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SECURE SYNOPSIS: 24 November 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.


General Studies – 1


 

Topic : Parliament and State legislatures—structure, functioning, conduct of business, powers & privileges and issues arising out of these.

1. Despite the guarantees in the Constitution, free speech, dissent and even legitimate criticism is looked at as an exercise in bad faith, and projected as an attack on democratically elected authority. Critically analyse the statement in the light of recently passed ordinance in the state of Kerala. (250 words)

Reference: The Hindu 

Why the question:

Kerala Governor recently signed an ordinance amending the law to give the police more powers to prosecute persons who exploit various communication platforms to slander fellow citizens. Thus the question.

Key Demand of the question:

One is expected to critically examine the statement in question with the recent example of the Kerala ordinance related to free speech and dissent.

Directive:

Critically analyze – When 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. 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:

Present briefly the background of the question; the ordinance has introduced a new provision, Section 118-A, to the Kerala Police Act, 2011. The amendment proposes three years of imprisonment and a fine of up to ₹10,000 for those convicted of producing, publishing or disseminating derogatory content through any means of communication to intimidate, insult or defame any person.

Body:

Present the issue at hand; what are the concerns with the amendment through the ordinance; the drastic amendment to the Kerala Police Act, 2011, would give the local law enforcement more powers to curb defamation. The ordinance would allow whimsical interpretations by law enforcement agencies.

Opposition parties, journalists’ bodies and civil rights activists see it as a threat to the freedom of the press and free speech in the State. It is argued that the amendment would reverse the course on media freedom, muzzle free speech and jeopardize civil liberties.

Throw light on Section 66 A of the Information Technology Act, 2000.

Conclusion:

Conclude that despite the guarantees in the Constitution, free speech, dissent and even legitimate criticism is looked at as an exercise in bad faith, and projected as an attack on democratically elected authority. As a result, existing laws are being weaponised to arrest journalists and citizens for a tweet or a slogan or a Facebook post.

Introduction:

Kerala Governor recently signed an ordinance amending the law to give the police more powers to prosecute persons who exploit various communication platforms to slander fellow citizens. The ordinance has introduced a new provision, Section 118-A, to the Kerala Police Act, 2011. The amendment proposes three years of imprisonment and a fine of up to ₹10,000 for those convicted of producing, publishing or disseminating derogatory content through any means of communication to intimidate, insult or defame any person.

Body:

Issues with the ordinance:

  • The drastic amendment to the Kerala Police Act, 2011, would give the local law enforcement more powers to curb defamation.
  • The ordinance would allow whimsical interpretations by law enforcement agencies.
  • Opposition parties, journalists’ bodies and civil rights activists see it as a threat to the freedom of the press and free speech in the State. It is argued that the amendment would reverse the course on media freedom, muzzle free speech and jeopardize civil liberties.
  • It is opined that conferring power on the police to gauge mental injury, loss of reputation and such matters due to dissemination of information would result in widespread abuse.
  • And in the light of the growing use of the internet and social media as a medium of exercising this right, access to this medium has also been recognized as a fundamental human right.
  • Another aspect of worry was that it gave power to the police to file suo-motu cases against anyone.

SECTION 66 A of the IT ACT 2000

  • In 2015, the Supreme Court struck down Section 66A of the Information Technology Act, 2000, which gave the government power to arrest and imprison an individual for allegedly offensive online posts.
  • The court ruled that as it did not distinguish between speech that was merely “offensive or annoying” and that which was guilty of inciting a disruption of public order, Section 66A was liable to have a chilling effect on free speech.
  • The same judgment also declared as invalid Section 118 (d) of the Kerala Police Act, which prescribed a jail term for those who caused annoyance to others by indecent statements, comments, calls or messages. In effect, the new ordinance tries to resurrect a section struck down as unconstitutional by the apex court.
  • It lay in the fact that it had created an offence on the basis of undefined actions: such as causing “inconvenience, danger, obstruction and insult”.
  • These did not fall among the exceptions granted under Article 19 of the Constitution, which guarantees the freedom of speech.

Conclusion:

Despite the guarantees in the Constitution, free speech, dissent and even legitimate criticism is looked at as an exercise in bad faith, and projected as an attack on democratically elected authority. As a result, existing laws are being weaponised to arrest journalists and citizens for a tweet or a slogan or a Facebook post.

The ordinance decides to strike a blow against liberty and is a sign of an endemic intolerance to dissent, cutting across ideological lines. The institutions of a mature democracy should shrug off such comments. The Kerala government must withdraw an ordinance that does not pass the constitutional test.

 

Topic : Issues relating to poverty and hunger. Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections.

2. While accounting for the key findings of the survey taken by ‘hunger watch’, discuss how far have the recent efforts of the government been able to address them? Also bring out the challenges associated and suggest solutions to the same. (250 words)

Reference: Indian Express 

Why the question:

Since the lockdown, the Government of India (GoI) has announced Pradhan Mantri Gareeb Kalyan Yojana (PMGKY) and Atmanirbhar Bharat. However, numerous studies have shown their inadequacy. Thus the question.

Key Demand of the question:

Account for the key findings of the survey taken by ‘hunger watch’ and elaborate on the recent efforts of the government been able to address them and express the challenges and concerns while also suggesting solutions.

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:

The Right to Food campaign in partnership with several civil society organisations initiated “Hunger Watch”, a rapid survey across 11 states from mid-September to mid-October. The objective was to assess the situation of hunger among vulnerable groups, as well as to take immediate local action to support those in extreme need.

Body:

Present the key findings of the survey – Widespread hunger continues to be a major issue irrespective of the income levels, more than half the respondents said their current consumption of rice/wheat was less than what it was pre-lockdown. Discuss other aspects from the findings.

Present the schemes and policies that have been directed to curb the problems of hunger in the country.

Discuss the issues and concerns associated.

Conclusion:

Suggest solutions to address the problems, take hint from the article.

Introduction:

The effects of the lockdown and the resultant economic crisis continue to disproportionately impact the poor and informal sector workers. Since the lockdown, the Government of India (GoI) has announced relief packages under the Pradhan Mantri Gareeb Kalyan Yojana (PMGKY) and Aatmanirbhar Bharat. The Economist referred to India’s lockdown as the “stingiest”.

Body:

HUNGER WATCH SURVEY

  • The Right to Food campaign in partnership with several civil society organisations initiated “Hunger Watch”, a rapid survey across 11 states from mid-September to mid-October.
  • The objective was to assess the situation of hunger among vulnerable groups, as well as to take immediate local action to support those in extreme need.
  • It focussed on the conditions among marginalised communities such as Dalit/Adivasi households, daily-wage workers, households with single women, aged or disabled and so on.
  • 41 per cent of sample reported having a monthly income of less than Rs 3,000 pre-lockdown compared to only 2.4 per cent more than Rs 15,000.
  • One-third of them were daily wage workers.

Key findings

  • Widespread hunger continues to be a major issue irrespective of the income levels:
    • Households also face difficult conditions with 27 per cent saying that they had no incomein the month before the survey (compared to 43 per cent with no income during April-May).
    • One in three respondents reported members having to skip meals “sometimes” or “often”.
  • Reduction in consumption to cope with food insecurity:
    • More than half the respondents said their current consumption of rice/wheat was less than what it was pre-lockdown.
    • Two-thirds of households reported that the quantity of food consumption either decreased somewhat or decreased a lot and 73 per cent reported that their consumption of green vegetables decreased.
  • Nutrition hunger:
    • Based on the 2011 National Sample Survey, a recent paper by Raghunathan, Headey, and Herforth, published in the Food Policy showed that between 63 and 76 per cent of rural Indians could not afford nutritious diets.
    • The statistics from the survey comparing the food situation before lockdown and in October indicate about 71 per cent of our respondents reported that the nutritional quality of food worsened.
  • Rural-Urban disparity:
    • Based on leaked consumption expenditure survey from 2017-18, S Subramanian, showed that consumption declined uniformlyacross rural India.

Measures needed:

In India, to combat the malnutrition levels both immediate and long term interventions are needed.

  • Around 85 to 90% of wasting can be managed at the community level.
  • Now, the nutritional rehabilitation centres are coming up across the country. It can help in taking care of the institutional needs of the children who are already malnourished.
  • But to prevent it from happening, mothers need to be educated about nutrition at anganwadis, access to clean drinking water and sanitation has to be ensured, and livelihood security is needed.
  • However, for immediate intervention, nutritional formulation needs to be made available at community level.
  • Public Distribution System must be universalised (excluding income tax payees), and should distribute not just cereals but also pulses and edible oils. Further, we need to reimagine it as a decentralised system where a variety of crops are procured and distributed locally.
  • Both pre-school feeding and school meals need adequate budgets, and the meals should be supplemented with nutrient-rich foods such as dairy products, eggs and fruits..
  • Social protection also entails universal pension for persons not covered by formal schemes, universal maternity entitlements to enable all women in informal work to rest and breast-feed their children, a vastly expanded creche scheme, and residential schools for homeless children and child workers.
  • Long-term investments in health, sanitation and nutrition are far more effective in preventing deaths due to severe acute malnutrition.
  • The NNM would do well to keep such studies in mind

Way forward:

  • Achieving zero hunger requires agriculture and food systems to become more efficient, sustainable, climate-smart and nutrition-sensitive.
  • labour reforms which protect job security, fair work conditions and social security of all workers.
  • The time has come for an urban employment guarantee programme, to help build basic public services and infrastructure for the urban poor — especially slum and pavement residents, and the homeless.
  • This should also include employment in the care economy, with services for child-care, children and adults with disability and older persons.
  • There is a need for synchronisation among malnutrition, dietary diversity and production diversity.
  • Policies must pay special attention to groups who are the most vulnerable to the harmful consequences of poor food access: infants, children aged under five, school-aged children, adolescent girls, and women.
  • There is an urgent requirement for a legally enforceable right to healthcare, with universal and free out-patient and hospital-based care, free diagnostics and free medicines.
  • A sustainable shift must be made towards nutrition-sensitive agriculture and food systems that can provide safe and high-quality food for all.
  • The UN report also calls for greater efforts to build climate resilience through policies that promote climate change adaptation and mitigation, and disaster risk reduction.

 

Topic : Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora. Important International institutions, agencies and fora- their structure, mandate

3. What are the obstructions to international cooperation in the 21st century? Discuss and analyse the need for a more democratic global governance system to address the challenges facing the world. (250 words)

Reference: Indian Express 

Why the question:

The article presents to us a detailed discussion on bringing a new democratic global governance system.

Key Demand of the question:

Analyse the need for common global governance.

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:

Start by first setting the context of the question.

Body:

In the answer body discuss the impediments to international cooperation in the 21st century.

Bring out the challenges like – Ensuring affordable availability of the COVID vaccine to the entire global population. Making the world economy inclusive, equitable and sustainable for complete eradication of poverty, achieving time-bound climate action to protect the planet, preventing the militarization of oceans, outer space and other global commons etc.

Suggest remedies to address these problems, discuss the need to have a new democratic global governance system to address the issues.

Conclusion:

Conclude with way forward.

Introduction:

In the 21st century mankind is facing a range of severe risks and challenges that call for effective global action. To manage these challenges, we need institutions that allow us to take and implement collective decisions on a global level, in a way that takes the interests of all into account. The current international system has unfortunately proved unable to cope with the most pressing global issues in an acceptable way.

Body:

  • Global governance encompasses the totality of institutions, policies, norms, procedures and initiatives through which States and their citizens try to bring more predictability, stability and order to their responses to transnational challenges.
  • Global governance brings together diverse actors to coordinate collective action at the level of the planet. The goal of global governance, roughly defined, is to provide global public goods, particularly peace and security, justice and mediation systems for conflict, functioning markets and unified standards for trade and industry.
  • The leading institution in charge of global governance today is the United Nations. It was founded in 1945, in the wake of the Second World War, as a way to prevent future conflicts on that scale. The UN’s main mandate is to preserve global security, which it does particularly through the Security Council.
  • In addition, the UN can settle international legal issues through the International Court of Justice, and implements its key decisions through the Secretariat, led by the Secretary General.
  • Beyond the UN, other institutions with a global mandate play an important role in global governance. Of primary importance are the Bretton Woods institutions: the World Bank and the IMF, whose function is to regulate the global economy and credit markets.
  • Global governance is more generally effected through a range of organisations acting as intermediary bodies. Those include bodies in charge of regional coordination, such as the EU or ASEAN, which coordinate the policies of their members in a certain geographical zone.
  • Finally, global governance relies on looser norm-setting forums, such as the G20, the G7, and the World Economic Forum: those do not set up treaties, but offer spaces for gathering, discussing ideas, aligning policy and setting norms.

International cooperation and the resulting governance mechanisms are not working adequately or effectively. The obstructions faced are:

  • Responses to common challenges have been mostly taken at the national level, with global responses being insufficient, incomplete or simply non-existent. Moreover, there has been growing tension between decision-making processes at the national and global level as local challenges “have become an integral part of global stakes”.
  • In trade, where international rules are crucial, countries have been frustrated by the stalemated Doha negotiations, and have resorted to bilateral and regional negotiations, as in Asia Pacific.
  • Based on analysis of governance in these areas, three principles might guide thinking about transformation. These are:

Way forward

  • Pluralism, where national, regional and global governance systems work in concert;
  • Strengthened multilateral processes, and the updating and transformation of existing international organizations;
  • Stronger accountability to wider groups of governments and stakeholders.
  • Global governance arrangements must respect the mixed strategies that countries are choosing.
  • Transformed multilateral institutions are crucial, since international cooperation and rules can reduce costs, and increase the support and information available to developing countries.
  • The accountability of global institutions to their full membership and beyond should be greatly scrutinized at each stage.

Conclusion:

The formulation of the post-2015 development agenda requires a new international consensus to incorporate environmental sustainability as an integral part of the development process. Greater acceptance of the concepts of green economy and sustainable development will enhance the global governance according to the needs of present times.

 

 


General Studies – 3


 

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

4. What is Virtual currency? Why did RBI ban it? elaborate upon the supreme court judgments in relation to it. (250 words)

Reference: The Hindu

Why the question:

The 4th Global Conference on Criminal Finances and Cryptocurrencies was organized by the Interpol, Europol and the Basel Institute on Governance.

Key Demand of the question:

Discuss what virtual currency is and talk about the RBI ban related to it and SC judgments.

Directive:

Elaborate – Give a detailed account as to how and why it occurred, or what is the particular context. You must be defining key terms where ever appropriate, and substantiate with relevant associated facts.

Structure of the answer:

Introduction:

Briefly discuss the context – Representatives from 132 countries attended the virtual conference to shape international cross-sector solutions against the criminal use of cryptocurrencies.

The conference’s agenda included trends and investigations on cryptocurrency-related offences, exploring criminal flows and operations in the dark markets, ransomware and sextortion case studies, money laundering involving virtual assets, and the transfer of drug proceeds using cryptocurrencies.

Body:

As of now, there is no globally accepted definition of what exactly is virtual currency. Generally, it is known as a digitally tradable form of value, which can be used as a medium of exchange.

Cryptocurrency is a specific type of virtual currency, which is decentralized and protected by cryptographic encryption techniques. (Ex: Bitcoins, Ethereum, Ripple, Petro, Alber etc.)

In 2018, RBI prohibited banks and entities regulated by it from providing services related to virtual currencies. Discuss elaborately the reasons behind the ban.

Then detail upon the Supreme Court Judgment on Virtual Currencies.

Conclusion:

Conclude with its importance.

Introduction:

Cryptocurrencies are digital currencies in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. Examples: Bitcoin, Ethereum etc. There would be no central regulator for virtual currencies as they would be placed in a globally visible ledger, accessible to all its users. All users of such virtual currencies would be able to see and keep track of the transactions taking place. Virtual currency is the larger umbrella term for all forms of non-fiat currency being traded online. They are mostly created, distributed and accepted in local virtual networks.

Body:

Reasons for RBI ban:

  • The RBI flagged its concerns on trade and use of the currency due to,
    • Lack of any underlying fiat,
    • The episodes of excessive volatility in their value,
    • Their anonymous nature which goes against global money-laundering rules,
    • Risks and concerns about data security and consumer protection,
    • Its potential impact on the effectiveness of monetary policy.
  • The RBI argued in the SC that these currencies weren’t safe for use due to a significant shoot in the valuation of many virtual currencies and rapid growth in initial coin offerings.
  • That ban was aimed at “ring-fencing” the country’s financial system from the private virtual currencies, deemed illegal by the government.

Supreme court ruling:

  • In its judgment, the SC held that the RBI directive came up short on the five-prong test to check proportionality.
  • The court did not agree, however, with any other submission made by the petitioners.
  • The court said that the RBI could not be faulted for not adopting a “light-touch” approach as adopted by the developed economies.
  • Therefore, the court said that it won’t test the correctness of the measure taken by RBI on the basis of the approach adopted by other countries.
  • The verdict removes the arbitrariness of regulatory actions without disregarding the power of RBI to regulate.

Effects of lifting the ban on cryptocurrency

  • This lifting of the ban will help in incorporation of blockchain technology.
    • Blockchain technology is the underpinning technology behind many cryptocurrencies.
    • Blockchain, which was conceptualised for the verification of anonymous peer-to-peer transactions in bitcoin, has since been adapted for many other purposes.
    • It creates electronic ledgers, where every transaction is recorded and is open to verification by many persons while maintaining confidentiality.
    • It quickly detects fakes and disallows duplicate transactions.
    • Block chain technology forms a crucial part of Industrial revolution 4.0.
    • It is also estimated that block chain will generate $3.1 trillion in new business value by 2030.
  • Cryptocurrencies act as alternative investments.
    • These currencies may enable savvy traders to hedge global volatility, as it did during the financial turmoil of 2012-13.
  • There is a worldwide proposal for central-bank digital currencies,which could allow for money to be transferred between users without the involvement of a third-party (commercial bank).
    • Allowing cryptocurrency will enable India to be part of this global deal.
    • For India, aiming to be a digital economy powerhouse,embracing emerging technologies like cryptocurrency and block chain is a must.

Way forward:

Rather than impose bans, it would be more pragmatic to institute awareness campaigns to alert investors to specific risks, and to monitor trades for fraud and scams. Fintech industry needs to jointly with the RBI and the government on a constructive policy framework for cryptocurrencies in India. In this context:

  • There is a need for RBI to formulate a detailed regulatory framework to license virtual currency intermediaries like exchanges.
  • These local cryptocurrency exchanges could be asked to adhere to the KYC norms followed by stock exchanges.
  • There is a need for the Fintech Industry to show that virtual currency trade can be carried on in a safe and responsible ma­nner with self-imposed safeguards, such as adequate customer due diligence.
  • One im­mediate step that could be taken by the government is to designate virtual currency intermediaries as reporting en­tities under the Prevention of Mo­ney Laundering Act (PMLA).
  • These steps should ideally be done by a new expert regulatory body with capability in technology, economics and fi­nance.

Conclusion:

A vibrant cryptocurrency segment could add value to India’s financial sector. Thus, in the face of growing technological innovation in the financial sector, it is critical to strengthen the supporting regulatory frameworks of India that operate regardless of the nature of an instrument.

 

Topic : Conservation, environmental pollution and degradation, environmental impact assessment.

5. An important element to correct in the policy matrix addressing the menace of air pollution in the country is the policy of subsidies on power, fertilizers and procurement. Analyse. (250 words)

Reference: Financial Express 

Why the question:

The article presents to us a relook at the agri-subsidies to curb agri-pollution. Thus the question.

Key Demand of the question:

One has to explain the grim need to shift the nature of support to farmers from input subsidies to investment subsidies to curb the menace of air pollution in the country.

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:

Briefly present background for air pollution in the country.

Body:

In the answer body present the main reasons for air pollution in India and discuss its impact in detail.

Then discuss the effect of policy of subsidies on power, fertilizers and procurement; Power subsidies have not only led to an alarming overuse of groundwater, but also it has severely damaged the health of power distribution companies. Subsidized Urea has led to massive overuse of nitrogenous fertilizers, leading to damaged soils and pollution of local water bodies etc.

Suggest what needs to be done? – hint at solutions like crop diversification, direct cash transfers to farmers etc.

Conclusion:

Conclude with way forward.

Introduction:

With every winter there is news of elevated pollution levels in the national capital. The problem of pollution disrupts not only the NCR area but many other prominent urban areas like Allahabad and Ludhiana which figure above Delhi in the pollution ranking across the world.

Air pollution Scenario in India:

  • According to WHO, of the 20 most polluted cities in the world, the top 14 are Indian cities. These include Kanpur, Faridabad, Varanasi, Delhi, etc.
  • The Environmental Performance Index (released by World Economic Forum) ranked India 178th out of 180 countries in terms of air quality.
  • According to Central Pollution Control Board data, 11 most polluted cities in country are from Uttar Pradesh. Ghaziabad is the most polluted city in the country followed by Gurugram.

Wrong policy measures and poor implementation of policies leading to Air Pollution in India:

  • Vehicular pollution: Mainly due to trucks, tempos and other diesel run vehicles. These vehicles negate the impact of cleaner fuel and emission technology. Stopping such truck from entering cities, congested areas and policy failure to check health of vehicles led to menace of air pollution.
  • Combustion and burning: Combustion in power plants and industries using dirty fuels, like pet coke, FO and its variants, coal and biomass release hazardous air pollutants. Garbage burning, both in landfills and other places where there is no collection, processing or disposal. Inability to put check on this and corrupt governance, lack of timely inspections lead to air pollution issue in India.
  • Agricultural activities: Use of insecticides, pesticides and fertilisers in agricultural activities release ammonia which is a major air pollutant. Crop residue burning-large-scale burning of crop residues from paddy crop in October-November and then wheat in April in the neighbouring states of Punjab, Haryana and western Uttar Pradesh contributes significantly to the air pollution in the Delhi NCR Region every year. The climatic conditions during winter aggravate the condition. Inability of government to put a ban on practice of stubble burning and non-procurement of any stubble cause air pollution due to burning.
  • Cold Weather: During the winter, dust particles and pollutants in the air become unable to move. Due to stagnant winds, these pollutants get locked in the air and results in smog. Lack of use of scientific methods like artificial raining in policy measures also made air pollutant stay for a longer time.
  • Mining Operations: During the process of mining, dust and chemicals are released in the air causing massive air pollution. Failure of state to prevent unchecked mining and illegal mining has added to the issue.
  • High dependence on coal for power: share of coal in power generation in India continue to be around 80%. Power plants with poor technology and efficiency continue to be the major source of pollutants like CO and oxides of nitrogen and sulphur. State’s failure to quickly switch over to renewable resources has led to rise in air pollution.
  • Exploitation of resources: Over exploitation of commons like forests, grazing lands and mindless deforestation reduces the natural capacity to absorb pollutants. Inability to punish and catch forest mafias and to check deforestation led to air pollution.
  • Haphazard Construction menace: Unchecked corruption and violation of construction rules, corruption in municipalities added up to air pollution through dust and haze.
  • Poor governance: The issue of environment and pollution is still to get the policy priority it deserves. While agencies liked CPCB and SPCBs continue to be under-resourced and under-staffed, multiplicity of the state authorities at the ground level leads to poor coordination, lax enforcement of rules and lack of accountability as seen in Delhi. Absence of environmental governance continues to be a major challenge.
  • Unplanned urbanisation: Haphazard growth of urban areas has led to proliferation of slums and poor public transport has increased the burden of personal vehicles on the road. Landfills used for waste management also releases pollutants in the air. The rapid urbanization of the recent years if left unmanaged will further exacerbate the problem

Conclusion:

Pollution and its health burden are inevitable in the near future. Therefore, it is necessary to equip public healthcare systems with adequate resources for facing this emerging challenge and shield poor from catastrophic healthcare expenditures. Coherent environmental policies are needed. Since air pollution knows no boundaries, states and centre have to harmonise their strategy to deal with it. Platforms like inter-state council apart from serving this objective can also help resolve pollution related disputes among states.

 

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

6. What is a bank moratorium, and when does it come into play? Give examples of how a moratorium can prevent a ‘run’ on the bank? (250 words)

Reference: The Hindu The Hindu 

Why the question:

As the financial ecosystem navigated one more pothole last week, with depositors in Lakshmi Vilas Bank Limited (LVB) getting bailed out, the implications of the Reserve Bank of India’s sleight of hand have got all stakeholders thinking about the way forward.

Key Demand of the question:

One has to explain the concept of Moratorium in banking sector and its applications.

Structure of the answer:

Introduction:

Start by defining what Moratorium is.

Body:

The RBI, the regulatory body overseeing the country’s financial system, has the power to ask the government to have a moratorium placed on a bank’s operations for a specified period of time. Under such a moratorium, depositors will not be able to withdraw funds at will.

Then explain when it comes into play; usually, the RBI steps in if it judges that a bank’s net worth is fast eroding and it may reach a state where it may not be able to repay its depositors. When a bank’s assets (mainly the value of loans given to borrowers) decline below the level of liabilities (deposits), it is in danger of failing to meet its obligations to depositors.

Present the past experiences of India with respect to Moratorium in the country.

Explain how does a moratorium prevent a ‘run’ on the bank?

Conclusion:

Conclude with its relevance and importance.

Introduction:

A moratorium is a temporary suspension of activity until future events warrant lifting of the suspension or related issues have been resolved. Moratoriums are often enacted in response to temporary financial hardships.

Recently, the Centre, acting on the recommendation of the Reserve Bank of India (RBI), imposed a moratorium on Lakshmi Vilas Bank (LVB) for a period of 30 days. The 94-year-old bank, based in Karur, Tamil Nadu, has been struggling with losses for three years.

Body:

How moratorium works:

  • A moratorium is often effected in response to a crisis that disrupts normal routine.
  • In the aftermath of earthquakes, floods, droughts or disease outbreaks, an emergency moratorium on some financial activities may be granted by a government or the central bank.
  • It is lifted when normalcy returns.
  • Usually, the RBI steps in if it judges that a bank’s net worth is fast eroding and it may reach a state where it may not be able to repay its depositors.
  • When a bank’s assets (mainly the value of loans given to borrowers) decline below the level of liabilities (deposits), it is in danger of failing to meet its obligations to depositors.

Case of LVB:

  • As LVB’s financial position deteriorated, the regulator placed it under the Prompt Corrective Action (PCA) framework, which restricts certain operations depending on the severity of financial stress.
  • After allowing time for the bank to find investors to shore up its capital, the RBI has appointed an administrator for the bank and mooted a merger with the Indian subsidiary of the Singapore-based DBS Bank.
  • Similar moratoria were placed in the recent past on other lenders too, including Yes Bank and Punjab and Maharashtra Co-operative Bank.

Moratorium and prevention of ‘Bank run’:

  • A moratorium primarily helps prevent what is known as a ‘run’ on a bank, by clamping down on rapid outflow of funds by wary depositors, who seek to take their money out in fear of the bank’s imminent collapse.
  • Temporarily, it does affect depositors who may have placed, for example, their retirement with the bank, or creditors who are owed funds by the bank but are struggling with the collection.
  • A moratorium gives both the regulator and the acquirer time to first take stock of the actual financial situation at the troubled bank.
  • It allows for a realistic estimation of assets and liabilities, and for the regulator to facilitate capital infusion, should it find that necessary.
  • Singapore’s DBS bank has promised to infuse ₹2,500 crore into the merged entity, once it takes over LVB.
  • A key objective of a moratorium is to protect the interests of depositors.
  • Even if they are temporarily handicapped by facing restricted access to their funds, there is a high probability that the bank would soon return to normal functioning once a bailout is arranged.

Conclusion:

After banks were nationalised in 1969, the RBI sought to always intervene to protect depositors’ interests and prevent commercial banks from failing. In 2004, it nudged State-owned Oriental Bank of Commerce(OBC) to take over the troubled private lender Global Trust Bank (GTB). As in the case of LVB, GTB was given time to find a suitor for a merger. When it failed to come up with any names, but proposed infusion of foreign capital, the RBI refused permission and instead insisted on the merger with OBC.

 

 


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 – lessons from the lives and teachings of great leaders, reformers and administrators; role of Family society and educational institutions in inculcating values.

7. Explain how John Rawls intends to use “veil of ignorance’ for distribution and redistribution of resources and responsibilities? Is it ethically consistent? (250 words)

Reference: Ethics, Integrity and aptitude by Lexicon Publications

Why the question:

The question intends to ascertain the role of the veil of ignorance in Rawls theory of distributive justice.

Key Demand of the question:

Discuss the role of the veil of ignorance in Rawls theory of distributive justice and give your opinion as to whether it is ethically consistent.

Directive:

Explain – Clarify the topic by giving a detailed account as to how and why it occurred, or what is the particular context. You must be defining key terms where ever appropriate, and substantiate with relevant associated facts.

Structure of the answer:

Introduction:

The Veil of Ignorance, a component of social contract theory, allows us to test ideas for fairness. First brief upon what veil of ignorance is.

Body:

Rawls suggests that you imagine yourself in an original position behind a veil of ignorance. Behind this veil, you know nothing of yourself and your natural abilities, or your position in society. Behind such a veil of ignorance all individuals are simply specified as rational, free, and morally equal beings.

Then move on to explaining the two principles that Rawls says we would choose behind the veil of ignorance. By being ignorant of our circumstances, we can more objectively consider how societies should operate. Two primary principles supplement Rawls’ veil of ignorance: the liberty principle and the difference principle.

Conclusion:

Conclude by giving your opinion as to whether it is an ethically consistent theory.

Introduction:

John Rawl’s concept of social justice gives emphasis to fairness, it must be fair to all, to the most talented as well as the most disadvantage section.

Body:

Rawl’s proposes a thought experiment where the individual is behind the ‘veil of ignorance’. He assumes humans as rational negotiators unaware of others talents. He concludes that the nature of society to be established would give priority to the following in lexical order.

  • Maximum Personal liberty
  • Equality of opportunity
  • Difference principle

Rawl’s believes that humans would incorporate the difference principle for the benefit of disadvantaged section for the fear that he might fall in the category of least advantaged.

In the Indian context the positive discrimination in favour of certain disadvantaged sections can be considered as the incorporation of the third principle of Rawl.

This concept in India context finds following applications

  • Reservation Issue: That whether demand some high castes to get reservation is valid or not. We can also look any amendment in present reservation policy according to it.
  • Environment to maintain balance between biodiversity and development. For example, increase in area of eco-sensitive zones.
  • Economy issues like increase in FDI, monetary policy or even present demonetization issue can be examined though spectrum Rawls’concept.
  • Traditions: We can also examine and introspect various traditional practices and customs like Jallikattu, entry of women in certain temples or religious places etc.

Conclusion:

In India too we have given maximum liberty and equality of opportunity for free enterprise. However, we have provided a slew of welfare programmes as a safety net for the disadvantaged sections to protect them. Moreover, the Indian constitution has provided for reservation to equalize the differences, and attempted to undo the historic injustices meted out to certain communities. The constitution has favoured to establish an egalitarian society instead a meritocratic society.


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