Answered: Mains Marathon – UPSC Mains Current Affairs Questions – March 20

Following are the Suggested Answers for Mains Marathon, March 20:

1.List some advantages of notifying startups as ‘Fast Track firms’. What steps can be taken by the government for easier exit of startup firms? (GS 3)

‘फास्ट ट्रैक फर्म’ के रूप में स्टार्टअप को सूचित करने के कुछ फायदों को सूचीबद्ध करें।स्टार्टअप फर्मों के आसान निकास के लिए सरकार द्वारा क्या कदम उठाए जा सकते हैं?

The Hindu

Background :-

• To enable faster exit for start-ups and to bring the winding up process in line with global best practices, the Department of Industrial Policy and Promotion (DIPP) has written to the Ministry of Corporate Affairs (MCA) to notify start-ups as ‘Fast Track firms’.
• Fast Track firms will be start-ups with simple debt structures or those meeting certain criteria that will be specified

Advantages:-

• Once this is notified, start-ups shall be able to wind up their business within a period of 90 days from making an application for the same.
• It gives positive vibes that government understands the risk involved in startups and is trying to provide a helping hand.
• It helps one to move on and one’s freedom remains intact as easy winding up would encourage many more ideas to turn to reality as they may not be threatened by the winding up process
• The perception about the government would improve as startup friendly which would help increase FDI, more innovations into society and will be key to finding various solutions of society through these.
• In larger picture, it would attract new ideas from all around the world, given the fertile land to grow
• Dormant Firms:–
  • Dormant firms which are lying on paper will be closed and this will help in better sync of accurate information on companies which are actually operating.
• As per Global standards: Many countries like UK, Singapore follow easy exit policies where only one form is needed to be submitted in order to shut down the business.This initiative by the government can bring India into this group as well.

Measures needed:

• A portal like e-biz can be helpful in addressing issue and providing resolution right there.
• Allowing voluntary windingup without taking matters into tribunals.
• Special cell for start ups to guide them .
• Simplified legislation such that entrepreneurs are not harassed and investors get their investment back .
• Alternative Investment Policy Advisory Committee observed that more often loss incurring start ups, move into new venture and therefore must be allowed to carry forward the loses
• Government has been running several startup related initiatives like start-up India, has vision of Make in India. So these steps will definitely create the conducive environment for startup to grow and will allow the thousands igniting minds to come forward to shape the world stage.
• Simplified easier exit policies will help more entrepreneurs to join the industry and will generate more employment, diversity and services.
  

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2.Discuss the role played by the World Bank in resolving the Indus Water issue between India and Pakistan. (GS 2)

भारत और पाकिस्तान के बीच सिंधु पानी के मुद्दे को हल करने में विश्व बैंक द्वारा की गई भूमिका पर चर्चा करें।

The Hindu

Introduction:-

• The Indus Waters Treaty 1960 is seen as one of the most successful international treaties and has withstood frequent tensions between India and Pakistan, including conflict.
• The Treaty sets out a mechanism for cooperation and information exchange between the two countries regarding their use of the rivers.

Positive role by WB:-

• The World Bank (then IBRD), under the presidency of Eugene Black, helped in 1952 to settle the dispute between the two nations on the sharing of the Indus river basin waters.
• The Indus Waters Treaty was signed in 1960 after nine years of negotiations between India and Pakistan with the help of the World Bank, which is also a signatory.
• The World Bank actively encouraged both countries to reach agreement on a mechanism to address the issue  of the two hydroelectric power projects.
• More generally, it is also working with them on how to ensure that the Treaty remains an effective tool to manage the use of Indus basin rivers.
• In December 2016,The World Bank Group announced a pause in the separate processes initiated by India and Pakistan under the Indus Waters Treaty to allow the two countries to consider alternative ways to resolve their disagreements.
• India and Pakistan are important partners and clients of the Bank. In South Asia, Pakistan ($2,280 million) received the highest lending from the Bank after India ($3,845 million) during the fiscal 2016.
• In case of differences and disputes, the WB designates people to certain roles when requested by either or both the parties. For eg. Pakistan asking for the Court of Arbitration and India asking for Neutral Expert when the former raised concerns over India’s two hydroelectric projects- Kishenganga and Ratle.

Negative:-

• The Treaty also sets forth distinct procedures to handle issues which may arise: “questions” are handled by the Commission; “differences” are to be resolved by a Neutral Expert; and “disputes” are to be referred to a seven-member arbitral tribunal called the “Court of Arbitration.”  The World Bank’s role in relation to “differences” and “disputes” is limited to the designation of people to fulfill certain roles when requested by either or both of the parties.  

The Treaty has survived wars and frequent tensions, the WB’s role is important because its aid can be effectively used only if both nations keep the peace and manage waters in a better way.

3.Comment on the challenges faced by the government to reduce unemployment in India. Suggest measures to be taken by the government for the same. (GS 3)

भारत में बेरोजगारी को कम करने के लिए सरकार द्वारा सामने आने वाली चुनौतियों पर टिप्पणी करें। इसके लिए सरकार द्वारा क्या कदम उठाए सकते हैं।

TOI | Indian Express | Link

Fact:

• Unemployment has been rising steadily over the years with the figures pegged at 9.13 lakh persons in 2013, 10.97 lakh persons in 2014 and 12.22 lakh persons in 2015.

Challenges:-

• Economic:
  • Weak industrial growth
  • Struggling agriculture sector with widespread drought
  • Cost rationalisations in several sectors
  • Knock-on effect of a global slowdown.
  • The informal sector accounts for the larger chunk of jobs created. India has only about 30 million jobs in the organised sector and nearly 440 million in the unorganised sector.
  • Economic growth: By and large the Indian economy growth remained sluggish during the last five decades at an annual rate of 4 to 5 %
  • The lack of buoyancy in the economy has failed to absorb the ever increasing labour force
  • Jobless Growth:
    • The immediate effect of jobless growth is rigidity in the labour  market. Decrease in the labour demands leads to the increase in the number of low paid jobs.
  • Twin Balance sheet problem is impeding growth of credit for industries
  • Fragmented markets due to lack of uniform taxation practices.
  • lack of financial inclusion and credit channels for self employment avenues.
• Mechanization:
  • Traditionally labour-intensive industries are beginning to increasingly mechanise their operations.
  • The government’s Make in India saw investment commitments of Rs 15 lakh crore from Indian and overseas investors, but those projects are still largely on paper.
    • The programme aims to increase the share of manufacturing in GDP from the current 16 per cent to 25 per cent by 2022, and create 100 million additional jobs by then.
    • But experts say this may not be an opportune time for a manufacturing-led model of the sort that created 64 million jobs in China between 2011 and 2016.
    • Creating manufacturing jobs will be tough with the advent of robotics.
  • The population explosion has created an army of labour force of around 500 million, which are difficult to absorb given the land and other resources of the country.
  • Gap between curriculum and industry demand:
    • The  education system of India is still colonial in nature tailored to produce clerks in tune with the requirements of the British Government in India. There is hardly any tune between the needs of the industry and the class-room teaching,resulting in unemployed graduate.
  • While in the short run job search and  wage rigidity is primary reasons.
  • Rural urban migration makes it even harder for the government as pressure is put on the urban areas.
  • Societal attitude against female participation in education and economy leading to low LFPR
  • To fight with the unemployment government of India has taken many steps and introduced many Many of those schemes are really beneficial but it creates more of mixed of unskilled labour force, rather than creating surplus skilled labour force.

The government, on its part, seems to have grasped this change: new ‘thrust areas’-such as Digital India, Skill India, Startup India and Make in India-all focus on creating an ecosystem that will generate jobs. However more measures are needed like:

• More focus on vocational education is needed.
• Quality of the education where there is sync with the demands of the industry need to be incorporated.
• The disguised unemployment in agricultural sector need to be tackled more by providing more avenues for self employment.
• Reforms in Labour laws need to be undertaken to provide protection to the employee..
• Ease of doing business should be promoted by relaxing construction permit, land acquisition, electricity permit. 340 point programme should lead to competitive federalism.
• Increasing the penetration of entrepreneurship programs like stand up India, Stand up India, SHGs etc., to increase job creation
• Provide unorganised sector with social security schemes like Atal pension yojana, Atal innovation mission, PM Jeevan Jyoti Bhima Yojana, etc.
  

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