SECURE SYNOPSIS: 15 SEPTEMBER 2018

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SECURE SYNOPSIS: 15 SEPTEMBER 2018


NOTE: Please remember that following ‘answers’ are NOT ‘model answers’. They are NOT synopsis too if we go by definition of the term. What we are providing is content that both meets demand of the question and at the same time gives you extra points in the form of background information.


General Studies – 2


Topic– Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources.

1) The concept of general education and specialised education proceeding together needs to be widely adopted in India. Analyze.(250 words)

The hindu

Why this question

Education is a key to understand ourselves as well as our environment. It is also essential for gainful employment in today’s world. However the later role has sidelined the primary role of education. It is essential to analyze, why there is a need for a holistic education system upto a certain level.

Directive word

Key demand of the question.

The question wants us to discuss why the concept of general education and specialised education proceeding together needs to be widely adopted in India. What are the benefits and what is the need.

Structure of the answer

Introduction– write a few lines about increasing GER in higher education in India.

Body

  • Discuss why such an integrated education system is essential. E.g Without all-round general (including liberal) education, one could not be expected to play roles expected of a citizen outside one’s immediate professional sphere; The development of general ability for independent thinking and judgement should always be placed foremost, not the acquisition of special knowledge. If a person masters the fundamentals of his subject and has learned to think and work independently, he will surely find his way; the purpose of higher education is to prepare graduates for work and life, as well as active and engaged citizenship — achieved only through the acquisition of knowledge, skills and competencies related to the profession they chose to specialise in and also written and oral communication skills, ability to work as a team, ethical decision making, critical thinking, and ability to apply knowledge in real world settings etc.
  • Discuss the state of Indian education system in this regard. E.g HEIs are far from integrated. Several engineering, and science education and research institutes have embedded general education programmes at the undergraduate level. Such programmes are missing in most university-affiliated science colleges. Rather, there are institutions that cater to a single stream which precludes the possibility of even an informal interaction between students and faculty with different specialisations etc.

ConclusionBased on your discussion, form a fair and a balanced conclusion on the given issue.

Background :-

  • In a recent survey published by the All India Survey on Higher Education  this year the gross enrolment ratio (GER) was 25.8% in 2017-18, up from 10% in 2004-05.Though the GER for higher education in India is still less than what it is in developed countries, the growth rate is still quite impressive

Why there is always need to integrate the concept of general education and specialised education :-

  • RadhaKrishnan committee report  recommended a well-balanced education with ‘general’, ‘liberal’ and ‘occupational’ components.
    • Without all-round general (including liberal) education, one could not be expected to play roles expected of a citizen outside one’s immediate professional sphere. Therefore, a lack of communication skills could be a handicap.
    • The development of general ability for independent thinking and judgement should always be placed foremost, not the acquisition of special knowledge.
  • The purpose of higher education is to prepare graduates for work and life, as well as active and engaged citizenship  achieved only through the acquisition of knowledge, skills and competencies related to the profession they chose to specialise in and also written and oral communication skills, ability to work as a team, ethical decision making, critical thinking, and ability to apply knowledge in real world settings. 
  • Disciplinary specialisation has resulted in many developments but also points out that emerging problems are multi-disciplinary.
    • The use of energy on a large scale and the continued availability of energy in an environmental-friendly manner are challenges which cannot be addressed by narrow specialists.
    • There are technical advances every day, influencing everyday life in diverse ways. This is also leading to concerns about privacy, technology-driven social and workforce changes, and the evolving need for individuals to retrain themselves to remain in employment.
    • In such a scenario, it is important that professionals study the impact of innovations on society in a holistic manner.
  • Without all-round general (including liberal) education, one could not be expected to play roles expected of a citizen outside one’s immediate professional sphere
    • The development of general ability for independent thinking and judgement should always be placed foremost, not the acquisition of special knowledge.
    • If a person masters the fundamentals of his subject and has learned to think and work independently, he will surely find his way
  • There are adequate issues with current education system:-
    • HEIs are far from integrated. As far as the inclusion of elements of general education in the curriculum for undergraduates is concerned, the situation is mixed.
    • Several engineering, and science education and research institutes have embedded general education programmes at the undergraduate level. Such programmes are missing in most university-affiliated science colleges.
    • Rather, there are institutions that cater to a single stream which precludes the possibility of even an informal interaction between students and faculty with different specialisations.

Topic- Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

2) India is still a long way away from the goal of predominantly having electric vehicles on Indian roads by 2030. Analyze whether a national policy on electric vehicles would enable us to accelerate towards this aim?(250 words) 

Hindustantimes

Why this question

The article discusses the impact that the absence of a policy regarding electric vehicles has had, the immense potential that Indian market offers to the companies working in the field of electric vehicles and the need for India to promote electric vehicles. The government has recently indicated its aim of having 30% electric vehicles on road and the issue is important from GS2 and GS3 perspective.

Key demand of the question

The key focus of the question is on establishing the necessity of a policy regarding promoting electric vehicles in terms of achieving the stated aim, the requirement of promoting electric vehicles, as well as the impact having a policy would have on promotion of electric vehicles.

Directive word

Analyze – When asked to analyze, you  have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary.

Structure of the answer

Introduction – Discuss the stated aim of achieving 40% electric vehicles on roads by 2030, the efforts made by the government in introducing FAME.

Body

  • Bring out the status of electric vehicles in India – In 2017 alone, 24.5 million conventionally powered automobiles were sold in India and these are likely to grow to 84. 53 million by 2030, according to the Niti Aayog. By comparison, only about 2000 battery electric cars were sold last year, an International Energy Agency (IEA) report said. More than 12 million cars will be added to Indian roads between 2017 and 2030, per Niti Aayog data.
  • Discuss the need of promoting electric vehicles in the country from an environmental perspective. Highlight the problem of carbon emissions, international obligations, huge market of two wheelers and four wheelers in India etc to establish that electric vehicles indeed need to be promoted
  • Examine the issues in the current regulatory architecture that hinders achievement of the stated aim – lack of charging infrastructure, India’s Electricity Act does not allow entities other than licensed discoms to sell power etc
  • Discuss how a national policy would enable faster achievement of targets relating to electric vehicles – the international precedents where a policy helped, how a policy would get rid of the current inadequacies, the issues with the current emission standards etc

Conclusion – Give your view on the need for a policy and highlight the way forward.

Background :-

  • As Bill Gates once said, governments across the globe play an integral role in ushering in positive social change, be it through sound policy-making or by offering financial support to facilitate innovation. These words are all the more pertinent in the context of the Indian electric vehicles (EV) market, as the government and corporates slowly steer India towards sustainably powered green mobility solutions, including EVs.
  • Home to one of the largest automobile industries in the world, India currently contributes a major percentage of the global car sales hence the potential for electric vehicles is immense.

Issues with the goal of achieving electric vehicles by 2030 :-

  • 100% Electric Vehicles By 2030 Plan Too Ambitious
    • Automakers feel that in a country where of a total of 200 Million vehicles, less than 1% is currently electric (as of November 2017), the target of switching to all-electric vehicles by 2030 seems a too ambitious.

·         Lack Of Adequate Charging Infrastructure

o   To successfully transition to 100% EVs, India needs a robust network of charging stations. While the government is working with private sector players to set up EV charging points in specific areas, a nationwide deployment is not something that is currently on the cards.

o   According to a Bloomberg New Energy Finance report, India has just over 350 public EV chargers compared with around 57,000 petrol pumps.

·         Need For Greater Investment In EVs

o   In order to set up a proper ecosystem for EVs in the country, investments from the government as well as corporates are absolutely essential which is atill lacking at present.

  • Better Facilities Required For Indigenous EV Manufacturing
    • To encourage indigenous production of EVs, the government will have to offer greater subsidies to automakers and car component manufacturers. Currently, a large section of the country’s auto component market is wary of the government’s push on EVs, especially since electric cars usually have less number of parts than traditional internal combustion engines, which means less business.
  • Lack of Technological Innovation In Energy Storage
    • Because of insufficient availability of raw materials and inadequate local production, the cost of batteries has remained high. Li-ion batteries are the single most important component of an electric vehicle, contributing around40% of total production cost.
  • Dearth Of Awareness Among Consumers
    • Lack of sufficient consumer awareness about EVs and their potential is another major challenge hindering the market’s growth in India. 

Why national policy on electric vehicles is needed:-

  • Policy confusion exists:-
    • While the government has done quite a bit to create the foundation needed for a robust EV market in India, through initiatives likeglobal tenders and Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME), when it comes to concrete policies, there is still quite a bit of confusion, at least at the Centre level.
    • Lack of clarity has also deterred a number of foreign automakers from entering the Indian EV market, with many including Volkswagen, Jaguar Land Rover, Renault, Ford, etc  stating that they would wait until a concrete EV policy in place in India.
  • Clear cut norms will be established:-
    • If the policy is instituted, it will not only erase confusion in the market, but will provide also norms for bidding, installation, and the sale price of power at charging stations, among others.
    • The new policy will view those offering EV charging infrastructure solutions as service providers and not power sellers. This would, in turn, eliminate the need for a license to set up charging stations.
  • International experiences:-
    • A national policy takes into account the industry’s position, the needs of the population and challenges to come up with a roadmap that includes what the government can and will do to support the industry and public.
    • International experience has shown that the government has an important role in creating a market for EVs and shaping an industrial policy that encourages automakers to align their production with the targets set by the government.
  • Transport sector not only generates about a quarter of India’s carbon emissions but also a major source of air pollution. An effective electric vehicles policy can curb this.
  • Policy already existing at Federal level:-
    • Karnataka approved an electric-vehicle policy with an aim to drive more research into these vehicles and to encourage manufacturers to set up shop in the state.
    • Maharashtra unveiled its policy much later, offering incentives to prospective electric-vehicle owners and also for setting up charging stations

What should the national policy deal with :-

  • First step towards going electric would be to start moving towards hybrid vehicles.
  • Going after large fleets:-
    • Government should target larger vehicles and fleets of vehicles such as buses for public transport and not go around subsidising personal cars.
    • Getting the bus fleet to go electric should be a priority simply because subsidising cars would add more vehicles on the roads across cities
  • Augment power capacity and set up an independent grid:-
    • India will have to focus heavily on power generation and distribution. While the coal sector will remain active for some time, the country needs to focus on long-term capabilities, especially nuclear.
  • Deregulation of Charging infrastructure :-
    • In case of the electric vehicle sector, charging infrastructure has to be deregulated to allow any interested party to set up charging points. This can include malls, apartment complexes, and other commercial spaces.
    • However, proper regulation must be in place to ensure that they are connected to the right grid.
  • Investing heavily in R&D and overhauling the Indian education system
    • The most important part of India’s electric-vehicle policy is a massive push towards research and development (R&D). The fruits of R&D in the sector will not only have an effect on electric vehicles but also on other sectors, including the power sector, space sector, and more.
  • Introducing a sunset policy
    • No electric-vehicle policy will work without a proper sunset policy in place to phase out the existing system. In order for the switch to electric vehicles to succeed, the government will have to focus on two separate sunset policies.
      • The first sunset policy, as suggested by NITI Aayog last year, would be to slowly phase out diesel-based vehicles. It should then be extended to petrol and then compressed natural gas vehicles as well.
      • The second sunset policy is for subsidies within the electric-vehicle policy itself. At some point, government subsidies would have to give way to allow the market to take over and start filling the supply-demand gap, and the electric-vehicle movement would have reached critical mass.
    • Conversion of existing fuel stations to charging stations :-
    • Keeping in mind that electric vehicles will first arrive on the urban scene, the government can start by adding a charging point at all the urban ones alone. These charging stations can be equipped with a fast-charge option at a premium rate. 
    • Policies have to be developed to facilitate the indigenization of battery assembly, and manufacture of EVs and their basic components. 
    • If we address all these issues, we can gradually acquire enough experience to develop a manufacturing ecosystem for electric mobility.

No need for a policy :-

  • NITI Aayog seconded the government’s statement by saying that technology is always ahead of rules and regulations. And in India, it becomes very tough to change rules and regulations, so let there be just actions. So there is no need for a separate policy.
  • The government is of the opinion that while switching to all-electric vehicles is the need of the hour, India doesn’t need a separate policy on EVs. Rather, what is essential, at the moment, are actionable solutions and guidelines that can help boost the nation’s EV ecosystem.

Topic – Indian polity : Issues

3) Right to be forgotten as envisaged by draft data protection Bill will lead to compromises with transparency, freedom of speech and freedom of press. Critically analyze. (250 words) 

Indian express

Why this question

The draft data protection Bill recommended by SriKrishna committee has raised several important debates. The article discusses the provisions related to right to be forgotten, and the challenges that the provisions might pose to press freedom, freedom of speech and transparency. The question will help you prepare the provisions related to right to be forgotten in the draft Bill and its critical analysis.

Key demand of the question

The question expects us to bring out the provisions related to right to be forgotten in the draft bill, and analyze the impact of it in on press freedom, freedom of speech and transparency. The key focus should be on making reasoned arguments from both sides to finally reach to what we think should be the way forward.

Directive word

Critically analyze – When asked to analyze, you  have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary. When ‘critically’ is suffixed or prefixed to a directive, all you need to do is look at the good and bad of something and give a fair judgement.

Structure of the answer

Introduction – Explain what right to be forgotten is and highlight that Srikrishna Committee has made recommendations related to right to be forgotten which needs to be debated.

Body

  • Explain the recommendations of the committee related to right to be forgotten
  • Provisions related to the adjudicating authority
  • Section 27(2) which vests power in the adjudicating authority to decide on the question of disclosure
  • Conditions listed in the subsection regarding the factors that have to be considered
  • Highlight the provisions of review enshrined in the draft Bill
  • Discuss the pros in relation to the usefulness of right to be forgotten – highlight that it is a part of right to privacy, discuss the cases in India where judiciary has favoured the right to be forgotten etc
  • Discuss the issues with the Bill in its present form – highlight the provisions of section 27 which grants power to data principal to prevent data fiduciary from using data in certain cases, discuss the challenges that it poses in terms of freedom of press and transparency etc

Conclusion – Give your view on the provision related to right to be forgotten in the draft Bill and discuss the way forward.

 

Background :-

  • Justice BN Srikrishna Committee’s draft Personal Data Protection Bill 2018 is introducing a new right  the right to be forgotten which is to remove very old, irrelevant and unnecessary information links from social media networks.
  • This concept is prevalent and has been hence reinforced in data protection laws and regulations in the EU, including EU’s General Data Protection Regulation (GDPR). 
  • Draft Personal Data Protection Bill, 2018, has a section on the Right to be Forgotten. But the proposed bill does not provide right to erasure. 

Provisions of the bill about right to be forgotten :-

  • According to Section 27 of the Bill a data principal (for instance, a former minister convicted earlier) has a right to prevent the data processor or data fiduciary (could be a TV, web portal or newspaper) from using such data or information if data disclosure is no longer necessary, the consent to use data has been withdrawn or if data is being used contrary to the provisions of the law.
  • Section 27(2) says the adjudicating officer (bureaucrat) can decide on the question of disclosure, and the circumstances in which he thinks such disclosure can override the freedom of speech and the citizen’s right to information.
  • In determining the above, the adjudicating officer has to consider five factors listed in subsection (3). They are:-
    • (a) the sensitivity of the personal data
    • (b) the scale of disclosure and the degree of accessibility sought to be restricted or prevented
    • (c) the role of the data principal in public life
    • (d) the relevance of the personal data to the public
  • (e) the nature of the disclosure and of the activities of the data fiduciary, particularly whether the data fiduciary systematically facilitates access to personal data and whether the activities would be significantly impeded if disclosures of the relevant nature were to be restricted or prevented.
  • Review provision:-
    • Aggrieved by the order of the adjudicating officer, one can file for a review.
    • If the officer reaffirms the decision, an appeal can be made to the appellate tribunal. This is fine as far as data protection is concerned.

Leads to compromise:-

  • But when the data principal is a public servant (for instance, a former minister), and the data fiduciary is a newspaper or web journal, the freedom to criticise the public personalities for their public policies based on their past statements and activities will be in jeopardy, and a journalist has to wait for the decision of the adjudicating officer to clear her writing about it.
  • Confusion :-
    • A citizen seeking access to such information will be confused whether to approach the CIC or DPA .These adjudicating officers are subordinate to members of the Data Protection Authority.
  • Press freedom :-
    • Right to be forgotten in the bill might spell a danger to press freedom.
    • The Bill says the rights of the data principal, including the right to be forgotten, are exempted if the purpose of data processing is in the interest of the security of state (Section 42).
  • The Srikrishna Committee did not suggest any draft for these two additional provisions contemplated under Sections 42 and 43. Even for this, Section 4 (right to privacy needs to be respected) and, Section 31 (fair and reasonable processing duties) will apply.
  • Journalistic publication will be dependent upon the opinion of a dealing clerk or adjudicating officer. These are additional pre-publication restrictions on citizens and media which were never contemplated by the Constitution and rejected by the judiciary.
  • Penalty provisions are severe and costly :-
    • Section 74 gives the power to impose a penalty to the adjudicating officer after an inquiry, besides facilitating compensation (Section 75).
    • Failure to adhere to security standards (Section 31) might lead to a penalty of up to Rs 5 crore (Section 69).
    • A penalty of up to Rs 1 crore can be imposed where any person fails to comply with any provision of this Act, for which no separate penalty has been provided in the Act (Section 73). This can easily be used against journalists.
  • Some free speech organisations are warning that the right to be forgotten may be in danger of being transformed into a tool of global censorship.
  • The advocates of human rights believe that this case can threaten free speech. They believe that a country’s regulator should not be allowed to control what users across the world find and search on the web.

 

Benefits of right to forgotten :-

 

  • GDPR’s Article 17 has outlined the circumstances under which EU citizens can exercise their right to be forgotten or right to erasure.
    • The Article gives individuals the right to get personal data erased under six conditions, including withdrawal of consent to use data, or if data is no longer relevant for the purpose it was collected.
    • However, the request may not be entertained in some situations such as if the request contradicts the right of freedom of expression and information, or when it goes against  public interest in the area of public health, scientific or historical research or statistical purposes.
  • It is a part of right to privacy.
  • When an individual does not want some aspect of his / her past to be remembered in internet he has the right to be forgotten
    • For instance In 2014, the European Court of Justice (ECJ) ruled in favour of Mario Costeja González, a Spanish man who was unhappy that searching his name on Google threw up a newspaper article from 1998.

General Studies – 3


Topic– Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

4) It has been cautioned that the next crisis in India’s banking sector could come from MUDRA loans, and credit extended through the Kisan credit card scheme. Critically examine.(250 words)

The hindu

The hindu

Why this question

India is already facing an NPA crisis and any further liability could lead to a serious banking or even economic crisis. So it is important to examine how loans under the two schemes can be a source of India’s next banking crisis.

Directive word

Critically examine- Here we have to probe deeper into the topic,  get into details, and find out the causes or implications if any. Based on our discussion we have to form a concluding opinion on the issue.

Key demand of the question.

The question wants us to look into MUDRA loans, and credit extended through the Kisan credit card, and find out how they could be the cause of the next crisis in India’s banking sector.

Structure of the answer

Introduction– write a few lines about the importance of banking sector for the working of the modern economy.

Body-

  • Write a few introductory lines about the MUDRA and KCC scheme.
  • Discuss in points how the loans disbursed under MUDRA and KCC scheme could lead to the next banking crisis in India. E.g The disbursement under Mudra loans alone is ₹6.37 lakh crore, which is over 7% of the total outstanding bank credit. Given that these are small loans up to ₹10 lakh each, with the borrowers mostly from the informal sector, banks have to monitor them very closely. It is debatable whether banks have the resources and manpower to do this when they are chasing the bigger borrowers for business and, increasingly these days, recoveries. The risk is that these small-ticket loans will drop under the radar and build into a large credit issue in course of time. The same logic holds true for crop loans made through Kisan Credit Cards etc.

Conclusion– discuss briefly as to what should be done in this regard. E.g political parties should agree on not waiving farm loans as such waivers vitiate the credit culture and eventually reduce the flow of credit etc.

Background:-

  • Former RBI governor In his note to Parliament’s Estimates Committee on bank non-performing assets (NPAs), has flagged three major sources of potential trouble:
  • Mudra credit, which is basically small-ticket loans granted to micro and small enterprises
  • Lending to farmers through Kisan Credit Cards
  • Contingent liabilities under the Credit Guarantee Scheme for MSMEs, run by the Small Industries Development Bank of India.

What is Mudra?

  • The Micro Units Development & Refinance Agency Ltd. (Mudra) was set up in 2015 under the Pradhan Mantri Mudra Yojana (PMMY) to help develop and refinance the ‘non-corporate business’ sector by supporting finance institutions that lend to micro/small business entities engaged in manufacturing, trading and service activities.
  • It is aimed at using micro finance as an economic development tool that helps to provide income-generating opportunities to the people at the bottom of the pyramid, targeting small manufacturing units, shopkeepers, fruits and vegetable vendors, truck and taxi operators, food-service units, repair shops, machine operators, artisans and food processors.

Mudra loans and kiss credit card issues:-

  • Mudra loans:-
    • The disbursement under Mudra loans alone is Rs.6.37 lakh crore, which is over 7% of the total outstanding bank credit. 
    • Given that these are small loans up to ₹10 lakh each, with the borrowers mostly from the informal sector, banks have to monitor them very closely.
    • It is debatable whether banks have the resources and manpower to do this
    • The risk is that these small-ticket loans will drop under the radar and build into a large credit issue in course of time.
    • Critics of the scheme say that too many best practices in loan origination have been neglected while authorising and disbursing loans.
      • Earlier this year, the CBI registered a case against a former official of Punjab National Bank for alleged abuse of official position in sanctioning and disbursing 26 Mudra loans amounting to Rs.65 lakh.
    • Even if loans are sought by business owners genuinely seeking growth and bankers disburse them with an eye on economic development, ensuring repayment is still a challenge.
    • These loans are unsecured a collateral that could protect the interests of the bank is not required, unless an asset that is purchased can itself serve as collateral.
    • The scheme is meant for those who need small amounts, but do not have access to such funds, but the very nature of the business of such borrowers is susceptible to volatility and annual cycles, not to mention the itinerant ways of some business owners, such as vegetable vendors.
  • The same logic holds true for crop loans made through Kisan Credit Cards:-
    • Loan waivers , vitiate the credit culture and create a moral hazard where farmer-borrowers assume that their loans will invariably be waived off.
    • Merrill Lynch report suggested that loan waiver is likely to double to $40 billion by the 2019 general elections.
    • Loan waivers stress the budgets of the waiving state or central government.
    • They are poorly targeted, and eventually reduce the flow of credit.

They benefitted as well:-

  • Mudra scheme :-
    • Loans offers to small businesses in the unorganized sector are now covered by a credit guarantee scheme. It also helps bridge the shortfall in loans for these businesses. This helps small entrepreneurs save on the interests that they need to pay.

Way forward:-

  • Revising compensation structures to attract the best talent
  • Ensuring that banks are not left without a leader at the top.
  • Improve governance of public sector banks and distance them from the government.
    • Professionalising bank boards with appointments done by an independent Banks Board Bureau
    • Inducting talent from outside banks to make up for the deficit within
    • Risk management processes still need substantial improvement in PSBs. Compliance is still not adequate, and cyber risk needs greater attention
  • Improve the process of project evaluation and monitoring to lower the risk of project NPA’s
    • Significantly more in-house expertise can be brought to project evaluation, including understanding demand projections for the project’s output, likely competition, and the expertise and reliability of the promoter.
    • Bankers will have to develop industry knowledge in key areas since consultants can be biased.
  • An appropriately flexible capital structure should be in place. The capital structure has to be related to residual risks of the project.
    • The more the risks, the more the equity component should be (genuine promoter equity, not borrowed equity, of course), and the greater the flexibility in the debt structure.
    • Promoters should be incentivized to deliver, with significant rewards for on-time execution and debt repayment.
    • Where possible, corporate debt markets, either through direct issues or securitized project loan portfolios, should be used to absorb some of the initial project risk. More such arm’s length debt should typically refinance bank debt when construction is over.
  • Long-term solutions need to be explored to enhance the productivity levels of the agricultural sector in general so that the excessive dependence on loan waivers is eliminated. A good place to start would be to reduce the embarrassing rain dependency of crops for over 60 percent of the net sown area across India. 

TopicIndian economy: issues

5) The GST amendment Bill passed recently has ironed out the ambiguities in the newly introduced GST. Examine. (250 words)

Financial express

Why this question

The article talks about the recent amendments made in GST Law by the GST amendment Bill and how the amendments have an impact on the indirect taxation regime in India. Since GST is one of the most important reforms brought about in recent years, and has recently completed an year in existence, the amendment is important from GS3 perspective.

Key demand of the question

The question expects us to bring out the key changes made in the GST amendment Bill and how it helps in ironing out the issues in GST architecture faced in the last year. Thus we need to bring out the issues faced, and examine whether the amendments helped in ironing out those issues.

Directive word

Examine – When you are asked to examine, you have to probe deeper into the topic,  get into details, and find out the causes or implications if any .

Structure of the answer

Introduction – Explain that GST is one of the most significant reforms introduced and assess its performance over the past year.

Body

  • Highlight the amendments made by the Bill – changes made in the tax regime with respect to the unregistered taxpayers, the clarification made with respect to the definition of supply etc
  • Discuss the issues faced in the GST regime over the past year – the problems faced by the unregistered taxpayers, the issues with respect to filing of returns etc.
  • Highlight whether the amendment would iron out the issues faced

Conclusion – Assess the impact of the amendments and what more needs to be done.

Background :-

  • The GST amendment Bill  introduced changes that were proposed to the GST legislations. The GST Amendment Bill of 2018 is the first ever revision to the supreme law regulating the GST. 

 

GST ambiguity:-

  • Compliance has miles to go:
    • The biggest dampener was the compliance process, as information technology glitches took more than the anticipated time to be resolved. The filing system that was put in place in the beginning was quickly abandoned as businesses struggled with compliance. 
  • Cumbersome registration system:
    • Multiple registration requirements have complicated things for industry, which was expecting simplicity. In many cases, registration is required in all states. Companies fear that multiple audits and assessments due to multiple registrations could make life more difficult for them going forward.
  • New cesses crop up:
    • While GST scrapped a multiplicity of taxes and cesses, a new levy in the form of compensation cess was introduced for luxury and sin goods. This was later expanded to include automobiles. A new cess on sugar is also being examined.
  • Refunds problem for exports:
    • The refund mechanism for exporters, including data matching law, besides procedures governing them, have irked the sector, particularly smaller entities that saw their working capital requirements rise.
  • Small businesses :-
    • GST implies additional operational costs for Small businesses. In a developing country like India, not all SMEs will be able to afford the cost of computers and accountants required to implement GST (make bills and file tax returns). 28% GST rate on some products like plywood, automobile parts and electronic items forces potential buyers to opt for unregistered dealers.
    • It is too difficult to assign MRP to handmade products like local shoes, Banarasi Sarees, etc. Most small artisans are illiterate and therefore unable to write MRP on their productsand/or do any paperwork. Dealers are confused how to rates of such products.
    • Small businesses that have a small turnover and need not pay GST face trust issues. Buyers demand bills from even those sellers who are exempted from GST. Without proof of certificate of GST exemption, small shop owners find themselves stranded and immobile.
  • If an organisation pays the GST and claims input tax credit, while the company which has sold products avoids paying its share of tax, this might lead to unwarranted fines against duly tax-paying company.

How the GST amendment bill erases those :-

  • The ambivalence around taxability of transactions in the nature of high sea sales, bonded warehouse sales and merchant exports will cease to exist.
    • There is confusion around taxability of these transactions, since there are contradictory views floating in the industry. With the amendment, such transactions have been put outside the sphere of ‘supply’.
  • Provisions around restrictions on the seamless availability of credits have also been rationalised. The credit pool has now been extended to permit increased flow of credits.
    • This is a huge relief for the industry, since major players take buses and tempo travellers for transportation of employees.
    • In addition, services of general insurance, servicing, repair and maintenance of such vehicles will also be available.
    • Where such vehicles are taken on rent or lease or hire by business houses, for the purposes of transportation of employees, credit restrictions will not apply.
  • The provisions will allow taxpayers to amend their tax returns in order to rectify errors. They also widen the scope for availing input tax credit.
  • Procurements made from an unregistered supplier of goods and/or services provided for the discharge of GST by the registered purchaser. This provision was time and again suspended by way of an exemption, thereby reducing substantial effort and tax risks via the registered buyer. Moreover, the unregistered sector experienced some setbacks due to tax obligations vested on their respective GST-registered customers
    • The amendment of 2018 revises the enabling provision for the levy of GST on such transactions and empowers the Centre to specify the class of registered persons who will have to pay tax upon procurement of specified goods and/or services from the unregistered sector. This amendment is similar to the law that prevailed during the service tax regime.
  • The definition of supply, which also happens to be a trigger point for the levy of GST, was elastic enough to cover a host of transactions.
    • With the amended law, the sole purpose of listing activities in Schedule II seems to determine whether GST will be levied on such activities as a supply of goods or as a supply of services. In other words, Schedule II will no longer decide whether the transaction will be a supply or not.

TopicPart of static series under the heading – “physiography”

6) Explain how the Himalayan and the Tibetan highlands play an important role in the-development of the South – West monsoon?(250 words)

 

Key demand of the question

The question expects us to bring out the impact that Himalayas and the Tibetan plateau have on the onset, progress and retraction of south west monsoon in India.

Structure of the answer

Introduction – Explain the geographical presence and physical features of Himalayas and Tibetan plateau.

Body

  • Discuss the impact of Himalayas on SW Monsoon – in foothills of Himalayas is location of sub-tropical high pressure(STHP) belt. In summers, pressure belts shift to north so STHP belt also move to the north, which disintegrates the jet stream(which was blowing
    originally over northern plains), thus causing a monsoonal trough (vacuum) in this region, thus sucking the SW
    monsoonal winds . In addition , Himalayas also prevent the further northward movement of the monsoons and
    hence confine them to Indian landmass

Discuss the impact of tibetan highlands- also strengthen SW monsoons by giving birth to tropical easterly jet stream. In summers, the surface of Tibetan plateau become very warm ( warm air always rise) and the warm air rising from Tibet
move south towards Indian ocean because of the precence of STHP belt north of Tibet. These currents of warm
air deflect to their right as they move due to coriolis force and hence sink over Arabian sea. This air picks up
moisture from Arabian sea and joins SW monsoonal winds.

 

Background:-

Himalayas acted on the monsoon in two ways. The Tibetan plateau, heated up during summer and thereby established an atmospheric circulation that was conducive for the monsoon. The vast mountain range also acted as a tall barrier, preventing cold, dry air in the northern latitudes from entering the subcontinent and subduing the warm, moisture-laden winds from the oceans that drive the monsoon.

Role of Himalayas and Tibetan highlands in South west monsoon:-

  • The Tibetan Plateau is an enormous block of highland acting as a formidable barrier. Due to its protruded height it receives 2-3°C more insolation than the neighboring areas.
  • The plateau affects the atmosphere in two ways: (a) as a mechanical barrier, and (b) as a high- level heat sources.
  • At the beginning of June the subtropical jet stream is completely withdrawn from India and occupies a position along 40° N (to the north of Tibetan Plateau).
  • The plateau accentuatesthe northward displacement of the jet stream. Hence the burst of monsoon in June is prompted by the Himalayas and not by the thermally induced low pressure cell over Tibet. (Tibetan plateau is responsible for south-west monsoons. But it is the subtropical jet stream that facilitates sudden outburst of monsoons with its sudden northward migration)
  • In the middle of October the plateau proves to be the most important factor in causing the advance of the jet south of the Himalayas or bifurcating it into two parts.
  • The winter Tibetan Plateau cools rapidly and produces a high pressure cell. (Cyclonic condition over Tibet ceases and an anticyclonic condition is established). The high pressure cell over Tibet strengthens N-E monsoons.
  • Tibet gets heated in summer and is 2°C to 3°C warmer than the air over the adjoining regions. Because the Tibet Plateau is a source of heat for the atmosphere, it generates an area of rising air (convergence)(intense low pressure cell).
  • During its ascent the air spreads outwards in upper troposphere (divergence) and gradually sinks (subsidence) over the equatorial part of the Indian Ocean.
  • It finally approaches the west coast of India as a return current from a south-westerly direction and is termed as equatorial westerlies.
  • It picks up moisture from the Indian Ocean and causes rainfall in India

 

 


General Studies – 4


Topic–  Ethics and Human Interface: Essence, determinants and consequences of Ethics in human actions; dimensions of ethics; ethics in private and public relationships. Human Values

7) The project of creating value-aligned AI is perhaps one of the most important things we will ever do. Comment.(250 words)

Reference

Directive word

Comment- here we have to express our knowledge and understanding of the issue and form an overall opinion thereupon.

Key demand of the question.

The question wants us to express our knowledge and understanding about the need for a value-aligned AI- we have to form an opinion as to why there is/ is not such a need.

Structure of the answer

Introduction– write a few lines about the growth of AI and its increased integration in our lives.

Body

  • Discuss the ethical issues posed by the AI. e.g The end goal of AI safety is to create beneficial intelligence not undirected intelligence. What beneficial exactly entails is still an open question that largely exist in the domain of ethics; AI and enabling technologies like robotics and autonomous vehicles will change lives and livelihoods. Great benefits and unprecedented wealth will be created. But with that will come waves of disruption- How do we share income and protect displaced workers? How do we share benefits of better health?How do we share access to powerful tools?How and when do we augment our intelligence? Etc.
  • Discuss how a value based AI can be created. E.g Validation: ensuring that the right system specification is provided for the core of the agent given stakeholders’ goals for the system; Security: applying cyber security paradigms and techniques to AI-specific challenges; Control: structural methods for operators to maintain control over advanced agents etc.

Conclusion- Based on your discussion, form a fair and a balanced conclusion on the given issue.

Answer:-

  • AI is one of the technologies that could revolutionize the world, some people call it the electricity of the twenty first century.
  • AI opens up whole new fields of potential value, such as doctors being able to use it to improve their cancer treatment decisions. But with that comes uncertainty about unexpected consequences that could be introduced.
  • Since AI is still emerging in our society, we need to be intelligent about how we create and enable it, how we control it and what we demand of it. This is why the ethics of artificial intelligence are so important.
  • It’s not just about useful intelligence but the ends to which intelligence is aimed and the social/political context, rules, and policies in and through which this all happens.

Ethical issues:-

  • Hierarchy of labour is concerned primarily with automation as people are scared that increased automation can lead to lay offs and rise in unemployment.
  • By using artificial intelligence, a company can drastically cut down on relying on the human workforce, and this means that revenues will go to fewer people. So there will be rise in inequality.
  • Excessive dependence on technology can be addictive. Now a days artificial boys can also build relationships with humans .This can threaten the way world is now and the consequences might not be assessed.
  • AI systems are created by humans, who can be biased and judgemental. So AI can lead to furthering the biases
  • Cyber security:-
    • AI can help protect against these vulnerabilities, but it can be also used by hackers to find new sophisticated ways of attacking institutions.
  • Privacy is a human right and should be protected against misuse.

The following are the ways through which interdisciplinary issues with respect to AI are to be addressed:

  • Validation: 
    • Ensuring that the right system specification is provided for the core of the agent given stakeholders’ goals for the system.
  • Security: 
    • Applying cyber security paradigms and techniques to AI-specific challenges.
  • Control: 
    • Structural methods for operators to maintain control over advanced agents.
  • Foundations: 
    • Foundational mathematical or philosophical problems that have bearing on multiple facets of safety
  • Verification: 
    • Techniques that help prove a system was implemented correctly given a formal specification
  • Ethics: 
    • Effort to understand what we ought to do and what counts as moral or good.
  • Governance: 
    • The norms and values held by society, which are structured through various formal and informal processes of decision-making to ensure accountability, stability, broad participation, and the rule of law.
  • Value Alignment:
    • Highly autonomous AI systems should be designed so that their goals and behaviors can be assured to align with human values throughout their operation.