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Soul factor, the missing link in B-schools (The Hindu)

Mains Paper 2 : International
Prelims level : Blue chip companies
Mains level : Blue chip companies and their relevance

Context

• Blue-chip companies going to only Tier 1 institutions could be attributed to two primary reasons.
• First, matching external branding of the blue-chip recruiting organisation with the stock pool of recruits in equally well-known and pedigreed institutions.
• And, second, rigour.
• The first level of rigour is the scores obtained by the top ranked institutions’ students in a very tough entrance examination followed by an equally demanding personal interview.
• The second level is the extremely demanding work and study schedules at such institutions. Tier 2 schools shy away from both rigours.

But are they really better?

• There are examples of students from Tier 1 B-schools not always being great leaders and there have been great business leaders from lesser known schools too.
• However, pro-rata, the incidence of CEOs from B-schools is skewed in favour of the top schools.
• Tier 1 B-schools are able to enhance the emotionally mature attitude of students better than non-Tier 1 schools through specific courses and a range of out-of-class activities.
• The responsibility of emotionally developing individuals has rarely been embraced by Tier 2 B-schools leading to long-term negative effects.
• Technical and hard skills development are their professed goals.
• But high performing, culturally developed organisations are increasingly demanding such skills.
• Long lasting soft skills can only be built on the bedrock of self-awareness. This is where aspiring B-schools need to broaden their vision.

Self aware leaders

• After the collapse of the US economy in 2008-09, there was a serious rethink at Ivy League institutions about the social and ethical implications of their management curriculum which was churning out superbly capable business leaders but without a soul.
• The soul factor is often missing from B-schools.
• There is a growing demand for self-aware leader-managers.
• The soul factor comes from a deep sense of self-awareness. However, often in tightly scheduled business management programmes focussing on hard skills, this finds little favour.
• The consequent loss is being felt across corporations, industry, the nation and beyond.

Evaluation method

• We posit SF = IQ x EQ x SQ where IQ is Intelligence Quotient (verbal comprehension, perceptual reasoning, working memory and processing speed), EQ is Emotional Quotient (self-awareness, self-regulation, motivation, empathy, and social skills) and SQ is Societal Quotient (encompassing concern for intra- and inter-society harmony, foundational value systems, and active environmental defence).
• We propose a multiplicative equation to explain SF as it prevents a low score on one element being offset by a high score on another and helps in equally focussing on all three aspects of a student’s development.

India’s scenario

• In India, EQ and SQ are where we have fallen short. These are two factors which are critical for an individual’s long-term success.
• A growing number of businesses now realise that they are mere trustees of the earth’s resources.
• They also realise that profit-making is pointless if it is not underpinned by a sustainability-seeking world view.
• Educational institutions which build individuals in this direction would be the preferred destination for blue-chip companies and society.

Way forward

• In modern higher education, there has been a marked departure away from the integration of ethics, social sciences and self-awareness toward an overwhelming focus on the hard skills.
• Analytics, finance, marketing, operations and strategy excellence form one-half of the story.
• Future business leaders must pursue the other half comprising humility, humanity, empathy, humour and hope, all of which need a high degree of self-awareness and soul.
• B-schools are doing rather fine in one and not so well in the other.

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Current Affairs for IAS Exams - 01 June 2019

::NATIONAL::

Newly formed government gives preference to farmers,traders

• The newly-sworn in NDA government at the Centre has taken four major decisions related to farmers' and traders welfare in the first meeting of the Union Cabinet.

• It has approved the extension of PradhanMantriKisanSammanNidhi (PM-KISAN) to all the farmers in the country. Earlier the benefit of the scheme was applicable to farmers having two hectares of land.

• Briefing reporters after the Cabinet meeting in New Delhi last evening, Agriculture Minister Narendra Singh Tomar said, nearly 14 crore 50 lakh farmers will be now covered under the revised scheme. The Minister said, total burden on the exchequer will be over 87,000 crore rupees for the year 2019-20. He said, over three crore farmers have been benefited so far. Six thousand rupees per year is being given in three instalments to the farmers, under the scheme.

• In another major decision, the Centre approved the PradhanMantriKisan Pension Yojana under which small and marginal farmers will get a minimum fixed pension of 3,000 rupees per month on attaining the age of 60 years. The beneficiaries should be in the age group of 18 to 40 years. Mr Tomar said, the central government will also contribute an equal amount to the pension fund. He said, the scheme aims to initially cover 5 crore farmers in the first 3 years.

• The Cabinet cleared a pension scheme for small traders. Briefing reporters in New Delhi last evening, Information and Broadcasting Minister PrakashJavdekar said, the scheme is meant to provide universal social security to all shopkeepers, retail traders and self-employed persons. They will be given a minimum monthly pension of 3 thousand rupees on attaining the age of 60 years. Altogether 3 crore retail traders and shopkeepers will be benefited under this scheme.

India lifts curbs on usage of its airspace

• There is relief likely for thousands of air travellers affected due to the closure of Pakistan airspace as India lifted curbs on use of its skies on Friday.

• “The ball is now in Pakistan’s court. Most likely they will also open up,” a senior official said on the condition of anonymity.

• “Temporary restrictions on all air routes in the Indian airspace imposed by the Indian Air Force on 27 February 2019 have been removed,” the IAF posted on Twitter. The IAF communicated its decision in a letter to the Airports Authority of India (AAI).

• Pakistan shut its airspace for all flights on February 27 following the IAF airstrike at a Jaish-e-Mohammad camp in Balakot. According to Indian officials, 11 entry and exit points, which are located between Jammu and Kashmir and Gujarat, were also closed for flights to and from Pakistan as a reciprocal measure.

• The government official also said that AAI has written to U.N.’s aviation watchdog, International Civil Aviation Organisation, as well as countries like Pakistan, Afghanistan, Oman and Iran informing them of the decision.

• Since the imposition of its ban, Pakistan has gradually opened its airspace for most airlines, barring those that enter the country from its eastern border after traversing India.

::ECONOMY::

GDP growth slows down to 5 year low mark

• India’s GDP grew at 5.8% in the January-March 2019 quarter, dragging down the full year growth to a five-year low of 6.8%. The unemployment rate in the country rose to a 45-year high of 6.1% in 2017-18, as per official data released on the first day of the second term of the Modi government.

• Addressing a press conference on Friday, Economic Affairs Secretary Subhash Chandra Garg said the slowdown, caused by temporary factors such as liquidity crunch, is likely to continue in the April-June 2019 quarter, with the demand picking up from the second quarter onwards.

• Asked about India losing the fastest growing nation tag to China with a quarterly growth of 5.8%, Mr.Garg, who is also the Finance Secretary, said, “Quarterly numbers don’t matter…it is basically annual growth… At 6.8% annual growth, India is still the fastest growing nation… China is still lower.”

• During the year, the slowdown in the economy was led by sluggish growth in the agriculture, forestry and fishing sector (2.9% growth), the mining sector (1.3% growth) and in manufacturing (6.9%).

• The sectors which saw growth rate of over 7% were public administration, defence and other services, construction, financial, real estate and professional services, and electricity, gas, water supply and other utility services.

• The unemployment data, which was released a day after Prime NarendraModi took oath for the second term, confirms an earlier leaked version of this survey that claimed that joblessness was at a 45-year high.

New draft education policy report submitted

• Former ISRO chief Dr.Kasturirangan led Committee submitted the draft National Educational Policy (NEP) to HRD Minister Ramesh PokhriyalNishank in New Delhi yesterday.

• The policy draft recommends incorporation of Indian knowledge systems in the curriculum, constituting a National Education Commission and curbing arbitrary fees hikes by private schools.

• The expert panel also proposed massive transformation in Teacher Education by moving all teacher preparation and education programmes into large multidisciplinary universities or colleges.

• It added that the topics will include Indian contribution to mathematics, astronomy, philosophy, psychology, yoga, architecture, medicine, as well as governance, polity, society, and conservation course on Indian knowledge systems.

• The existing NEP was framed in 1986 and revised in 1992.

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::INTERNATIONAL::

India to lose access to preferential trade under U.S GSP

• India will lose access to preferential trade terms with the U.S. under the latter’s Generalised System of Preferences (GSP) programme, a Senior State Department official told reporters in Washington DC on Thursday.

• The official, who did not want to be named, said the restoration of benefits remained a possibility if underlying trade issues were resolved, but the withdrawal of India’s GSP eligibility, was “a done deal”.

• President Donald Trump had written to the U.S. Congress on March 4 stating his intention to withdraw GSP benefits for India, saying India had failed to assure Washington that it would provide “equitable and reasonable access to the markets of India”.

• However, U.S. lawmakers had written to the administration, asking that a final decision be put on hold until the Indian elections concluded. Twenty-five lawmakers also wrote to the administration in May to request that GSP benefits not be cancelled as it would represent “a step back, not forward” and harm U.S. companies.

• The lawmakers had urged further negotiations with India. Indian exports to the U.S. worth $5.6 billion are covered by GSP, although India gets only $190 million in tariff savings.

• Nevertheless, the programme impacts crucial Indian sectors including textiles, leather, engineering goods, gems and jewellery.

U.S to confront Mexico with tariffs over migration issue

• Washington will impose a 5% tariff on all goods from Mexico increasing to as much as 25% — until “illegal migrants” stop coming through the country into the U.S., President Donald Trump said on Thursday.

• “On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP,” he tweeted. “The Tariff will gradually increase until the Illegal Immigration problem is remedied, at which time the Tariffs will be removed,” he wrote.

• According to a White House statement, the tariff will rise to 10% on July 1, then increase by 5% increments each month until topping out at 25% on October 1. “Tariffs will permanently remain at the 25% level unless and until Mexico substantially stops the illegal inflow of aliens coming through its territory,” the statement said

• Mexican President Andrés Manuel LópezObrador struck a conciliatory tone in a letter to Mr. Trump following the tariff announcement. “I express to you that I don’t want confrontation,” he wrote. “I propose deepening our dialogue, to look for other alternatives to the migration problem.”

• The announcement came a day after border agents in El Paso, Texas detained the largest single group of migrants they had ever encountered — 1,036 people.

::SCIENCE & TECHNOLOGY::

ICMR claims e-cigarette poses severe health risk

• The Indian Council of Medical Research (ICMR) has warned of a potential public health disaster if action was not taken to completely prohibit and dissuade the use of Electronic Nicotine Delivery Systems (ENDS) or e-cigarettes given that the nicotine delivered by these devices adversely affect almost all systems in a human body.

• E-cigarette use adversely affects the cardiovascular system, impairs respiratory immune cell function and airways in a way similar to cigarette smoking and is responsible for severe respiratory disease. It also poses risk to foetus, infant, and child brain development, the council noted in a white paper released on Friday.

• Given the harmful health effects e-cigarettes pose to users, as well as passive exposure, failure to make appropriate interventions at the right time — by bringing together all stakeholders under one umbrella to prevent this impending epidemic of e-cigarettes use — could lead to a public health disaster in India, Dr.Bhargava asserted.

• With any benefit that e-cigarettes may offer as a tobacco cessation aid yet to be established and evidence suggesting that there were risks of both dual use and the initiation to tobacco addiction among non-smokers, these products, on balance, had a net negative impact on public health, the ICMR noted.

• In its response, Association of Vapers India (AVI) in a statement said that the white paper does not present the true picture.

::SPORTS::

Shooter Manu bhaker secures Olympic quota

• In shooting, young shooter Manu Bhaker secured India its seventh Olympic quota with a fourth-place finish in the women's 10 meter air pistol event of the ISSF World Cup in Munich, Germany, today. This is India's first quota in women's 10 meter pistol.

• The 17-year Bhaker shot 201 in the final to secure the quota for the Tokyo Games. Bhaker is winner of multiple medals at top global events. She finished third in qualification with a total of 582 points , shooting a solid 98 in her last two rounds.

• SaurabhChaudhary has won quota place in men's 10 meter air pistol at the World Cup in Delhi and AbhishekVerma grabbed the quota place in the same event at the World Cup in Beijing.

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Current Affairs for IAS Exams - 31 May 2019

::NATIONAL::

Crucial EC recommendations pending since 2014 says experts

• Among the 37 recommendations of the Election Commission’s working groups, pending since 2014, are the disqualification of candidates at the stage of framing of charges that attract a minimum of five years’ imprisonment; increased punishment for false affidavits; and permanent disqualification of those guilty of corruption and heinous crimes.

• The nine working groups set up by the EC to suggest improvements in specific areas, based on their experience during the 2014 LokSabha elections, had submitted a total of 337 recommendations, of which 300 have been disposed of so far.

• Among the suggestions was drafting of legal provisions to disqualify candidates for offences with a minimum of five years’ punishment on framing of charges, rather than on conviction.

• With respect to the model code of conduct (MCC), which has been evolved through consensus among political parties, a working group had suggested amendments empowering the Commission to issue notice to a party for necessary corrections in its manifesto. It was also for the setting up of courts to adjudicate electoral offences and disallowing the use of government designations for the purposes of political publicity.

• Another pending recommendation pertains to the introduction of indelible marker ink pens, instead of ink vials, as a pilot project. The quality check of the ink should be done by multiple independent laboratories, it was suggested.

• Standardisation of elector photo identity card numbers, as they are 10 digits in some States and 16 in others, is also one of the issues, apart from the setting up of fast-track courts for speedy resolution of expenditure-related matters.

National workshop on population research centres held

• Ministry of Health and Family Welfare is organizinga two-day orientation workshop for Population Research Centres (PRCs) to highlight the various features of the flagship schemes of the Health Ministry for concurrent monitoring.

• Inaugurating the national workshop today at New Delhi, Ms.Preeti Sudan, Secretary (HFW) stated there is an urgent need for PRCs to reinvent themselves to become more relevant.

• She further stated that PRCs should integrate with the institute they are anchored in for more thoughtful insights of local and current issues to enrich their research.

• Ministry of Health and Family Welfare (MoHFW) has established the network of 18 Population Research Centres (PRCs) spread over 17 major States/UTs, with the mandate to provide, inter alia, critical research based inputs related to the Health and Family Welfare programs and policies at the national and state levels.

• The PRCs are autonomous in nature and administratively under the control of their host University/Institutions. The scheme started with establishment of 2 PRCs at Delhi and Kerala in 1958 and expanded to 18 PRCs with latest inclusion of PRC, Sagar during 1999.

• The PRCs were established to undertake research projects relating to family planning, demographic research and biological studies & qualitative aspect of population control, with a view to gainfully utilize the feedback from these research studies for plan formulation, strategies and policy interventions of ongoing schemes.

::ECONOMY::

Three major PSU’s form joint venture to acquire reserves overseas

• Three public sector units — National Aluminium Company (NALCO), Mineral Exploration Corporation Ltd. and Hindustan Copper Ltd. — are set to sign by next month, a joint venture (JV) agreement for making overseas acquisition of reserves of rare metals like lithium and cobalt.

• The first acquisition is likely to be made within six months NALCO will hold 34% of the proposed Rs. 100 crore equity, with the other two companies holding 33% each. “The JV will acquire assets in overseas countries,” HCL CMD Santosh Sharma said.

• Expert teams have already visited countries holding such deposits like Chile, Peru and Bolivia, he said, adding that the tie-ups are likely to be between the governments. These rare metals are needed in devices such as mobile phones, laptops and also for electric vehicles.

• He said that HCL hoped to increase its ore output by 25% to 51.5 lakh tonnes this fiscal through capacity expansion at its existing mines, reopening of closed mines and acquisition of new ones.

• The company has earmarked about Rs. 1,200 crore towards capital expenditure. The flagship expansion project at Malanjkhand (where an underground project was being developed in the place of the existing opencast mine) will start production this fiscal, while work on reopening the Rakha and the ChapriSidheswar mines in Ghatsila would start soon.

Global childhood reports suggests children better off today than previous

• Children born today have a better chance than at any time in history to grow up healthy, educated and protected, with the opportunity to reach their full potential, says the Global Childhood Report recently released by Save the Children, an NGO working for the education and protection of child rights.

• The document indicates that in 2000, an estimated 970 million children were robbed of their childhood due to ill-health, malnutrition, exclusion from education, child labour, child marriage, early pregnancy and violent death. That number has reduced to 690 million which effectively means that at least 280 million children are better off today than they would have been two decades ago.

• However, it warns that the world has made less progress in reducing adolescent births and child homicide, and there has been no progress at all in reducing the number of children living in areas of violence and conflict.

• “In fact, the number of children living in war zones or forced to flee their homes due to conflict has skyrocketed since 2000. Today, 1 child in 4 is being denied the right to a childhood — a time of life that should be safe for growing, learning and playing. These stolen childhoods are increasingly concentrated in the world’s conflict zones,’’ says the report.

• Another important aspect brought was the fact that in 2016 alone, 85,000 boys and girls under the age of 20 were murdered. “About 40% of these victims were under 15. Each of these deaths represents hundreds or even thousands more children who live in violent or abusive environments,’’ it says.

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::INTERNATIONAL::

India criticises slow pace of UNSC reforms adoption

• India has criticised the slow pace of UN Security Council reform process. The adoption of opaque methodologies, non-attribution of assertions and obfuscation of references by the member states are attributed to block the early reform of the world body.

• India's Permanent Representative Syed Akbaruddin said that the document co-chairs produced on the meetings of the Inter-Governmental Negotiations (IGN) for reforms during the current General Assembly session had serious gaps and did not properly reflect the proceedings.

• He was addressing an informal plenary meeting of the IGN on 'Question of equitable representation on an increase in the membership of the Security Council and other matters related to the Council'.

• The G-4 grouping of India, Japan, Brazil and Germany has been seeking expansion of the permanent and non-permanent seats of the Council to make it more representative and reflective of the changing global order.

• The four nations support each other's bids for permanent seats on an expanded Security Council.

Saudi seeks international support to confront Iran

• Saudi Arabia’s King Salman opened an emergency summit of Gulf Arab leaders in Mecca yesterday with a call for the international community to use all means to confront Iran. But, he also said the kingdom extends its hand for peace.

• King Salman was speaking at the first of three high-level summits in Mecca that were urgently convened after a spike in tensions between Saudi Arabia and its rival Iran.

• Speaking at a gathering of the Gulf Cooperation Council, King Salman said the alleged sabotage of four oil tankers off the coast of the United Arab Emirates and a drone attack on a key Saudi oil pipeline earlier this month requires serious efforts to protect the security and the gains of the six energy-rich Arab nations.

• Iran denies being involved in the attacks. Attending yesterday night’s GCC summit were the leaders of Kuwait and Bahrain, as well as senior officials from the United Arab Emirates, Oman and Qatar.

• The meeting will be immediately followed with an emergency summit of the 22-nation Arab League, minus Syria whose membership remains suspended.

• Another summit is expected today, focusing largely on Palestinian statehood and independence. It will bring together leaders from the 57-nation Organization of Islamic Cooperation, which is headquartered in Saudi Arabia.

::SCIENCE & TECHNOLOGY::

Scientists go for disease prediction with microbial presence

• We share our bodies with trillions of microbes that are critical to staying healthy, but now scientists are getting a much-needed close look at how those bugs can spur disease.

• A single test to see what gut bacteria you harbour would not tell much. Research published on Wednesday found that repeat testing spotted the microbial zoo changing in ways that eventually may help doctors determine who’s at risk of preterm birth, inflammatory bowel disease, even diabetes.

• Microbiomes start forming at birth and are different depending on whether babies were born vaginally or via C-section. And they change with age and different exposures, such as a course of antibiotics that can wipe out friendly bacteria along with infection-causing ones.

• The researchers did quarterly tests for microbial, genetic and molecular changes, plus testing when the volunteers caught a respiratory infection and even while some deliberately put on and lost weight. Not surprisingly, they found a list of microbial and inflammatory early warning signs of brewing diabetes.

• But most interestingly, people who are insulin-resistant showed delayed immune responses to respiratory infections, correlating with tamped-down microbial reactions.

::SPORTS::

India concludes with best performance in ISSF worldcup

• In Shooting, India produced their best ever show at the ISSF World Cup with a total tally of five gold medals in Munich, Germany.India topped the medals tally with five golds and a silver. Second-placed China bagged nine medals - two gold, two silver and five bronze medals.

• India gold medallists included ApurviChandela in the Women's 10 metre Air Rifle, RahiSarnobat in the Women's 25m Pistol and SaurabhChaudhary in the men's 10m Air Pistol, besides the Mixed Team titles won on the last day today.

• The pair of AnjumMoudgil and Divyansh Singh Panwar first won the 10m Air Rifle mixed team gold. Teenage pair of Manu Bhaker and SaurabhChaudhary backed them up with the 10m Air Pistol mixed team title.

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How to use the mandate (Indian Express)

Mains Paper 2 : Governance
Prelims level : Economic reforms
Mains level : Highlights the economic reforms by the new government.

Context

• In India, there has rarely been a dearth of options on what needs to be done, and there is a long list of reforms that often appear on wish-lists, each discussed for decades.
• For example, the problems of the railways have been repeatedly documented, their criticality for the economy highlighted, and suggestions for ending the government’s monopoly, splitting it, corporatising it, listing it or privatising it have been made.
• Administrative reforms were first discussed more than five decades ago.
• India’s laggard manufacturing has similarly dominated economic literature and the voices of commentators for a long time.
• Much has been written on the challenges of power distribution: Notoriously inefficient state-government monopolies; or on agriculture, where India’s workforce remains disproportionately large.

Background

• There are a few areas where significant background work has been done, and the process needs to move towards conclusion, such as in labour reforms.
• More than 40 laws with often contradictory clauses are to be replaced by four new laws (or codes);
• The first of these (the code on wages) now needs to be legislated. The code on labour could be next.
• There are some long-standing issues like urban infrastructure and affordable housing where intent has been shown and efforts made, but with limited success so far: Continued focus would be of the essence.
• The realisation in the past few years that there is scope for significant improvement in the abysmally low direct tax to GDP ratio also needs to see some follow-through.
• To these must be added some new challenges that have a more recent provenance, that is, those that have only become critical in the past few years.
• In these, the problem itself has to be first defined properly, and the government’s approach made clearer.

Growing dependence on imported energy

• The foremost here must be India’s frighteningly growing dependence on imported energy.
• One cannot grow economically without consuming more dense forms of energy, and India either does not have domestic sources of dense energy, or does a poor job in extracting and using them.
• As a result, import dependency is rising, creating growth risks: These days even a $10 rise in crude oil prices begins to threaten growth.

Dominance by PSUs

• The second has to be the financial system where government owned (PSU) banks still dominate.
• When 90 per cent of the bad loans in the past few years turned out to be in PSU banks, the government made a tacit assumption to privatise the financial system by stealth.
• It assumed that as PSU banks lost market share to private banks and non-banking financial firms (NBFCs), the system would become privatised.
• This had worked (even if unintentionally) in airlines and telecom, but once the NBFCs growth slowed due to a funding crunch, the problems in this approach have become obvious.
• The recent economic slowdown is perhaps worsened by a lack of financial capacity in the system: A decisive approach on the financial architecture in India is necessary.

Maintain foreign capital inflows

• The third has to be a rethink on foreign capital inflows. Total capital inflows as a share of GDP last year fell back to 2002 levels, and can become a cap on economic growth, particularly given rising energy imports.
• The last time the rupee’s convertibility on the capital account was discussed in-depth and a consensus built on the framework, India’s economy was the 15th largest in the world, struggling with chronic high inflation and no demonstrated commitment to fiscal responsibility.
• The world has also changed, in its geopolitics as well as growth assumptions and capital flows.
• The objective should not just be to attract more foreign capital, as it can cause undesirable volatility, but to prudently assess which risks are worth taking, given the changed domestic and global environments.

Improve better measurement and transparency

• The fourth would be better measurement and transparency.
• Everyone being on the same page on where our fiscal deficits are, where our growth is, and if we are creating enough jobs, is important.
• Even if some of the distrust on growth metrics is politically generated, there is no doubt that the Indian economy is very hard to measure, and that the time spent debating whether the economy is growing or not is a waste.
• This uncertainty has real costs too: The lack of a clear time series and the policy on off-balance-sheet borrowings by the government is one of the factors often quoted to justify high interest rates in the economy.

Three challenges in economic reforms

• That change has been slow on all of the known fronts is a reflection of the challenges in economic reforms.
• First, even steps that improve the “collective good” have interest groups that would lose economic power: Think, for example, about corporates that lose control of their companies if the firms go bankrupt, or tax evaders who are forced to pay up.
• Second, reforms are disruptive, and the more radical ones almost by definition involve uncertainty, like a surgery: Slip-ups in execution can imperil even the best intended changes.
• Third, given that reforms for the above reasons use up political capital, or goodwill of the masses, it is tempting to target incremental improvement. This requires sustained effort and is less risky.

Conclusion

• At the same time, political capital, earned through hard work in elections, also fades fast.
• Spending some of it to push through some long pending decisions could be the stimulus a three trillion dollar economy needs to keep growing rapidly.

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New beginnings, old friends (Indian Express)

Mains Paper 2 : International Relations
Prelims level : not much
Mains level : India and Japan relations

Context

• This year, the month of May has brought with it a breath of fresh air and a new ray of hope for both India and Japan. Today, India witnesses the inauguration of the second Narendra Modi administration.
• A strong and stable government in India, with renewed validation from the voters, is warmly welcomed across the globe, and not just in Japan.

To focusing three areas for Japan

Improving economic and social development

• Japan and India will continue to team up for India’s economic and social development. Japan will vigorously support the people of India by meaningfully combining our official development assistance (ODA) and private sector engagement.
• Japan has been the largest supporter of India in terms of ODA and will further broaden and deepen its efforts. Big infrastructure projects such as Mumbai-Ahmedabad High Speed Rail as well as metros in Delhi, Mumbai, Kolkata, Chennai, Ahmedabad and Bengaluru are well known.
• Japan has also been a long-standing advocate for bettering the lives of Indian people, including at the grass roots level, so that they can fulfill their potential.
• Women are at the center of our projects. Metro trains are providing comfort and safety to countless women going to work and supporting their families.
• To building schools for disadvantaged people, so that children girls, in particular can have a bright future. Japan is also determined to support projects related to rural development, sustainable forest conservation and disaster risk reduction.
• A vibrant private sector is an indispensable ingredient to our collaboration. Japan is already one of the largest investors in India and we expect even more Japanese companies to invest and operate here in the next five years.
• Japanese companies will continue to bring technologies and skills in the manufacturing sector. But the window of business collaboration is wide open for digital, IT, AI and telecommunications.
• India’s incredible IT talents complement Japan’s technological vigour beautifully. Japan has established a start-up hub in Bengaluru which has attracted young talents.

Maintain good partnership

• The partnership between Japan and India carries increasing weight for the peace and prosperity of a wider region.
• Our Special Strategic and Global Partnership is literally special, because it is supported by shared values such as democracy, freedom, and the rule of law.
• A free and open Indo-Pacific is a manifestation of our commitment to a stable and prosperous region that upholds these values.
• Working with other like-minded countries, including the US, ASEAN members and Australia, Japan and India are at the forefront of the international community’s increasing affinity for this concept.
• In particular, the Japan-India-US framework plays a key role as it has been elevated to the summit level.
• Japan and India are collaborating on development projects in countries, in regions as diverse as South Asia and Africa, to translate this vision into a reality. Quality infrastructure holds the key to enhancing connectivity in the region, providing long-term and sustainable benefits.
• The most recent effort includes a joint collaboration with Sri Lanka to develop the Colombo South Port and make it a shipping hub of the Indian Ocean.
• Japan’s commitment to the development of and better connectivity in India’s Northeast is a part of our joint efforts for regional stability and prosperity.

Collaborating SDGs

• Japan and India will be true partners on the global stage, closely collaborating in such areas as the SDGs, United Nations reform, including Security Council reform, global warming mitigation and free and open multilateral trading systems.
• As Japan hosts the G20 Summit Meeting next month and welcomes Prime Minister Modi, we would like to work with India on digital data governance, quality infrastructure and other international challenges and opportunities.
• India could become the most populous country in the world by the end of the new government’s tenure, with its economy on a steady ascent. Prime Minister Abe stresses that “A strong India is in Japan’s interest, and a strong Japan is in India’s interest”.
• Building upon the trust between our two leaders, Japan-India relations will take greater strides in the coming five years.
• Our strong relations are not only for ourselves but for the entire humanity.
• In a world where uncertainties and unpredictability are pervasive, a firm Japan-India relationship exemplifies a strong force that promises stability.

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Freedom gas (Indian Express)

Mains Paper 2 : International Relations
Prelims level : LNG
Mains level : Freedom to liquefied natural gas for US government

Context

• America stands for a lot more than freedom now.
• It stands for “freedom gas”.
• And you would be foolish to think this is just more hot air emanating from POTUS and his administration.
• A press release this week, from Trump’s Department of Energy (DoE), has re-labelled liquefied natural gas.

Renaming LNG

• Mark W Menezes, the US undersecretary of energy, renamed LNG while announcing the DoE’s approval of increased exports of the natural gas produced by Freeport LNG, a gas production facility off the coast of Texas.
• The announcement also quoted the energy department’s assistant secretary for fossil energy as saying that the DoE is aiming for the “molecules of US freedom to be exported to the world”.
• This decision by the Trump Administration seems to sit nicely with Jacques Charles’s pioneering work. He said that the volume of a gas is proportional to its absolute temperature at constant pressure.

Implications on the Trump administration

• The Trump presidency has indeed been under pressure.
• Naturally, the volume of rhetoric can only increase as “fake news media” ratchet up the temperature with multiple investigations.
• Earlier this month, the US energy secretary had informed an audience that “the US is again delivering a form of freedom to the European continent”, and that instead of “young American soldiers, it’s in the form of liquefied natural gas”.

Conclusion

• This is the extension of a legacy. The White House cafeteria is said to have renamed French fries as “freedom fries” in 2009 when the French opposed the Iraq war.
• Wondering about the equivalent connect for freedom gas?
• China is the world’s largest source of natural gas demand growth globally now and the US is one of the biggest exporters of it. Freedom always has a price.

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Capital buffers: RBI draft norms timely for NBFCs (The Hindu)

Mains Paper 3 : Economy
Prelims level : RBI
Mains level : Highlights of the new RBI draft

Context

• Non-banking financial companies, already reeling under a painful liquidity crisis, are up against a fresh challenge in the form of new regulatory norms set by the Reserve Bank of India.
• The central bank has released draft norms on liquidity risk management for deposit taking and non-deposit taking NBFCs.

New proposed rules

• According to these proposed rules, NBFCs would have to comply with a higher liquidity coverage ratio (LCR), which is the proportion of assets that an NBFC needs to hold in the form of high-quality liquid assets that can be quickly and easily converted into cash.
• The new norms, which are expected to be implemented by the RBI over four years starting from April 2020, would likely put significant pressure on the margins of NBFCs.
• Under these norms, NBFCs would have to maintain their LCR at 60% of net cash outflows initially, and improve it to 100% by April 2024.
• If the norms are implemented, NBFCs may be forced to park a significant share of their money in low-risk liquid assets, such as government bonds, which yield much lower returns than high-risk illiquid assets.
• The strict norms have to be seen in the context of the present crisis where even prominent NBFCs are struggling to meet their obligations to various lenders.

Affected by the new norms

• While the profit outlook and other short-term financial metrics of NBFCs may be affected by the norms, there are good reasons to be optimistic about their long-term impact on the health of NBFCs and the wider financial sector.
• NBFCs, which are in the business of borrowing short term to lend long term, typically run the risk of being unable to pay back their borrowers on time due to a mismatch in the duration of their assets and liabilities.
• This is particularly so in instances where panic sets in among short-term lenders, as happened last year when lenders, worried about the safety of their capital, demanded to be paid back in full.
• NBFCs rely heavily on short-term lenders rolling over their loans without fail in order to avoid any kind of liquidity crisis.
• The new norms would discourage NBFCs from borrowing over short term to extend long-term loans without the necessary buffer capital in place.
• This could compel NBFCs to shrink the scope of their lending from what it is today, but it would save them from larger crises and significantly reduce the need for the government or the RBI to step in as the lender of last resort.

Conclusion

• Undeniably, NBFCs have done a tremendous job in recent years in widening and deepening access to credit by taking a share from the public sector banks, which have been severely affected by the bad loans crisis.
• However, the latest liquidity norms for NBFCs are still necessary to ward off systemic crises.

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Challenges in giving shape to the economy (The Hindu)

Mains Paper 3 : Economy
Prelims level : Non-Performing Assets
Mains level : Reshaping the economy to curb the Non-Performing Assets

Context

• The new government is inheriting an economy that doesn’t appear to be in great shape. The actual GDP numbers and the unemployment figures can be debated but there appears to a broad agreement that despite being one of the fastest growing economy in the world, it faces serious challenges.
• Some of these challenges are on account of the factors beyond the national boundaries but quite a few of them emanate out of actions and inactions within the country.
• Let us look at some of the challenges and the possible way forward.

The NPA time bomb

• Scheduled banks are sitting on a ticking time bomb of Non-Performing Assets (NPAs).
• Infusion of huge amount of capital by the government in the public sector banks has had no significant improvement in the credit flow from the banks.
• The problem is not merely of liquidity it is one of crisis of confidence in the banking industry.
• Fixed investments have been stagnant at 30 per cent of GDP during the past few years. Make in India hasn’t travelled the distance it was supposed to. After driving substantial FDI initially, it has slowed down. Private domestic investment has virtually dried up.
• Unemployment is the biggest challenge.
• Employment figures have been contested. However, if the “leaked” NSSO data is to be believed, the unemployment rate of 6.1 per cent would be the highest in the past 45 years.

Steps need to be taken

• Effective steps need to be taken by the new government on various fronts.
• Mere statements and announcements will not help.
• Some concrete measures will have to be initiated on the ground.
• International factors like the Iran crisis, the US-China trade relations and increasing protectionism amongst the developed world are by and large beyond the control of the government.

Way ahead

• However, a lot can be done within the country.
• The new government will have to first admit that there are indeed serious problems that afflict the economy.
• Without such an admission, the issues cannot be addressed.
• This should be followed by a well-defined, practicable action plan to address each of the issues.
• Revival of credibility of institutions is imperative.
• RBI should be allowed freedom on the monetary policy front and should be tasked with sorting out the “mess” in the banking industry.
• The objective should be to ensure easy availability of credit that afflicts various sectors of the economy.
• GST related processes have to be streamlined.
• Glitches in the IT backbone also need to be sorted out.
• Improvement in GST collections will ease the pressure on fiscal deficit.
• On account of the powers vested in those that are likely to make assessments of returns, there would be a number of operational issues. These will need to be resolved.
• On the expenditure front too, leakages continue to be a source of major concern. Aadhaar can be used as an effective tool to prevent leakages but the controversies around the use of Aadhaar will have to be sorted out.
• MSMEs have enormous employment potential.
• Hence, this segment will need to be encouraged. Issues relating to factors of production (land, capital, labour, taxation, electricity, transport etc) should be addressed. Demonetisation and GST have impacted this sector adversely.

Investment worries

• Private sector investment continues to be low despite India climbing up the ladder on ease-of-doing-business.
• The “ease” has to get reflected in private sector investments.
• The Project Monitoring Group (PMG) set up by the UPA 2 needs to be revived at the central level and instituted at the State level as well.
• The PMG could fast track investment clearances even during a regime that was notorious for scams. Fast tracking of clearances will boost investor confidence.

It will also enable streamlining of processes.

Improving Human resource management

• Human resource management is the key to making things happen on the ground.
• Leaving top management posts vacant (e.g. coal production suffered during 2017-18 on account of absence of full time CMD) will have disastrous consequences.
• It is difficult to fathom why critical posts are kept vacant when it is known well in advance when they will fall vacant.
• Finally, efficiency and integrity will have to be the primary criterion for manning these posts.

Way forward

• However, the industrial slowdown (industrial production fell for the first time in March 2019 since 2017) is likely to impact the deficit.
• According to some estimates, the Centre’s revenue growth during 18-19 is likely to be only 6.2 per cent instead of 19.5.
• The current account deficit (CAD) is currently around 2 per cent of GDP but is under enormous pressure.
• The brewing Iranian crisis and the trade tensions between the US and China do not augur well. The rupee has been sliding for a while.

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Trade tantrums (The Hindu)

Mains Paper 2 : International Relations
Prelims level : ASEAN plus 3
Mains level : Bilateral talks and other significant meetings

Context

• The slow progress over RCEP talks, China has once again floated its ‘ASEAN plus 3’ idea (ASEAN, Japan, China and South Korea).
• The move, which leaves out India, Australia and New Zealand, is a clear message to India, which has resisted RCEP demands on tariff reduction, to ‘like it or lump it’.
• India apprehends that, given its $60-billion trade deficit with China, the RCEP demand to reduce tariffs on 90 per cent of the traded goods to zero will have a disastrous effect on its already struggling MSME sector.

Background

• India’s FTA experience with ASEAN, Japan and South Korea has been a mixed one. The Economic Survey 2015-16 notes: “We find that the average effect of an FTA is to increase overall trade by about 50 per cent over roughly four years.
• We also find that the ASEAN FTA has had the greatest impact, possibly because tariff reduction by India has been greater under it.
• The results also suggest a bigger impact on metals on the importing side and textiles on the exporting side.” Apart from being reluctant to slash tariffs for political economy reasons, India has expressed its reservations over inclusion of e-commerce in the RCEP talks.
• The RCEP draft is opposed to data localisation, while India fears the monopoly power of digital giants which includes the likes of Tencent and Alibaba.
• With no easy solution in sight to these issues and China threatening to pull the plug on India by junking RCEP, it would seem that India is in a tight spot.

Key possibilities

• However, the bright side of this story is that there are a number of Japanese, Korean and Chinese companies invested in the domestic market, who would, in fact, prefer a tariff wall for finished goods.
• Moreover, China is turning into a high cost producer, and needs lower tariffs and a softer currency in days to come. To that extent, India’s export markets in the ASEAN may not recede in a hurry.
• The Centre must adopt a considered approach, keeping its domestic interests in mind, while at the same time being flexible in certain areas.
• For instance, India can offer to liberalise foreign participation in education, accountancy and legal services. Its e-commerce rules are restrictive.

Way forward

• The ASEAN plus three grouping (provided Japan plays ball) is not without strategic significance.
• It raises China’s heft in the East. If this grouping pushes for an FTA with the EU, now facing issues with the Trump administration, it could further China’s global influence.
• China’s Belt and Road Initiative as well as its strides in digitisation could be leveraged here. India’s trade diplomacy needs to be reviewed, with both the US and China applying pressure to secure access to its markets.
• The earlier multilateral consensus has collapsed.
• In its place, tariff wars and arm-twisting have assumed centrestage. India must support exporters through WTO-compatible means in these uncertain times.

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Current Affairs for IAS Exams - 30 May 2019

::NATIONAL::

Cities submit their plans under NCAP to centre

• Eighty-four out of the 102 cities that have been tasked with reducing toxic particulate matter levels by 20%-30% by 2024 have submitted proposals, C.K. Mishra, Secretary, Union Environment Ministry, said at a press conference.

• “We haven’t set any annual targets for the cities but are looking at a periodic review,” Mr. Mishra said at a function to announce the government’s plans to celebrate World Environment Day on June 5. One hundred and two cities, considered India’s most polluted, have been tasked with reducing PM (particulate matter) 10 and PM 2.5 levels by 2024, as part of the National Clean Air Programme (NCAP). This was made public in January this year.

• The States in which the cities are located are expected to produce plans that include increasing the number of monitoring stations, providing technology support, conducting source apportionment studies, and strengthening enforcement. For achieving the NCAP targets, cities would be expected to calculate the reduction in pollution, keeping 2017’s average annual PM levels as the base year.

• The NCAP requires cities to implement specific measures such as “ensuring roads are pothole-free to improve traffic flow and thereby reduce dust” (within 60 days) or “ensuring strict action against unauthorised brick kilns” (within 30 days). It doesn’t specify an exact date for when these obligations kick in.

Supreme court clarifies on benami transactions

• Mere financial assistance provided to purchase property for the welfare of family members cannot be classified as a benami transaction, the Supreme Court held in a recent judgment.

• A Bench led by Justice L. NageswaraRao upheld a Karnataka High Court order, which dismissed a plea that the financial help given by G. VenkataRao to his family members to purchase property was a benami transaction.

• Financial assistance or source of money cannot be sole determinative factor or circumstance to hold that a purchase of property is benami.

• The court reiterated its own precedents while considering the nature of benami transactions. “The source of money had never been the sole consideration. It is merely one of the relevant considerations but not determinative in character,” Justice Rao wrote in the verdict.

• It referred to the Supreme Court’s judgment in the Thakur Bhim Singh case, in which it held that “while considering a particular transaction as benami, the intention of the person who contributed the purchase money is determinative of the nature of transaction.”

• “It is further observed by this court as to what the intention of the person was, who contributed the purchase money, has to be decided on the basis of the surrounding circumstance,” the Bench said.

::ECONOMY::

SC to consider authoritative power in GST evasion cases

• The Supreme Court on Wednesday decided to consider the question of power of authorities to make arrests for Goods and Services Tax (GST) evasion.

• A Vacation Bench led by Chief Justice of India RanjanGogoi and Justice Aniruddha Bose asked the government to address the court on the issue, particularly in the backdrop of varying decisions on the question by several High Courts.

• On May 27, the court dismissed a challenge against the Telangana High Court decision that said individuals cannot be protected from arrest for GST violations.

• On April 18, the High Court said it was not inclined to grant relief against arrest to petitioners who had approached it challenging the summons issued by the Superintendent (Anti-Evasion) of the Hyderabad GST Commissionerate under the Central Goods and Services Tax Act, 2017 and invocation of penal provisions under the law.

RBI constitutes task force on corporate loans

• The Reserve Bank of India (RBI) on Wednesday constituted a task force to suggest policy and regulatory interventions required for development of secondary market in corporate loans, including loan transaction platform for stressed assets.

• The six-member body, headed by Canara Bank chairman T. N. Manoharan, has been set up to review the existing state of the market for loan sale/transfer in India as well as international experience in loan trading, the central bank said.

• Secondary loan market in India is largely restricted to asset reconstruction companies (ARCs)and ad hoc sale to other lenders, including banks, and no formalised mechanism has been developed to deepen the market.

• A well-developed secondary market for debt will also aid in the transparent price discovery of the inherent riskiness of the debt being traded, the Reserve Bank of India said while announcing the task force.

• The task force has also been asked by the central bank to make recommendations for the creation of a loan contract registry to remove information asymmetries between buyers and sellers, its ownership structure and related protocols such as standardisation of loan information, independent validation and data access.

• The task force has been asked to submit its report by the end of August 2019.

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::INTERNATIONAL::

India removed from U.S currency monitoring list

• The Trump administration removed India from its currency monitoring list of major trading partners. It cited certain developments and steps being taken by New Delhi which address some of its major concerns.

• Switzerland is the other nation that has been removed by the US from its currency monitoring list. The list includes other countries like China, Japan and Germany.
  
  India has been removed from the monitoring list in the latest semi-annual report on macroeconomic and foreign exchange policies of major trading partners of the US. The Treasury Department reasoned that India had met only one out of three criteria - a significant bilateral surplus with the US - for two consecutive reports.

• After purchasing foreign exchange on net in 2017, the central bank steadily sold reserves for most of 2018, with net sales of foreign exchange reaching 1.7 per cent of GDP over the year.

• The report added that India maintains ample reserves according to the IMF metrics for reserve adequacy.

• In both Switzerland and India, there was a notable decline in 2018 in the scale and frequency of foreign exchange purchases, the report observed.

• India for the first time was placed by the US in its currency monitoring list of countries with potentially questionable foreign exchange policies in May 2018 along with five other countries - China, Germany, Japan, South Korea and Switzerland.

• Meanwhile, even as it still kept China on a list of countries whose trade surpluses with the US and other indicators are closely tracked, the administration once again refused to label China as a currency manipulator.

U.S-UAE defence pact comes to force

• The United States and the United Arab Emirates have announced that mutual defence cooperation agreement (DCA) has come into force, amid increasing tensions between Washington and Tehran.

• A joint statement said yesterday that the DCA will enhance military coordination between the United States and the United Arab Emirates, further advancing an already robust military, political, and economic partnership at a critical time.

• It said the United States and the United Arab Emirates share a deep interest in promoting prosperity and stability in the region.

• The DCA will advance that interest by fostering closer collaboration on defence and security matters and supporting efforts by both nations to maintain security in the Gulf region. US national security advisor John Bolton was in Abu Dhabi yesterday, meeting his Emirati counterpart, Sheikh Tahnoun bin Zayed Al Nahyan.

• This came on the eve of emergency Arab and Gulf summits called by Saudi Arabia to discuss the stand-off and ways to isolate Tehran.

::SCIENCE & TECHNOLOGY::

WHO gives a sigh of relief for transgenders

• The World Health Organization (WHO) will no longer categorise being transgender as a “mental disorder”.The change was brought in after a major resolution to amend the WHO health guidelines was approved earlier this week on May 25.

• The global health organisation said, “Evidence is now clear that gender incongruence is not a mental disorder, and indeed classifying it as such can cause enormous stigma for people who are transgender. Also there remain significant health care needs that can best be met if the condition is coded under the ICD (International Classification of Diseases).”

• The WHO added that a “significant change in the mental disorders section of ICD-11 is the attempt of statisticians to simplify the codes as much as possible to allow for coding of mental health conditions by primary health care providers rather than by mental health specialists.

• Health and human rights activists are now hoping that the ICD-11 will be implemented by the WHO’s 194 member states over the next three years. The WHO’s removal of “gender identity disorder” from its diagnostic manual will have a liberating effect on transgender people worldwide, they said.

• “In India, psychiatrists at an individual level have stopped treating transgender as a mental health condition. With this move, the Indian government will have to make the changes in the medical systems and laws that require this now officially outdated diagnosis,” said Dr.ZakirhusainShaikh, assistant professor, Department of Community Medicine, Hamdard Institute of Medical Sciences and Research.

• AkkaiPadmashali, social activist, said, “The Indian government now has to ensure that this is implemented in totality. This may be a milestone, but there is still quite a way to go.”

::SPORTS::

ICC cricket world cup to begin today at England

• The ICC Cricket World Cup 2019 will begin today. England will open the tournament at The Oval in London when they will take on South Africa. The match will begin at 3 PM Indian Time.

• Australia will launch their title defence on June 1 against the ICC Cricket World Cup Qualifier champions Afghanistan in a day/night match in Bristol.

• India, the 1983 and 2011 world champions, will play their first match on June 5 against South Africa at the Hampshire Bowl in Southampton.

• Their feature match against arch-rivals Pakistan will be on June 16 at Old Trafford in Manchester.

• The World Cup will span 48 matches in all, of which 45 will make up the group stage. Each team will play nine group stage matches, and the top four will progress to the semifinals, similar to how the 1992 World Cup was held.

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Breaking out of the middle-growth orbit (The Hindu)

Mains Paper 3 : Economy
Prelims level : NBFC
Mains level : Reforming NBFCs

Context

• The financial sector is gasping under a liquidity crunch.
• A crisis is building up in the NBFC space that could snowball across the entire sector and worse, even the economy itself.
• This, even as banks are still clawing their way back to health after digesting large write-offs.
• Going by the high-frequency data on the economy, it is likely that GDP growth in the fourth quarter of 2018-19 will be below 6.5%.
• It was 6.6% in the third quarter that ended December. At this rate, it might be difficult to touch the 7% mark for fiscal 2018-19.

Rescuing NBFCs

• This should be the first priority for the new Finance Minister. Even as banks are showing incipient signs of recovery from the non-performing assets (NPAs) issue, the non-banking financial sector seems to be lapsing into trouble.
• Beginning with the IL&FS collapse, the NBFC space has been hit by one problem after another and the thread running through them all is the drying up of liquidity.
• The NBFCs have been crying hoarse for liquidity support from the Reserve Bank of India (RBI), but the regulator has been reluctant to do the one thing that will help them the most — open an
  exclusive funding window.
• The central bank may have its own valid reasons for not conceding the demand but the truth is that there is a real crisis out there and a risk that the contagion will spread.
• Usually it is the real sector’s problems that spread to the financial sector but in this case there is a real possibility of the reverse happening. The new Finance Minister will have to work with the RBI and banks to resolve this issue at the earliest.

Drive consumption

• The high-frequency data coming out over the last few months point to a demand slowdown in the economy.
• Commercial vehicle off-take has been in the negative territory for the last few months following a drop in freight volumes and also tariffs.
• Passenger car sales, that were weak through 2018-19 with growth of just 2.7%, actually fell by 17% in April, which is the sharpest drop in eight years. Two-wheeler sales fell by 17% in 2018-19.
• Consumer durable and fast-moving consumer goods sales have been tepid too. Even domestic air traffic growth fell for the first time in six years in April.
• These trends are validated by the monthly factory output data after a flat, no-growth February, output contracted by 0.1% in March.
• In an economy such as India’s excessively dependent on domestic consumption, a fall in consumer spending spells trouble.

Key tasks ahead

• A return of private investment is crucial to ensure the other important objective of this government: creating jobs.
• As businesses invest more to expand capacities, hopefully more jobs will be created.
• The introduction of Goods and Services Tax (GST) and demonetisation were in no small measure responsible for the slowdown in the economy.
• Despite frequent tweaks to rates, product classifications and procedures, the GST remains a work in progress and needs to be streamlined.
• The best that the new government can do is to quickly move to a set of just three rates from the six now.
• About 62% of goods and services are now taxed at 18% and above, which is rather high.
• The median rate should be reduced to 12% in phases certainly 16% to start with given that the GST is a regressive tool that taxes the rich and the poor alike.
• Revenues have stabilised at around ₹1 lakh crore a month now despite a number of products being moved to lower tax slabs over the last few months.
• It is time to get bold and reduce rates to spur consumption. Widening the basket and stricter enforcement are better ways to increase revenues compared to high rates.

Conclusion

• Meanwhile, the farm sector is crying out for attention too.
• The new government will certainly be focussing on the crisis in agriculture, and the outcomes will determine the health of the rural economy.
• He expended tremendous political capital in his first term on measures such as demonetisation which had questionable returns.
• He should use his renewed capital now to push through important reforms that will help the economy break out of the shackles of middling growth and push it into a high-growth sphere.

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Why the integrity of data matters (The Hindu)

Mains Paper 2 : National
Prelims level : NSSO
Mains level : NSSO surveys credibility

Context

• The announcement that the government has decided to merge the National Sample Survey Office (NSSO) into and under the Central Statistics Office (CSO) has caused both surprise and concern. What exactly the ‘merger’ means remains unclear.
• Recent attempts to question the veracity of National Sample Survey (NSS) data and the way the issue has been handled have given rise to apprehensions within academia, State governments and the media about the prospect of radical changes in the present system for deciding substantive issues of scope, design, scrutiny and validation of the surveys.

The present system

• Under the present system, every year various departments of government send a list of subjects that they would like to be investigated by the NSSO.
• The requests are sent to the National Statistical Commission (NSC), which has respected economists, subject matter specialists and statisticians from government, including the head of the CSO and senior officials of the NSSO responsible for technical aspects of design and conduct of field work, as well as representatives of State governments.
• Subject matter specialists in particular fields are also brought in.
• The proposals are discussed at length keeping in view the budget allocations, availability of trained field staff and supervisors.
• The conduct of periodic surveys on important issues is also considered. (It should be noted that budget allocations, and personnel of the NSSO have always been under the Department of Statistics.)

How the surveys done?

• The tasks of sampling design, the scope and content of information to be collected, design of schedules and protocols of field work are left to be decided by special working groups.
• These groups are chaired by experts from academia, and senior officials of the CSO and the NSSO, State government representatives as well as select non-official experts.
• These working groups are in continuous session from the inception of each round through all the subsequent steps.
• Discussions of concepts, questionnaire design, field work schedules and supervision are continuous, detailed and highly professional.
• Once the field work is over, the groups decide the detailed tabulation programme, and the tables to be prepared for publication.
• The tabulated results are discussed in detail by the NSC and are published after its approval.
• After considerable hesitation and prodding, the government decided some years back to put all tabulations and the primary data on open access, especially to academic and other interested users.
• This decision has stimulated and facilitated the use of these data for intensive analyses by numerous researchers.
• They have been used extensively for monitoring of trends and critical assessment of several important aspects of the economy and society, such as poverty and inequality, consumption patterns, employment, household savings and investment, and health-seeking behaviour.
• They have spawned intense as well as creative controversies over survey methodology, quality of data, and interpretation of structure and trends. These have played an important role in shaping policy and in improving the surveys.

Implications from NSSO surveys

• The NSSO surveys command wide respect among academics, State governments and non-governmental organisations as the most reliable and comparable basis for discussions in the public, policy and even political arenas.
• This is based on their well-earned reputation for professionalism, independence and integrity.
• Widespread apprehensions that the proposed absorption of NSSO into the CSO could compromise the surveys by subjecting their review and publication to government approval must therefore be allayed promptly in an unqualified manner.
• The existing institutional arrangement in which the NSC, as a professional body independent of government, has not only functioned smoothly but also commands confidence and respect both within the country and abroad must be maintained.
• Any attempt or even a suggestion that its substantive work, publication and free dissemination of data are subject to the department’s approval will hugely dent the credibility of the Indian statistical system.

Scope for improvement

• Urging this forcefully does not in any way suggest that the present institutional arrangements are flawless or that the NSSO is perfect.
• On the contrary, it is widely recognised that there is scope for improvement in the functioning of the institution and the way data are collected.
• These problems are well known: the NSSO doesn’t have adequate budgetary allocations; there is an acute shortage of trained field staff; the scale of surveys is un-manageably large mainly because the users demand a degree of detail in content and regional disaggregation of estimates. The NSC is fully conscious of these difficulties.
• The solutions call for action by the institutions responsible for gathering data by investing in continuing research on improving sampling design, field survey methods and validation of data. Correcting these deficiencies is entirely in the domain of government.
• But there are also serious difficulties inherent in trying to get reliable and complete information through the interview method. Most respondents do not maintain any records or accounts of their transactions.
• Since most respondents rely on recall, it is unrealistic to expect them to provide reliable information on the scope and detail sought by questionnaires.

Conclusion

• Memory lapses and respondent fatigue lead to high incidence of non-response, indifferent response and biased response.
• These problems are particularly serious among the more affluent and better-educated sections of respondents.
• Increasing the role of CSO officials in running the NSSO will not solve these problems, but they can help by providing funds for specialised research on survey design and methodology.
• The necessity and importance of such research calls for far greater attention and resources than they receive at present.

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The Huawei bogey (Indian Express)

Mains Paper 3 : Science and Tech
Prelims level : Huawei Tussle
Mains level : Improving telecom infrastructure

Context

• The Trump administration has not only passed orders restricting the US government and its departments from procuring networking equipment from Chinese companies, but is exerting considerable pressure on other countries to follow suit.
• The fear that Huawei and ZTE will aid Chinese espionage and surveillance operations has become common even though there has been no compelling evidence to suggest that Huawei’s equipment is substantively different from its competitors.
• These events have also sparked a larger debate about the security of India’s communications infrastructure, an industry powered by foreign imports.
• Commentators have not shied away from suggesting that India ban the import of network equipment.

Restricting Huawei

• The path towards indigenised manufacturing of networking equipment is an expensive, elaborate process.
• Restricting certain foreign companies from operating in the country without evidence would be a knee-jerk reaction solely based on cues from US policy, and would undermine India’s strategic autonomy.
• At the heart of threats from untrusted software or hardware, lies an information asymmetry between the buyer and seller.
• It is not always possible to audit the functioning of every product that you purchase. Open technical standards, developed by various standards development organisations (SDOs), govern the behaviour of networking software, and remove this information asymmetry: They allow buyers to glean or implicitly trust operational and security aspects of the equipment.

Failed to improve privacy and security

• It is clear that various governments including India have repeatedly failed to advance privacy and security in the 5G standards, which are developed at the 3rd Generation Partnership Project (3GPP) the organisation developing standards for telephony.
• Government and industry dominance at the 3GPP has ensured that telecom technologies include security vulnerabilities that are euphemistically termed as “lawful interception”.
• From an architectural perspective, 5G does not contain any significant vulnerabilities that were absent in older telecom standards.
• Unfortunately, these vulnerabilities are indifferent to those who exploit them: A security exception for law enforcement is tantamount to a security vulnerability for malicious actors.
• As the report from UK’s Huawei Cyber Security Evaluation Centre Oversight Board confirmed, there is perhaps no technical way to mitigate the security risks that 5G poses now.
• But there is still no evidence to suggest that Huawei is operating differently from say Ericsson or Nokia.

Way ahead

• India needs to establish that Huawei is aiding the Chinese government through their products (5G or otherwise) before reacting.
• That Chinese companies are rarely insulated from Beijing’s influence is indisputable.
• However, the legal requirements placed on Chinese companies by Beijing are equivalent to de facto practices of countries like the US, which has a history of intercepting equipment from American companies to introduce vulnerabilities, or directly compelling them to aid intelligence operations.
• Such influence should be fought back by pushing for international norms that prevent states from acquiring data from companies en masse, and domestic data protection legislation.

Conclusion

• In the long term, the Indian government and its defence wings would benefit from understanding the argument Lawrence Lessig has made since the 1990s: Decisions of technical architecture have far-reaching regulatory effects.
• A long-term strategy that focuses on advancing security at technical SDOs will prove more effective in ensuring the security of India’s critical infrastructure than the economically expensive push for indigenisation.

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Next, Plasticene (Indian Express)

Mains Paper 3 : Environment
Prelims level : Anthropocene
Mains level : Broad usage of plastic

Context

• The Holocene is drawing to a close, and the Age of Humans will dawn in 2021. But the Anthropocene lacks a sub-category.

About Anthropocene era

• Just when the human race seems ready to annihilate itself and enter the fossil record for keeps, the Anthropocene Working Group of the International Commission on Stratigraphy is propelling it into the Anthropocene Age the era in which the imprint of this industrial and agricultural species becomes visible planetwide. Of course, stratigraphers work with geological slowness.
• The process of defining the Anthropocene was initiated in 2016 and, while the working group has voted overwhelmingly for the motion, it will be formally proposed only two years later to the commission.

Difference in the legacy of Holocene and Anthropocene

• Humans have also left their mark on the Holocene, the era which began about 11,650 years ago, when the glaciers retreated.
• Ruined cities like Petra and Ur are stirring tourist attractions. Further back in time are the odds and ends of material culture and fossilised human footprints on the sands of time.
• Signs of the Anthropocene are less poetic traces of pollution in tree rings, layers of soot in the substrata of industrial towns, massive deforestation and erosion, millions of acres of concrete, space
  junk in orbit.

Subcategory of Anthropocene

• However, there is time yet, until 2021. Time to define a subsidiary age of the Anthropocene, in recognition of a human stain that is far more pervasive than all these vile signs — plastic.
• Undegraded plastic is everywhere, from landfills to kitchens and the innards of cows.
• Rivers of plastic flow down to the sea, where it breaks down into microscopic particles that are now found in maritime life forms.
• Plastic is the most enduring sign of the human race.
• It is significant enough to be eponymous, identifying a subsidiary of the Anthropocene. It must be named Plasticene.

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Current Affairs for IAS Exams - 28 May 2019

::NATIONAL::

BIMSTEC leaders to attend PM’s swearing in ceremony

• India has invited the leaders of the BIMSTEC Member States for the swearing-in ceremony of Prime Minister NarendraModi on Thursday evening.

• Ministry of External Affairs, MEA said that invitations have also been sent to the President of Kyrgyzstan SooronbayJeenbekov who is the current Chair of the Shanghai Cooperation Organization and Mauritius Prime Minister PravindJugnauth, the Chief Guest at this year's PravasiBhartiya Divas.

• MEA spokesperson Raveesh Kumar said in response to a media query, this is in line with the Government's focus on its 'Neighbourhood First' policy.

• The BIMSTEC, or the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation, member states are: Bangladesh, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan including India.

• Prime Minister NarendraModi will take oath for the second term on Thursday evening. President Ram NathKovind will administer the Oath of Office and Secrecy to Mr Modi and other members of Union Council of Ministers at a function in RashtrapatiBhavan.

WHO study claims majority Indian women facing violence from partners

• Global estimates published by the World Health Organization (WHO) indicate that about 1 in 3 (35%) women worldwide have experienced either physical and/or sexual intimate partner violence or non-partner sexual violence in their lifetime.

• Worldwide as many as 38% of murders of women are committed by a male intimate partner. What makes this worse for countries like India is the fact that intimate partner violence is the highest at 37.7% in the WHO South-East Asia region.

• As per figures released by WHO, the violence ranges from 23.2% in high-income countries and 24.6% in the WHO Western Pacific region to 37% in the WHO Eastern Mediterranean region.

• Meanwhile, healthcare professionals cautioned that violence can negatively affect a woman’s physical, mental, sexual, and reproductive health, and may increase the risk of acquiring HIV in some settings.

• Warning that intimate partner violence cause serious short-and long-term problems for women and adversely affect their children besides leading to high social and economic costs for women, their families and societies, WHO said: “There is now evidence that advocacy and empowerment counselling interventions, as well as home visitation are promising in preventing or reducing intimate partner violence against women.’’

::ECONOMY::

New draft export policy unveiled

• The Commerce Ministry has come out with a comprehensive draft of the export policy which includes product- specific rules with a view to provide a ready reckoner for exporters.

• The draft policy aims at consolidating the export norms for each product as applicable at different government agencies.ITC-HS Codes are Indian Trade Clarification based on Harmonised System of Coding. It was adopted by India for import-export operations.

• Every product has been accorded eight digit HS codes. The compendium will help an exporter know all the applicable norms pertaining to a particular product, helping him/her understand policy conditions for that item.

• This exercise is for consolidating the norms and not for making any changes in the existing export policy of the country. The DGFT said that the updated draft had been prepared by including all existing policy conditions, all notifications and public notices issued after January 2018. Besides, it also includes non-tariff regulations imposed by different government agencies.

• Commenting on the move, exporters body Federation of Indian Export Organisations (FIEO) said that it would provide a “ready reckoner” for traders and help in digitisation.

CIC asks RBI to release list of large defaulters

• The Central Information Commission (CIC) has again directed the Reserve Bank of India (RBI) to disclose the list of large loan defaulters to activist Nutan Thakur. However, Central Information Commissioner Suresh Chandra said the RBI need not provide copies of files related to the list.

• In November 2018, the CIC had issued a show cause notice to RBI Governor Urjit Patel, holding him responsible for not disclosing the same information, in a different case. The recent CIC order comes a month after the Supreme Court backed the transparency watchdog against the central bank in an April 26 ruling.

• The SC gave the RBI “a last opportunity” to withdraw a November 2016 Disclosure Policy which stonewalls the disclosure of many types of information under the Right to Information Act, including the list of wilful defaulters and annual inspection reports. The policy was directly contrary to the court’s December 2015 judgement that the RBI could not withhold information sought under the RTI Act, said an SC Bench.

• In the wake of the SC ruling, the CIC has again directed the RBI to partially disclose the details requested by Ms. Thakur. She had initially filed her RTI request in September 2017, on the basis of a lecture by RBI Deputy Governor Viral Acharya who said the RBI had directed banks to file insolvency applications against 12 large accounts comprising about 25% of the total non-performing assets.

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::INTERNATIONAL::

U.S to sort out trade imbalances with Japan

• The U.S. President Donald Trump today pressed upon Japanese Prime Minister Shinzo Abe to even out a trade imbalance with the United States and said he is happy with how things are going with North Korea but in no rush to reach a peace deal.

• Speaking at a press conference with Abe after their summit, Trump said that his goal is to remove trade barriers to put U.S. exports on a fair footing in Japan. He said he hoped to have more to announce on trade very soon and said he and Abe had agreed to expand cooperation in human space exploration.

• Japanese Prime Minister Shinzo Abe, in his address stressed upon the closeness of ties. He said the visit of President Trump is a golden opportunity to clearly show the unshakable bond to the whole world and inside Japan as well. Earlier, Trump was greeted by Emperor Naruhito at the imperial palace in Tokyo in a formal welcome ceremony.

Austrian chancellor ousted in no confidence vote

• Austrian Parliament has removed Chancellor Sebastian Kurz from office as he lost the no confidence in a special Parliamentary session.His previous coalition ally, the far-right Freedom Party (FPÖ) and the opposition Social Democrats (SPÖ) backed the no-confidence motions.

• The FPÖ had become embroiled in a political scandal caused by a secret video, which ended the coalition.

• Opposition parties brought forward the two no-confidence votes - one against Kurz and the other against his government.

• Austria's President Alexander Van der Bellen named Vice Chancellor HartwigLöger as the interim leader. Löger will serve until a new transitional government can be appointed ahead of elections expected in September.

• Kurz, head of the conservative Austrian People's Party, is the first Chancellor in post-war Austrian history to lose a confidence vote. He was the world's youngest state leader when elected in 2017, at 31.Kurz's surprise strong showing in recent European Union elections - with a projected 35% of the vote - was not enough to save him.

::SCIENCE & TECHNOLOGY::

DRDO test fires Akash missile system

• Defence Research and Development Organisation (DRDO) has successfully test fired AKASH-MK-1S missile from ITR ,Chandipur, Odhisa on 25 and 27 May 2019. Akash Mk1S is an upgrade of existing AKASH missile with indigenous Seeker.

• AKASH Mk1S is a surface to air missile which can neutralize advanced aerial targets. The Akash weapon system has combination of both command guidance and active terminal seeker guidance.

• Seeker and guidance performance have been consistently established in both the missions. All the mission objectives have been met.

::SPORTS::

Surabhchaudhary breaks world record in ISSF

• In ISSF shooting World Cup, in Munich Germany, India's SaurabhChaudhary has won 10m Air Pistol Gold beating his own World Record.

• The 17-year old Chaudhary scored 246.3 bettering his previous best of 245 points that was set in New Delhi World Cup Shooting in February this year.

• Chaudhury has already secured a berth for the Tokyo Olympics. This is India's second Gold in the championship.

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Why Modi swearing-in invite to BIMSTEC leaders sends important signals to India’s neighbours (Live Mint)

Mains Paper 2 : Polity
Prelims level : BIMSTEC
Mains level : India and its neighbourhood relations

Context

• Leaders from the BIMSTEC, Kyrgyz Republic and Mauritius are invited for the swearing-in ceremony of Indian Prime Minister.
• In this context, here is an overview on the role and significance of BIMSTEC in India.
  Implications
• BIMSTEC: (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation). The invite signals a major outreach to India’s neighbourhood in the Bay of Bengal.
• Last time, the PM had invited the SAARC leaders.
• The then Pakistan Prime Minister Nawaz Sharif’s attendance had raised hopes of a new beginning in the bilateral ties.
• This time, SAARC’s exclusion is clearly aimed at keeping Pakistan out of New Delhi’s engagement with its neighbours.
• Kyrgyzstan: By inviting the Kyrgyz Republic leader, India is displaying an outreach to the Shanghai Cooperation Organisation (SCO).
• India became a member in SCO along with Pakistan in 2017.
• India thus wants to leverage its membership to advance its strategic objectives in Central Asia.
• Mauritius Prime Minister Pravind Jugnauth is one of the most well-placed People of Indian Origin in the world.
• Since Indian PM has invested diplomatic capital in outreach to the Indian diaspora since 2014, this invite is seen as a natural choice.

Significance of BIMSTEC

• BIMSTEC comprises of Bangladesh, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan, besides India.
• New Delhi’s engagement with BIMSTEC rose from the ashes of SAARC (India, Pakistan, Bangladesh, Bhutan, Sri Lanka, Maldives, Nepal, and Afghanistan).
• In October 2016, following the Uri attack, India gave a renewed push for BIMSTEC, although it had existed for almost two decades.
• India had long felt that the vast potential of SAARC was being under-utilised.
• Opportunities were being lost due to either a lack of response and/or an obstructionist approach from Pakistan.
• So BIMSTEC had emerged as an alternative regional platform.
• With 5 five countries from SAARC and two from ASEAN, BIMSTEC is a bridge between South Asia and Southeast Asia.
• It thus offers scope for discussions on sub-regional cooperation.
• Nevertheless, SAARC summit has only been postponed, and not cancelled.
• The possibility of revival remains, and so, the success of BIMSTEC does not render SAARC pointless.

Why the region matters?

• The Bay of Bengal is the largest bay in the world.
• Over one-fifth (22%) of the world’s population live in the seven countries around it.
• These countries have a combined GDP of close to $2.7 trillion.
• Despite economic challenges, they have been able to sustain average annual economic growth rates of 3.4% - 7.5% from 2012 to 2016.
• The Bay also has vast untapped natural resources.
• One-fourth of the world’s traded goods cross the Bay every year.

How could India benefit?

• As the region’s largest economy, India has a lot at stake in BIMSTEC.
• It is a natural platform to fulfil India's key foreign policy priorities of ‘Neighbourhood First’ and ‘Act East’.
• A key reason for India's engagement is the vast potential that is unlocked with stronger connectivity.
• About 45 million people live in landlocked North-eastern states.
• They will have the opportunity to connect via the Bay of Bengal to Bangladesh, Myanmar and Thailand.
• This opens up new possibilities in terms of development.
• From the strategic perspective, the Bay of Bengal is a funnel to the Malacca straits.
• In this context, the Bay has emerged a key theatre for an increasingly assertive China in maintaining its access route to the Indian Ocean.

Conclusion

• Given these, it is in India’s interest to consolidate its internal engagement among the BIMSTEC countries.
• The BIMSTEC invite is an effort to reach out diplomatically to the neighbourhood, diaspora and the China-Russia-led regional grouping of Central Asian countries.
• The future course of the move depends on the progress New Delhi makes with these groupings.

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Shadow over data (Indian Express)

Mains Paper 3 : Economy
Prelims level : NSSO
Mains level : Statistical system improvement

Context

• On May 23, while the counting of votes for the Lok Sabha election was underway, the NDA government passed an order to merge the National Sample Survey Office (NSSO) with the Central Statistics Office (CSO).

Highlights of the order

• The order, which cleared the formation of an overarching body National Statistical Office (NSO) skipped any mention of the National Statistical Commission (NSC). This is unfortunate.
• As the NSC is an independent body which oversees technical aspects of the NSSO’s statistical work, the worry is that this move will impinge on the autonomy enjoyed by the NSSO so far.
• Coming at a time when data put out by the Indian statistical system is already under a cloud of suspicion, this is likely to raise further questions over the independence of the statistical system.

New GDP series data

• Events over the past year have suggested that all is not well in the Indian statistical system.
• At the centre of it all, was the NSC. It all began when a report, prepared by a committee appointed by the NSC, showed that under the new GDP series.
• The economy had grown at a much faster pace under the UPA, than previously estimated. With the NDA government quick to disown it, the matter acquired a political dimension.
• A few months later, P C Mohanan, acting chairman of the NSC, and J V Meenakshi, Professor at the Delhi School of Economics, resigned from the NSC, protesting against the decision to not publish the NSSO’s employment survey.

Results statistics

• The results of the survey showed that unemployment in India had surged under the NDA.
• Then, a few weeks ago, another report by the NSSO showed that a large number of companies in the MCA21 database which is integral to estimating GDP under the new series either couldn’t be traced or had closed down or were operating in different sectors.
• This warrants a relook at the manner in which the MCA21 database is used for estimating GDP.

Conclusion

• This series of events, followed by the government’s latest order, is likely to increase scepticism of official data.
• But, while the more immediate concern is that of the role of the NSC, the larger concern is the decline of what was once a famed statistical system.
• For a government that should have begun its new term by re-building the credibility of the system, this is not a good start.

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Raja Mandala: Modi’s Taiwan opportunity (Indian Express)

Mains Paper 2 : International Relations
Prelims level : Not Much
Mains level : India’s relations with East Asian countries

Context

• Some in Delhi, however, would say that Modi’s focus on Taiwan is too big and risky an idea. They worry it might offend Chinese political sensitivities.
• But productive engagement with Taiwan is not about abandoning India’s “One-China” policy or playing some kind of a “card”. India has been rather scrupulous in respecting China’s sovereignty and territorial integrity.

Relationship with Taiwan

• Most major nations have significant cooperation with Taiwan without extending it diplomatic recognition.
• India, however, has too many self-imposed constraints on its Taiwan policy. It is now time to lift many of them.
• Even more important, is the need to end Delhi’s traditional political neglect of the Taiwan relationship.
• Lack of interest at the high political level means there is no bureaucratic ownership in South Block.
• To be sure, since the establishment of formal channels of contact in the mid-1990s, there has been steady progress in the relationship.
• Annual bilateral trade has reached $7 billion last year and the hope is to raise it to $20 billion in the next few years.
• There has been a rise in Taiwan’s investments in India and a steady growth in exchanges between the two societies.
• During the last five years, the NDA government has taken steps to enhance the relationship.
• These include the upgradation of the bilateral investment agreement, promotion of major Taiwanese investments, expanding parliamentary exchanges and facilitating track-two dialogues on regional issues.

Reasons to enhance the relationship

• There are at least three reasons why Delhi should take a fresh look at Taiwan and replace its current incrementalism with a more ambitious policy.

The first is geopolitical:

• The delicate three-way political compromise between US, China and Taiwan crafted in the 1970s appears to be breaking down, thanks to rising China’s regional assertiveness, the renewed threat of forceful reunification of Taiwan and Beijing’s relentless pressure tactics against Taipei.
• If there is one piece of real estate that holds the key to the geopolitics of East Asia, it is Taiwan. The unfolding dynamic around Taiwan will have significant consequences for India’s Act East Policy and its emerging role in the Indo-Pacific Region.

Second is geo-economic:

• The unfolding trade war between the US and China is compelling Taiwan to accelerate its plans to move its large manufacturing bases away from China to Southeast Asia and India. Well before the US-China trade conflict intensified, Taiwan announced the “New Southbound Policy” in 2016. The objective is to strengthen ties with the 10 countries of the ASEAN as well as Australia, New Zealand and India.
• As the structure of industrial production in East Asia undergoes a profound transformation, amidst the prospect of an economic decoupling between the US and China, India has once-in-a-generation opportunity to boost its own manufacturing sector.

The third is talent and technology:

• Few issues have animated Modi than the promotion of global access to India’s professional talent. As it turns out, Taiwan has embarked on a big mission to attract skilled workers.
• With a declining birth rate and growing emigration, Taiwan’s industry, education, and technology development could do with Indian engineers and scientists. At present, there are barely 2,000 Indians working in Taiwan.

Way forward

• There is no shortage of ideas for the transformation of India’s relations with Taiwan.
• An agreement on comprehensive economic cooperation is one of those.
• The synergy in human resources provides the basis for massive collaborations between the universities, research institutions and technology enclaves in the two countries.
• What the bilateral relationship now needs is high-level political attention in Delhi to make things happen and quickly.
• Expanding the engagement with Taiwan can’t be a tactical game; it should be an important part of Delhi’s effort to come to terms with all corners of Greater China that looms so large over India’s future.
• Those who think Taiwan is small beer in the wider scheme of Indian grand strategy should ponder over two facts.
• Taiwan’s GDP is about $600 billion and twice the size of Pakistan’s economy.
• And few entities in the international system are today as eager and capable of boosting Modi’s domestic economic agenda.

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Global implications of the 2019 mandate (The Hindu)

Mains Paper 2 : International Relation
Prelims level : Not Much
Mains level : Global implication of India’s verdict

Context

• The clear and decisive mandate for Prime Minister Narendra Modi is a defining moment in India’s democratic history.
• Its extent, which is manifest from the highest-ever voter turnout in a general election and the share of votes won by the winning coalition, creates its own very unique set of circumstances.
• To put this in perspective, as the world’s largest democracy, India has a staggering 900 million-odd voters, of whom about over 67% turned out, making it about a little over half-a-billion people participating in the general election of 2019.
• Out of this, the winning coalition is estimated to have earned close to 300 million votes.
• When we compare this with the next biggest democracy, the United States, which has a population of more than 320 million, the magnitude of the mandate earned by Mr. Modi becomes clear.

Significance

• It is a unique moment for India that the rising aspirations of people in one of the fastest growing economies have resulted in this kind of a mandate.
• While it raises the bar on expectations, more importantly, it gives the leadership of the country the necessary wherewithal to take the kind of decisions that are needed to put India on a high growth trajectory.
• At a time when two of the largest economic powers in the world, the U.S. and China, are locked in a trade war of sorts, this mandate opens the window for India to take advantage of economic opportunities that are likely to develop in the geopolitical space.
• To get the Indian economy on the right trajectory, to spur our exports and to create jobs while this kind of a mandate creates expectations, it also empowers the leadership to take the right decisions to realise the same.

A chance to steer geopolitics

• The poll result also paves the way for India to take its rightful place in the world order not just as a participant in the deliberations that happen at multilateral platforms but, more importantly, to set the course for the kind of change that we would like to see in the world.
• India over the last five years has taken a leadership position in quite a few initiatives such as the International Solar Alliance, while facilitating global action on climate change through the Paris Agreement.
• India has also projected its soft power through a global projection of yoga to shine the spotlight on how Indian spirituality can be a force for greater good.
• Now, with this kind of political mandate and the unique set of global circumstances it has been delivered in, the expectation is even higher that India would take up its rightful role in steering geopolitics in a host of areas: from global trade to regional conflicts to setting the global direction in emerging technology areas such as artificial intelligence and space exploration, to name a few.

Protecting interests

• The mandate also calls for a new creed of techno-nationalism as a counter to borderless techno-activism that has threatened Indian interests through its pursuit of innocuous agendas (net neutrality and privacy) which have advocated measures inimical to India.
• The political mandate demands that India devise ways and means to stay ahead of the curve in emerging technology areas such as 5G and artificial intelligence, among others.
• It calls for out-of-the-box thinking as India can no longer risk being left out of setting the course for technology changes that will not only shape the global economy but also geopolitical dynamics.

Conclusion

• India is also the largest open market to global technology majors which continue to locate their computing and storage infrastructure outside India and beyond Indian jurisdictions.
• The mandate demands that India leverage the strength of its democracy and the power of its markets to ensure that the global platforms play by rules that do not hurt the Indian national interest.
• While India continues to benefit from global digital innovations, this needs to happen within a framework that enhances Indian interests.

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How to rescue genuine secularism (The Hindu)

Mains Paper 1 : Society
Prelims level : Not Much
Mains level : Upsurging secularism

Context

• Prime Minister Narendra Modi brought it back in his victory speech. Most political parties in the last 30 years had practised a naqli (fake) secularism, he said. His great achievement, he implied, was to have unmasked these fake secularists and single-handedly dismantled secularism.
• In other words, it does not satisfy their real needs, but only gives the illusion of doing so. Here, Mr. Modi acknowledges that Muslims are a deprived lot.
• So, what, according to Mr. Modi, is asli (genuine) secularism?
• The answer he gives is the inclusion of minorities in ‘sabka saath sabka vikas’, which is translated by his party as ‘justice to all, appeasement to none’. To this he added ‘sabka vishwas’, winning the trust of all.

Fears of minorities

• On the treatment of minorities by other parties, the Prime Minister is partly right and partly wrong. Wrong, because the insecurity amongst minorities is created largely by Mr. Modi’s own political supporters.
• Lynchings in the past few years and the fear such random violence creates are only the tip of this gigantic iceberg. Right, because when in power, most non-Bharatiya Janata Party (BJP) parties have done little more than provide security.
• Now, the condition of feeling safe and secure must not be underestimated. Freedom from fear is important, and to live in the fear of being lynched only because you are a Muslim is a very real unfreedom indeed.
• Yet, political parties have not helped Muslims with their vikas. Some have even pampered the orthodoxy within their communities and have done little to bring them out of their ghettos.
• So, this secularism is partly fake because it has often meant tolerating minority communalism, and hobnobbing with the most selfish and conservative spokespersons of the multiple Muslim communities of India.

But is the secularism propounded or implied by the Prime Minister genuine?

• At least in theory, ‘sabka saath sabka vikas’ gets one thing right: no individual citizen should face discrimination on grounds of religion.
• Basic amenities, good health, education, housing and employment should be available equally to all, regardless of their religion.
• If he succeeds in this endeavour, he would make great strides towards realising secularism.
• However, secularism combats not just discrimination and other worse forms of inter-religious domination such as exclusion, oppression and humiliation.
• It is equally opposed to intra-religious domination, i.e. the domination (of women, Dalits, dissenters) within every religious community.
• For instance, the fight against the hierarchical caste system in India, quite like the struggle against the church in European history, is integral to the fight for secularism a point noted by both Ambedkar and Nehru.
• Equally important for secularism is opposition to religious fanaticism and bigotry. Neither of these is explicitly captured by ‘sabka saath, sabka vikas’.

Misunderstanding secularism

• That Indian secularism is not anti-religious is widely understood but not that it is simultaneously against both forms of institutionalised religious domination.

How did this misunderstanding develop?

• First, the struggle against inter-religious domination (a defence of minority rights, opposition to majority and minority communalism) became separated from the fight against intra-religious domination (religion-related patriarchy and caste domination, fanaticism, bigotry and extremism).
• Then, this intra-religious dimension was jetttisoned from the meaning of secularism and, much to the detriment of its overall value, secularism began to be identified, by proponents and opponents alike, exclusively with the defence of minority rights.
• This opened the door for viewing secularism first as a tool to protect the interests of Muslims and Christians, of no relevance to Hindus, and then for twisting it to appear as pro-Muslim and anti-Hindu.
• The strength of Indian secularism its advocacy of minority cultural rights was easily made to appear as its weakness and the burden of its defence, rather than be shared by all citizens, fell on the shoulders of minorities and ‘pro-minority’ secularists.
• This is unfair. Secularism is needed as much to protect Hindus from intra-religious domination, from their ‘fringe elements’, as well as from proponents of religion-based caste and gender hierarchies.
• And required equally to protect minorities from their own orthodoxies and extremisms. Asli secularism plays that role. Naqli secularism protects fanatics and legitimises gender and caste-based domination.

Other problems of secularism

• One is its intellectual failure to distinguish communitarianism from communalism.
• Communitarianism simply notes that an individual is at least partly defined by his or her religious/philosophical commitments, community and traditions.
• Therefore, it is entirely appropriate to claim that one is a Hindu/Muslim/Sikh/Christian/atheist etc, and to take legitimate pride in one’s community or be ashamed of it when there is good reason to be.
• Attention must also be drawn to another problem of Indian secularism.
• Our education system often fails to distinguish religious instruction and religious education.
• No publicly funded school or college should have religious instruction, best done at home or in privately funded schools; but reasonable, decent education should include elementary knowledge of all religious traditions.
• A deeper understanding of these traditions is vital, for it would enable students to discern their strengths and weaknesses and identify what in them is worth preserving or discarding.
• But Indians come out of their education system without any critical understanding of their religio-philosophical traditions.
• As a result, a defence of our own religious traditions or critique of others is shallow and frequently mischievous. This too is fake secularism.

Way forward

• Justice to all citizens, affirmation of all reasonable religious identities, rejection of majority communalism, careful defence of legitimate minority rights only when accompanied by a robust critique of minority extremism, and a critical appraisal of religions with a deeper, empathetic grasp of their traditions.
• The government’s primary business is to prevent religion-based violence, oppression and discrimination.
• Perhaps, those outside the government should attend to its other functions. Together, we may just rescue our genuine secularism.

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