein.
As our understanding grows, we will have the potential to edit out genes that cause fatal diseases.
They have the potential to use the very same mechanisms to edit out undesirable traits in human beings.
This raises the spectre of eugenics.
Bioethicists fear abuse of gene editing, not just by misguided governments hoping to create a ‘superior’ race, but also by the private sector preying on a parent’s desire to create a perfect child.
For now, it remains a distant prospect, but silencing science or hijacking the debate is not the answer.
The burden of this knowledge cannot be borne by science alone.
Q.1) The term REPAIR, recently seen in news,
(a) it’s a technique to detoxify water by using sunlight
(b) is a DNA editing tool
(c) is the World’s biggest and most powerful icebreaker ship
(d) is a RNA editing tool Answer: D
UPSC Mains Questions:
Q.1) Can a faulty gene be deleted or corrected at the embryonic stage?
Mains Paper: 2 | India and its neighbourhood relation
Prelims level: Maldives Election
Mains level: How Maldives election is important for India?
Context
The victory of the joint Opposition candidate, Ibrahim Mohamed Solih the democratic instinct of this small Indian Ocean island is alive and well.
The election was held in contentious circumstances.
Yameen had imposed an Emergency earlier in the year and jailed opposition leaders and judges.
Important highlights of this election event
The MDP offices in Male were raided the night before voting day on September 23.
The run up was full of allegations that Yameen, would rig the election.
In the end, nearly 90 per cent of the over 2.6 lakh registered voters turned out, and Solih won decisively with 58.34 per cent of the vote, to Yameen’s 41.66 per cent.
Assuming Male is all set for a smooth transition, for India, whose relations with Yameen had been strained for years over an opportunity for a fresh start on bilateral ties.
The mistake that India has made with each of its neighbours, and should desist from repeating.
If India desires influence in its neighbourhood, it must earn it through the hard slog of smart diplomacy, not demand it as a right of geography.
New Delhi should plan a visit by Prime Minister Narendra Modi to the Maldives, the only country in the neighbourhood that he has not visited.
Q.1) Indian armed forces conducted Operation Cactus in order to
(a) Save the Maldives government from a coup in 1988.
(b) Evacuate stranded Indians from Kuwait during the Iraq invasion in 1990.
(c) Liberate Goa from the Portuguese in 1961.
(d) To end civil war between LTTE and the government in Sri Lanka in 1987 Answer: A
UPSC Mains Questions:
Q.1) How Maldives election is important for India?
Long road ahead: on Ayushman Bharat scheme
Mains Paper: 2 | Health
Prelims level: Ayushman Bharat scheme
Mains level: Budgetary support must be strengthened to make Ayushman Bharat a success
Introduction
Ayushman Bharat has been rolled out as a health protection scheme that will provide guaranteed access to treatment that is free at the point of delivery to about 40% of the population selected on the basis of censused socio-economic indicators.
It is the essential first step on the road to universal health coverage, although it has been launched by the NDA government quite late in its term, possibly with an eye on the 2019 general election.
Since the Centre has announced that 10.74 crore families identified through Socio-Economic Caste Census data will be given an annual ₹5 lakh cover under the Pradhan Mantri Jan Arogya Yojana (the insurance component of the scheme).
To what extent it is possible to implement
The allocation of just ₹2,000 crore during the current year to the PMJAY cannot provide the promised cover to the large population sought to be included.
Not all States and Union Territories are in a position to raise their own share, and a few have not even joined the scheme.
The challenge of funding, therefore, remains and without adequate budgetary commitments, the implications of pooling the financial risk for such a large segment of the population through insurers or state-run trusts or societies make the outcomes uncertain.
The Prime objectives of PMJAY
Guaranteeing health-care access using private or public facilities presumes tight cost control. In the case of the PMJAY, this is to be achieved using defined treatment packages for which rates are prescribed.
Costs are a contested area between the care-providers and the Centre, and many for-profit hospitals see the government’s proposals as unviable.
The Ayushman Bharat administration is talking of a rate review.
More importantly, a lot of time has been lost in the NDA government’s tenure, when State governments should have been persuaded to regulate the hospital sector under the Clinical Establishments (Registration and Regulation) Act, which dates back to 2010.
The law broadly provides for standardisation of facilities and reasonable rates for procedures.
The apprehensions of fraud have prompted Ayushman Bharat administrators to announce that some key treatments should be availed through public sector institutions.
It is essential to reduce the pressure on secondary and tertiary hospitals for expensive treatments by investing in preventive and primary care facilities.
The 150,000 health and wellness centres of the National Health Protection Mission can play a valuable role.
The first-order priority should be to draw up a road map for universal health coverage, through continuous upgradation of the public sector infrastructure.
Q.1) Ayushman Bharat Programme is related to which of the following?
(a) Child Nutrition
(b) Healthcare and Insurance
(c) Women empowerment
(d) Environment safety Answer: B
UPSC Mains Questions:
Q.1) There is a need budgetary support must be strengthened to make Ayushman Bharat a success. Critically examine the statement.
Mains Paper: 2 | Bilateral, regional and global groupings and agreements
involving India and/or affecting India's interests
Prelims level: Brexit
Mains level: At UN, India must look to engage with structural changes unfolding in the international system.
Context
Will Sushma Swaraj attend the customary meeting of the South Asian foreign ministers, and if she does, will she shake hands with Qureshi?
Might they chat for a couple of moments?
Important highlights of the conflict
One unfortunate casualty of this war of words has been the deepening inability of the two countries to engage with the larger global issues.
There was a time when the voices of both Pakistan and India mattered on the world stage.
Islamabad rightly saw itself as a pragmatic Islamic nation capable of exercising influence in the Middle East and acting as a bridge between America and China, which did not have diplomatic relations
with each other.
Today, despite its growing economic salience and expanding global footprint, India seems obsessed with a few issues rather than engage with the unfolding structural changes in the international system.
From India’s angle
Delhi persists with the futile quest for a permanent seat at the UN Security Council, when all indications are that it is unlikely to happen.
Delhi has also devoted far too much energy in the pursuit of the international convention against terrorism.
The essence of Trump’s “America First” has been the promise to liberate US from the “globalist trap” that it had been boxed in for decades.
Decision are taken by President Trump
Since he took charge, Trump has walked out of the Paris agreement on climate change, withdrew from the United Nations Scientific and Cultural Organisation, the UN Human Rights Council, and
threatened the International Criminal Court with punitive actions.
A second important theme is global trade.
Trump is threatening to pull out of the World Trading Organisation and choking its dispute-settlement mechanism, again in the name of sovereignty.
He has junked the 2015 nuclear agreement with Iran negotiated by the Obama administration.
Trying to construct a new Middle East Security Alliance of Arab nation.
Conclusion
What should matter for India is the fact that the geopolitics of the Gulf region — where India has massive economic and political stakes — is undergoing unprecedented change.
So is the world trading system and the nature of multilateralism.
India’s diplomatic engagements at the UN this year should be about crafting a new strategy to address these challenges.
UPSC Prelims Questions:
Q.1) Consider the following international conventions related to Wild Life conservations:
1. Convention on International Trade in Endangered Species of wild fauna and flora (CITES)
2. International Whaling Commission (IWC)
3. Convention on Migratory Species (CMS) India is party to which of the above conventions?
(a) 1 only
(b) 1 and 2 only
(c) 2 and 3 only
(d) 1, 2 and 3 Answer: D
UPSC Mains Questions:
Q.1) Will Sushma Swaraj attend the customary meeting of the South Asian foreign ministers, and if she does, will she shake hands with Qureshi?
After Salzburg: on rejection of post-Brexit blueprint
Mains Paper: 3 | Economy
Prelims level: Brexit
Mains level: The significance of Brexit to the European union.
Context
The rejection of Prime Minister Theresa May’s post-Brexit blueprint at the Salzburg summit rules out nothing as yet in Britain’s rocky negotiations on withdrawing from the European Union.
Her proposal, adopted by the Cabinet in July, has deepened divisions among the Tories.
A controversial idea in the July white paper is for a hybrid arrangement, with Britain staying in the common market only for trade in goods and agriculture, and without the obligations of free movement of people.
Post Brexit situation
This is at odds with the EU stance of not allowing cherry-picking when it comes to its four basic freedoms — of movement of capital, goods, services, and labour.
The other dispute is over the post-Brexit status of the soft border between Northern Ireland and the Republic of Ireland.
Maintaining the status quo is critical to keeping the peace under the terms of the 1998 Good Friday agreement.
Brussels seems flexible on its original proposal for full regulatory convergence and jurisdiction of EU courts over Belfast.
This is meant to assuage London’s concerns about two separate jurisdictions operating within the U.K. Britain’s alternative proposal to avoid the return of checkpoints on the Irish border and to get around the difficulties of erecting invisible borders is to bring all of the U.K. under a common customs arrangement.
Eurosceptics see this as aligning the country too close to the EU and curbing its freedom to negotiate trade deals outside the bloc.
For Brussels, it would still amount to an unacceptable division of the EU’s four freedoms.
European Council President Donald Tusk’s remarks in Salzburg that the July proposals were not workable amplified these concerns.
They drew angry reactions from Ms. May, who harked back to the mantra that a no-deal was better than a bad deal.
Way forward
The discrepancies in the opposing positions go back to the 2016 referendum outcome. Brussels had said then that while it regretted the verdict, it respected London’s decision to leave.
It stuck firm on established procedure and stressed that withdrawal negotiations could not commence until Article 50 of the EU treaty was triggered.
It emphasised that exit from the bloc would involve costs for Britain, just as the benefits of membership entailed obligations.
This accent on process could harden in the wake of the populist threat across the region to the European project.
With elections to the European Parliament due next May, the leaders are keen that the anti-EU parties see the economic and political perils of quitting the bloc.
Brexit uncertainty will linger, meanwhile.
UPSC Prelims Questions:
Q.1) Which of the following are the member countries of Group of 20 (G-20)?
1. India
2. China
3. Brazil
4. South Africa Select the correct answer using the code given below.
(a) 1, 2 and 3 only
(b) 1 and 4 only
(c) 2, 3 and 4 only
(d) 1, 2, 3 and 4
Answer: D
UPSC Mains Questions:
Q.1) What are the imnpacts of Brexit to the European union?
Mains Paper: 2 | International Relation
Prelims level: Rafale deal
Mains level: Not so important
Introduction
The Rafale deal has been the subject of heated claims and counter-claims on two broad issues that the contract to purchase 36 French multi-role fighter aircraft was grossly overvalued and that it was tainted by crony capitalism.
Ammunition for the second charge came from an unexpected quarter with former French President François Hollande stating in an interview that it was India that suggested the Anil Ambani-owned Reliance Defence Ltd. as the offset partner for the deal.
The political power tussle on this issue
The Centre has insisted that the choice of offset partners is entirely that of the manufacturer, or of Dassault Aviation.
Mr. Hollande’s remarks were widely perceived as bolstering the Congress allegation that the Rafale deal was structured to favour one industrialist.
In the storm that ensued, the clarificatory statements issued — by the Centre, the French Foreign Ministry and Dassault — did little to clearly address what Mr. Hollande had said.
The Defence Ministry’s statement merely reiterated that governments have no role in offset contracts, which are purely commercial.
The French government said pretty much the same thing, and Dassault’s statement reaffirmed that it had chosen to tie up with Reliance Defence.
But all this merely begs the question: did the Centre suggest a partnership with Reliance Defence as Mr. Hollande said?
It remains to be seen whether Mr. Hollande will now choose to complete his half-finished remarks to the French investigative website.
No questions have been raised about the capabilities of the Rafale jet, and the corruption allegations have persisted in the absence.
But a fair part of the reason for the concerns about the deal relate to process.
Way forward
It is true that the deal was signed only in September 2016, after clearance from the Cabinet Committee on Security, but Mr. Modi’s 2015 declaration of a new deal clearly caught even many of his senior officials unawares.
The purchase of 126 Rafale aircraft, initiated by the UPA government, andwere still on.
The greater transparency is the only way to clear the air. Private briefings to Opposition leaders and the disclosure of all information that doesn’t jeopardise national security or impact the aircrafts’ operational capability are good starting points.
The decision to reject the formation of a Joint Parliamentary Committee to examine the deal should be reconsidered.
If the political war over Rafale continues, it is defence modernisation that will become the real victim.
UPSC Prelims Questions:
Q.1) Consider the following statements regarding the Rafale fighter jets:
1. The Rafale is a twin-engine fighter, multi-role fighter aircraft manufactured by French aviation company Dassault.
2. These aircrafts is capable of carrying out all combat missions such as interception, air defence, in-depth strikes, ground support, reconnaissance, anti-ship strikes and nuclear deterrence.
3. India, France ink deal for 36 Rafale fighter jets.
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) All the above Answer: D
UPSC Mains Questions:
Q.1) What are the key facts behind Rafale deal between India and France?
Mains Paper: 2 | International Relation
Prelims level: Not so important
Mains level: India and its neighborhood relations
Context :
In 48 hours, what was a promising start ended in abject failure.
In his letter to Prime Minister Modi, Khan had suggested the bilateral meeting on the sidelines of the upcoming UN General Assembly session in New York as a first step to build on the “mutual desire for peace between our two countries”.
Pakistan had issued postage stamps honouring Hizbul Mujahideen’s Burhan Wani and Kashmir pellet victims in July this year; the mutilated body of the Border Security Force jawan was found on September 19.
The abduction and killing of three policemen in Jammu & Kashmir on September 21 was of a pattern with similar incidents earlier.
Presenting this as a new disclosure, and a reason for not engaging with him, is pointless and self-defeating.
When Nawaz Sharif was the prime minister, it was fashionable to ask what the point was of talking.
Still, adults on both sides know that talk the two sides must, and they will need to, if not now, at some point, irrespective of who is in office on this side or that.
Given this, it is best that both India and Pakistan now take a step back, and desist from statement-mongering that makes it more and more difficult.
UPSC Prelims Questions:
Q.1) Consider the following statements regarding the Financial Intelligence Unit of India:
1. It is an attached office set up under the Ministry of Home Affairs.
2. It was set to provide quality financial intelligence to protect against abuses of money laundering, terrorism financing and other economic offences. Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2 Answer: B
UPSC Mains Questions:
Q.1) India’s about turn on meeting with Pakistan’s foreign minister and PM Imran Khan’s response are both self-defeating. How the recent consequences can be improved?
Mains Paper: 3 | Economy
Prelims level: Non-banking financial companies
Mains level: The panic sell-off raises the alarm about risks that face the Indian markets
Context
Volatility is back in the Indian markets.
Stock indices witnessed an extraordinary swing on Friday, with the Sensex moving 1,500 points between its high and low during the day and the Nifty almost by 370 points.
The Sensex and the Nifty were down 279 and 91 points, respectively, at the end of trading on Friday after a significant recovery, but the day-end figures failed to capture the panic that struck investors during the day.
Crisis faced by NBFCs in India
Non-banking financial companies (NBFCs) were the major force behind Friday’s extreme volatility. Shares of Dewan Housing Finance Corporation Ltd (DHFL) had lost 42% of their value by the end of trading, after having fallen 60% during the day.
Other financials such as Indiabulls Housing Finance, LIC Housing Finance, and Repco Home Finance also witnessed similar steep falls.
The market panic was attributed to DSP Mutual Fund’s sale of bonds worth ₹300 crore issued by DHFL at yields higher than normal.
Its leading to fears that it could be a precursor to higher borrowing costs that adversely affect the profitability of NBFCs.
The Infrastructure Leasing & Financial Services Ltd.’s continuing default on its various liabilities also shook investors.
The 29% fall in shares of Yes Bank, after the RBI refused to extend the term of its chief executive officer beyond January, further added to the panic.
But Friday’s fall was not simply limited to financials, as scrips across the board witnessed panic-selling.
Why it’s called alarming?
The market’s impressive recovery from the day’s lows, which was fuelled by strong institutional buying.
It has offered some reason for optimism to investors, who believe the fall was simply a temporary correction in a bull market.
Such optimism may be warranted, at least partially, after looking at how both the Sensex and the Nifty have recovered since their previous deep sell-off in February.
Way foward
The market breadth continues to remain a major concern since the last sell-off.
Midcap and smallcap indices have failed to replicate the recovery that has been witnessed in the Sensex and the Nifty since February.
The panic sell-off also raises the alarm about stretched valuations and other risks faced by the Indian markets.
The depreciating rupee and the likely increase in the fiscal deficit in the run-up to the general election are the most immediate concerns.
The need for corporate earnings to catch up with current valuations is another. The systemic risks posed by rising interest rates to corporate debt and various lenders also cannot be ignored.
Investors, as well as financial market regulators, will do well to understand and act against these risks.
UPSC Prelims Questions:
Q.1) With respect to the Reserve Bank of India (RBI), consider the following statements:
1. RBI regulates all the Non Banking Financial Companies (NBFC) in India.
2. National Bank for Agricultural and Rural Development is jointly held by RBI and the Government of India. Which of the statements given above is/are not correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2 Answer: C
UPSC Mains Questions:
Q.1) The recently panic sell-off raises the alarm about risks that face the Indian markets. Why is it so? Critically examine.