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SECURE SYNOPSIS: 28 April 2020


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.


 

Topic:  The Freedom Struggle – its various stages and important contributors /contributions from different parts of the country.

1. Who were the Khudai Khidmatgars? analyse the aftermath of the Qissa Khwani Bazaar massacre.(250 words)

Reference:  Indian Express 

Why this question:

Its 90 years for Peshawar’s Qissa Khwani Bazaar massacre. The massacre was perpetrated by British soldiers against non-violent protesters of the Khudai Khidmatgar movement on April 23, 1930.

 Key demand of the question:

Explain who the Khudai Khidmatgars were and what was the Qissa Khwani Bazaar massacre; present a detailed analysis of its aftermath.

Directive:

AnalyzeWhen asked to analyse, 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:

Explain about who Khudai Khidmatgars were.

Body:

To start with, talk about the contributions of Khudai Khidmatgars. a non-violent movement against British occupation of the Indian subcontinent. Discuss why did the Qissa Khwani Bazaar massacre happen? What was it. Explain the aftermath of the incident.

Conclusion:

Conclude with significance of the event in the modern Indian history of the country.

Introduction

The Khudai Khidmatgar was a non-violent movement against British occupation of the Indian subcontinent led by Abdul Ghaffar Khan, a Pashtun freedom fighter, in the North-West Frontier Province.

The volunteers of Khudai Khidmatgar movement were also known as “Surkho Posh” or “Red shirts” and it was initially a social reform organization focusing on education and the elimination of blood feuds from Pashtun society but turned more political later.

Body

Khudai Khidmatgars

  • In 1929, the Khudai Khidmatgars (“Servants of God”) movement, led by Khan Abdul Ghaffar Khan, nonviolently mobilized to oppose the British in India’s Northwest Frontier Province.
  • Ghaffar Khan and the Khudai Khidmatgar movement inspired thousands of Pashtuns (also called Pathans), who were known as fierce warriors, and others to lay down their arms and use civil resistance to challenge British rule.
  • Ghaffar Khan, who is also known as Badshah Khan and the “Frontier Gandhi,” formed the world’s first nonviolent army, a force of perhaps 100,000 Pathans who took a solemn oath in joining the “Servants of God” movement.
  • Members of the movement were known as “Red Shirts” because of the red uniforms they wore.
  • Initially they set to work organizing village projects and opening schools, but soon they became part of the broader Indian Independence movement, accepting without retaliation some of the most fierce British repression—mass firings on unarmed crowds, torture, personal humiliation, setting homes and fields on fire, and even the destruction of entire villages.
  • Inspired by the dissidence of the INC and the charismatic spiritual-political leadership of Mahatma Gandhi, the Red Shirts blossomed in 1930 during the civil disobedience movement.
  • The British responded to their mobilization by putting the Northwest Frontier Province under Martial Law from August 1930 until the following January.
  • Ghaffar Khan was arrested in 1930, for giving a seditious speech.

Qissa Kwani Bazaar Massacre

  • Abdul Ghaffar Khan and other leaders of the Khudai Khidmatgar were arrested on April 23, 1930 by British police after he gave a speech at a gathering in the town of Utmanzai in the North-West Frontier Province.
  • A respected leader well-known for his non-violent ways, Khan’s arrest spurred protests in neighbouring towns, including Peshawar.
  • Protests spilled into the Qissa Khwani Bazaar in Peshawar on the day of Khan’s arrest.
  • British soldiers entered the market area to disperse crowds that had refused to leave.
  • In response, British army vehicles drove into the crowds, killing several protesters and bystanders.
  • British soldiers then opened fire on unarmed protestors, killing even more people.

Aftermath of the massacre

  • The British ramped up the crackdown on Khudai Khidmatgar leaders and members following the Qissa Khwani Bazaar massacre.
  • In response, the movement began involving young women in its struggle against the British, a decision in line with tactics adopted by revolutionaries across the undivided India. Women were able to move undetected with more ease than men.
  • Following the recruitment of women in the movement, the British also engaged in violence, brutality and abuse of women members.
  • British also adopted their tactic of sowing divisions on religious grounds in the North-West Frontier Province as well, in an attempt to weaken the Khudai Khidmatgar.
  • In a move that surprised the British government, in August 1931, the Khudai Khidmatgar aligned themselves with the Congress party, forcing the British to reduce the violence they were perpetrated on the movement.
  • The Khudai Khidmatgar opposed Partition, a stance that many interpreted as the movement not being in favour of the creation of the independent nation of Pakistan.

Conclusion

Khan Abdul Ghaffar Khan was against the partition of India and he was many times targeted for being Anti-Muslim and was placed under house arrest from 1948-1954. Post 1947, the Khudai Khidmatgar slowly found their political influence decreasing to such an extent that the movement and the massacre 90 years ago in the Qissa Khwani Bazaar has been wiped out from collective memory.

 

Topic:  Important aspects of governance, transparency and accountability, e-governance applications, models, successes, limitations, and potential; citizens charters, transparency & accountability and institutional and other measures.

2. Discuss the shortcomings of citizen’s charter in India and suggest reforms to make it more effective.(250 words)

Reference:  Governance by Lakshmikant

Why this question:

The question is straightforward from the static portions of GS paper II.

Key demand of the question:

Explain the drawbacks of the citizen’s charter in India and suggest reforms to make it more effective.

Directive:

Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.

Structure of the answer:

Introduction:

Briefly define what a citizen’s charter is.

Body:

To start with, present the case of citizen’s charter in India, highlight the shortcomings such as – Devoid of participative mechanisms, Poor design and content, Lack of public awareness, Charters are rarely updated etc. Suggest reforms to make the citizen charter more effective such as – One size does not fit all, Wide consultation process, Firm commitments to be made etc.  

Conclusion:

Conclude that a Citizens’ Charter cannot be an end in itself; it is rather a means to an end – a tool to ensure that the citizen is always at the heart of any service delivery mechanism.

Introduction

A citizens’ charter is a document of commitments made by a government agency to the citizens in respect of the services being provided to them. It empowers the citizens to demand the committed standards of service. However, it is not legally enforceable and hence, non-justiciable. Its objective is to build bridges between citizens and administration and to streamline administration in tune with the needs and concerns of citizens.

Body

Citizen Charter Initiative in India

  • In 1996, the Centre organised a Conference of Chief Secretaries of States and Union Territories on “Effective and Responsive Administration”.
  • The conference inter alia recommended the adoption of citizens’ charters for all public service organisations.
  • This recommendation was approved by the Centre, states and union territories in the Conference of Chief Ministers held in 1997.
  • Since 1997, when the scheme was introduced in India, the various ministries, departments, directorates and other agencies of the Central Government, state governments and union territory administrations have formulated a number of citizens’ charters.

Citizen Charter Component

A citizens’ charter in India has the following components:

  • Vision and Mission Statement of the Organisation
  • Details of Business transacted by the Organisation
  • Details of citizens or clients
  • Statement of services including standards, quality, time frame etc., provided to each citizen/client group separately and how/where to get the services
  • Details of grievance redressal mechanism and how to access it and
  • Expectations from the citizens or clients.

Shortcomings of Citizen charter initiative

  • In a majority of cases charters were not formulated through a consultative process.
  • By and large, service providers are not familiar with the philosophy, goals and main features of the charter.
  • Adequate publicity to the charters had not been given in any of the departments evaluated.
  • In most departments, the Charters are only in the initial or middle stage of implementation. Citizens’ charters have still not been adopted by all Ministries/Departments.
  • No funds have been specifically earmarked for awareness generation of citizens’ charter or for orientation of staff on various components of the charter.
  • End-users, Civil society organizations and NGOs are not consulted when CCs are drafted. Since a CC’s primary purpose is to make public service delivery more citizen-centric, consultation with stakeholders is a must.
  • There was lack of precision on standards and commitments in several cases.
  • There is often little interest shown by the organisations in adhering to their charter.
  • On the communications front, the charter programme has been throttled on account of poor planning and resource commitment for publicity.
  • In some cases, the charters have become a one-time exercise, frozen in time.
  • There was general lack of accountability and review mechanisms.
  • The charters were devoid of participative mechanisms for effective performance.

Reforms needed in citizen charter

  • No One size fits all approach: Every organization has it’s own set of priorities and likewise the charter must be prepared catering to their goals.
  • Wide consultation process: Charter must be formulated after extensive consultations within the organization followed by a meaningful dialogue with civil society. People who benefit from these reform must be widely consulted through surveys.
  • Firm commitments to be made: Charter must be precise and make firm commitments of service delivery standards to the citizens/consumers in quantifiable terms wherever possible.
  • Redressal mechanism: It must clearly lay down the relief which the organization is bound to provide if it has defaulted on the promised standards of delivery.
  • Continuous Evaluation: It must be done preferably through an external agency like a social audit.
  • Accountability: Fix specific responsibility in cases where there is a default in adhering to the charter.

Conclusion

The Second Administrative Reforms Commission (ARC) in its12th Report entitled ‘Citizen Centric Administration – Heart of Governance” has recommended for making the Citizens’ charters more effective as a document for interacting with citizens. This recommendation has been accepted by Government of India. All Central Ministries/Departments have been requested to review their Citizens’ Charters to make them more effective as a tool for interacting with the citizens. It must be implemented in the true spirit.

 

Topic:  Important aspects of governance, transparency and accountability, e-governance applications, models, successes, limitations, and potential; citizens charters, transparency & accountability and institutional and other measures.

3.Discuss the contributions of Sevottam model in improving the quality of public service delivery in the country. (250 words)

Reference:  darpg.gov.in 

Why this question:

The question is straightforward from the static portions of GS paper II.

Key demand of the question:

Explain the contributions of Sevottam model in improving the quality of public service delivery in the country.    

Directive:

Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.

Structure of the answer:

Introduction:

Briefly explain Sevottam model.

Body:

The Sevottam model has been developed with the overarching objective of improving the quality of public service delivery in the country. It is a combination of two words Seva (service), Uttam (excellence). Explain the concept in detail. Discuss the contributions of it in the country’s public service delivery.

Conclusion:

Conclude with way forward.

Introduction

Sevottam is a “Service Delivery Excellence Model” which provides an assessment-improvement framework to bring about excellence in public service delivery. The term “Sevottam” is formed by joining two Hindi words “seva” and “uttam” meaning “service” and “excellence” respectively.

Body

Sevottam Model

integrated_approach

  • The first component of the model requires effective charter implementation thereby opening up a channel for receiving citizens’ inputs into the way in which organizations determine service delivery requirements.
  • Citizens’ Charters publicly declare the information on citizens’ entitlements; making citizens better informed and hence empowering them to demand better services.
  • The second component of the model, ‘Public Grievance Redress’ requires a good grievance redress system operating in a manner that leaves the citizen more satisfied with how the organization responds to complaints/grievances, irrespective of the final decision.
  • The third component ‘Excellence in Service Delivery’, postulates that an organization can have an excellent performance in service delivery only if it is managing the key ingredients for good service delivery well, and building its own capacity to continuously improve delivery

Benefits of Sevottam

There are four broad ways in which the Sevottam model can be used:

  • As a self – assessment tool by organizations already motivated to improve service delivery
  • As a requirement standard
  • As a benchmark assessment process to be established
  • As a rating model to recognize and reward organizations that are doing commendable work in service delivery

Contributions of Sevottam in service delivery excellence

  • Initially, Sevottam framework was undertaken from April 2009 to June 2010 in ten Departments of the Government having large public interface. These are, Department of Post, CBEC, CBDT, Railways, Passport office, Pensions, Food Processing, Corporate Affairs, Kendriya Vidyalaya Schools and EPFO.
  • Later, Sevottam has been launched as a certification scheme which provides for the award of the Sevottam symbol of excellence to public service organizations that implement and are able to show compliance to a set of management system requirements that have been specified in a specially created standard document.
  • This standard, known as IS 15700:2005, was developed by the Bureau of Indian Standards (BIS) based on the objectives of Sevottam.
  • The standard takes into account unique conditions of service delivery by Public service organisations in India and the sectoral and regional variations in service delivery standards.
  • It offers a systematic way to identify weaknesses in specific areas and rectify them through systemic changes and process reengineering.
  • India is among the first countries in the world to have a Quality Standard for public service delivery.

Conclusion

The framework enables implementing organizations to undertake a systematic, credible and authenticated self-assessment (or ‘gap analysis’) for citizen-centric service delivery. Using this analysis, practical solutions are gradually and systematically incorporated into the organization’s day-to-day routine thereby ensuring sustainable results.

 

Topic:  Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests. Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.

4. Examine India’s stand with respect to the Nuclear Proliferation Treaty (NPT) and the Comprehensive Test Ban Treaty (CTBT).(250 words)

Reference:   The Hindu 

Why this question:

A recent report by the U.S. State Department claimed that China has been carrying out nuclear testing against the provisions of the Comprehensive Nuclear-Test-Ban Treaty (CTBT). Thus the question.

Key demand of the question:

One has to analyse India’s stand with respect to the Nuclear Proliferation Treaty (NPT) and the Comprehensive Test Ban Treaty (CTBT).

Directive:

Examine – When asked to ‘Examine’, we must look into the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications.

Structure of the answer:

Introduction:

Briefly narrate the background of the question context.

Body:

To start with, explain the coming of Comprehensive Nuclear-Test-Ban Treaty (CTBT) into action. Highlight the concerns associated with CTBT. Bring out the challenges and threats associated with possibility of new nuclear arms race. Discuss in detail India’s stand with respect to the Nuclear Proliferation Treaty (NPT) and the Comprehensive Test Ban Treaty (CTBT).

Conclusion:

Conclude with way ahead.

Introduction

India supports upholding and strengthening global non-proliferation objectives, in particular the full and effective implementation by States of their obligations arising from the relevant agreements and treaties, including the NPT.

Body

Nuclear non Proliferation Treaty (NPT)

The NPT is an international treaty whose objective is to prevent the spread of nuclear weapons and weapons technology, to foster the peaceful uses of nuclear energy, and to further the goal of disarmament. Nuclear-weapon states parties under the NPT are defined as those that manufactured and exploded a nuclear weapon or other nuclear explosive device before January 1, 1967.

Comprehensive Test Ban Treaty (CTBT)

The Comprehensive Nuclear-Test-Ban Treaty (CTBT) is the Treaty banning all nuclear explosions – everywhere, by everyone.

  • The Treaty was negotiated at the Conference on Disarmament in Geneva and adopted by the United Nations General Assembly.
  • Of the 44 listed countries, to date only 36 have ratified the treaty.
  • China, Egypt, Iran, Israel and the U.S. have signed but not ratified.
  • China maintains that it will only ratify it after the U.S. does so but the Republican dominated Senate had rejected it in 1999.
  • In addition, North Korea, India and Pakistan are the three who have not signed.
  • All three have also undertaken tests after 1996; India and Pakistan in May 1998 and North Korea six times between 2006 and 2017.
  • The CTBT has therefore not entered into force and lacks legal authority.

India’s stand on NPT

Today, India is one of the only five countries that either did not sign the NPT thus becoming part of a list that includes Pakistan, Israel, North Korea (withdrew later), and South Sudan.

  • Till date, the NPT recognises only the five permanent members of the UN Security Council (US, Russia, UK, France and China) as nuclear weapon powers and mandates that other countries can be a party to the NPT only as a non-nuclear weapon state.
  • This is not acceptable to India and hence the issue of India joining the NPT does not arise.
  • India’s stated position on the NPT is that it “cannot accept externally prescribed norms or standards on matters within the jurisdiction of its Parliament or which are not consistent with India’s constitutional provisions and procedures, or are contrary to India’s national interests or infringe on its sovereignty.”
  • India’s refusal to accede to the Treaty is on grounds that it is a biased legal instrument that divided the world into “nuclear haves” and “nuclear have-nots”.
  • Perceived security threats from Pakistan and Pakistan’s all weather friend China, on the one hand, and from the United States, on the other (U.S. inaction in 1965 war and active support for Pakistan in the 1971 war are cases in point) provide a strong security-driven rationale.
  • Despite being a non-party, India abides by the principles and objectives of the NPT, including its nuclear disarmament aspirations.
  • India’s hostile neighbor Pakistan is increasingly talking about tactical nuclear weapons. India’s geographical position between China and Pakistan is a huge security threat. Hence there is no question of giving up nuclear weapons under NPT.
  • India has always reiterated for complete and verifiable global disarmament.

India has ruled out the possibility of joining the Non-Proliferation Treaty (NPT) as a non-nuclear weapon state but said it remains “committed” to a unilateral voluntary moratorium on nuclear explosive testing.

Indias stand on the CTBT

  • India’s principled opposition drew from its emphasis on universal and complete nuclear disarmament in a time-bound manner.
  • India has traditionally believed this to be the end goal with the test ban just being a path to get there. But CTBT did not insist on a complete disarmament clause in 1994, acknowledging that it was a “complex issue.”
  • India saw the attempt at a test ban becoming an end in itself, while exacerbating technology differences between the ‘haves’ and ‘have nots.’
  • For instance, one of India’s concerns was the possibility of those already possessing nuclear weapons upgrading their arsenals through sub-critical and laboratory simulated testing.
  • Another major concern was Article XIV, the entry-into-force (EIF) clause, which India considered a violation of its right to voluntarily withhold participation in an international treaty.
  • The treaty initially made ratification by states that were to be a part of the the CTBT’s International Monitoring System (IMS) mandatory for the treaty’s EIF. Because of this, India withdrew its participation from the IMS.

Conclusion

However, India has pledged to continue with its voluntary and unilateral moratorium on further nuclear testing. India is the only nuclear weapon state to declare that it believes its security would be enhanced, not diminished, in a world free of nuclear weapons.

 

Topic:  issues relating to intellectual property rights.

5. An efficient and equitable intellectual property system can help India to realize intellectual property’s potential as a catalyst for economic development and social & cultural well-being. Discuss. (250 words)

Reference:    Business Standard 

Why this question:

The question is premised on the importance and relevance of efficient and equitable intellectual property system for our country and in what way it can act as a catalyst for economic development and social & cultural well-being.

Key demand of the question:

Explain the importance of intellectual property system to the country and draw its relations to economic development and social & cultural well-being of the country.

Directive:

Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.

Structure of the answer:

Introduction:

Explain IPR – Intellectual property rights (IPR) are the rights given to persons over the creations of their minds: inventions, literary and artistic works, and symbols, names and images used in commerce. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time.

Body:

To start with, explain why there is need of IPRs. Present the case of India and the rule and regulations available with it in respect of IPR regimen. Discuss the national IPR policy. Highlight the challenges and concerns associated.

Conclusion:

Draw a balanced conclusion justifying how an effective IPR system can act as a catalyst for economic development and social & cultural well-being.

Introduction

Body

Intellectual Property Rights (IPRs) are legal rights, which result from intellectual invention, innovation and discovery in the industrial, scientific, literary and artistic fields. These rights entitle an individual or group to the moral and economic rights of creators in their creation. For ex: In India, patents are granted for a period of 20 years from the date of filing of the patent application.

It is also to be noted that the patents are valid only within the territory where they have been granted. Once a patent expires, protection ends and the invention enters the public domain. In India, Patent Acts, 1970 regulate the IPRs.

Need for IPR’s in India

  • They allow creators, or owners, of patents, trademarks or copyrighted works to benefit from their own work or investment in a creation.
  • Patents provide incentives which encourage innovation, which in turn enhances the quality of human life.
  • In return for patent protection, all patent owners are obliged to publicly disclose information on their inventions in order to enrich the total body of technical knowledge in the world. This ever increasing body of public knowledge promotes further creativity and innovation.
  • The legal protection of new creations encourages the commitment of additional resources for further innovation.
  • It promotes innovation and creativity and ensures ease of doing business. It facilitates the transfer of technology in the form of foreign direct investment, joint ventures and licensing.
  • The promotion and protection of intellectual property spurs economic growth, creates new jobs and industries, and enhances the quality and enjoyment of life.
  • It ensures credibility and quality of a product thereby enhancing consumers confidence through reliable, international trademark protection and enforcement mechanisms to discourage counterfeiting and piracy.
  • These rights are outlined in Article 27 of the Universal Declaration of Human Rights, which provides for the right to benefit from the protection of moral and material interests resulting from authorship of scientific, literary or artistic productions.

India’s National IPR Policy

The National Intellectual Property Rights (IPR) Policy 2016 was adopted in May 2016 as a vision document to guide future development of IPRs in the country. It’s motto is “Creative India; Innovative India”.

  • Thrust on IPR Awareness, Outreach and Promotion – To create public awareness about the economic, social and cultural benefits of IPRs among all sections of society.
  • Generation of IPRs – To stimulate the generation of IPRs.
  • Legal Framework – To have strong and effective IPR laws, which balance the interests of rights owners with larger public interest.
  • Administration and Management – To modernize and strengthen service-oriented IPR administration.
    • It sets in place an institutional mechanism for implementation, monitoring and review. It aims to incorporate and adapt global best practices to the Indian scenario.
    • Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce, Government of India, has been appointed as the nodal department to coordinate, guide and oversee the implementation and future development of IPRs in India.
    • The ‘Cell for IPR Promotion & Management (CIPAM)’, setup under the aegis of DPIIT, is to be the single point of reference for implementation of the objectives of the National IPR Policy.
  • Commercialization of IPRs – Get value for IPRs through commercialization.
  • Enforcement and Adjudication – To strengthen the enforcement and adjudicatory mechanisms for combating IPR infringements.
  • Inclusive Development- To strengthen and expand human resources, institutions and capacities for teaching, training, research and skill building in IPRs.

Challenges associated with IPR’s in India

  • Policy recommends scientist and professors to convert all their discoveries into IP which in turn has the potential to curb the free flow of knowledge.
  • Policy is aimed commercialization and monetizing on IPR’s. Rather focus must be to create good and quality innovation that is beneficial for all.
  • Foreign investors and MNCs allege that Indian law does not protect against unfair commercial use of test data or other data submitted to the government during the application for market approval of pharmaceutical or agro-chemical products. For this they demand a Data Exclusivity law.
  • IPR policy is driven by the agenda of IP maximalism, where IP owners’ rights will be maximized at the cost of public interest. This (policy) will influence courts and judges who might consider rights of patentees above that on common man in certain cases.
  • Connection between patenting and application of patented knowledge is yet to be established. Hence, patenting and not applying the new invention could deter progress.
  • Policy recommends criminalization of unauthorized copying of movies – which is just a civil wrong.
  • Compulsory Licensing: It is problematic for foreign investors who bring technology as they are concerned about the misuse of CL to replicate their products. It has been impacting India-EU FTA negotiations.
  • India continues to remain on the United States Trade Representative’s (USTR’s) ‘Priority Watch List’ for alleged violations of intellectual property rights (IPR).
  • Not understanding the modes of creativity and sharing in “shadow economy “, the policy leans towards superimposition of formal IP framework.
  • While IP could accelerate innovation in certain technologies it in turn impedes in others. Policy recommends scientist and professors to convert all their discoveries

Need of the hour

  • India will be unable to take full advantage of the transformative benefits of a strong IP system unless and until it addresses gaps in its IP laws and regulations.
  • Fostering an environment where innovation flourishes and a knowledge economy is built, is the key idea. Hence, the policy should have a balance.
  • Success of India’s flagship programmes – Make in India and Start up India – depends on the boost of innovation ecosystem with better IPR safeguardings.
  • It should encourage patenting and at the same time ensure that patentability of a product/process does not deter further innovation and progress.

Conclusion

Support for innovation has to be accompanied with instruments that guard local companies against the misuse of market power, coercive bargaining and aggressive acquisition strategies. India needs to spread awareness on IPR in public and for its traditional industries to enable fair monetization of IP Rights. An efficient and equitable intellectual property system can help all countries to realize intellectual property’s potential as a catalyst for economic development and social & cultural well-being.

 

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

6. What is direct monetization of deficit? Do you think it could be a comprehensive solution for the government to prevent the looming financial crisis? Critically examine.(250 words)

Reference:  Indian Express 

Why this question:

The article highlights that with the economy stalled; there isn’t enough money in the market for the government to borrow. It explains if it can ask the RBI to print more money and in such a case how does the process work, and what are the arguments against it.

Key demand of the question:

Explain the concept of direct monetization of deficit and present arguments for and against it.

Directive:

Critically examine – When asked to ‘Examine’, we have to look into the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications. When ‘critically’ is suffixed or prefixed to a directive, one needs to look at the good and bad of the topic and give a fair judgment.

Structure of the answer:

Introduction:

Briefly define the idea of direct monetization of deficit in the preset context.

Body:

Explain first the current scenario, discuss as to what triggers a demand for direct monetization. Discuss the scope and feasibility of “Direct” Monetization by the government for Deficit Financing as an option of the last resort. Explain if India has done this in the past. Highlight the issues involved.

Conclusion:

Conclude with what should be the way forward.

Introduction

The COVID-19 spread has meant that the Indian economy, which was already slowing down rapidly over the past couple of years, has completely stalled. Most estimates suggest that India’s GDP (gross domestic product) will barely grow in the current financial year – that is, if it does not contract as is likely to be the case in most major economies of the world.

With a nationwide lockdown, incomes have fallen and so have consumption levels. In other words, the demand for goods (say a pizza or a car) and services (say a haircut or a holiday) in the economy has gone down.

Body

Direct Monetization of Deficit

  • It is a scenario where the government deals with the RBI directly, bypassing the financial system and asks it to print new currency in return for new bonds that the government gives to the RBI.
  • Now, the government would have the cash to spend and alleviate the stress in the economy — via DBT to the poor or starting social and capital expenditure etc.
  • In lieu of printing this cash, which is a liability for the RBI (recall that every currency note has the RBI Governor promising to pay the bearer the designated sum of rupees), it gets government bonds.
  • Such bonds are an asset for the RBI since such bonds carry the government’s promise to pay back the designated sum at a specified date.
  • And since the government is not expected to default, the RBI is sorted on its balance sheet even as the government can carry on rebooting the economy.

Why is Direct Monetization needed?

  • Lack of Demand: The income levels have fallen as the economy has come to a stand still.
    • This in turn has led to fall in the consumption levels. In other words, the demand for consumer goods and services in the economy has gone down.
  • Financing the fiscal deficit: To reboot the economy, government has to come up with a stimulus package for various sector. And as the expenditure for fighting the pandemic was unforeseen in the budget, these packages will cause fiscal slippage and needs to be financed through various mechanisms. Direct monetization is one of the ways this can be done.
  • No credit available for borrowing: For the government to borrow the money, the market should have it as savings. Data show that savings of domestic households have been faltering and are barely enough to fund the government’s existing borrowing needs.
  • Receding foreign capital: Foreign investors, too, have been pulling out and rushing to “safer” economies like the US, and are unwilling to lend in times of such uncertainty.

Feasibility of Direct monetization

  • Used in the past:  Until 1997, the RBI “automatically” monetized the government’s deficit. In 1994, Manmohan Singh (former RBI Governor and then Finance Minister) and C Rangarajan, then RBI Governor, decided to end this facility by 1997.
  • Recently C Rangarajan had said that monetization of the deficit was inevitable. Such a large increase in expenditure could not be managed without monetization of government debt.
  • Countries like the UK have decided to tread this path. The Bank of England extended direct monetization facility to the UK government.
  • Ideally, this tool provides an opportunity for the government to boost overall demand at the time when private demand has fallen, like it has today with enough caution.
  • Good inflation is also needed. With a lockdown, the most immediate issue that policymakers have to contend with would be a dramatic fall in inflation.
    • That has deleterious impact on taxes, wages and ability of the government to take on more debt.
    • The risk of very low inflation (no-one is still talking about deflation in India yet) is as real as the one of high inflation.
    • “Printing money” ensures a backstop to ensure a certain amount of inflation in the economy – enabling the government to inflate away at least part of the new debt it is taking on to provide a safety net for the economy.

Issues with Direct Monetization

Direct monetization of deficit is a highly contested issue. Ex-RBI Governnor Subbarao cautioned that India must remember that the balance of payments crisis in 1991, and a near-crisis in 2013, were, at heart, a result of extended fiscal profligacy.

  • Inflation: Government expenditure using this new money boosts incomes and raises private demand in the economy.
    • With RBI printing a lot of money to buy G-Secs, money supply will shoot up and engender an inflationary spiral.
    • Thus, it fuels inflation and if the government doesn’t stop in time, more and more money floods the market and creates high inflation.
  • Data lag: Inflation data is revealed with a lag, it is often too late before governments realise they have over-borrowed. Higher inflation and higher government debt provide grounds for macroeconomic instability
  • Another oft-quote risk of DM is external vulnerability. The rationale is that aggressive DM could devalue the currency, causing foreign investors to lose confidence and pull out money, putting the existing fiscal financing plan at risk.
  • The other argument against direct monetizing is that governments are considered inefficient and corrupt in their spending choices — for example, whom to bail out and to what extent.

Conclusion

Consistency in policymaking is often touted as a virtue. But in extreme scenarios more than otherwise, consistency is merely a hobgoblin of mediocre minds. We need inspirations beyond mediocrity to kick-start India back into action. Monetization is perhaps the sharpest inspiration in the quiver today.

Topic:  Case Study

7.  Aparna recently landed a well-paying software job in a reputed company in Bangalore. She has an ambition to become a civil servant. She is working hard towards it. Recently she wrote the entrance for Prime Minister’s Rural Development Fellowship (PMRDF) and got selected as its Fellow. Though she received better salary in the present job, she wanted to accept the PMRD Fellowship and work for it. She will be posted in a faraway state from her present location. The district where she will be posted is a sensitive region severely affected by Naxal problem. Few days ago, few civil servants and policemen were killed by Naxals in an ambush. Aparna’s parents do not want her to leave the present job. She thinks that this fellowship would equip her with skills needed to work as an IAS officer in case she gets selected in future.

 If you are in Aparna’s place, what decision will you take? Give reasons.(250 words)

Reference:  case study

Why this question:

The question is premised on a situation involving ethical perspectives.

Key demand of the question:

One must provide for a detailed examination of the case study and identify the ethical dimensions in it and suggest suitable solution to address it.

Structure of the answer:

Introduction:

Briefly explain the situation in question.

Body:

To start with, bring out the ethical dilemmas involved in the present case. Discuss the aspects of personal ambition, family needs and wishes; in what way they may not all is in alignment with each other. Explain the need to balance such a situation. Highlight the genuine concerns of the family, wishes and aspirations of Aparna. Suggest how escaping from the situation may not be apt and that there needs to be a concrete decision with respect to the situation.

Conclusion:

Suggest a fair and balanced opinion.

Introduction

“Only those who will risk going too far can possibly find out how far it is possible to go” (TS Elliot)

In this case Aparna, as an aspiring civil servant is in an ethical dilemma of choosing between two imperatives. The choice involves foregoing of personal safety and security but on the other hand would also equip her to understand the ground realities of administration which will make her a more resilient civil servant.

Body

Ethical Dilemma

  • Personal safety versus ambition
  • Pursuing aspiration versus going against wishes of parents
  • Hardwork and pursuit that may transcend work life balance.
  • Issue of loss of life.

Action #1: Decide against accepting the fellowship and continue in the same job.

Merits: It ensures safety and security of life. Aparna would be adhering to her parents’ wishes and at the same time would have better financial security as the IT job has more remuneration.

Demerits: It is said that “Trust your own instinct. Your mistakes might as well be your own, instead of someone else’s”. By foregoing of her aspiration to become a civil servant, Aparna may have regrets that might overpower her thoughts in the future. She would be compromising with her goals and ambition when she had the potential to achieve them and be successful. The feeling of contentment would also not exist.

Action #2:  Accept the fellowship and work towards becoming a civil servant

Merits: It is easier to accept failure than to live with a regret. By choosing to chase her dreams, Aparna would be motivated to give her best in the fellowship. She would encompass the foundational values of empathy, comapssion, tolerance and objectivity while working in the district. She also gets an opportunity to work at the grassroots level, giving her a firsthand experience into civil services. From her she can further choose to either go back to IT or take civil services exam.

Demerits: As the district is affected by naxal movement, her safety may be endangered. She would also be antagonizing her parents by going against their wishes. Finally Aparna, may be even discouraged to go into civil services by looking at the work environment in the future.

 

Decision taken: If I were in Aparna place, I would go with the second option and pursue the fellowship. Because fear cannot be overcome without aiming for something and risking what you have. Success also does not come without working for it. As the saying goes– “The way to develop self-confidence is to do the thing you fear and get a record of successful experiences behind you. Destiny is not a matter of chance, it is a matter of choice; it is not a thing to be waited for, it is a thing to be achieved.

By choosing this path, I would have not backed out on my dream of becoming a civil servant. The ground realities learnt during fellowship would strengthen my resolve and serve as motivation to work hard for the examination.

As for my parents, I would convince them about the choice I would make. Make them understand that this opportunity would be an eye opener for my future course of action.

Conclusion

One must have the right understanding of their abilities and set realistic goals to achieve. Once the mind is made up, ensure, no path other than hard work as the only way to achieve the goal. It is hard work, perseverance, learning, studying, sacrifice and most of all, love of what you are doing or learning to do that is the key to achieving your dreams. Even if one falls short of their goals, one must realize the immense experience and learning they have acquired through the process which will help us in all our endeavors. The first step to this is, trying.