9 PM Daily Brief – 9th December 2015

A brief of newspaper articles for the day bearing
relevance to Civil Services preparation

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National

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[1]. India to sign deal with Japan to get first bullet train

What has happened?

India is set to sign a deal with Japan this week on the country’s first bullet train, with Tokyo financing the bulk of the high-speed rail project between Mumbai and Ahmedabad through a $8 billion loan.

 

Total cost of the project: $14.6 billion (approx)

Distance: 505Km

Between: Ahmedabad & Mumbai

Current time taken: 8hours

Time via bullet train: 2 hours

 

Facts:

1. A deal with India would be the second successful case of Japan exporting its bullet train technology to a foreign market, following a deal with Taiwan in 2007.
2. India ranked as the second-biggest recipient of Japanese government-backed yen loans as of fiscal 2013, with a running total of 4.45 trillion yen
3. The Japan International Cooperation Agency and India’s rail ministry began a joint feasibility study on high-speed rail two years ago.
4. With trains zipping along at up to 320 kph, the Mumbai-Ahmedabad railway is expected to shorten travel time between the two western Indian cities from around eight hours to roughly two.
5. Construction is supposed to begin in 2017, with completion slated for 2023. India has plans for seven high-speed rail corridors, starting with this one.

[2]. Parliament must ratify WTO deals, say NGOs

 What has happened?

Civil society groups have urged the Union government not to undertake new binding commitments at the upcoming Nairobi ministerial from Dec 15 – 18, without public consultation as well as before debate and ratification by Parliament.

 

What civil society groups are saying?

1. Involving stakeholders: Take inputs from all stakeholders and carry out a thorough assessment of the employment, social and environmental impacts arising out of the commitments India makes at the WTO-level talks as well as due to the various free trade agreements (FTA) between India and other countries.
2. Concerned over India’s engagement on non-binding issue: Concern has been expressed over India engaging in ‘non-binding’ discussions on ‘new’ issues such as environment and labour that the developed world is keen on introducing during the December 15-18 meetings in the Kenyan capital.
3. Corporate agenda: The civil society groups alleged that the new issues — which the rich world terms as the latest challenges facing world trade — represent the corporate agenda of the advanced countries to further pry open developing country markets.

 

Continuance of S&DT (Special & Differential Treatment)

India should also ensure that the WTO mandate of ‘Special and Differential Treatment’ (S&DT) for developing countries is not abandoned by agreeing to aggressive tariff cuts in farm products — as demanded by the developed world.

 

What are S&DT provisions?

The WTO Agreements contain special provisions which give developing countries special rights and which give developed countries the possibility to treat developing countries more favourably than other WTO Members. These special provisions include, for example, longer time periods for implementing Agreements and commitments or measures to increase trading opportunities for developing countries.

These provisions are referred to as “special and differential treatment” (S&D) provisions.

The special provisions include:

• longer time periods for implementing Agreements and commitments,
• measures to increase trading opportunities for developing countries,
• provisions requiring all WTO members to safeguard the trade interests of developing countries,
• support to help developing countries build the capacity to carry out WTO work, handle disputes, and implement technical standards, and
• provisions related to least-developed country (LDC) Members

[3]. India’s fight against TB lacks punch

 What has happened?

A report titled “ Out of step 2015” prepared jointly by Stop TB Partnership and MSF Access Campaign, was presented at 6th Union World Conference on Lung Health in Cape Town, South Africa

What do the results of the report signify?

The results of the survey show that many countries need to take bold steps to bring their policies up to date with the latest international standards

India’s TB policies have been found wanting on several counts,

1. Initial diagnostic test: Unlike South Africa, Brazil and the Russian Federation which have recommended rapid molecular testing (Gene Xpert) instead of sputum smear microscopy as the initial diagnostic test for all presumptive TB cases, India has recommended its use only for people at risk of multidrug-resistant TB (MDR-TB) or HIV-associated TB, paediatric TB and extra-pulmonary TB cases. Even after limiting its usage, the roll-out has been “progressing slowly,” despite having in place “ambitious scale-up plans.
2. Use of streptomycin: Despite recording 71,000 MDR-TB cases (both new and retreatment) in 2014, the Indian TB policy continues to recommend the use of Category II treatment regimens containing streptomycin. It uses the drug “despite recommendations for drug susceptibility test for those at risk of MDR-TB
3. Use of FDC: though the use of fixed-dose combination (FDC) drugs for treating drug-sensitive TB cases improves drug adherence and make the administration easy, RNTCP does not recommend FDC formulation

Revised National TB Control Programme (RNTCP)

In spite of evidence showing that there is a higher rate of people lost to follow up from treatment and associated risk of drug resistance generation, India continues to recommend intermittent drug regimen.

However, the Revised National Tuberculosis Control Programme (RNTCP) intends to switch over to daily regimen in March-April 2016. “Procurement of drugs is at an advanced stage,” he said. “Daily regimen will be introduced in a phased manner. The switch will happen in 104 districts in five States — Kerala, Himachal Pradesh, Bihar, Sikkim and Maharashtra.”

What is MDR-TB?

Multi-drug-resistant tuberculosis (MDR–TB) is defined as a form of TB infection caused by bacteria that are resistant to treatment with at least two of the most powerful first-line anti-TB drugs, isoniazid (INH) and rifampicin (RMP).

The reasons why multidrug resistance continues to emerge and spread are mismanagement of TB treatment and person-to-person transmission. Most people with TB are cured by a strictly followed, six-month drug regimen that is provided to patients with support and supervision. Inappropriate or incorrect use of antimicrobial drugs, or use of ineffective formulations of drugs (e.g. use of single drugs, poor quality medicines or bad storage conditions), and premature treatment interruption can cause drug resistance, which can then be transmitted, especially in crowded settings such as prisons and hospitals.

Must read: http://www.ncbi.nlm.nih.gov/books/NBK100386/

 

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Business & Economy

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[1]. Floods, price gouging & free market

 

What is Price gouging?

Price gouging is, when a seller spikes the prices of goods, services or commodities to a level much higher than is considered reasonable or fair, and is considered exploitative, potentially to an unethical extent.

 

What is a free market system?

A free market is a market economy system in which the prices for goods and services are set freely by consent between vendors and consumers, free from any intervention by a government, price-setting monopoly, or other authority.

 

Author in this article deliberates on the ethical perspective of price gouging. The author couldn’t get flight ticket from Bengaluru to New Delhi during recent Chennai floods. She noticed that airlines had raised the prices of tickets to around 10 times of their normal price.

Author contends that,

1. Market rules work when there is a level playing field—if sellers have the pricing power, buyers have the power to switch brands but during a catastrophe it is not a normal situation and such situations need new rules of the game
2. Who should make these rules? The government? But we are against government interference in the free market. So, should government intervene only in times of distress?
3. What we need is a regulator and not increased interference from the government
4. In times of a natural disaster, presence of a regulator would ensure that such blatant price gouging can’t happen. Like, Disaster price of an airline ticket can be fixed beforehand so that airlines do not extort money from needy customers.

 

Some ethical questions to ponder upon,

1. Is it wrong for sellers of goods and services to take advantage of a natural disaster by charging whatever the market will bear?
2. If so, what, if anything, should the law do about it?
3. Should the state prohibit price gouging, even if doing so interferes with the freedom of buyers and sellers to make whatever deals they choose?

 

[2]. The GDP growth signals

What has happened?

2nd quarter (July-Aug-Sept) GDP numbers have been positive with a GDP growth rate of 7.4% indicating that economy is on an upward path.

Nominal GDP is not adjusted for inflation while Real GDP is adjusted fro inflation and hence is lower than Nominal GDP but in the present scenario on the account of a negative GDP deflator we have a situation where Nominal GDP is less than Real GDP
Takeaways from the data,

1. Positive signals for 3^rd Quarter: Growth rate of 7.4% in 2^nd quarter bodes well for the growth in 3^rd
2. Nominal GDP: The growth in nominal GDP at current prices comes in lower at 6%, with a cumulative growth of 7.4% against 13.5% last year.
3. Impact of lower Kharif crop: the first two quarters are free from the influence of the monsoon and its impact on farm output. As the kharif season starts from October onwards, the impact of lower output will come in Q3. Also, Q4 is critical as most of the rabi crop is harvested. Therefore, the negative impact of lower kharif agricultural output is to be felt in the second half of the year.
4. Slow construction sector: the construction sector has grown by just 2.6%, which comes as a disappointment as there were expectations that there were big bang investments coming from the government in roads and railways. This means the movement in previously stalled projects in the construction space has not been significant as issues beyond permissions have come in the way.
5. Growth in trade sector: the segment trade, transport and communications has shown a healthy growth rate of 10.6%, which has been attributed more to the trade sector where high growth in sales tax collections has contributed to the same
6. Financial sector growth: the financial sector including real estate and professional services has been buoyant with 9.7% growth being witnessed. With professional services growing by 15.6%, it is tempting to conclude that self-employed income generation has been vibrant, probably reflecting growth in entrepreneurial spirit.
7. Lower consumption: The share of consumption in GDP has come down from 56.2% to 55.9%, which, though not really significant. is still indicative that consumption has not picked up.

 

[3]. GST Must Apply to Ecommerce, In Full

What has happened?

E-retailers have said that they should not be included in the GST purview as they only provide a portal through which buyers and sellers interact. They do not sell anything. Author in this article states that online retailers should be taxed under GST

Author says,

1. There is no reason to exempt ecommerce companies from the Goods and Services Tax (GST). Online retailers should be taxed on par with brick and mortar retailers. Amazon and Flipkart, those who organise the online marketplace, where sellers meet buyers, should pay service tax on the fee they charge for providing this service, labelled fulfilment.
2. The seller so facilitated by Amazon, etc, should collect the tax on their sales from buyers and pass on the tax to the government.
3. The government should not ask aggregators that run marketplaces to pay value-added tax (VAT) on products that they neither own nor sell.
4. Online retail is growing at a fast clip in India, and the government must not lose out on revenues. The share of service tax revenues is just 2% of the GDP despite services contributing to over 60% of the economy. To raise the share, there is a compelling case to bring ecommerce under GST. It will also prevent Base Erosion and profit Shifting (BEPS).

[4]. Norms soon for crowdfunding, MF sale through ecommerce: Sinha

What has happened?

Capital markets regulator SEBI will soon put in place norms to help entrepreneurs raise funds through ‘crowdfunding’, while discussions are also underway to allow sale of mutual funds through e-commerce platform.

 

Committee to submit report

1. A SEBI-constituted committee, headed by Infosys co-founder N R Narayana Murthy, to suggest ways for raising funds through crowdfunding is likely to submit its report in a month
2. SEBI has set up a committee under another Infosys co-founder Nandan Nilekani to suggest ways for boosting Mutual Funds industry. Regulator is actively working towards making it possible for mutual funds (MF) to sell their schemes on e-commerce platforms.

 

What is crowdfunding?

Crowdfunding typically involves young entrepreneurs and small groups of people raising funds for their ventures through various online platforms involving individuals and organisations

 

What is a Mutual Fund (MF)?

MF is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money managers, who invest the fund’s capital and attempt to produce capital gains and income for the fund’s investors.

 

SEBI

The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India. It was established in the year 1988 and given statutory powers on 12 April 1992 through the SEBI Act, 1992

 

The SEBI is managed by its members, which consists of following:

1. The chairman who is nominated by Union Government of India.
2. Two members, i.e., Officers from Union Finance Ministry.
3. One member from the Reserve Bank of India.
4. The remaining five members are nominated by Union Government of India, out of them at least three shall be whole-time members

 

Powers vested with SEBI

For the discharge of its functions efficiently, SEBI has been vested with the following powers:

1. To approve by−laws of stock exchanges
2. To require the stock exchange to amend their by−laws
3. Inspect the books of accounts and call for periodical returns from recognized stock exchanges
4. Inspect the books of accounts of financial intermediaries
5. Compel certain companies to list their shares in one or more stock exchanges
6. Registration brokers

 

SEBI has three functions rolled into one body: quasi-legislative, quasi-judicial and quasi-executive. It drafts regulations in its legislative capacity, it conducts investigation and enforcement action in its executive function and it passes rulings and orders in its judicial capacity.

 

[5]. Opec’s divisions keep oil prices low

 

What has happened?

OPEC (Organization of Petroleum Exporting Countries) met on 4^th Dec 2015 at Vienna

 

OPEC

The Organization of the Petroleum Exporting Countries (OPEC) is a permanent, intergovernmental Organization, created at the Baghdad Conference on September 10–14, 1960, by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.

 

OPEC’s objective is to co-ordinate and unify petroleum policies among Member Countries, in order to secure fair and stable prices for petroleum producers; an efficient, economic and regular supply of petroleum to consuming nations; and a fair return on capital to those investing in the industry

 

What is a swing producer?

A company or country that changes its crude oil output to meet fluctuations in market demand. Saudi Arabia is seen as the world’s major swing producer, as it deliberately limits its crude oil production in an attempt to keep supply and demand roughly in balance. This role has been taken over by the U.S now.

 

Issues battering the oil market,

1. Supply: Supply side has been destabilised by rapid encroachment of shale energy technology
2. Demand: Demand side has been marred by an economic slowdown in the economy of emerging countries
3. Swing Producer: The role of “swing producer” on the downside once played by Saudi Arabia and some of its OPEC partners—by reducing output when prices are low—has de facto been taken over by the US. This has given rise to the increased role of market fluctuations in the oil market price balance.

 

Due to lowering of oil prices earning of the producers reduce considerably but the ability to deal with these fluctuations differ from nation to nation. Like Saudi Arabia which has large accumulated wealth can easily transition from this phase while countries like Venezuela would have to face a period of increased social and political turmoil.

 

Conclusion

Meeting at Vienna was convened to discuss various issues regarding current oil market conditions. Meeting resulted in no concrete agreement. So, author contends that conditions in the international oil market would continue to remain volatile for a while.

 

[6]. It’s Vehicles for Some, Dust & Factory for Others

 

Context: Conflicting studies point out the cause of pollution in capital to be different sources. Study by National Environmental Engineering Research Institute (NEERI) says road dust and industries are big contributors, not vehicles.

 

Report by NEERI

1. The high PM 10 levels in Delhi were caused more by dust and industries rather than vehicles. The report said while road dust contributed up to 52% of Delhi’s PM 10 levels, vehicles contributed 6.6% and industry share was 22%. Open burning and other area sources contributed 18%.
2. The study showed road dust was the biggest contributor to Delhi’s high PM levels. Vehicles are also very visible sources of pollution and hence also a perception about how much they contribute. Assessments have shown it is mostly heavy duty vehicles like trucks and LCVs that cause more pollution

NEERI’s report is flawed

Centre for science and environment (CSE) has trashed the report of NEERI deeming it as flawed, based upon flawed methodology.

 

 

[7]. India’s Solar Goals a Global Priority, Says Stanford Report

 

What has happened?

On the sidelines of the climate talks in Paris, a group of solar experts from Stanford University released a report on 8^th dec 2015 calling India’s solar goals a “global priority“. The report calls for the international community ­ banks, financial institutions, governments ­ to support Prime Minister Narendra Modi’s “audacious solar ambitions“, which present opportunities for India and the world.

 

India’s plans for solar energy

To balance India’s pressures for economic growth and vulnerability to climate change, Modi’s big ticket offering has been to increase India’s share of energy from renewable sources to 40% by 2030. In October, his government also pledged to produce 175GW of energy from non-fossil sources by 2022, of which 100GW would be solar. This is the largest renewable energy target in the world.

 

Diverse deployment: Report says that diverse mix of solar deployment is the key. India should concentrate on,

1. Distributed – Distributed generation (DG) refers to electricity that is produced at or near the point where it is used. Distributed solar energy can be located on rooftops or ground-mounted, and is typically connected to the local utility distribution grid
2. Off-grid solar
3. Utility-scale Solar projects – A utility-scale solar power plant can be one of several solar technologies – concentrating solar power (CSP), photovoltaics (PV), or concentrating photovoltaics (CPV). What distinguishes utility-scale solar from distributed generation is project size and the fact that the electricity is sold to wholesale utility buyers, not end-use consumers. Utility-scale solar plants provide the benefit of fixed-priced electricity during peak demand periods when electricity from fossil fuels is the most expensive.

 

Of the 100GW, India has targeted creating 60GW through solar farms (greater than 1MW) and 40GW through distributed solar like roof-top (less than 1MW). Of India’s current deployment of 4.5GW, 85% is utility-scale. Rooftop solar is 350MW, and off-grid is 200MW.

 

Lastly, report says that Development banks, agencies like USAID, World Bank, ADB, must support a diverse mix, and governments and bilateral agreements must offer India technical and policy support.

 

[8]. Dangers of getting sunburnt

Context: Author has stated that despite a fall in the cost of solar panels, aggressive bidding for India’s solar power projects and despite the fact that under our new PM the focus is high on solar power, there is uncertainty as to whether companies will be able to deliver.

 

Solar producers are worried

They fear that cut-throat competition is leading to what economists call the `winner’s curse’. In any auction, the most aggressive bid is made by the most optimistic bidder, who banks on everything coming right with no glitches and no unexpected political or economic shocks. In practice, alas, many things can -and do -go wrong. When this happens, an aggressive winner of contracts can end up with huge losses. This is the winner’s curse.

 

Current condition of solar sector companies

SunEdison, the biggest US solar company , has sold solar assets globally even as it has made the lowest bid ever in India. Welspun, a prominent Indian operator in the solar space, has just sold its 40% stake in a joint venture with the Leighton Group, saying it needs to reduce its high debt.

 

Depreciation of rupee: Depreciation of rupee means the fall in solar panel costs would be neutralised by increased import costs.

 

Author’s solution

1. Given the risks, it’s necessary to reduce the consequences of a possible winner’s curse. First, bidders should be asked to post big bank guarantees in future auctions. This will discourage really aggressive bids, and help offset losses if a project is abandoned halfway.
2. The Reserve Bank should alert banks and ensure that leverage is not high for solar projects. Given the risks, they should be financed substantially by equity, maybe 50%. Many road and power projects went bust because high leverage meant they had no cushion to survive bad breaks and delays.

 

[9]. Bond yields not reflecting repo cuts

Context: There has been a major reduction in Repo rate by over 125 bps which has lowered the lending rate in market but same change is not seen in bond yields which are source of borrowing of Union and State Governments making a huge part of planned expenditure foregone as interest payments annually.

 

What is Repo rate?

The rate at which scheduled commercial banks borrows from RBI in case of any shortfall in fund is known as Repo rate. Repo rate is used by monetary authorities to formulate monetary policies in the country.

 

What is Bond Yields?

In a very simple term Yield is a figure that shows the return you get on a bond. It can be said that yield is equal to the interest rate.

Why has banks not transmitted the cut in repo rate to their lending interest rates?

1. Resources of banks are mainly derived from Term Deposits and CASA (current and savings bank accounts) and not from borrowing from RBI.
2. A reduction in term deposit rates, when the repo rate is reduced, takes time to translate into the cost of funds – this is because the change in value of existing deposits can only take place when they mature and not before that.

 

What is the Debate?

The change in yield on government bond G-sec has reduced by 12 basis points only from January 2015 to till date. The cut in repo rate has not been at all transmitted to bond yields.

 

How does that affect the economy?

G- Sec is the instruments through which government raises loans from different sources. Interest payments on borrowings are large component of government expenditure. The current year budget estimates an outgo of Rs 4,56,145 crore on account of interest payments by the Union government, mostly on market borrowings, which is a very big part of the planned expenditure and 70% of total gross borrowing.

 

How will lowering rate of yield help economy?

Government is looking to provide a fillip by increasing its investments. Thus, the need for lower rates for the government is obvious.

 

How do high bond yields affect Indian banks?

1. Deposit Side – Higher Yield for banks – gives them incentive to reduce deposit rate – hence provide room for reducing lending rates, In an increasing interest rate scenario, banks earn higher profits in the banking book with higher net interest margins (NIMs),

 

HOW: Increase in the cost of deposits is felt with a lag, but book losses in the treasury where the mark-to-market value of securities comes down.

 

2. With attractive zero-risk yields in government securities, there will be no incentive for banks to finance risky loans at fine prices.
3. With yields remaining stubborn as at present, the room for treasury gains is limited.

How does it affect the Corporate?

Corporate bond prices depend heavily on G-Secs yields. Hence a hign yield regime discourages corporates seeking to borrow from corporate bond market.

 

Why repo rate cut is not being transmitted to bond yields?

1. Reduction in Statutory Liquidity Ratio (SLR) and Held-To-Maturity (HTM) cap for commercial banks over a period of time, the demand from banks for G-Secs has reduced.

HOW: SLR mandates bank to invest in liquid assets while HTM mandates bank to invest                in debt instrument for a fixed amount of time.

Liquid assets are defined as easily cashable and with minimum change in value. Based on this definition gold and G-Secs are considered liquid assets. Also G-Secs are debt instrument            through which government borrows. With the cap being lowered down the demand from bank of these products will automatically go down.

 

2. Provident funds (PFs) have diversified their investments to corporate bonds and equity ETFs, thus further reducing demand from G-Secs.

WHY: Option mentioned above give PFs a better return on their investment with a slight             risk factor than G-Secs.

 

3. On the other hand, the supply has been very high in comparison to the liquidity available in the system. In October alone, the issuances amounted to more than Rs 75,000 crore.

HOW: Any increase in lending has a direct effect on interest rate. Hence, if more is being borrowed the market tends to increase the interest rate.

 

4. The possibility of Special State Development Loan issuances beyond their planned borrowing under the Project UDAY—to restructure the discoms—will further increase supply.

 

5. The last straw is the tightness in liquidity (Liquidity Tightening = when central banks try to reduce the growth in the money supply).

 

[10] Economy: right direction, slow pace

Context: Indian Economic Outlook 2016

The article assesses the macroeconomic conditions in the country and lists down challenges and issues for the economy in coming years.

 

Macroeconomic Condition has been stabilized and is well grounded but there are issues that needs to be addressed.

Issue 1: Assessment of Growth – Inflation mix

Before: GDP methodology used to give reliable real GDP growth but the parameter (WPI) used by RBI for inflation targeting was faulty.

After: With new methodology of GDP calculation and RBI adopting CPI as headline inflation the situation has exactly reversed. Real GDP growth calculation doesn’t seem consistent.

This has created a confusion and problem in assessing “Growth – Inflation” mix.

 

Issue 2: Investment recovery

Phase 1:

1. Delayed investment projects being revived.

This is seen as there is increase in gross fixed capital formation for three straight quarters.

The improvement of capital goods production and the largely ignored recovery in real   credit growth also suggest that activity is gaining traction.

 

Phase 2:

1. Will need new investments. Key input – Turnaround in the corporate profitability cycle. This will take time
2. A recovery in investment and fixing banking sector asset quality woes will be gradual at best

 

Issue 3: Fiscal Consolidation

The current financial year target for fiscal deficit will be met due to increase in fuel excise. But recent recommendations of seventh pay commission and its implementation may make the fiscal deficit target for next financial year miss the target.

The slippage will probably be complemented by a pro-growth public capital expenditure push and some reform measures embedded in the budget so as to avoid downgrading of the ratings.

 

[11]. Balancing currency and interest rates

Context: Conflict between monetary and exchange rate management.

Current Scenario:

India have scored well above all emerging markets in terms of securing Foreign Portfolio Investments (FPI) but with current scenario and further speculation of rate increase by Fed has made a solid ground for capital outflow from the country.

Issue:

Central bank was compelled to announce open market operations, or sovereign bond purchases, to decrease yields.

Rupee fell to 67 a dollar – Intervention support shored up the currency.

Depreciation pressures and intervention support led to squeezed domestic rupee liquidity which was already in deficit for last two months

Other reasons for squeezed domestic rupee liquidity – Slower government spending and higher festival demand for funds.

 

Outcome: Interest rates have inched higher across the spectrum

 

Conclusion: More accommodative monetary policy by RBI stance thus stands invalidated by these developments.

 

[12]. December 7 Monetary Policy Review

RBI went for open market purchases (monetary policy tool) are aimed at curbing short-term rates and keeping these consistent with the monetary policy stance.

 

The shrinkage in net foreign currency assets is expected to persist as more capital outflow is likely ahead of the US Federal Reserve’s mid-December review, while temporary demand for funds is higher from tax payment outflows and consumer spending

 

Conclusion:

The conflicts arise just when the RBI guided at its 1 December monetary review that the central bank would use the space for further accommodation, when available, indicating more future easing

But the confluence of external and domestic factors is sharpening the delicate balance between need to avert currency depreciation and keep funding costs low as well.

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Opinion & Editorial

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[1]. Cynical in Fighting terror

Context: In the light of recent San Bernardino killings where a U.S couple of Pakistani origin shot and killed people, author says that governments and administrative officials have been outclassed by terrorists of the IS

 

Author states that,

1. San Bernardino attack has been perpetrated by a couple, a normal husband and wife who decided to shoot and kill people as they got radicalised. How can one control such acts, if done at an individual level without any hint whatsoever?
2. It is easy to fault the FBI, which covers domestic intelligence in the U.S., for having failed to identify the couple before the incident. When there is no information that the two had received any external directions to act the way they did, surveillance — physical or electronic — may not have helped. This is the complexity of the task that daunts intelligence agencies the world over.
3. One cannot brand intelligence and police agencies as total failures. Do we know how many terrorist attempts have been foiled? We don’t
4. If the IS continues to strike terror in all of us, it is not because governments the world over have not tried every means to outwit what has proved to be an outfit deadlier than al-Qaeda. Those in the administration in many countries have simply been outclassed and outmanoeuvred. Here, we need to recall the classic statement of the Irish Republican Army (IRA), which was out to get British Prime Minister Margaret Thatcher: “We’ve to be lucky just once. You’ve to be lucky all the time!” This is the harsh truth of a problem that is getting increasingly out of hand due to radicalisation of young minds.

 

[2]. Doing its bit in Paris and then some

Context: In the wake of ongoing Paris COP21 talks, author outlines the approach India ought to take, if it wants to develop sustainably while reducing its carbon emissions

 

Author says,

1. Carbon common: There is universally available, set quantity of carbon dioxide that can be emitted without increasing the global temperature by 2deg C. Three fourth of this carbon budget has already been used up. Most of it was used up by countries other than India, which isn’t even using its per capita share

 

Three scenarios,

• India wants to emit as others have done. The world turns super-hot.
• India says we will stay within our budget’s “fair share”, but the world still turns hot, mainly because many others over-emitted.
• India consumes less than its fair share, to try to avoid or at least minimise global warming. That seems to be the frame with which people are looking towards India, and then saying “not enough”.

 

Why reduction targets should not be forced upon India?

Development: China already has provided almost all its citizens modern energy. India still has hundreds of millions of people lacking electricity, and those that have a wire face supply shortfalls (load-shedding), sometimes on a daily basis. India needs to develop.

 

Thinking beyond treaties

Treaties are a step forward, but how does India exceed its commitments or targets?

 

• Innovate: This isn’t just technology such as batteries or solar energy, but also business models, regulation, etc. Global help is valuable, but this would necessarily involve the private sector, and not just governments or those signing treaties.
• Focus on the longer-term and on efficiency: Lots of houses (and even cities) are yet to be built. We should not rely on “clean energy” to absolve us of over-consumption or inefficiencies. Fixing this will take a systems approach that spans jurisdictions or even politics, with much of the effort required at a state or local level.
• Population growth: Recognise that population growth is an issue. Make it easier for people to want fewer children (through social security schemes, non-agricultural jobs, etc.). No one says use coercion or be as strict as China, but imagine where the world would be if China’s population growth rate was like India’s?
• Develop: If you believe the environmental Kuznets curve (where you first develop by being dirty and then clean up when you can afford it), India should develop quickly. If a nation consumes energy but is “coasting along” (not developing enough), it has squandered energy and carbon resources. There is no inherent cap on consuming more energy if it gives disproportional and ultimately sustainable development.

 

[3]. What the citizen must do

Context: Author, a deputy chairperson of the Rajya Sabha maintains that fundamental duties should be taught more aggressively at the school level and their importance should not be forgotten lest we be on course towards chaos and anarchy.

 

Why fundamental duties were not included in the constitution?

The makers of constitution could not envision a society which forgets its duties while asserting its rights.

 

42^nd Amendment 1973: It was through this amendment that fundamental duties were included in the constitution

 

Author says,

• Lack of citizen awareness: Even three decades after the fundamental duties were incorporated, there’s no adequate awareness among citizens. In 1998, Atal Bihari Vajpayee’s government had appointed the Justice J.S. Verma Committee “to operationalise the suggestions to teach fundamental duties to the citizens of the country”. This committee submitted its report containing a number of recommendations for the government to act on. There are schemes being implemented by the ministry of home affairs, HRD ministry, the environment ministry, etc, to promote the teaching of fundamental duties. There’s also a big involvement of voluntary agencies. But the impact of governmental as well as non-governmental involvement in this process is not being felt much.
• Teaching children: Children, if from the start are taught the significance of the fundamental duties, a lot of today’s problems like intolerance, sectarian violence etc would not be there. Religious and social prejudices would have no place if children developed a spirit of inquiry and began to understand the world with the help of science.

 

Conclusion

We should consider incorporating the essential aspects of citizens’ duties in all oaths and pledges. The Supreme Court, too, has said that since duties are obligatory for citizens, the state should strive to achieve the same goal. Rights and duties have to exist together. Rights without duties will lead to anarchy.

[4]. A line in water

What has happened?

An inter-ministerial group, including Water Resources Minister Uma Bharti, Environment Minister Prakash Javadekar and Power Minister Piyush Goyal, has decided, in principle that no new construction would be allowed on the River Ganga or any of its tributaries.

 

Why this decision has been taken?

To ensure the river’s minimum environmental flow and protect the ecosystem that depends on it

 

A welcome step due to following reasons,

One, it shows the acknowledgement, among policymakers, of the intricate set of factors that must be taken into account to keep alive and rejuvenate a river system like the Ganga.

 

Two, in the past, policymakers have shied away from calling a halt to power projects that clearly threatened delicately balanced and even critically endangered river ecosystems. On this occasion, it has been offered to compensate the six hydroelectric power projects (HEPs) to be built on the Alaknanda and Bhagirathi river basins in Uttarakhand, out of the Rs 20,000 crore approved for Namami Gange. The decision revives hope of not only rejuvenating the Ganga, but also of averting tragedies like the Uttarakhand floods in 2013.

 

Road to this decision

1. In the aftermath of the floods, the Supreme Court had prohibited the setting up of any new HEPs in Uttarakhand.
2. In February this year, a four-member committee of the environment ministry evaluating the cluster of six HEPs argued against them.
3. In October, another expert body set up by the environment ministry, which included the Central Water Commission (which comes under the water resources ministry), overturned the first committee’s recommendation.
4. And now, yet another five-member committee — this time led by the secretary of the water resources ministry — has reverted to the earlier decision against setting up the HEPs

 

Namami Gange

An Integrated Ganga Conservation Mission called “Namami Gange” has been proposed to be set up and a sum of Rs. 2,037 crores has been set aside for this purpose.

Aim: This project aims at Ganga Rejuvenation by combining the existing ongoing efforts and planning under it to create a concrete action plan for future.
Conclusion

The Centre might also want to relook at other schemes that show more ambition than ecological sense — like the proposed linking of 101 rivers across the country

 

By: ForumIAS Editorial Team