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SECURE SYNOPSIS: 14 January 2017

 


SECURE SYNOPSIS: 14 January 2017


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 – 1;


Topic:Distribution of key natural resources

1) The Ken-Betwa river-linking project was cleared by the standing committee of the National Board for Wildlife (NBWL). Why is this project controversial? Also discuss implications of NBWL clearance. (200 Words)

The Indian Express

Introduction:-

 An ambitious project to link Ken and Betwa rivers has become a stage for a unique man-animal conflict. Proponents of the project, led by the Union Water Ministry, say that the proposed Daudhan dam and the 2.5 km canal — the key structures of the project — that will transfer surplus water from the Uttar Pradesh section of the Ken to the Betwa in Madhya Pradesh are critical to irrigate nearly 7,00,000 hectares in drought-ravaged Bundelkhand.

However, environmentalists say that such a dam will submerge at least 4,000 hectares of Madhya Pradesh’s Panna tiger reserve, whose tigers were almost lost to poaching in 2009 and have only recently been partially replenished. They allege that most districts in Madhya Pradesh will not actually get the promised water. There are vultures in the region, whose nests will be threatened by the height of the dam.

Since the project involves clearing forest land, affects endangered animals and involves relocating some farmers, it requires multi-pronged environmental clearance by the Ministry of Environment Forests and Climate Change.

ken-betwa

Project is controversial due to following reasons:-

  • It will lead to submergence of a huge portion of Panna Tiger Reserve, compromising the ecological integrity of the region
  • Large amount of illegal sand mining along the coast of Ken, has already changed its course and further diversion to Betwa river will hamper the agriculture in the region even more
  • Ken flows 60-70 feet below Betwa river. Flow diversion will require constant pumping, which may cost a huge amount of electricity, leading to more negative externalities
  • The hydro power project proposed in the linking canal will not be able to recover the cost of pumping, leading to wastage of funds

The clearance by NBWL is being seen given under political pressure to garner vote bank. The implications of such clearance include:

  • Such a clearance can serve as a benchmark for future clearances on such projects which can hamper India’s target to reach 33% of forest cover
  • It will lead to loss of 10% of tiger reserve’s area, along with loss of forest in the buffer area around it
  • As a result of this decision, Supreme court’s Central Empowered Committee will have to step in to take the final call to protect the flora and fauna in the region.

Conclusion:-

Although development in necessary in the country, but it should not come at the cost of destruction of nature. Government should be able to chart another course around the forest areas, along with making adequate plans for rehabilitation of population involved in the planning stage itself, while using the canal for building solar panels. Such measures will help in moving forward with a sustainable approach and help in benefitting all stakeholders.

 


General Studies – 2


TopicIssues relating to development and management of Social Sector/Services relating to Education

2) Analysis of the ‘District Information System on Education’ (DISE) data that in the four-year period after the implementation of the RTE Act, between 2010 and 2014, despite the number of public (government) schools increasing by 13,498 in the country, total enrolment in such schools fell by 1.13 crore, and enrolments in private schools rose by 1.85 crore. Critically comment on this finding. (200 Words)

The Indian Express

Introduction:- Analysis of the raw DISE data for 21 states shows that in the four-year period after the implementation of the RTE Act, between 2010 and 2014, despite the number of public schools increasing by 13,498 in the country, total enrollment in such schools fell by 1.13 crore, and enrollment in private schools rose by 1.85 crore.

  • Over the same period, the number of “tiny” public schools — those with a total enrollment of 20 or fewer students — rose sharply.
  • In 2014-15, these nearly one lakh tiny public schools had an average enrollment of only 12.7 students per school, a pupil-teacher ratio of only 6.7 students per teacher, a per-pupil teacher-salary expense of just under Rs 80,000 per student per year, and a staggering teacher salary bill of Rs 9,440 crore.
  • The number of public schools with only “50 or fewer” students rose even more dramatically to 3.7 lakh small schools, that is, to 36 per cent of the total 10.2 lakh public elementary schools in the country by 2014-15.
  • These 3.7 lakh “small” public schools had, on average, only 29 students per school, a pupil-teacher ratio of only 12.7 pupils per teacher, a per-pupil-teacher-salary expense of Rs 40,800 per year per child, and a monumental teacher salary bill of Rs 41,630 crore in 2014-15 — a grotesque squandering of tax-payers’ resources on pedagogically unviable public schools.

 

Reasons of the same:-

  • Absence from the school of government schools is high when compared to private counterparts Ahigh teacher absence rate of 25 per cent nationally, low time-on-teaching even when teachers are in school (identified in the PROBE-2 Report)
  • Less teaching hours even if teachers are present as compared to private schools
  • Untrained and inspired teachers in public schools
  • Political activism of MLAs and MLCs thus no actions are taken against errant teachers
  • Poor infrastructure such as drinking facilities, poor ICT framework, toilets etc in public schools
  • Question of credibility on the quality of education as evident from mass cheating in board examination in Bihar

Measures need to be taken:-

  • Introducing DBT voucher scheme which empowers parents to withdraw their children from schools by taking their wards if they are not satisfied with education quality
  • Teachers should be appointed on merit with minimum 50 % marks and to pass TET(as per TSR SUBRAMANIUM REPORT)
  • Increasing the accountability of teachers by reducing political influence
  • Up gradation centers for teachers to enhance their productivity.
  • Absenteeism in public can be tackled through biometric attendance system
  • Upgrading infrastructure facilities
  • Per-student fundingshould given to school indirectly via a school voucher to parents (Direct Benefit Transfer or DBT)
  • Dismantle the culture of political activismwhich diverts teachers’ attention from teaching by amendment of Article 171 (3c) of the Constitution that guarantees teachers representation in the state legislatures

 


Topic: Transparency & accountability and institutional and other measures.

3) The RBI board’s decision to recommend withdrawal of legal tender of high denomination notes after a short board meeting  is seen as a loss of independence of the RBI. In this light, examine why RBI board’s meeting should be transparent and what should be done to ensure this. (200 Words)

The Indian Express

Introduction:- 

The recommendation was based on advice by the government that the RBI Central Board should consider such a decision. The RBI board was within its powers to turn it down. It could have directed the management to give it a report on the costs and benefits involved and taken a considered decision in its next meeting.

HOW RBI MAKES DECISION:-

  • The RBI annual report shows the RBI’s annual expenses in 2014-15 were Rs 13,356 crore. These are comparable to the annual expenditure of many states in India, and many times bigger than that of most central banks and regulators in India and abroad. Nearly a third, or more than Rs 4,000 crore, is spent on RBI staff salaries, superannuation, housing, maintenance, directors’ fee and board meeting expenses. Such a large use of public money requires adequate scrutiny.
  • The board would discuss and approve the expenses and fulfill its role of controlling excessive expenditure by the management. However, there is no evidence available that the board even discusses this enormous annual spend of the RBI.
  • Further, there is no evidence that the board looks after the public’s interest in the event that there may be a conflict with the interests of the management. This is something the Board would have been expected to do. The decision seems to be taken mainly by the management — without the scrutiny of the Board.

 

RBI is considered as banking sector regulator and controls the monetary policy of the country. Therefore due diligence, independence and transparency is expected from it because-

  • RBI takes decision on monetary policies which directly impacts people like inflation targeting, lending rates
  • Monetary policies through Open Market Operation, Statutory Liquidity Ratio, Cash Reserve Ratio directly affect money supply in economy
  • Position as a regulator should be maintained with independence from government or pressure groups
  • Key regulators like SEBI, IRDA depend on guidelines of RBI
  • Payment security, Bank licensing and Transaction processes are governed by RBI

Therefore owing to the position RBI holds it decisions should be transparent and board meetings should be detailed on the reasons behind policy changes. However short board meeting prior to demonetization points to loss of autonomy to government.

It can be addressed through following-

  • Releasing detailed notes and analysis of all the board meetings including releasing transcripts
  • White papers issues on policy changes – before & after analysis
  • International bench-marking on important policy changes
  • Strengthening committees like MPC which collectively take decision
  • Decisions open for public comments prior to implementation
  • Economists and Members from other regulators to be involved in decision making.
  • Non-interference of government in monetary policy to be followed

 


General Studies – 3


Topic: Conservation

4) What do you understand by ‘captive breeding ‘? Is it a viable option to conserve threatened or endangered wild animals? Discuss. (200 Words)

The Hindu

Captive breeding is the process of breeding animals in controlled environments within well-defined settings, such as wildlife reserves, zoos and other commercial and noncommercial conservation facilities. Sometimes the process includes the release of individual organisms to the wild, when there is sufficient natural habitat to support new individuals or when the threat to the species in the wild is lessened. Captive breeding programs facilitate biodiversity and may save species from extinction. Release programs have the potential for diluting genetic diversity and fitness.

Captive breeding is a viable option because-

  • Extinction rates are going up and it is predicted that 20-50% of the world’s species will become extinct in the next couple decades. So zoos can act as somewhat of an “arc” by holding the world’s species in captivity and saving their genetic material from total elimination.
  • Some of these captive breeding programs also have goals for the reintroduction of these animals back into a natural or wild environment. These reintroductions can help in conservation efforts by keeping population numbers up and decreasing inbreeding and genetic drift.
  • Captive breeding increases the chances of successful breeding by allowing use of artificial methods ex surrogate mothers, artificial insemination, cryogenics etc.

Though captive breeding requires skilled human resource and financial resources, the experiments all over the world have achieved credible results. The recent example of Visakhapatnam’s Indira Gandhi Zoological Park, where a striped hyena was born through captive breeding speaks for itself.

Challenges-

  • The gene pool of animals which are captive-bred become less diverse, reducing the chances of survival of their species. It also takes a long time for an outside-the-site captive-bred animal to adjust to the wild.
  • Captive breeding can contribute to behavioral problems in animals that are subsequently released because they are unable to huntor forage for food leading to starvation, possibly because the young animals spent the critical learning period in captivity. The soft introduction itself might not suit the animals and there is over a 50 per cent chance that they will not make it in the wild. 
  • Another challenge with captive breeding is the habitat lossthat occurs while they are in captivity being bred (though it is occurring even before they are captured). This may make release of the species nonviable if there is no habitat left to support larger populations.

Conclusion-

Although there are mixed views about the usefulness of captive breeding, there is no doubt that it is the last resort for saving the species from extinction. Thus the process despite having some limitations is viable option for breeding critically endangered and near to extinct species.

 


Topic: Conservation

5) A recent Gauhati High Court verdict assumes that the existence of human beings in Protected Areas is inherently dangerous to wildlife. Critically discuss issues and challenges involved in managing conservation and community rights of forest dwellers. (200 Words)

EPW

Introduction-

The development versus environment tussle is tough to find any solution due to continuing changes in the lifestyle of the people living inside and outside the forest. The Guwahati HC decision is reminder for human kind towards responsibility of sustainable development and judicial use of existing natural resources. Human wildlife conflict is mostly discussed in regard to areas outside PA but this observation of court is very specific highlighting the impact human living inside PA.

The issues and challenges linked with it are:

  • There are no reliable estimates of the likely number of eligible families although the Bill proposes to vest forest land rights to FDSTs. Therefore, it is not known whether there could be significant risk to existing forest cover.
  • If FDSTs (forest dwelling Scheduled Tribes) in core areas are not relocated within five years, it could lead to loss of forests, which are crucial to the survival of certain species of wildlife. Large-scale relocation, on the other hand, could result in possible harassment of FDSTs.
  • The over-extraction of forest produce by the locals goes against the guidelines set by FRA 2006.
  • Many tribal communities living inside the forest are switching to intensive agriculture practice away from their traditional way of living that is leading to the pollution and over exploitation inside the forest. E.g.: cultivation of rice in wayal land in Wayanad district of Kerala.
  • The support and involvement of local communities is must in the decisions and policies to get successfully implemented which is hitherto missing in the approach of the government.
  • Lack of information to tribal people about government schemes regarding relocation makes them reluctant towards relocation.
  • Middle man menace still exists in many states and it is big challenge to deal with it at local level.
  • There is need of all department cooperation for tribal settlement rehabilitation and provision of all rights they hold after shift in their place.
  • Forest fire is big challenge which generally created by people living in forest due to either ignorance or for clearing land for next season by buring.

More about FRA 2006:

  • To address the adverse living conditions of many tribal families living in forests was on account of non-recognition and vesting of pre-existing rights, a landmark legislation viz. Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, has been enacted to recognize and vest the forest rights and occupation of forest land in forest dwelling Scheduled Tribes and other traditional forest dwellers, who have been residing in such forests for generations, but whose rights could not be recorded.
  • This Act not only recognizes the rights to hold and live in the forest land under the individual or common occupation for habitation or for self-cultivation for livelihood, but also grants several other rights to ensure their control over forest resources which, inter-alia, include right of ownership, access to collect, use and dispose of minor forest produce, community rights such as nistar; habitat rights for primitive tribal groups and pre-agricultural communities; right to protect, regenerate or conserve or manage any community forest resource which they have been traditionally protecting and conserving for sustainable use.
  • The Act also provides for diversion of forest land for public utility facilities managed by the Government, such as schools, dispensaries, fair price shops, electricity and telecommunication lines, water tanks, etc. with the recommendation of Gram Sabhas. In addition, several schemes have been implemented by the Ministry of Tribal Affairs for the benefit of tribal people, including those in the forest areas such as “Mechanism for marketing of Minor Forest Produce (MFP) through Minimum Support Price (MSP) and development of Value Chain for MFP”. Funds are released out of Special Central Assistance to Tribal Sub Plan for infrastructure work relating to basic services and facilities viz. approach roads, healthcare, primary education, minor irrigation, rainwater harvesting, drinking water, sanitation, community halls, etc. for development of forest villages.

 


Topic: Resource mobilization

6) Most of the infrastructure funding in India stems from the government or from banks. What can be done to mobilize funds from domestic bond and capital markets towards infrastructure sector? Examine. (200 Words)

EPW

The rising number of Non-Performing Assets (NPA) of banks and defaulting infrastructure(Infra) firms is a clear indicator that corporate houses still prefer to rely on old route of bank lending, shirking away from bond market

The reason for non-deepening of bond market-

  • Over-leveraged firms with poor interest coverage ratio prefer to lend from banks.
  • Rising NPA- stalled projects has made new investor lose confidence in Indian Infra market.
  • Regulatory bottleneck, global slowdown along with stock market volatility (china stock market crash-2015) also reduced foreign Investors.

Steps to be taken to mobilize funds from domestic bond and capital markets towards infrastructure sector-

  • Regulatory- There is urgent need of regulatory overhaul-stipulated time frame for clearances, implementing Narayan Murthy recommendations for simplifying procedure.

Also there should be specialized rating agency for Infra projects.

Need for moving toward full Capital account convertibility when macroeconomic indicators become stable and conducive.

  • Facilitating- Need to tap into long term investment funds like Pension & provident funds, develop National Infrastructure investment Fund (NIIF) as a professional body to attract sovereign funds from Saudi Arabia, UAE, China etc.

Attract green bonds by AIIB, NDB banks for financing clean energy Infrastructure projects.

Explore foreign markets through Masala bonds, International exchange at GIFT city.

  • Incentivize- Requirement of viable exit mechanism for defaulted firms and renegotiation to revive projects.

Strengthen urban local body’s structure to fully realize potential of Municipal bonds.

Tax breaks for Infra bonds under section 80c of income tax act.

  • Long-term infrastructure financing market needs long-term institutional investors. Delivery risk of the green-field projects restricts the ability to achieve a high credit rating. Also, since most of the infrastructure projects are implemented through special-purpose vehicles they are unable to get a high credit rating. Therefore, a vibrant bond market needs to be created by efforts of government, RBI,SEBI and other stakeholders.
  • Further, an effective bankruptcy regime is essential for development of robust debt market. Insolvency and Bankruptcy code is a welcome step. Tobin-tax like alternatives in order to discourage speculative behavior and short term investments.

Conclusion-

Building strong infrastructure would be the top priority for India to sustain the growth of around 8% and to create jobs. Thus there is need for diversifying the sources for financing these infrastructural avenues, like bond and capital market.

 


Topic:  Resource mobilization

7) As the history of the license permit quota raj shows, unless the economic incentive favour voluntary tax compliance and less political, bureaucratic and police corruption, any benefits are soon frittered away and negative effects multiply over time. In this regard, should there be a flat income tax rate for all citizens? If yes, what should be its rate? Substantiate. (200 Words)

The Indian Express

Flat tax-

Flat tax is a system that applies the same tax rate to every taxpayer regardless of income bracket. Typically, a flat tax applies the same tax rate to all taxpayers, with no deductions or exemptions allowed,
Why there are demands for flat tax in India?

  • As per the records of Ministry of Finance there were only 2.4 million individuals declaring incomes above Rs 10 lakh. The number is grossly underestimated and shows poor tax compliance. Thus flat tax is being proposed to increase the tax compliance and to reduce the tax evasion in India.
  • The flat tax would also increase the tax base. Currently only 4% of the population pays the income tax.
  • Supporters of a flat tax system propose that it gives taxpayers incentive to earn more because they are not penalized with a higher tax bracket.
  • The system would rest the long-standing conflict between rich and poor that should rich be made to pay to make-up for the income of the poor.
  • Further flat tax simplifies the process of tax collection from taxpayers.
  • Tax authorities have been accused of misusing their authority while collecting higher taxes from the richer people.

If a system of flat tax is to be adopted in India, the rate should be kept at 12% as this was the actual average rate of tax collected in 2013-14. A flat tax rate of 12 per cent, even for a tax-shy Indian, should be very appealing. It is estimated that the compliance rate will increase by eight percentage points to 33 per cent from currently 25%.

Way forward-

In a country like India, the principle of progressive taxation has always been upheld. The reasons are-

  • “The point of progressive taxation is not to penalize those who succeed, but to protect those who have not.
  • Progressive taxation makes all citizens sacrifice equally and upholds the principle of equality enshrined in our constitution.
  • Progressive tax systems recognize income is partly a collective good.
  • Progressive taxation is a system of income re-distribution.
  • Progressive taxation helps combat extreme poverty.
  • Regressive sales tax makes progressive income tax necessary.
  • Progressive taxation combats growing income inequality.
  • Progressive tax rates stimulate higher consumer activity.

India cannot revert to the flat taxation suddenly by overriding the benefits of progressive taxation. At present the better way for Indian economy is to increase the tax compliance by simplifying the procedures, rationalizing the taxes, bringing missing tax-payers in the tax net and reducing further tax exemptions.