Answered: Mains Marathon – UPSC Mains Current Affairs Questions – April 5

Following are the Suggested Answers for Mains Marathon, April 5:

1. What is National Institutional Ranking Framework (NIRF)? Discuss the parameters and methodology used in the ranking.

नेशनल इंस्टीट्यूशनल रैंकिंग फ्रेमवर्क (एनआईआरएफ) क्या है? रैंकिंग में प्रयुक्त पैरामीटर और पद्धति पर चर्चा करें।

The Hindu | NIRF

Background:-

• The National Institutional Ranking Framework (NIRF) was approved by the MHRD and launched by Minister of Human Resource Development in 2015.

Parameters and methodology:-

• This framework outlines a methodology to rank institutions across the country. The methodology draws from the overall recommendations broad understanding arrived at by a Core Committee set up by MHRD, to identify the broad parameters for ranking various universities and institutions.
• The parameters broadly cover
  • Teaching, Learning and Resources
  • Research and Professional Practices
  • Graduation Outcomes
  • Outreach and Inclusivity
  • Perception
  • Each broad category has an overall weight assigned to it. Within each category, the sub-categories also have an appropriate weight distribution
• There are separate lists within disciplines for engineering, management and pharmacy, and for universities and colleges.
• Methodology involves defining a set of metrics for ranking of universities and colleges based on the parameters agreed upon by the Core Committee (CC).
  • Intellectual property rights is an interesting measure — one that perhaps truly highlights the ‘innovative’ aspect of research.
  • Graduation outcome assesses the percentage of students clearing degree requirements in minimum time. An added component is the performance of students at national level exams such as GATE, UPSC etc.
  • To understand inclusivity and outreach,refresher and orientation courses were taken into account along with “e-content creation”, industry interaction and measures taken by the universities to improve their quality.Regional diversity i.e. students from different states also became a point of measure.

Positives:-

• A national ranking system, and one that is as exhaustive as this one, will propel institutions into higher world rankings.
• According to a study on the importance of national rankings, a combination study of the national and international rankings of universities will help create better research policies and help universities become better.
• Separate ranking formulae for universities and colleges is suggested to ensure that institutions are compared within an appropriate peer group of institutions, and provided a level-playing field.
• A system for data collection from public bodies and random sample checks is suggested for each parameter.
• As India lacked a national ranking for higher education institutes thid will help students to finalise the college for study
• Improves competition between institutions
• Comprehensive parameters with different weightage are included.
• Use of inclusive parameter needed to ensure social justice principles of preamble.

Negatives:-

• According to the World Economic Forum, while rankings do have value, often they do not serve as the best proxy of quality and relevance of tertiary education institutions.
• Possibility of use of unethical means by using false data.
• These rankings are not mandatory.
• Private institution with less than 1000 students cannot participate.

This is the first for India and could actually propel the world to notice the Indian university system.Thus it can be a changing step for the higher education in India.

2. Do you think that MPC needs to reconsider its decision of taking a ‘neutral’ policy stand? Also, discuss key recommendations of Urjit Patel committee report on monetary policy reform.

क्या आप सोचते हैं कि एमपीसी को ‘तटस्थ’ नीति लेने के अपने फैसले पर पुनर्विचार करने की जरूरत है? इसके अलावा, मौद्रिक नीति सुधार पर उर्जित पटेल समिति की रिपोर्ट की प्रमुख सिफारिशों पर चर्चा करें।

Live Mint | Business Standard

Background:-

• Neutral policy stand means that  Inflation is fine but there is a need to be cautious since macroeconomic conditions show that inflation may rise. Thus don’t expect rate cuts.

Yes this stand needs  reconsideration because:-

• The change in the stance led the bonds to crash.
• This is because, post the last policy, yields on bonds and debentures the major source of finance have significantly hardened.
  • Many factors like uncertainty on the liquidity outlook, reduced probability of policy rate cuts, large supply of state development loans and front-loading of central government market borrowings have created a sharp upside bias in long-term interest rates, especially in bond markets.
  • This clearly signals “pain” rather than growth ahead for Indian economy.

There is no need to reconsider because:

• Experts  feel that the current (policy rate) is optimal for liquidity in the economy. Therefore, a change of stance from accommodative to neutral at this stage was desirable.
• It can impart the necessary flexibility for the monetary policyin future to respond to any development on either side.
• The committee decided to change the stance from accommodative to neutral while keeping the policy rate on hold to assess how the effects of demonetization on inflation and output played out.
• While policy rate cuts may not help much, moving the policy stance back to “accommodative” from “neutral” will certainly reduce the risk of further eroding investor confidence.
• It is important to understand that monetary policy-making is undergoing some change now in the developed market (DM) economies and as a consequence the emerging market (EM) economies should follow.
  • This is because the EM economies are still largely dependent on global flows from the DM economies and hence cannot afford to drop their interest rates when the global interest rates are heading higher.
• Thus, despite weak credit growth banks might not be willing to further reduce lending rates. On both ends  the asset and the liability sides the interest rate game appears to be largely over.
• India is thus in a phase where the downward cycle of interest rates alone would not be able to lift economic activity as on the other side is the banking sector that is saddled with bad loans and hence has little risk appetite to lend.
• One of the reasons why the RBI has maintained status quo is banks are brimming with funds post demonetisation and the ball is now in bank’s court.
• Revival:-
  • Because of this policy stand the growth is expected to recover sharply in 2017-18 on account of several factors.
  • The discretionary consumer demand held back by demonetisation is expected to bounce back
  • secondly,economic activity in cash-intensive sectors such as retail trade, hotels and restaurants, and transportation, as well as in the unorganised sector, is expected to be rapidly restored.
• The MPC has changed its stance to ‘neutral’ as the committee is committed to bringing headline inflation closer to 4%.
• Seventh Pay Commission :- 
  • The effects of the house rent allowances under the 7th Central Pay Commission award which have not been factored in the baseline inflation path.
• Through this change, the RBI has sent out a message that it will now keep its eyes on the inflation target of 4 percent and the banks will have to take on the onus of quickly clearing off NPAs, hastening recapitalisation and syncing of rates on small savings through requisite transmission.

Recommendations of Urjit Patel committee:-

• The headline Consumer Price Index (CPI) should be the nominal anchor for monetary policy and the Reserve Bank of India (RBI) should make this the predominant objective.
• The nominal anchor for inflation should be set for a two-year horizon at 4 per cent with a band of plus or minus 2 per cent.
• The Central Government needs to reduce the fiscal deficit to 3.0 per cent of GDP by 2016-17.
• Administered prices, wages and interest rates are impediments to transmission of monetary policy and should be eliminated.
• Monetary policy decisions should be vested in a Monetary Policy Committee (MPC) comprising the Governor, the Deputy Governor and Executive Director in charge of monetary policy and two external full-time members.
• The decisions of the MPC will be by voting.
• Members will be accountable for failure to attain the target .
• The real policy rate should be positive. In the first phase the weighted average call rate would be the operative target and the repo rate would be the single policy rate. The funds available at the repo rate would be restricted and increasingly liquidity would be provided at the 14 day term repo; longer-term repo auctions should be introduced.
• In the second phase, the 14-day repo rate would be the operative target and recourse to outright two-way open market operations (OMO) would determine liquidity. OMO should not used to manage yields on government securities.
• There should be a remunerated standing deposit facility at the RBI to sterilise excess liquidity.
• With an independent debt management office, the market stabilisation scheme and cash management bills should be phased out.
• All sector specific refinance should be phased out as committed to the Asian Development Bank in 1992.

Concerns:-

• The Patel Committee recommends a remunerated standing deposit facility which, unlike the reverse repo, would not require government securities as collateral.
• While this would allow sterilisation of capital inflows, without any limit it would be detrimental to the RBI balance sheet as there is no provision in the law to ensure that all losses of the RBI will be met by the government. In the absence of such a legislative clause it would be hazardous to introduce a remunerated standing deposit facility.
• The structure and composition of the MPC are pre-eminently suitable. The MPC will have two external full-time members with a fixed three year non-renewable term. There could be some hierarchical problems about these members questioning executive decisions. The RBI should study the experience of Korea and other countries which have full-time members in the MPC.
• Experts believe, inflation targeting per se in a country like India will face some key operational challenges as it will require close co-ordination with the Government.
• The choice of CPI as a nominal anchor in Western and even emerging economies is also guided by different rational – high household indebtedness – a phenomenon absent in India.
• It will mean a fundamental change in the way monetary policy is framed in India, could become controversial for the reason that it seems to suggest that the central bank should set the inflation target (and not the government) and that a committee of the central bank, and not just the governor, take the call on monetary policy.
• The key implication of this new CPI-based inflation targeting framework is that interest rates in India will remain higher for longer.

3. “Cooperation between executive and judiciary in dealing with the high number of pending cases in India is essential.” Critically examine.

“भारत में लंबित मामलों की उच्च संख्या को निपटने में कार्यकारी और न्यायपालिका के बीच सहयोग आवश्यक है।” गंभीर रूप से जांच करें।

The Hindu

Introduction:-

• For over a year, there were indications of an impasse over judicial appointments between the two branches of the state, mainly after the Supreme Court struck down legislation to establish a National Judicial Appointments Commission. That phase appears to be coming to an end.
• Prime Minister’s assurance to the Chief Justice of India, that his government would contribute its share in reducing the judiciary’s burden is a positive gesture that will be welcomed by the legal fraternity.

Why is it important?

• Official figures show there are as many as 437 vacancies in the High Courts alone as of March 1, 2017. It is incontestable that any effort to liquidate the arrears of cases would involve a significant increase in the speed at which judicial appointments are processed.
• Due to non cooperation judicial system could not work efficiently especially because appointments, law making powers,infrastructure etc lies on executive and legislature.
• Appointments problem :-
  • Vacancies,lack of competent judges in lower level, lack of transparency in collegium, veracity of age in SC and high court judges needs urgent.
• Provision of e-governance:-
  • In the courts, centre can provide the e tools to better manage the cases.
• Government litigation:-
  • Executive needs to implement the Policy regarding governnment litigation to reduce government litigation as government is a major litigator.
• For Improving court infrastrucutre
• Promotion of lok adalats and alternate dispute redressal
• If they don’t work together there will be conflicts and both branches would get insecure with each other  like the Shah Bano case, reservation issue, latest Gujarat DGP case etc.
• If both branches don’t work in tandem there might be disturbances that judiciary has overstepped it’s mandate and some friction between the two.

What can be done ?

• Technology and digitalisation in the judicial system:-
  • There is much that the use of technology can do in both liquidating arrears and expediting processes such as filing of documents and serving of notices.
  • Also reports suggest that the government and the Supreme Court Collegium may be close to agreeing on a new Memorandum of Procedure for judicial appointments.
• The executive should also cooperate by improving the investigation techniques by incorporating latest state of art techniques like DNA profiling, dna fingerprint etc to bring about more certainty in conviction and thereby expediting the justice delivery.
• The executive should also work towards improving the existing Alternative Dispute resolution mechanisms under National legal services act 1987, arbitration and reconciliation act,1996, family courts.
• This sustained cooperation between executive and judiciary is important to prevent the long pendency as “justice delayed is justice denied .