9 PM Daily Current Affairs Brief – January 25, 2021

Good evening dear reader

Here is our 9pm current affairs brief for you today

List of 9 PM Articles

List of 9 PM Articles

• World Economic Forum: Need for ‘the Great Reset’ of capitalism
• Reasons for increasing Palk Bay fishing conflict
• Need for New 4-tier Regulations for NBFCs
• COVID Vaccine and Science, Technology, and Innovation Policy (STIP), 2020

World Economic Forum: Need for ‘the Great Reset’ of capitalism

Source: Indian Express

GS-2: Important International Institutions, agencies, and fora  – their Structure, Mandate

Synopsis: WEF’s executive chairman Klaus Schwab is advocating for rearrangement of the global order through “The Great Reset”. India should also take this development seriously and try to limit the potential implications of this possible global reset.

Background

• The WEF’s (World Economic Forum) online  Summit began recently. Its physical meeting is scheduled to take place in Singapore in June 2021. It is only the second time after 2002 that Davos annual meeting is taking place outside Davos.
• Choosing Singapore instead of any European or American city is a symbol of shifting focus on Asia.
• In this context, the World Economic Forum’s initiative for “The Great Reset” has gained attention.
• In this article, we will discuss what is “Great Reset” and what are the key changes suggested by the “Great Reset” initiative, and how India should plan for it?

What is “The Great Reset”?

• The concept has been given by the founder and executive chairman of the WEF- Klaus Schwab.
• The concept is developed, based on the assessment that the world economy is in deep trouble. Events like the pandemic, ongoing technological revolution, impacts of climate change have further worsened the global situation.
• Hence, the concept of  “The Great Reset” suggests, there is an urgent need to reform global societies and economies. Reforms should be brought into every industry of the world and every country should participate in it.
• This initiative will mainly focus on reforming market-led Capitalism into stakeholder capitalism. Which will be focussed on ensuring equality and sustainability.

Why the “Great Reset” initiative is a step in the right direction?

Firstly, economic reforms like deregulation and globalization reduced barriers to capital movement within the countries. Now it is being challenged even in a country like the US.

Secondly, US and EU countries failed in dealing with the COVID pandemic and its economic impacts. Whereas Asian Countries handled it effectively. It magnifies the failure of the Capitalism model of these countries.

How focus areas of The Great Reset’ are relevant for the present world?

The agenda of The Great Reset focuses on many key issues faced by the world today. Three important themes among them are,

• First, serious thinking on moving from capitalism to “stakeholder capitalism”. Because
  • • One, capitalism’s lack of concern for stakeholders/society’s interests and its greed for profit maximization. For example, Tech giants who are the big beneficiaries of deregulation pay few taxes and actively depress wages for working people.
    • Two, their increasing power to influence the governments is a cause of concern.
• Second, with the US rejoining the 2015 Paris accord on mitigating climate change. Now, the focus needs to shift on equal distribution of economic and social costs of moving away from carbon use. 
• Third, the Liberalism of the ’90s resulted in increasing conflicts among nations and resulted in present “competitive multilateralism”. The forum will focus on global cooperation on important universal issues.

Way forward for India

Rearrangement of the global order looks inevitable. India should prepare for changes that will be introduced due to it;

• India must actively contribute to the framing of new rules to govern global capitalism and the reshaping of international institutions.
• Simultaneously, we must also reform our own economy and society to make it more equitable, sustainable.
  

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Reasons for increasing Palk Bay fishing conflict

Source: The Hindu

Gs2: India and its Neighborhood- Relations.

Synopsis: The recent death of 4 fishermen resurfaces the unresolved issue of fisheries conflict between India-Sri Lanka at Palk Bay.

Background:

• Recently four fishermen from Tamil Nadu died while fishing in Palk Bay.
• Tamil Nadu has accused Sri Lankan Navy of that. But, the Sri Lankan navy maintains that they died when their trawler collided with a naval vessel while trying to avoid arrest.
• The timing of the incident signifies the sensitivity of this issue. As recently, after a three-year gap, India and Sri Lanka have resumed their discussion on fisheries through a Joint Working Group (JWG).
• In JWG, India demanded the early release of fishermen and the boats in Sri Lankan custody. On the other hand, Sri Lanka demanded to curb illegal fishing by Indian fishermen, which has adversely affected the livelihood of its fishermen.
• India has registered its strong protest against these deaths.

Why the conflict has not been resolved yet?

There are many reasons for the continuance of the conflict. They are,

• Failure in implementing joint working group resolutions: Earlier both sides agreed for no violence or loss of life while handling the fishermen. A hotline was established between the respective Coast Guards for that.  However, the proposed hotline has not been operationalized yet.
• Alternate solutions failed: The plan to replace Tamil Nadu fishermen trawlers with deep-sea fishing vessels has not been successful.
• Failure of Direct talks: Attempts to negotiate a settlement through direct talks between fishermen from both sides have also failed.
• Inability to find a common ground: Sri Lanka favors an immediate ban on unsustainable fishing practices such as bottom trawling.  While Tamil Nadu fishermen want a lengthy phase-out period for the same.
• Insensitivity of Tamil Nadu Political leaders. Political leaders in Tamil Nadu fail to acknowledge that incursion into Sri Lankan waters by the State’s fishermen contribute immensely to the problem.

A comprehensive solution to end this conflict is to ban unauthorized fishing. It should be followed by the facilitation of sustainable use of resources by fishermen from both sides

Need for New 4-tier Regulations for NBFCs

Source: click here

Syllabus: GS 3

Synopsis: The RBI’s plan to tighten regulations on large NBFCs is critical for financial stability.

Introduction 

The RBI has planned an important change in its regulatory approach towards India’s non-banking financial companies (NBFCs). It plans to monitor larger NBFCs almost as closely as it monitors banks.

Read – 4-tier structure for regulation of NBFCs| ForumIAS Blog

What was the need for a change in the regulatory framework?

•  The size of NBFC has increased from just about 12% of banks in 2010, to a quarter of the banking sector.
• The growth has been facilitated by the lighter regulations on sourcing funds from home loans to micro-finance and large infrastructure projects.
• However, These lighter regulations revealed a systematic risk. For instance, IL&FS’s payment defaults resulted in a large scale economic crisis in 2018. 

What is RBI’s proposed regulatory structure?

The RBI has introduced a four-tiered regulatory structure. By this, RBI is striking a balance between the need for low regulations and less systemic risks in the sector. 

• First, For smaller NBFCs, regulations are light, on the basis of a largely ‘let it go’ approach.
• Second, For the largest NBFCs, it is imposing tougher ‘bank-like’ capitalization, governance, and monitoring norms. It is with an aim to reduce a systemic risk due to the nature of their operations.

• Third, the top tier will be activated only when a certain large player poses ‘extreme risks’. NBFC categorized in this tier will face the toughest regulations.

Way forward

• The banking sector is in despair over the past two years (PMC Bank, Yes Bank, Lakshmi Vilas Bank). Thus, a complete restart of the omission tool for NBFCs is critical to keep the confidence and maintain financial stability.
• It is hoped that the plan for the regulation of NBFCs is official soon. This would ensure the new economic recovery is not hampered by funding constraints.

COVID Vaccine and Science, Technology, and Innovation Policy (STIP), 2020

Source: Click here

Syllabus:  GS 2 – Issues relating to development and management of Social Sector/Services relating to Health, Education and Human Resources.

Synopsis: The hasty Emergency Use Authorization (EUA) to the two COVID-19 vaccines is against draft Science, Technology, and Innovation Policy (STIP) 2020. 

Introduction

Open Science principle is a global movement. It advocates steps against unethical practices such as fabrication and falsification of data, plagiarism, unethical authorship, etc.

Science, Technology, and Innovation Policy (STIP), 2020

The Government has prepared a draft of the Science, Technology, and Innovation Policy (STIP) in December 2020 based on the principle of “Open Science”.

To implement ‘Open Science’ principles, STIP, 2020 provides for the following provisions:

1. First, creation of Open Science Framework: It will provide everyone with access to scientific data, information, knowledge, and resources. 
2. Second, FAIR (findable, accessible, interoperable, and reusable) terms: Under FAIR terms, all data of publicly funded research will be available to everyone.

However, EUA to 2 vaccine candidates without efficacy data is not consistent with this policy of the government.

Read – DST releases Draft 5th National Science, Technology and Innovation Policy (forumias.com)

What are the two first vaccine candidates?

First, Covishield: It is developed by AstraZeneca and Oxford University. It is manufactured by the Pune-based Serum Institute in India. The overall efficacy of the vaccine:

Major concerns on this Vaccine are 1. Limited ethnicity data in the present trials and 2. The absence of results on elderly people above the age of 55.

Second, Covaxin: It is developed by Hyderabad based Bharat Biotech in collaboration with the Indian Council of Medical Research (ICMR). EUA was provided to vaccine while It was undergoing Phase III trials.

Research on these vaccines was public-funded research. The ICMR funded the clinical trial site fees for Covishield and collaborated in the development of Covaxin. Thus, these vaccines fall under the scope of the draft STIP 2020. So all data on these vaccines must have been available publicly. 

What are the implications of non-transparency?

• First, It may result in erosion of public trust in science and scientist.
• Second, It hampers the Self-critical and self-correcting nature of science. It includes scientists analysing the data available on new researches.

Way Forward 

The government should implement STIP 2020 on a priority basis. It should make the data across the different stages of COVID-19 vaccine research public on ICMR’s open access repository, the Department of Science and Technology, or other open access repositories identified by the CSIR.

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