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[Mission 2022] Insights SECURE SYNOPSIS: 26 March 2022



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How to Self-evaluate your answer? 



Answer the following questions in 150 words:

General Studies – 1

1. The role of women in the police has been steadily increasing, though at a slow pace. But it must move beyond mere tokenism, so that they can champion the cause of women’s empowerment. Examine. (150 words, 10 marks)


In India, most people view the police as a male preserve. The role of women in the police has been steadily increasing, though at a slow pace. Women police personnel, apart from performing their professional obligations, have also been championing the cause of women’s empowerment, thereby gradually sowing the seeds of modernity and positive change in society. The India Justice Report 2019 compiled by a group of sectoral experts, ranging from human rights groups to legal policy groups, show that women account for seven per cent of India’s 2.4 million police personnel.


Women in police in India

  • As per the Bureau of Police Research and Development, we have only around 10 per cent women in the police.
  • There are around 25 per cent women in the Bihar police, the highest among all states.
  • It is followed by Himachal Pradesh with around 19 per cent and Tamil Nadu at 18 per cent. Delhi certainly needs to improve on its ratio of 12 per cent women.
  • Among Union territories, Chandigarh and Ladakh are doing well with above 18 per cent women.
  • Jammu and Kashmir, among the lowest with about 3 per cent women in the police.
  • The numbers are expected to rise, with many States and Union Territories providing for 30% (and more) reservation for women in the police in specific ranks.
  • Current data reveal that most women in the police are concentrated in the lower ranks.

The barriers that hinder the growth of women in Police services are:

  • Gender Apathy:
    • The police department suffers from gender apathy as evident through the absence of separate toilets, changing rooms for women, and separate accommodation for women, and other facilities and child-care support, in addition to persistent and widespread gender bias.
  • Gender stereotyping:
    • Decisions on deployment of women are not free of gender stereotyping restricting women from leading operational positions. This biasness is not limited only from male colleague sometimes female superiors too consider them weak, less willing to work and less tough.
  • Lower priority tasks allotted:
    • There appears to be a tendency to sideline women, or give them policing tasks that are physically less demanding, or relegate them to desk duty, or make them work on crimes against women alone.
  • Allocated only Women related cases:
    • Women police persons are relegated to dealing with crimes against women and accompanying women prisoners the concept works against the interests of women as it segregates them.
  • Women recruited at lower levels:
    • Current data reveal that most women in the police are concentrated in the lower ranks reflecting the dearth of females at key operational positions.

Measures needed to overcome:

  • Increased Recruitment:
    • There is a need to have more women in the field in executive postings – from constables to inspectors and higher ranks.
    • Departments should undertake special recruitment drives in every district to ensure geographical diversity.
  • Better Training:
    • Women in the constabulary must get the training, support and confidence needed to put them on a par in every sense with their male counterparts.
    • Resource centres for mentoring, creating awareness about opportunities and prospects, and helping with career planning and training and coping with workplace challenges are essential.
  • Safe workspace:
    • Police departments must also ensure safe working spaces for women and adopt a zero-tolerance policy towards discrimination and harassment, in order to make policing a viable career option for women.
    • Departments must operationalise the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act of 2013.
  • Gender sensitivity:
    • A common gender-neutral cadre needs to be created for all ranks so that promotional opportunities are evenly available.
    • Women do have some special needs, like during and post pregnancies, which need to be catered to. They shouldn’t be shunted to non-executive postings. The force needs to encourage more women to be in the field.
  • Higher funding:
    • Most State police departments have received funds under the Modernisation of State Police Forces Scheme for providing separate toilets and changing rooms for women, and for constructing separate accommodation for women with attached toilets in all police stations and units. Police departments must ensure the best use of this fund.
  • Spreading awareness and sensitization:
    • The police should reach out to the media and educational institutions to spread awareness about opportunities for women in the police.
    • While women have a role in making up for the lack of training and sensitization of the force in general in dealing with crimes against women they should not be ghettoised into dealing only with such crimes.


The discourse on mainstreaming women in the police by making policing inclusive, non-discriminatory and efficient in India is missing in policy circles. Leading to the vicious cycle of non-reporting and non-action, perpetuating the culture of silence. Desk work too must be allocated evenly among men and women. For women in police to perform to their full potential, it would take sustained increase in their strength, meaningful networking within themselves and an institutionalized support system in the current social realities. Then, they will be the women that they are, the police officers that they are. It will allow them to be their authentic selves, agents of change. To achieve. To lead. To serve the people.

Value addition

Women in numbers in police force- The Case study of Himachal Pradesh:

  • In 1975, the first regular batch of 28 lady constable recruits was inducted and since then, our women personnel have gone on to become an integral part of our police force with a strength of 15 IPS officers, eight HPS officers and 2,352 non-gazetted officers.
  • Today, women account for 13 per cent of Himachal Pradesh police force.
  • Himachal Pradesh is one of the seven states — the others being Bihar, Gujarat, Maharashtra, Sikkim, Tamil Nadu and Uttarakhand — where the percentage of women cops is higher than 10.
  • In 2009, the Union Home Ministry set a target of 33 per cent for women in the police force and Himachal Pradesh hopes to get there fast enough, if not be the first.
  • The state already has 20 per cent reservation for women at the constable level.

Rationale behind increasing the women power in Policing:

  • A gender-diverse force is necessary to create a safe and secure environment for women and to achieve the larger national development goals.
  • Women are more sensitive to the sufferings of others and have greater concern for the well-being of others.
  • They often approach and solve problems from a different perspective than their male counterparts.
  • It is widely recognized that women cops play a crucial role in responding to and preventing gender violence and crime against women and children.
  • The induction of women and their increased representation in the force have not only helped women at large feel empowered, but also helped reduce crime against them, especially the ones committed on women who had come to accept them as their fate.


2. The national tele-mental health programme is a welcome step in main streaming mental health and wellness. But its success will depend on its ability to reach masses and destigmatise mental disorders in the society. Discuss. (150 words, 10 marks)


According to the World Health Organization, over 90 million Indians, or 7.5% of the population, suffer from mental health issues. A study published in Lancet in December 2019, titled “The burden of mental disorders across the states of India: the Global Burden of Disease Study 1990–2017”, also highlights the scale of the challenge. The COVID-19 pandemic led to an increase in mental health-related problems among people of all age. Global research has highlighted the increased rates of depression, anxiety, sleep disturbances, etc., in individuals affected by the virus.


State of Mental healthcare in India

  • WHO has labelled India as the world’s ‘most depressing country’
  • The National Mental Health Survey (NMHS) 2015–2016 conducted by NIMHANS revealed that one in five individuals suffer from some sort of mental health disorder and only 15% of those affected receive the treatment required.
  • This amounts to a massive untreated ‘mental health burden’ in our country.
  • There is just one qualified psychiatrist for 10 lakh people in India, the number of psychologists and psychiatric social workers being even fewer.

Importance of national tele-mental health programme

  • During her Budget 2022-23 Speech in the Parliament, Union Finance Minister Nirmala Sitharaman announced a National Tele Mental Health Programme.
  • The programme, which has been hailed by all sectors of people for having the potential of changing mental health care in the country, is proposed to consist of 23 tele mental health centres with NIMHANS (National Institute of Mental Health and Neuro Sciences Bangalore) acting as the nodal centre.
  • Meanwhile, for this, International Institute of Information Technology-Bangalore (IIIT-B) would be providing the technological expertise.
  • Lack of awareness and sensitivityabout mental health is one of the biggest issue. There is a big stigma around people suffering from any kind of mental health issues.
  • They are often tagged as ‘lunatics’ by the society. This leads to a vicious cycle of shame, suffering and isolation of the patients.
  • Tele-mental healthcare can bridge the gap by connecting people from remote areas to health professionals in times of need but also help train general physicians and community health workers in mental healthcare.
  • They form the backbone of our health infrastructure, and the ability to provide mental health services at a primary level under the tele guidance of psychiatrists is a fruitful and cost-effective exercise.
  • The national tele-mental health programme is expected to help people get easier access to quality counselling and care services related to mental health.

Challenges to National tele-mental healthcare

  • Mental health issues in India are hugely complex. Data on mental illness is remarkably patchy. Most data is based on self-reporting of conditions and extrapolation.
  • Like any other legal document, implementation is the key and a challenge at the same time. The Mental Healthcare Act (2017) came in with a lot of promises by revamping the old act of 1987.
  • Digital illiteracy, limited data connectivity, network glitches, ethical and legal lacunae related to tele-psychiatry guidelines, limitations in medical assessment through a virtual medium and data safety are the main concerns that riddle tele-mental healthcare.
  • As the Covid threat reduces with time, the inherent tendency of the masses to prefer in-person consultation will be on the rise rendering virtual consultations redundant.
  • Affordability issues related to telemedicine should also be borne in mind to prevent health inequalities.

Way forward

  • Human wellness is about body and mind. Lasting change is possible only through a collaborative effort of policy-makers.
  • Invest in institutional support mechanisms like hospitals, treatment centres, qualified health care support and community support mechanisms.
  • Implementation of tele-mental healthcare cannot be decoupled from efforts to improve digital literacy, data security and enhanced accessibility to services.
  • Advocacy by mental health professionals, media and policymakers are likely to make a lasting impact in this area.
  • We need large scale social security support or insurance to cover costs.
  • Mental illnesses should be covered in health insurance policies.
  • The government must ensure that treatment is widely available and costs are regulated.
  • India must draw lessons from other countries as well as draw upon its own ancient wisdom to holistically treat mental health.


This rare but apt mention of mental health in the national Budget holds true promise of delivering tele-mental health services in the post-Covid future. The proposed Tele-Mental Health Programme is a timely and much-needed move but whether it delivers in the long run depends on its implementation, advocacy and dealing with the associated digital challenges.



3. With the Gupta period India entered upon the classical phase of sculpture. By the efforts of the centuries, techniques of art were perfected, definite types were evolved, and ideals of beauty were formulated with precision. Discuss. (150 words, 10 marks)



The Gupta dynasty is an important dynasty which ruled ancient India between 4th century to 6th century. They have left amazing examples of their glorious reign which has been called the ‘Golden era’ of India’s history. During their rule art, sculpture, inventions, philosophy, mathematics and literature has flourished.


Gupta sculpture seems to belong to a sphere that is entirely different. The Gupta artist seems to have been working for a higher ideal. A new orientation in the attitude towards art is noticed in the attempt to establish a closer harmony between art and thought, between the outer forms and the inner intellectual and spiritual conception of the people.



Salient features of Gupta Sculpture

  • The human figure, taken as the image, is the pivot of Gupta sculpture. A new canon of beauty is evolved leading to the emergence of a new aesthetic ideal.
  • This ideal is based upon an explicit understanding of the human body in its inherent softness and suppleness.
  • The soft and pliant body of the Gupta sculpture with its smooth and shining texture, facilitates free and easy movement
  • Gupta sculptures are characterized by elaborate draperies, jewellery, etc.
  • The wet or transparent clinging drapery hence became the fashion of this age. But the sensuous effect of these draperies especially in the case of female figures was restrained by a conscious moral sense, and nudity as a rule was eliminated from Gupta sculpture.
  • The magnificent red sandstone image of the Buddha from Mathurais a most remarkable example of Gupta workmanship datable to the 5th century A.D. The great Master, in all his sublimity, is here shown standing with his right hand in Abhayamudraassuring protection, and the left holding the hem of the garment.
  • The smiling countenance with down-cast eyes is robed in spiritual ecstasy. The robe covering both shoulders is skillfullyrepresented with delicately covered schematic folds and clings to the body. The head is covered with schematic spiral curls with a central protuberance and the elaborate halo decorated with concentric bands of graceful ornamentation.

Highlights of Gupta Sculpture

  • The Gupta sculptural style probably grew out of the Kushan style that survived at Mathura.
  • The Buddha images at Sarnath reflect serenity and contentment mirroring the religious atmosphere of the age. This practice of carving images was picked up by Hinduism also.
  • A great example of Gupta sculpture created at Sarnath is that of the seated Buddha preaching the Law, carved of Chunar sandstone.
  • The Gupta craftsmen distinguished themselves by their work in iron and bronze.
  • Bronze images of the Buddha began to be produced on a considerable scale because of the knowledge the smiths had of advanced metal technology.
  • With regard to iron objects, the best example is the iron pillar found at Mehrauli in Delhi.
  • A remarkable piece of Gupta metal-casting found at Sultanganj in Bihar is nearly feet high. Another metal figure but of a smaller size in bronze was found in U.P.
  • A group of small ivory images of Buddhas and Bodhisattavas founding the Kashmri area are prime examples of late Gupta art from about the eighth century.


The cultural creativity of the Golden Age of India produced magnificent architecture, including palaces and temples, as well as sculptures and paintings of the highest quality. The Gupta Dynasty promoted Hinduism, but supported Buddhist and Jain cultures as well. Gupta Buddhist art influenced East and Southeast Asia as trade between regions increased. The Gupta Empire became an important cultural center and influenced nearby kingdoms and regions in Burma, Sri Lanka, and Southeast Asia. Classical forms of Indian music and dance, created under the Guptas, are still practiced all over Asia today.

General Studies – 2

4. Judicial transparency is particularly important in judicial institutions because it fosters and promotes greater judicial independence and boosts public confidence. Elaborate. (150 words, 10 marks)



The Indian Judiciary plays an increasingly important role in the life and the governance of this country. However, the issue of transparency has been a sticking point for the judiciary in India. The use of material produced in a ‘sealed cover’ as an aid to adjudication is something to be strongly discouraged and deprecated. However, it gained much respectability in recent years, with contents withheld from lawyers appearing against the government, but being seen by the judges alone.


Importance of transparency in Judiciary

  • it promotes accountability, combats corruption, and helps eliminate arbitrariness, Transparency is particularly important in judicial institutions.
  • It facilitates greater judicial independence and enhances public confidence in this way.
  • The level of trust and the legitimacy of judges and others operating in the justice system can be enhanced by a policy of transparency and access to public information, thereby enabling the society to understand its operation, challenges, and limitations.
  • Thus, Transparency fundamentally reassures society that justice is served.

Challenges to transparency in Judiciary

  • Appointment and Transfer of Judges and Functioning of Collegium System
    • Due to  lack  of  transparency  in  the  appointment  of judges,  the  procedure  adopted  by  Collegium  system is  being  criticized  since  its
  • Transfer of Judges
    • Since many years not only the policy of appointment but the policy of transfer is also criticized because many transfer of judges of different High Courts has been made on extraneous
  • Roaster System
    • Chief Justice of India has power to decide the roster of the cases.
    • In this regard, dissatisfaction from the members of highest judiciary itself has been expressed.
    • It was said that particular and some specific case are picked up and has been allotted to favorable bench of judges.
  • Practice of Sealed Envelope
    • In case of sealed cover submission the information is accessible only to the court and only to the party who has submitted it.
    • There are  so many cases where  the Court  had sought  detailed report in  sealed  cover  envelope such as  in  case  of  former  Chief  of  CBI  Alok  Verma, Assam  National  Register  of  Citizen,  2G Spectrums and Board for  Control of  Cricket in India etc.
  • RTI Act
    • The Supreme Court, in a recent decision in the Chief Information Commissioner v. High Court of Gujarat (2020), barred citizens from obtaining access to court records under the RTI Act.
    • According to the Court, such records can only be accessed under regulations established by each High Court under Article 225 of the Constitution.
    • Though this ruling does not restrict the RTI Act from being used to the administrative side of the court, it does effectively close the door to accessing the millions of court records submitted on the judicial side under the RTI Act.
  • Judicial independence
    • Judicial independence is employed as a blanket over all difficulties and as a shield against accountability for the problems that have arisen.
    • There is a lack of openness in the court system’s operation.

Measures needed

  • To create  confidence  and  faith  of  the  public  it  is  necessary  to  adopt  the  principal  of transparency and fairness in the functioning of any democratic institution.
  • The use of transparent and open processes in the appointment of judges serves to shield judges from undue external influences such as those exercised by other branches of government or interest groups.
  • A key strategy to increase judicial transparency is to collect, analyse, and share statistical data. Such data allows for the analysis of performance, the identification of accomplishments, the detection of problems, and the development of strategies to address them.
  • It is critical to provide public access to the courts, including through the media, in order to raise awareness of the judiciary’s activities. The recording of court sessions by video, audio, or transcription is one example of such access.
  • Access to Supreme Court decisions is especially important since they affect government institutions and actions in general, not just the cases at hand. Such judgements may concern individual rights or state obligations, and hence have a significant impact on how citizens’ rights are viewed and safeguarded.
  • The Supreme Court should determine and circumscribe the circumstances in which confidential government reports, especially those withheld from the other side, can be used by courts in adjudication.
  • The procedure for allotment of cases must be transparent, fair, just and reasonable through a proper codified system.


Transparency also leads to the proper functioning of a democratic country whereby people have the right to receive information and make informed decisions regarding the government or the country they live in. As the Supreme Court must also serve as the protector of the fundamental rights of every citizen in the country, it is important to make sure that the people’s right to receive information which is implicit under Article 19(1)(a) of the Indian Constitution is not affected. We can soon have an efficient and responsible judicial system where the rule of law prevails if we take a few measures toward a more transparent judiciary.


5. Comprehensive reforms are needed in the criminal justice system to ensure effective enforcement of the law, uphold accountability, have a well trained workforce and speedy disposal of the cases. Comment. (150 words, 10 marks)


Criminal Justice System refers to the agencies of government charged with enforcing law, adjudicating crime, and correcting criminal conduct. Lord Thomas Babington Macaulay is said to be the chief architect of codifications of criminal laws in India. Criminal law in India is governed by Indian Penal Code, 1860, Code of Criminal Procedure, 1973, and Indian Evidence Act, 1872, etc.


Need for reforms

  • Pendency of Cases: According to Economic Survey 2018-19, there are about 3.5 crore cases pending in the judicial system, especially in district and subordinate courts, which leads to actualisation of the maxim “Justice delayed is justice denied.”
  • Huge Undertrials: India has one of the world’s largest number of undertrial prisoners.
    • According to NCRB -Prison Statistics India (2015), 67.2% of our total prison population comprises undertrial prisoners.
  • Investigation: Corruption, huge workload and accountability of police is a major hurdle in speedy and transparent delivery of justice.
  • Ineffectiveness: The purpose of the criminal justice system was to protect the rights of the innocents and punish the guilty, but nowadays the system has become a tool of harassment of common people.
  •  The existing system “weighed in favour of the accused and did not adequately focus on justice to the victims of crime.” This was as per Malimath Committee report

Measures needed

  • Penal code: Penal code should be modified to incorporate the present day societal, economic, and other changes. The Penal code can be divided into various codes incorporating social offences, correctional offences, economic offences and an Indian penal code (which will deal with cases that warrant 10 years punishment or more).
  • Police processes: Institutional reform including proper investigation of crimes, rationalisation of court systems by inducting technology, limiting appeal procedures to a minimum.
    • In Prakash Singh vs Union of India, Supreme Court ordered that reform must take place.
    •  The states and union territories were directed to comply with seven binding directives that would kick start reform.
  • Victim centric: The system should be victim centric to ensure that the victims get justice. The victim should get a chance to put forth his case and quick completion of trials is needed to ensure that they do not lose faith in the system.
    • Fixing responsibility quickly and transparently will maximise the sense of justice to the victim.
    • Witness protection is another area, where in if made robust, victims are more likely to get justice.
  • Prison reforms: Reforming the property-based bail system, provision of proper legal support to remove problem of undertrials, improvement of prison conditions is needed. Thus, India needs to reform its archaic system to incorporate more efficient practices like restorative justice, plea bargaining, etc. that will ensure a more robust criminal justice system.
  • Malimath committee has recommended many reforms which need to be implemented. Some of the important recommendations of the Malimath committee are as follows:
    • Need for more judges to dispose-off a large number of pending cases.
    • Constitution of a National Judicial Commission to deal with the appointment of judges to the higher courts and amendment of Article 124 to make impeachment of judges.
    • Creation of separate criminal division in higher courts that have judges specialising in criminal laws.
    • Article 20 (3) of the Constitution, which protects the accused from being compelled to be a witness against himself/herself, needs to be modified.
    • The courts should be given freedom to question the accused to give information and draw an adverse inference against the accused in case the latter refuses to answer.
    • Victim Compensation Fund should be created under the victim compensation law and the assets confiscated from organised crimes should be made a part of it.


The reforms should not only make Criminal Justice System more efficient but also be sensitive to both the innocent and the needs of the law enforcing officers. Our policy makers need to focus on reformative justice in order to bring all around peace in the society.



6. Why are the Cooperatives significant in India? Enumerate the reasons for the success of cooperative movement in India. (150 words, 10 marks)



A cooperative is an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly-owned and democratically controlled. The need for profitability is balanced by the needs of the members and the wider interest of the community


Importance of cooperatives:

  • India is an agricultural country and laid the foundation of World’s biggest cooperative movement in the world.
  • For instance, Amul deals with 16 million milk producers, 1,85,903 dairy cooperatives; 222 district cooperative milk unions; marketed by 28 state marketing federations.
  • There are over 8 lakh cooperatives of all shapes and sizes across sectors in India
  • In India, a Co-operative based economic development model is very relevant where each member works with a spirit of responsibility.
  • It provides agricultural credits and fundswhere state and private sectors have not been able to do very much.
  • It provides strategic inputsfor the agricultural-sector; consumer societies meet their consumption requirements at concessional rates.
  • It is an organization for the poor who wish to solve their problems collectively.
  • It softens the class conflictsand reduces the social cleavages.
  • Itreduces the bureaucratic evils and follies of political factions;
  • It overcomes the constraintsof agricultural development;
  • It creates a conducive environment for small and cottage industries.

For women in particular:

  • Increased Income: A study conducted on Women Dairy Cooperative Society (WDCS) members across Rajasthan showed that with the income generated through dairying, 31% of the women had converted their mud houses to cement structures, while 39% had constructed concrete sheds for their cattle.
  • Provides Leadership lessons: Importantly, women-led cooperatives also provide fertile ground for grooming women from rural areas for leadership positions.
  • Breaks barriers: In many instances, this becomes the first step for women in breaking free from traditional practices.
  • Defeats Information Asymmetry: The presence of collectives in the form of cooperatives and milk unions plays a significant role in enhancing the knowledge and bargaining power of women
  • Set up business chain: Cooperatives enhance backward and forward linkages in the dairy value chain, paving the way for freeing small farmers from the clutches of middlemen, and guaranteed minimum procurement price for milk.
  • A study by the International Development Research Centre (IDRC) indicates that 93% of women farmers who receive training alongside financial support succeed in their ventures, compared to the 57% success rate of those who receive financial aid alone.
  • According to latest data, there are more than 1,90,000 dairy cooperative societies across the country, with approximately 6 million women members.

Reasons for the success of cooperative movement in India

  • Economic growth and the increase in disposable incomes have played an important role in the growth of cooperatives in India.
  • Focus on quality means that the product quality is better. This helps in building customer confidence and makes customer retention easier.
  • Cooperatives, being democratic entities in nature, have the opportunity to elect a professional and experienced management. The most successful cooperatives in India are run by a professional management.
  • Innovation plays a crucial role in the success of Indian cooperatives. For instance, Amul has added 102 new products in the past four years. The increased adoption of drones is expected to help save farmers’ time and energy and increase their income.
  • Branding and effective marketing have played an important role in the success of cooperatives. Amul is famous for its Amul Girl mascot
  • cooperatives have remained socially relevant even after five decades. dairy cooperatives participate in community affairs such as festivals, donate food, contribute monetarily and non-monetarily in cultural and social functions in villages and help farmers in distress through loans.
  • The Government has initiated various reforms to help the Indian cooperatives. Such reforms include forming the Ministry of Cooperation, reducing compliance burden, providing training, and so on.
  • Further, the Government has organised training programmes through various entities, to help cooperatives become more eficient in conducting their operations. Among such entities are the National Cooperative Development Corporation (NCDC).

Way forward:

  • Principle of the cooperative movement is to unite everyone, even while remaining anonymous. The cooperative movement has the capacity to solve people’s problems.
  • The pandemic seems to have increased the significance of community effort.
  • Reducing vaccine hesitancy, providing food to those waiting outside hospitals and, most importantly, looking after orphaned children are imperatives crying out for the cooperative model.
  • Implementing the steps provided by the Vaidyanathan committee on credit cooperative societies.
  • The idea of cooperatives must take the agenda beyond agriculture, milk, credit and housing cooperatives
  • New areas are emerging with the advancement of technology and cooperative societies can play a huge role in making people familiar with those areas and technologies.
  • There is a need to create more cooperatives with women at the helm of it.
  • The irregularities in cooperatives need to be checked and the need of the hour is to have rules and stricter implementation of same.


General Studies – 3

7. What is inflation? How does inflation impact various macroeconomic parameters? Suggest measures that should be taken to keep the rate of inflation under accepted limits. (150 words, 10 marks)


Inflation refers to the rise in the prices of most goods and services of daily or common use, such as food, clothing, housing, recreation, transport, consumer staples, etc. Inflation measures the average price change in a basket of commodities and services over time. The opposite and rare fall in the price index of this basket of items is called ‘deflation’. Inflation is indicative of the decrease in the purchasing power of a unit of a country’s currency. This is measured in percentage.


Impact of Inflation on various macroeconomic parameters

  • Inflation is a decrease in the purchasing power of currency due to a rise in prices across the economy.
    • For instance, the average price of a cup of coffee was a 50 paisa. Today the price is closer to 25 Rupees.
  • The value of currency unit decreases which impacts the cost of living in the country.
  • When the rate of inflation is high, the cost of living also increases, which leads to a deceleration in economic growth.
  • However, a healthy inflation rate (2-3%) is considered positive because it directly results in increasing wages and corporate profitability and maintains capital flowing in a growing economy.

Factors for the high rate of inflation in the Indian economy

  • Fuel prices: The government has increased taxation of energy to raise resources.
    • Since energy is used for all production, prices of all goods and services tend to rise and push up the rate of inflation.
    • Further, this is an indirect tax, it is regressive and impacts the poor disproportionately It also makes the RBI’s task of controlling inflation difficult.
  • Supply shortage: The lockdowns disrupted supplies and that added to shortages and price rise.
    • Prices of medicines and medical equipment rose dramatically.
    • Prices of items of day-to-day consumption also rose.
    • Fruits and vegetable prices rose since these items could not reach the urban markets.
  • International factors: Most major economies have recovered and demand for inputs has increased while supplies have remained disrupted (like chips for automobiles).
    • So, commodity and input prices have risen (like in the case of metals).
    • Businesses claim increase in input costs underlies price rise.
  • Data collection and methodology: In April and May 2020, data on production and prices could not be collected due to the strict lockdown.
    • So, the current data on prices for April to July 2021 are not comparable with the same months of 2020.
    • As such, the official inflation figures for these months in 2021 do not reflect the true picture.
  • Weak Rupee: The weakening of the rupee also added to inflation.

Measures to keep the inflation under control

  • Monetary policy Measures: Maintaining price stability is the foremost objective of the monetary policy committee of RBI. However, during the pandemic, growth has taken centre stage and RBI has rightly cut interest rates.
  • Commodity prices: GoI needs to remove supply side bottlenecks. For example, GoI can immediately offload 10-20% of its pulses stock with NAFED in the open market.
  • Fuel prices: Bringing them under GST would reduce the prices by at least 30 rupees. GST council must agree to this with haste.
  • Policy measures: Navigating out of this will need a fiscal stimulus to shore up consumer spending, an investment revival to increase the productive capacity of the economy, and a careful management of inflationary expectations.
  • Concomitantly, the government will also need to pursue redistribution of income to reduce the widening disparity.
  • This also calls for fiscal prudence to cut wasteful spending, find new revenue through asset sales, mining and spectrum auctions, and build investor confidence.


With the rise in inflation amidst a second wave, the balancing acumen of the MPC will now be sorely tested. Factors like rising commodity prices, supply chain disruptions are expected to raise overall domestic inflation. Economists have pointed at India’s K-shaped recovery where a few have benefitted while others have fallen sharply behind. Big companies have benefitted and increased market share, revenues and profits sharply. They have also taken advantage of low interest rates to decrease the cost of their borrowings. Small and medium companies, struggling with falling revenues and cash flows, have not been able to take advantage of the rates. Hence inflation must also be controlled while growth is focussed upon.



8. Though nuclear energy is a source of clean energy but the vulnerabilities of nuclear reactors make it prone to disasters. Examine. (150 words, 10 marks)


Nuclear Energy plays a critical role in achieving sustainable economic and social development. Modern civilization heavily depends on energy for daily activities. Energy is like a lifeline for the sustenance and progress of the entire world. Nuclear energy plays a vital role in the world economy by generating jobs, income and facilitating trade on a massive scale.

Recently, a fire broke out near the Zaporizhzhia nuclear plant in Ukraine (Europe’s largest) during the course of a military battle between Russia and Ukraine


Some nuclear disasters across globe:

  • In 2011, multiple reactors at the Fukushima Daiichi nuclear plant suffered severe accidents after an earthquake and a tsunami.
  • The Chernobyl disaster in Ukraine in 1986 is the worst nuclear power plant accident ever in terms of death toll and cost.
  • The Kyshtym Nuclear disaster was a radiation contamination incident that occurred on 29 September 1957 at Mayak, a Nuclear fuel reprocessing plant in the Soviet Union. It measured as a Level 6 disaster on the INES, making it the third most serious Nuclear disaster ever recorded behind the Chernobyl Disaster and Fukushima Daiichi Disaster (both Level 7).

Potential of nuclear energy as a source of clean energy:

  • Thorium and Uranium reserves: India has vast reserves of Thorium that can fuel India’s nuclear energy provided appropriate technology. India’s thorium deposits, estimated at 360,000 tonnes, and natural uranium deposits at 70,000 tonnes. The country’s thorium reserves make up 25% of the global reserves.
  • Energy poverty: Although India is the 3rdlargest producer of electricity, about 20 % of the population of the country does not have access to electricity today. The per capita consumption of electricity is very low at about 1,181 kWh per annum, about half of the world average and way below that of advanced countries. There exist shortages in energy and peak power in the range 10-15%.
  • Energy demand:Nuclear energy is a critical part for India’s future energy security. As we know India’s annual energy demand is expected to rise to 800 GW by 2032, it is very important to consider every source of energy in the optimum energy mix.
  • Energy efficiency: Quantities of nuclear fuel needed are considerably less than thermal power plants. For instance, 10000 MW generation by coal will need 30-35 million tons of coal, but nuclear fuel needed will be only 300-350 tons.
  • Economic growth:Rapid economic growth is also critical to achieve developmental objectives and poverty alleviation. A sustained economic growth of about 8 to 10% is needed over the next few decades. As electricity is a key driver for economic growth, it is necessary that there is a massive augmentation in electricity capacity, apart from transmissions and distribution systems.
  • Decrease in Energy Supply:Energy supply has been negatively affected by changing weather patterns. As water reservoirs decreases due to lower precipitation and increased evaporation, capacity for electricity production from hydropower and other water-intensive generation technologies may decline.
  • Climate change:Due to its emission-free nature, nuclear energy can contribute to global efforts under the Paris Agreement. India’s Nationally Determined Contribution (NDC) to the United Nations Framework Convention on Climate Change (UNFCCC) has outlined goals to reduce the carbon emissions intensity of its economy by 33-35% by 2030 as well as increase the clean energy electricity capacity to 40% of the total installed capacity in the same period.

Vulnerabilities of nuclear energy and nuclear reactors:

  • In the case of Nuclear Reactors, there is a concern over their safety. The 2011 Fukushima Daiichi accident in Japan is a testimony to the havoc that can be created by a nuclear leak.
  • A nuclear disaster might leave large swathes of land uninhabitable — as in Chernobyl — or require a prohibitively expensive clean-up — as in Fukushima, where the final costs may eventually exceed $600 billion.
  • Nuclear power generation is not as clean as it is often considered. This is demonstrated in the case of Kudankulam. People have been protesting for decades as they worry that the hot water dispatched from the plant will affect the marine life of the surrounding water sources and subsequently their livelihood.
  • Nuclear power plants are capital intensive and recent nuclear builds have suffered major cost overruns. An illustrative example is the V.C. Summer nuclear project in South Carolina (U.S.) where costs rose so sharply that the project was abandoned — after an expenditure of over $9 billion.
  • Also, to build nuclear reactors, it requires huge amounts of land. This would displace local communities who may not want to leave. Further, it is not easy to rehabilitate them and provide them with appropriate compensation.
  • Pursuant to this, the nuclear industry came to a standstill except in Russia, China and India. However, a revival was seen with global warming becoming ever more apparent.
  • In 2020, a windstorm caused the Duane Arnold nuclear plantin the U.S. to cease operations. The frequency of such extreme weather events is likely to increase in the future.
  • The commercial nuclear supply can lead to proliferation of Nuclear weapons. The fast breeder reactors have a risk of the turning of inert uranium to plutonium, and then using the plutonium as fuel. However, plutonium is a nuclear explosive which can be used for developing a bomb.
  • The recent reports that China is building two more fast reactors have immediately provoked international concerns about China’s possible weapons plutonium production.


Nuclear power can help to improve energy security. For a rapidly developing economy such as India, it can make a vitally important contribution to growth. Besides, nuclear power can also reduce the impact of volatile fossil fuel prices and mitigate the effects of climate change. India needs to come up with a durable energy strategy to meet present and future energy demands of its population and industries.



9. A major budget announcement was the launch of central bank digital currency (CBDC). Analyse the various the challenges pertaining to CBDC that must be overcome for it be successful. (150 words, 10 marks)


A Central Bank Digital Currency (CBDC), or national digital currency, is simply the digital form of a country’s fiat currency. Instead of printing paper currency or minting coins, the central bank issues electronic tokens. This token value is backed by the full faith and credit of the government.



  • The Reserve Bank of India is likely to soon kick off pilot projects to assess the viability of using digital currency to make wholesale and retail payments to help calibrate its strategy for introducing a full-scale central bank digital currency (CBDC).
  • Union Finance Minister in the budget speech said the Reserve Bank of India (RBI) will launch a central bank digital currency (CBDC) in 2022-23, marking the first official statement from the Union government on the launch of much-awaited digital currency.

Need for a CBDC:

  • The growth of cryptocurrencies such as Bitcoin, Ethereum etc has raised challenges to fiat currencies.
  • Along with their other vulnerabilities made the central bank of each country explore the possibility of introducing their own digital currencies.
  • A 2021 BIS survey of central banks, which found that 86% were actively researching the potential for such currencies, 60% were experimenting with the technology, and 14% were deploying pilot projects.
  • The need for inter-bank settlement would disappear as it would be a central bank liability handed over from one person to another.

Challenges posed:

  • India is already facing many cyber security threats. With the advent of digital currency, cyberattacks might increase and threaten digital theft like Mt Gox bankruptcy case.
  • According to the Digital Empowerment Foundation in 2018 report, around 90% of India’s population is digitally illiterate. So, without creating enough literary awareness introduction of digital currency will create a host of new challenges to the Indian economy.
  • Introduction of digital currency also creates various associated challenges in regulation, tracking investment and purchase, taxing individuals, etc.
  • The digital currency must collect certain basic information of an individual so that the person can prove that he’s the holder of that digital currency. This basic information can be sensitive ones such as the person’s identity, fingerprints etc.


There are crucial decisions to be made about the design of the currency with regards to how it will be issued, the degree of anonymity it will have, the kind of technology that is to be used, and so on. There is no doubt that the introduction of National Digital currency prevents the various threats associated with the private-owned cryptocurrencies and take India the next step as a digital economy. But the government has to create necessary safeguards before rolling out. India needs to move forward on introducing an official digital currency.

Value addition

Global situation of CBDC

According to the Bank for International Settlements, more than 60 countries are currently experimenting with the CBDC. There are few Countries that already rolled out their national digital currency. Such as,

  • Swedenis conducting real-world trials of their digital currency (krona)
  • The Bahamasalready issued their digital currency “Sand Dollar” to all citizens
  • Chinastarted a trial run of their digital currency e- RMB amid pandemic. They plan to implement pan-China in 2022. This is the first national digital currency operated by a major economy.



Working of CBDC:

  • A central bank digital currency is the legal tender issued by a central bank in digital form.
  • It is the same as a fiat currency but the form is different and is exchangeable one-to-one with the government-issued money.
  • In other words, CBDC is the same as the legal currency we use. Just that it’s in a digital form.
  • A CBDC is the digital form of fiat currency and will ease transactions.
  • An RBI report had earlier described CBDC as something that will provide a safe, robust, and convenient alternative to physical cash.
  • Depending on various design choices, it can also assume the complex form of a financial instrument, the RBI report said.
  • A CBDC is not a crypto currency. CBDC is the digital form of a legal tender but private virtual currencies are entirely different.
  • CBDCs use distributed ledger technology (DLT), which is typically deployed in a hybrid architecture i.e. existing central bank and payment infrastructure + DLT for movement, transparency, workflow and audit trail or tracing of funds (value).
  • This technology helps in efficiency (speed), security (encryptions) and also other aspects like smart contracts which execute buy and sell transactions based on a pre-defined criteria and opens up the possibility of ‘programmable’ money.

Potential of a CBDC:

  • An official digital currency would reduce the cost of currency management while enabling real-time payments without any inter-bank settlement.
  • India’s fairly high currency-to-GDP ratio holds out another benefit of CBDC — to the extent large cash usage can be replaced by CBDC, the cost of printing, transporting and storing paper currency can be substantially reduced.
  • As the currency in digital form, it can provide an efficient way for financial transaction. Further, digital currency also solves the challenges with Cash and coins. Cash and coins require expenses in storage and have inherent security risks like the recent heist in the RBI currency chest.
  • There are about 3,000 privately issued cryptocurrencies in the world. According to IMF, the key reason for considering national digital currency is to counter the growth of private forms of digital money.
  • There is a possibility of these companies going bankrupt without any protection. This will create a loss for both investor and creditor. But the National Digital currency has government backing in case of any financial crisis.
  • As the state-backed digital currency can provide investor/consumer protection, the private can confidently invest in the associated infrastructure without any doubts over its regulation. This will improve the services to people.
  • The national digital currency will be regulated by the RBI. So, there will be less volatility compared to other digital currencies.
  • Current RBI’s work on inflation targeting can be extended to national digital currency also. Since India is planning to ban other cryptocurrencies, the RBI can better regulate digital and fiat currency. Thus, upgrading to digital currency and balancing the macroeconomic stability.
  • With the introduction of CBDC in a nation, its central bank would be able to keep a track of the exact location of every unit of the currency, thereby curbing money laundering.
  • Criminal activities can be easily spotted and ended such as terror funding, money laundering, and so forth


10. Examine the role played by Foreign Direct Investment in the economy of the developing countries. (150 words, 10 marks)



FDI is the process whereby residents of one country (the home country) acquire ownership of assets for the purpose of controlling the production, distribution and other activities of a firm in another country (the host country).

Foreign Direct Investment or FDI is a major driver of economic growth and is largely a matter of private business decisions. FDI inflows depend on a number of factors sub as availability of natural resources, infrastructure, market size, general investment climate etc. Govt of India has put in place a liberal and transparent policy for FDI with most sectors open to FDI under the automatic route.


Various aspects of FDI in emerging economies

  • Economic benefits: FDI acts as a bridge by filling up budgetary gap, stabilize rupee and improves Balance of Payment situation.
    • Capital inflows create higher output and jobs.
    • Capital inflows can help finance a current account deficit.
    • Long-term capital inflows are more sustainable than short-term portfolio inflows.
      • For e.g., in a credit crunch, banks can easily withdraw portfolio investment, but capital investment is less prone to sudden withdrawals.
  • Knowledge economy: Recipient country can benefit from improved knowledge and expertise of foreign multinational.
  • Employment generation: FDI creates employment opportunity mainly in service sector and ITEC.
    • Investment from abroad could lead to higher wages and improved working conditions, especially if the MNCs are conscious of their public image of working conditions in developing economies.
  • Infrastructure development: FDI in construction, railways except operation help in developing projects like high-speed train, Freight corridor, etc
  • Strengthen financial services: FDIs can enhance financial services of a country by not only entering its banking industry but also by extending other activities like merchant banking, portfolio investment etc.
    • This, in turn, can result in the promotion of more companies.
    • It has also helped the capital market within the country.

Government Measures to increase FDI

  • In 2020, schemes like production-linked incentive (PLI) scheme for electronics manufacturing, have been notified to attract foreign investments.
  • In 2019, the Central Government amended FDI Policy 2017, to permit 100% FDI under automatic route in coal mining activities.
  • Further, the government permitted 26% FDI in digital sectors. The sector has particularly high return capabilities in India as favourable demographics, substantial mobile and internet penetration, massive consumption along with technology uptake provides great market opportunity for a foreign investor.
  • FDI in manufacturing was already under the 100% automatic route, however in 2019, the government clarified that investments in Indian entities engaged in contract manufacturing is also permitted under the 100% automatic route provided it is undertaken through a legitimate contract.
    • Contract Manufacturing: Production of goods by one firm, under the label or brand of another firm.
  • Foreign Investment Facilitation Portal (FIFP) is the online single point interface of the Government of India with investors to facilitate FDI. It is administered by the Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry.


Foreign Direct Investment (FDI) is a major driver of economic growth and an important source of non-debt finance for the economic development of India. A robust and easily accessible FDI regime, thus, should be ensured. Economic growth in the post-pandemic period and India’s large market shall continue to attract market-seeking investments to the country.

Value addition

FDI in India

 FDI is an important monetary source for India’s economic development. Economic liberalisation started in India in the wake of the 1991 crisis and since then, FDI has steadily increased in the country. India, today is a part of top 100-club on Ease of Doing Business (EoDB) and globally ranks number 1 in the greenfield FDI ranking.

 Routes through which India gets FDI

  • Automatic route: The non-resident or Indian company does not require prior nod of the RBI or government of India for FDI.
  • Govt route:The government’s approval is mandatory. The company will have to file an application through Foreign Investment Facilitation Portal, which facilitates single-window clearance. The application is then forwarded to the respective ministry, which will approve/reject the application in consultation with the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce. DPIIT will issue the Standard Operating Procedure (SOP) for processing of applications under the existing FDI policy.


Answer the following questions in 250 words:

General Studies – 1

11. Solid waste management (SWM) in urban areas faces significant challenges associated with waste collection, transportation, treatment and disposal. Analyse. Suggest remedies to overcome these challenges. (250 words, 15 marks)


Solid waste management (SWM) refers to the process of collecting and treating solid wastes. It also offers solutions for recycling items that do not belong to garbage or trash.  In a nascent effort to look beyond toilets and kick off its ODF+ phase — that is, Open Defecation Free Plusfocussing on solid and liquid waste management, the Swachh Bharat Abhiyan (SBA) has included the prevalence of plastic litter and water-logging in villages as indicators of cleanliness in its 2019 rural survey.


Current Situation of SWM in India:

  • As per the SBM 2.0 guidelines, the total quantity of waste generated by urban areas in India is about 32 lakh tonnes daily. This adds up to 4.8 crore tonnes per annum.
  • Of this only about 25% is being processed; the rest is disposed of in landfills every year.
  • Given that the waste dumpsites have been operational since the early 2000s, more than 72 crore tonnes of waste need to be processed.
  • Most cities have confined themselves to collection and transportation of solid waste. Processing and safe disposal are being attempted only in a few cases.
  • The CPCB report also reveals that only 68% of the MSW generated in the country is collected of which, 28% is treated by the municipal authorities. Thus, merely 19% of the total waste generated is currently treated.
  • According to a UN report, India’s e-waste from old computers alone will jump 500 per cent by 2020, compared to 2007.
  • Disappearance of urban water bodies and wetlands in urban areas can be attributed to illegal dumping of Construction & Demolition waste.

Some of the major issues concerning solid waste management are:

  • Absence of segregation of waste at source
  • Lack of funds for waste management at ULBs.
  • Unwillingness of ULBs to introduce proper collection, segregation, transportation and treatment/ disposal systems.
  • Lack of technical expertise and appropriate institutional arrangement
  • lack of infrastructure and technology
  • lack of involvement from the private sector and non-governmental organisations
  • Indifference of citizens towards waste management due to lack of awareness
  • Lack of community participation towards waste management and hygienic conditions
  • Lack of sewage management plan.
  • About 70% of the plastic packaging products turn into plastic waste within a short period.
  • Unorganized vendors and markets, existence of slum areas and Corruption are other issues plaguing MSWM.

Measures needed

  • State governments should provide financial support to ULBs to improve their waste management system under various schemes and programs.
  • Initiatives like Smart Cities Mission, AMRUT should provide significant funding to improve civic services infrastructure.
  • The key to efficient waste management is to ensure proper segregation of waste at source and to ensure that the waste goes through different streams of recycling and resource recovery as stated in the Solid Waste Management Rules, 2016.
  • Waste to energy is a key component of SWM. Installation of waste-to-compost and bio-methanation plants would reduce the load of landfill sites
  • There is a need to encourage research and development so as to reinvent waste management system in India.
  • The focus should be on recycling and recovering from waste and not landfill. Further, it is important to encourage recycling of e-waste so that the problem of e-waste
  • Public- Private Partnership models for waste management should be encouraged.
  • Construction and demolition waste should be stored, separately disposed off, as per the Construction and Demolition Waste Management Rules, 2016.
  • Responsibilities of Generators have been introduced to segregate waste in to three streams, Wet (Biodegradable), Dry (Plastic, Paper, metal, wood, etc.) and domestic hazardous wastes (diapers, napkins, empty containers of cleaning agents, mosquito repellents, etc.) and handover segregated wastes to authorized rag-pickers or waste collectors or local bodies.
  • Sensitization of citizens as well as government authorities, community participation, involvement of NGOs. Littering should be prohibited.
  • International Best practices should be emulated. South Korea is one of the few countries to separate and recycle food waste. It has also launched landfill recovery projects such as the Nanjido recovery project which have successfully transformed hazardous waste sites into sustainable ecological attractions.


Municipal solid waste management (MSWM) is one of the major environmental problems of Indian cities. The need of the hour is scientific, sustainable and environment friendly management of wastes.



12. The focus on the quality and coverage of health services through public health initiatives have contributed majorly to the decline in the Maternal Mortality Rate (MMR) in India. Precise focus must however be continued in states still showing high mortality rate to achieve SDG-3. Discuss. (250 words, 15 marks)


India’s maternal mortality ratio (MMR) has improved to 103 in 2017-19, from 113 in 2016-18. This is according to the special bulletin on MMR released by the Registrar General of India March 14, 2022.

As per the World Health Organisation, maternal death is the death of a woman while pregnant or within 42 days of termination of pregnancy, from any cause related to or aggravated by the pregnancy or its management.


MMR in states: Findings

  • The number of States that have achieved the SDG target has now risen from five to seven — Kerala (30), Maharashtra (38), Telangana (56), Tamil Nadu (58), Andhra Pradesh (58), Jharkhand (61), and Gujarat (70).
    • Kerala has recorded the lowest MMR which puts Kerala way ahead of the national MMR of 103.
    • Kerala’s Maternal MMR has dropped by 12 points. The last SRS bulletin (2015-17) had put the State’s MMR at 42 (later adjusting it to 43).
  • There are now nine States that have achieved the MMR target set by the NHP, which include the above seven and Karnataka (83) and Haryana (96).
  • Uttarakhand (101), West Bengal (109), Punjab (114), Bihar (130), Odisha (136) and Rajasthan (141) — have the MMR in between 100-150, while Chhattisgarh (160), Madhya Pradesh (163), Uttar Pradesh (167) and Assam (205) have the MMR above 150.

Reasons for declining MMR

Focus on quality and coverage of health services through public health initiatives have contributed majorly to the decline. Some of these initiatives are:

  • LaQshya, Poshan Abhiyan, Janani Suraksha Yojana, Pradhan Mantri Surakshit Matritva Abhiyan, Pradhan Mantri Matru Vandana Yojana.
    • LaQshya Labour room Quality Improvement Initiative: Recently, the Union Ministry of Health and Family Welfare has launched “LaQshya” (Labour room Quality Improvement Initiative) to improve the quality of care in the labour room and maternity operation theatres in public health facilities.
  • Poshan Abhiyan: Targets expecting and new mothers along with the children. It has helped reduce anaemia in women and guiding them on right nutrition.
  • With the objective to provide quality ANC to every pregnant woman the Government of India has launched the Pradhan Mantri Surakshit Matritva Abhiyan (PMSMA), a fixed day ANCs given every month across the country.
    • This is to be given in addition of the routine ANC at the health facility.
  • The implementation of the Aspirational District Programme and inter-sectoral action has helped to reach the most marginalized and vulnerable population.
  • Recently launched Surakshit Matritva Aashwasan Initiative (SUMAN) especially focuses on zero preventable maternal and newborn deaths.
  • The continuous progress in reducing the MMR will help the country to achieve the SDG 3 target of MMR below 70 by 2030.

Conclusion and way forward

  • In conclusion, women deserve the right to safe maternity services. This includes physical and emotional safety for the mother and baby.
  • Hence, a well-managed system that allows pregnant women to access maternal health care with minimum exposure risk is essential during the outbreak.
  • Simultaneously, task sharing with community health workers under regulatory and legal provisions must be explored.
  • E-training mechanisms and capacity building exercises must be undertaken for the additionally requisitioned health workforce to reduce the workload of time-sensitive commitments and non-health work.
  • Importantly, the health workers must also be trained to reduce the risk, stigma and sensitization of pregnant women on COVID-19 symptoms, prevention and hygiene.



13. During the Quit India Movement, there was a paradigm shift in the nature of mass movement in India’s freedom struggle. Explain. (250 words, 15 marks)



The failure of the Cripps Mission in April 1942 made it clear that Britain was unwilling to offer an honourable settlement and a real constitutional advance during the War. Consequently, Gandhiji drafted a resolution for the Congress Working Committee calling for Britain’s withdrawal and nation edged towards Quit India Movement or August Kranti. Mahatma Gandhi’s clarion call of ‘Do or Die’ inspired thousands of party workers but also created frenzy among the British who rushed to imprison the entire Congress leadership.


Quit India Movement:  Paradigm shift in nature of mass movement in India’s freedom struggle

  • Social radicalism of Gandhi:
    • In a sharp contrast to Non-cooperation movement, where Gandhi withdrew after Chauri Chaura incident, in Quit India movement he not only refused to condemn the people’s resort to violence but unequivocally held government responsible for it.
    • Though the need for non-violence was always reiterated, Gandhi’s mantra of Do or Die represents the militant mood of Gandhi.
    • Gandhi also gave a call to all sections of the people, the princes, the Jagirdars, the Zamindars, the propertied and moneyed classes, who derive their wealth and property from the workers in the fields and factories and elsewhere, to whom eventually power and authority belong.
    • This  indicates Gandhi’s social radicalism and shift in the philosophy of the Congress, by now people with the goals of socialism and communism have become a part of the broad-based Congress organization.
  • Violent at some places:
    • The Quit India Movement was mainly a non-violent movement. However, it became violent at some places.Rails were uprooted, post offices were set on fire and offices were destroyed.
  • Leaderless movement:
    • Even before the formal launching of the movement, the government in a single sweep arrested all the top leaders of the Congress. This led to spontaneous outburst of mass anger against the arrest of leaders. 
    • The spontaneous participation of the massesin the Quit India movement made it one of the most popular mass movements.
  • Demand for independence:
    • This historic movement placed the demand for independence on the immediate agendaof the national movement.
    • The spirit unleashed was carried further by Indian National Army of Subhas Chandra Bose. After ‘Quit India’ there could be no retreat. Independence was no longer a matter of bargain.
    • It accelerated and sustained the urge for freedom and enabled India to achieve freedom in 1947.
  • Establishment of Parallel Governments:
    • Parallel governments were established at many places.
    • Ballia under Chittu Pandey, got many Congress leaders released.
    • In Tamluk and Contai subdivisions of Midnapore in West Bengal, the local populace were successful in establishing Jatiya Sarkar, which undertook cyclone relief work, sanctioned grants to schools, supplied paddy from the rich to the poor, organised Vidyut Vahinis, etc.
    • In Satara (Maharashtra), “Prati Sarkar”, was organised under leaders like Y.B. Chavan, Nana Patil, etc. Village libraries and Nyayadan Mandals were organised
  • Underground Activity:
    • Many nationalists went underground and took to subversive activities.
    • The participants in these activities were the Socialists, Forward Bloc members, Gandhi ashramites, revolutionary nationalists and local organisations in Bombay, Poona, Satara, Baroda and other parts of Gujarat, Karnataka, Kerala, Andhra, United Provinces, Bihar and Delhi.
    • The main personalities taking up underground activity were Rammanohar Lohia, Jayaprakash Narayan, Aruna Asaf Ali, Usha Mehta, Biju Patnaik, Chhotubhai Puranik, Achyut Patwardhan, Sucheta Kripalani and R.P. Goenka.
    • Usha Mehta started an underground radio in Bombay.
    • This phase of underground activity was meant to keep up popular morale by continuing to provide a line of command and guidance to distribute arms and ammunition
  • Strong women participation:
    • Quit India movement was unique in the sense that it saw women participation where they not only participated as equals but also led the movement.
    • Women, especially school and college girls, actively participated, and included Aruna Asaf Ali, Sucheta Kripalani and Usha Mehta.
    • There was Matangini Hazra, who lead a procession of 6,000 people, mostly women, to ransack a local police station.
  • Extent of Mass Participation
    • The participation was on many levels.
    • Youth, especially the students of schools and colleges, remained in the forefront.
    • Workers went on strikes and faced repression.
    • Peasants of all strata were at the heart of the movement.
    • Even some zamindars
    • Government officials, especially those belonging to lower levels in police and administration, participated resulting in erosion of government loyalty.
    • Muslims helped by giving shelter to underground activists. There were no communal clashes during the movement.


Despite its failure, the Quit India movement is considered significant as it made the British Government realize that India was ungovernable in the long run. Post the Second World War, the question that was most prominent for the British was on how to exit India peacefully.

Value addition:

The quit India resolution stated the provisions of the movement as:

  • An immediate end to British rule over India.
  • Declaration of the commitment of free India to defend itself against all kinds of imperialism and fascism.
  • Formation of a provisional government of India after British withdrawal.
  • Sanctioning a civil disobedience movement against British rule.


  • The Communists did not join the movement; in the wake of Russia (where the communists were in power) being attacked by Nazi Germany, the communists began to support the British war against Germany and the ‘Imperialist War’ became the ‘People’s War’.
  • The Muslim League opposed the movement, fearing that if the British left India at that time, the minorities would be oppressed by the Hindus.
  • The Hindu Mahasabha boycotted the movement.
  • The Princely states showed a low-key response.



General Studies – 2

14. The Indo-Japan Strategic and Global Partnership has evolved with collective cooperation and engagement on various issues. Yet, there remains scope for deepening the bilateral relationship especially in the wake of the current geopolitical ferment. Discuss. (250 words, 15 marks)



It is significant that despite the recent developments in Ukraine, Tokyo and New Delhi have managed to present a united front vis-a-vis China. While Kishida condemned the Russian attack, the Indian side called for peace and dialogue. This is in line with the two countries’ positions, and individual strategic needs — and that common interests outweigh the differences.


India-Japan cooperation and bilateral relations

  • Increased Economic Cooperation: Both signed Comprehensive Economic Partnership Agreement (CEPA) in 2011 which helped in boosting bilateral trade.
    • Japan has been one of the biggest sources of investment flows into India, accounting for $28.16 billion in FDI between April 2000 and June 2018.
  • Connectivity through Huge Infrastructure projects: Within India- Japan has been a leading financial donor in the form of ODA (Official Development Assistance) to India.
    • It continues to maintain a high degree of interest and support for India’s mega infrastructure projects like the Delhi-Mumbai Freight Corridor, Delhi-Mumbai Industrial Corridor etc.
    •  North East integrationIndia’s Act east policy has North east development at its core. Japan promises to undertake several projects in the region under north East Forum. It has security (chicken neck corridor) and developmental implications for India.
  • Asia-Africa Growth Corridor AAGC: Asia-Africa Growth Corridor (AAGC) announced in 2017 and joint projects in some third countries like Bangladesh, Myanmar, and Sri Lanka and in Africa as well will be taken jointly.
  • Defence ties: Quadrilateral Security Dialogue is a strategic dialogue between India, United States, Japan and Australia will be carried out.
    •  India and Japan signed an “Acquisition and Cross-Servicing Agreement” that would allow the militaries of the two countries to exchange supplies and services on a reciprocal basis during exercises in which both participate, U.N. and humanitarian assistance operations etc.
    • Trilateral naval exercise Malabar involving the United States, Japan and India will be carried on continuous basis.
  • Global and regional partnership: Both have come together, through platforms like QUAD, Asia-Africa Growth Corridor.
    • Looming presence of China has led to the convergence of economic and strategic imperatives, especially in the India-Pacific region.
  • Space cooperation: India and Japan conducted their first Annual Bilateral Space Dialogue, for enhancing bilateral cooperation in outer-space.

Ample scope to deepening the relations

  • In spite of CEPA India Japan trade it has not produced the anticipated results.
    • In 2011-12, the total volume of the bilateral trade was $18.43 billion, but it declined to $13.48 billion during 2016-17.
  • Both had diverging interest with respect to economic issues like on E-commerce rules (Osaka track), Regional Comprehensive Economic Partnership etc.
  • Both countries do not have a specific China policy. Despite, converging interests of Japan, India, trade with China represents more than 20% of Japan’s total trade.
  • No concrete action on projects like Asia Africa Growth Corridor, despite it being signed in 2017.


India Japan’s relationship has been defined as ‘indispensable natural partners.’ Also, Indian Prime Minister said, there are few partnerships that enjoy so much goodwill in India as our relationship with Japan. To realise the full potential of relationship, both need to expedite work on trade, defence and infrastructural issues. A strong Indo- Japan will arrest the inconsistency being witnessed in the region thus contributing to peace and prosperity in the Indo Pacific region and the world.



15. A permanent and sustainable solution which is mutually acceptable to both sides is needed to resolve decades long fishing issue between India and Sri Lanka. Comment. (250 words, 15 marks)


In line with the “Neighborhood First” approach and the “Sagar” doctrine, New Delhi attaches “a special priority” to its relations with Colombo. However, fishermen issues are persisting since a long time. Palk Bay, a narrow strip of water separating the State of Tamil Nadu from the Northern

Province of Sri Lanka is a rich fishing ground for both countries and continues to be the disputed space. The major issue is the ongoing disagreement over the territorial rights of the island of Katchatheevu.



Fishermen issues: Major concerns

  • Sri Lanka has accused Indian fishermen of frequent poaching in the island nation’s waters, and damaging the marine environment through frequent trawling.
    • As in the past, fishermen from Rameswaram and nearby coasts continue to sail towards Talaimannar and Katchatheevu coasts, a region famous for rich maritime resources in Sri Lanka.
    • Plenty of catch in this oceanic region had triggered a proliferation of fishing trawlers in Tamil Nadu coast in the past three decades.
    • There were many favourable reasons too for Indian fishermen as their access to Sri Lankan waters was easier at the time of Sri Lankan civil war.
  • Bottom trawling: In July 2017, Sri Lanka became the first Asian country to ban the aggressive method of fishing and declared it an offence by unanimously passing an amendment to the Fisheries and Aquatic Resources Act, attracting a fine of LKR 50,000 with two years of imprisonment.
    • Since then, many Indians were jailed.
  • Political issue: While the conflict is multi-layered, its political dimension has tended to overshadow other important factors.
    • It has been often a sensitive political issue in Tamil Nadu in the past one decade.
  • Indians jailed: In particular, Indian analysts say, the trauma faced by the families of fishermen detained in foreign jails hasn’t received much attention.
    • It is pertinent that in most cases, the arrested fisher-folk have been the sole earners for their families.
    • Their incarceration in Sri Lankan jails has inflicted trauma and suffering on their families.
  • Katchateevu issue: While the unpopular truth in the entire conflict is accusations about Tamil fishermen entering Sri Lankan waters, ownership of Katchatheevu island, where Tamil fishermen had traditional fishing rights for centuries, also remains an unresolved issue.

Resolution of fishermen issues

  • The department of ocean development and ministry of agriculture have to ensure assistance to the states so that fishermen are able to find alternative livelihood to fishing in Palk Bay.
  • The Sri Lankan Fisheries and Aquatic Resource Minister appointed a three-member committee to find a lasting solution to the issue.
  • According to the minister, India had accepted a draft solution submitted by Sri Lanka in January last year, but further progress was halted due to the COVID-19 pandemic.
  • Sri Lanka had suggested joint patrols and operations between the two countries to guarantee effective results on illegal fishing and trespassing. There is an immediate need to sign a protocol for joint patrolling.
  • If both countries are unable to settle the dispute, then they could seek assistance from international maritime experts.
  • The Indian government has renewed the thrust on ocean economy in recent times with the PM signing MoU on ocean economy with Sri Lanka, Mauritius and Maldives in 2015.
  • Both countries have agreed on certain practical arrangements to deal with the issue of bona fide fishermen of either side crossing the International Maritime Boundary Line.
    • Through these arrangements, it has been possible to deal with the issue of detention of fishermen in a humane manner.
  • India and Sri Lanka have agreed to set up a Joint Working Group (JWG) on Fisheries between the Ministry of Agriculture and Farmers’ Welfare of India and Ministry of Fisheries and Aquatic Resources Development of Sri Lanka as the mechanism to help find a permanent solution to the fishermen issue.


Despite having met more than once since 2016, a solution is yet to be finalized. Irrespective of the circumstances, a potential solution to the dispute relies on the response from the respective governments of India and Sri Lanka. There is a glaring need for institutionalisation of fishing in Indian waters by the government of India so that alternative means of livelihood are provided. Government will have to mark up a comprehensive plan to reduce the dependence of Indian fishermen on catch from Palk Bay.

Value addition

Kachchatheevu island

  • Kachchatheevu is a small island located about 10 miles north east of Rameshwaram.
  • The fishermen used it to dry their nets and catch fish.
  • When the Zamindari system was abolished, Kachchatheevu became a part of the Presidency of Madras.
  • When India became independent and initiated a boundary negotiation at the maritime level with Sri Lanka, Kachchatheevu was a disputed territory between Ceylon and the British and there was never an agreement on boundary ever.
  • In 1947 and 1976, as per agreements, the issue was bilaterally resolved between India and Sri Lanka, and the resultant maritime agreement has allowed Indians to visit Kachchatheevu for pilgrimage for which no visa is required.
  • The Indian government has maintained that the right of access to Kachchatheevu does not cover any fishing rights.


16. Despite various interventions to tackle hunger in the country, the issue continues to be persistent sore in the nation’s food security, undermining its developmental goals. Comment. (250 words, 15 marks)



“Food Security” is one of crucial factors of development and poverty alleviation around the globe the right to food is a principle of international human rights law. Food security, as defined by the United Nations’ Committee on World Food Security (CFS), is the condition in which all people, at all times, have physical, social and economic access to sufficient safe and nutritious food that meets their dietary needs and food preferences for an active and healthy life. Our current understanding of food security includes the four dimensions of access, availability, utilisation and stability.

The Right to Food Campaign and associated organisations had conducted the first Hunger Watch survey (HW-I). Covering close to 4,000 people in 11 states, the survey highlighted the extent of widespread hunger and a deterioration in the quality of diets compared to the pre-pandemic period.


Various interventions to tackle hunger in the country

  • Pradhan Mantri Matru Vandana Yojana (PMMVY): 6,000 is transferred directly to the bank accounts of pregnant women for availing better facilities for their delivery.
  • POSHAN Abhiyaan:aims to reduce stunting, under-nutrition, anaemia and low birth weight babies through synergy and convergence among different programmes, better monitoring and improved community mobilisation.
  • National Food Security Act (NFSA), 2013, aims to ensure food and nutrition security for the most vulnerable through its associated schemes and programmes, making access to food a legal right.
  • Mid-day Meal (MDM)scheme aims to improve nutritional levels among school children which also has a direct and positive impact on enrolment, retention and attendance in schools.
  • Integrated Child Development Services (ICDS),with its network of 1.4 million Anganwadi Centres, reaching almost 100 million beneficiaries who include pregnant and nursing mothers and children up to 6 years;
  • Public Distribution System (PDS)that reaches over 800 million people under the National Food Security Act.
  • Additionally, NITI Aayog has worked on a National Nutrition Strategy (NNS),isolated the 100 most backward districts for stunting and prioritised those for interventions.


The issue continues to be persistent sore in the nation’s food security

  • Economic distress:
    • The significant rise in food insecurity, as shown by these data, is a clear manifestation of the overall economic distress during this period marked by a deepening agrarian crisis, falling investments across sectors and shrinking employment opportunities.
    • The latest PLFS data have shown that the unemployment rates in the recent years have been higher than in the last four decades.
    • It is widely believed that demonetisation and introduction of the Goods and Services Tax were two prime causes of economic distress during this period.
  • NFSA issues:
    • The NSFA does not guarantee universal right to food: Targeted –Restricts the right to food to only 75% of rural and 50% of urban population in India
    • Act would not apply in times of “war, flood, drought, fire, cyclone or earthquake”. This a highly problematic clause given that food is becomes utmost necessary during these circumstances
    • The Act focuses primarily on distribution of rice and wheat and fails to address the ‘utilization’ dimension of food security.
    • Given that a major reason for micronutrient deficiency in India is because of a cereal-based diet; the NSFA does not address the issue of malnutrition and nutritional deficiency adequately.
    • Under the National Food Security Act, the identification of beneficiaries is to be completed by State Governments. As per findings of Comptroller and Auditor General in 2016, a massive 49 % of the beneficiaries were yet to be identified by the State Governments.
  • Quality issues:
    • Inadequate distribution of food through public distribution mechanism, food adulterations in distributed food
    • Beneficiaries have complained of receiving poor quality food grains.
  • Issues with procurement:
    • Open-ended Procurement: All incoming grains accepted even if buffer stock is filled creating a shortage in the open market.
    • The recent implementation of Nation food security act would only increase the quantum of procurement resulting in higher prices for grains.
    • The gap between required and existing storage capacity.
    • The open market operations (OMO) are much less compared to what is needed to liquidate the excessive stocks.
  • Issues with storage:
    • Inadequate storage capacity with FCI.
    • Food grains rotting or damaging on the CAP or Cover & Plinth storage.
    • The money locked in these excessive stocks (beyond the buffer norm) is more than Rs 1 lakh crore.
  • Issues with allocation of food grains:
    • Inaccurate identification of beneficiaries.
    • Illicit Fair Price shops: The shop owners have created a large number of bogus cards or ghost cards (cards for non-existent people) to sell food grains in the open market.
  • Issues with transportation:
    • Leakages in food grains distribution to be reduced as most leakages in PDS takes place in initial stages.
  • Climate Change:
    • Higher temperatures and unreliable rainfall makes farming difficult. Climate change not only impacts crop but also livestock, forestry, fisheries and aquaculture, and can cause grave social and economic consequences in the form of reduced incomes, eroded livelihoods, trade disruption and adverse health impacts.
  • Lack of access to remote areas:
    • For the tribal communities, habitation in remote difficult terrains and practice of subsistence farming has led to significant economic backwardness.
  • Increase in rural-to-urban migration, large proportion of informal workforce resulting in unplanned growth of slums which lack in the basic health and hygiene facilities, insufficient housing and increased food insecurity.
  • Overpopulation, poverty, lack of education and gender inequality.
  • Corruption:
    • Diverting the grains to open market to get better margin, selling poor quality grains at ration shops, irregular opening of the shops adds to the issue of food insecurity.

Measures needed:

  • Governments, private actors, and NGOs should carefully coordinate their responses to overlapping food and health crises and work with community organizations to make sure interventions are culturally acceptable, reach the most vulnerable, and preserve local ecosystems.
  • Food should be priced not only by its weight or volume but also by its nutrient density, its freedom from contamination, and its contribution to ecosystem services and social justice.
  • Governments should expand access to maternal and child health care, as well as education on healthy diets and child feeding practices.
  • Supporting smallholder farmers in becoming sustainable and diversified producers; governments and NGOs must seek to improve those farmers’ access to agricultural inputs and extension services, coupling local and indigenous agricultural knowledge with new technologies.
  • Existing human rights-based multilateral mechanisms and international standards—such as the Committee on World Food Security—must be strengthened to support inclusive policy making and sustainable food systems.


Prioritizing early childhood nutrition is key to ensuring India’s development rests on strong and steady shoulders. India’s ability to harness long-term demographic dividends rests on it prioritizing nutrition in its health agenda, and reforming the institutional framework through which interventions are delivered.


General Studies – 3

17. What are the various issues with respect to goods and services tax (GST)? Do you think that petroleum products should be included under GST? Critically Examine.  (250 words, 15 marks)


The Goods and Services Tax (GST) is an indirect tax system which was rolled out in 2017 with the aim of ‘One Nation, one tax’. The Comptroller and Auditor General of India (CAG) has pointed out lacunae in the GST regime, saying that system-validated input tax credit through invoice matching is not in place and a non-intrusive e-tax system still remains elusive after two years of its rollout.


Various issues with respect to goods and services tax (GST) regime

  • Input Tax Credit (ITC) is an area which has certain limitations that need to be addressed. The GST regime sought to have a seamless flow of ITC, however, conditions for availing ITC being stringent, many taxpayers lost out on ITC. Also, taxpayers lose their ITC due to non-reporting or mistakes by their suppliers.
  • Compliance issues: taxpayers are also complaining about the imposing an arbitrary monetary limit on availing input tax credit through Rule 36(4) and mandating that a certain percentage of GST has to be paid in cash. These laws are making life difficult for even the most honest taxpayers.
  • Difficulty in tax administration: Goes against the canons of taxation. A modern tax system should be fair, uncomplicated, transparent and easy to administer. It must yield revenues sufficient to cover the cost of government services and public goods.
    • Lack of clarity on many rules is also leading to various litigation and different interpretations (of the same laws) by Advanced Ruling Authorities in different states.
  • Complicated taxation structure: A World Bank study published in May 2018 said that the Indian GST rate was the second highest among the 115 countries with a national value-added tax. It was also the most complicated, with five main tax rates, several exemptions, a cess and a special rate for gold. The multilateral lender said that only five countries had four or more non-zero tax rates—India, Italy, Pakistan, Luxembourg and Ghana.
    • Falling revenue amid disruptions caused by the Covid-19 pandemic has continuously delayed the reform, leaving a large number of items in high tax slabs.
  • GST revenue potential overestimated: The Union Budget for 2018-19 (the first full year under GST) estimated receipts to the tune of ₹7.43 lakh crore. Actual collections were just 78% of this amount. While the shortfall between Budget Estimates (BE) and actual collections reduced significantly in 2019-20 (the latter was 90% of the former) the BE number itself saw a significant downward revision to ₹6.63 lakh crore.
  • High compliance costs: are also arising because the prevalence of multiple tax rates implies a need to classify inputs and outputs based on the applicable tax rate. Along with the need to apply the correct rate, firms are required to match invoices between their outputs and inputs to be eligible for full input tax credit, which increases compliance costs further.
  • Tax-Sharing issues: alleged deviation in the way GST revenue is shared with states. To determine how integrated GST is to be split up, the report notes, the government has followed a formula prescribed by the Finance Commission, though it should have gone by the Constitution and Integrated GST Act.
    • The nationwide lockdown, however, intensified the problem of revenue shortfall for states with the Centre not paying up the dues on time. Also with coffers drying up and with social and health spending going up, states are growing disenchanted with the system
    • Last year, the GST Council had borrowed `1.1 lakh crore to pay the states in order to make up for the shortfall. Still, `63,000 crore is pending which the Centre intends to pay this year.
  • GST Council meetings: the meetings of the GST Council are not as frequent as they were earlier, if the recent incidents are anything to go by, and it often end up with disagreement, fight and strong letters and statements. States have also accused the Centre of cornering a substantial portion of tax in forms of cess.
  • There has been lack of coordination between the Department of Revenue, the Central Board of Indirect Taxes and Customs and the GST Network

Advantages of bringing petroleum products under GST

  • Bringing petroleum products under GST would mean a single rate (18% or 28%) in place of excise duty and state VAT, which will lower fuel prices at pumps.
  • Reduced fuel prices will lead to lower transport costs for industries who benefit from increased production and competitiveness.
  • Idea of a ‘single nation, single tax’, will be implanted firmly which is aimed at improving production and employment while taxing consumption.
  • Disadvantages caused to firms due to exclusion of fuel prices under GST will be resolved and the firms can claim input tax credit.

Challenges in bringing petroleum products under GST

  • By being able to levy VAT on these products, the state governments have control over their revenues. Bringing petroleum under GST takes away that control as the Centre is the one in charge of fixing the rate of GST.
  • Another issue is the rate of VAT on petrol and diesel varies wildly amongst states. While Maharashtra charges up to 40% on petrol, while Andaman and Nicobar charge just 6%.
  • Levying a standard rate of GST on petrol would mean that the prices increase dramatically in Andaman and Nicobar, but on the flip side, they would fall in Maharashtra if the cumulative rate is lower than the current rate.
  • The current high petrol and diesel prices come at a time when overall revenue collections from GST have been erratic along with slump post pandemic and lockdown.
  • Taking an excise duty cut now will add further pressure on government revenues. A Rs2 a litre excise cut in petrol and diesel in October meant revenue loss of about Rs26,000 crore in a full year to the government.

Way Forward

  • The first target should be to move to at least a three-rate structure, a lower rate for essential goods, a relatively high rate for luxury goods, and a standard rate for the majority of goods and services.
  • The next step would be simplifying the tax returns process.
  • The scope for lowering the GST rate is umbilically linked to direct tax reform.
  • A better way to make a tax system more just is by lowering regressive indirect tax rates while widening the base for progressive direct taxes on income and corporate profits.
  • The government needs to establish GST Tribunals to reduce litigation timelines and the pressure on courts.
  • The state authorities for Advance Ruling should ideally also have an independent jurist member, apart from a representative from the tax department.
  • Many goods are still outside the GST net, which comes in the way of seamless flow of input tax credit. Key items outside its ambit are electricity, alcohol, petroleum goods and real estate. This aspect need to be looked into.
  • Emulating the best practices. The GST in New Zealand, widely regarded as the most efficient in the world, has a single standard rate of 12.5 percent across all industry groups.
  • The Fifteenth finance commission, in its latest report, has addressed many issues including large shortfall in collections as compared to original forecast, high volatility in collections, accumulation of large integrated GST credit, glitches in invoice and input tax matching, and delay in refunds.
  • The Commission also observed that the continuing dependence of states on compensation from the central government for making up for the shortfall in revenue is a concern.
  • While at the same time it suggested that the structural implications of GST for low consumption states need to be considered.


While the GST’s journey has given its stakeholders some causes to celebrate, it has also given moments of worry. But then, no transformation of the scale and complexity can be achieved without its share of hiccups and challenges. The process of evolution will take a few years more for the mammoth structural change to stabilize. The four-year journey of GST has been a roller-coaster ride for all stakeholders with equitable share of hits, misses and expectations. A work-in-progress in its transformational journey, GST suffers from several shortcomings which need to be resolved quickly, but its journey to ‘Good & Simple Tax’ is still quite long.



18. Enumerate the major tax reforms introduced in India in the recent times. Do you think that India should move towards a Direct Tax Code? Examine. (250 words, 15 marks)


The Government is committed to providing a hassle-free direct tax environment with moderate tax rates and ease of compliance to the taxpayers and also to stimulate growth by reforming the direct taxes system. Such reforms bring clarity and certainty to investors, leading to better economic growth. Investments into the country increases leading to higher GDP levels.


Major tax reforms in recent times

  • Indirect taxes reforms: The integration of State and Central indirect taxes in the GST led to the abolition of entry tax and the Central Sales Tax (CST). GST is an Indirect tax which introduced to replace a host of other Indirect taxes such as VAT service tax, purchase tax, excise duty, and so on.
  • Reduction in the corporate tax rate for all existing domestic companies: In order to promote growth and investment, the Government has brought in a historic tax reform through the Taxation Laws (Amendment) Ordinance 2019 which provided a concessional tax regime of 22% for all existing domestic companies from FY 2019-20 if they do not avail any specified exemption or incentive. Further, such companies have also been exempted from payment of Minimum Alternate Tax (MAT).
  • The incentive for new manufacturing domestic companies: In order to attract investment in the manufacturing sector, the Taxation Laws (Amendment) Ordinance 2019 has drastically reduced the tax rate to 15% for new manufacturing domestic companies if such company does not avail any specified exemption or incentive.
  • Reduction in MAT rate: In order to provide relief to the companies which continue to avail exemption/deduction and pay tax under MAT, the rate of MAT has also been reduced from 18.5% to 15%.
  • Exemption from income-tax to individuals earning income up to Rs. 5 lakh and increase in standard deduction: Further, to provide complete relief from payment of income-tax to individuals earning taxable income up to Rs. 5 lakh, the Finance Act, 2019 exempted an individual taxpayer with taxable income up to Rs. 5 lakh by providing 100% tax rebate.

Need for Direct Tax Code

The Income Tax Act 1961 should be redrafted to account for the structural changes in the Indian economy, new models of doing business (e.g. international businesses, digital businesses etc.) and evolving methods of income calculation based on the objectives of economic policy.

 Rationalization and simplification of Income Tax Structure

  • The rate structure – slabs of 10%, 20% & 30% in personal income tax – has broadly remained the same in the last 20 years.
    • Further, there is a need for rationalization of exemptions and a rethink of incentives on savings (such as small savings schemes like PPF)
  • Simplify corporate tax rate structure and phase out exemptions: The differential in effective corporate tax rate across sectors is very high. E.g. in 2014-15, effective tax rates for cement manufacturers, consultancy service firms and banking service firms were 9 %, 16 % and 35 % respectively
  • Wide tax base will help deal with the problem of potential revenue loss due to lower tax rates and simplified tax structure.
  • Reducing tax litigation: Tendency of tax officials to initiate an action without the necessary justification or assessment is reflected from low success rate of appeals (~30%).
    • Protracted tax litigation in India has not only put a burden on Indian judiciary but has also cost the government exchequer.
  • Ensure balance between direct and indirect taxes: Contribution of direct taxes has declined from 60% in 2010-11 to 52% in 2017-18. Increasing share of indirect taxes in revenue is alarming as indirect taxes are regressive which hurt poor people more.
  • Clarity in cross border transactions: Till now, source rule of taxation for non-residents was linked to physical presence (permanent establishment) which has led to protracted litigation, base erosion and profit shifting.


Taxation is not just a vehicle for raising state revenue. It can also be critically important for economic and political development. The legacy of contentious, adversarial tax issues from the past is being cleaned up. Tax administration is being improved: now around 95% of filings are electronic, tax refunds are now being issued in a record 7-8 days. However, the success has only been limited and sporadic in mobilizing larger tax revenue and still, India remains largely a tax non-compliant society. For this, further reforms as per Direct Tax code is the need of the hour.

Value addition

  • Recently, Akhilesh Ranjan Committee on formulation of new Direct Tax Code (DTC) is expected to have recommended:-
  • Widening of tax slabs: 10% tax slab is expected to be widened to incomes upto 10 lakh.
    • This would benefit over 27% (1.47 cr) of the country’s individual taxpayers who had incomes between ₹5 lakh and 10 lakh;
  • Scrapping of the surcharges/cesses
  • Review of the existing long term capital gains (LTCG) tax, the securities transaction tax (STT) and dividend distribution tax (DTT).




19. What is Balance of payments (BoP)? Even though the reform process has strengthened resilience of India’s BoP, at the same time vulnerabilities arise with greater exposure of the economy to the rest of world through liberalised trade and investment environment. Analyse. (250 words, 15 marks)


Balance of Payment (BoP) of a country can be defined as a systematic statement of all economic transactions of a country with the rest of the world during a specific period usually one year.

It indicates whether the country has a surplus or a deficit on trade. When exports exceed imports, there is a trade surplus and when imports exceed exports there is a trade deficit.



Evolution of India’s BoP and various crises faced

1991 BoP crisis was one of the worst crises that India had to face. The then government was close to default, as RBI had refused new credit and foreign exchange reserves had been reduced to such a point that India could barely finance three weeks’ worth of imports.

  • Widening of trade gap due to rise in imports against a small growth in exports and increased cost of imports.
  • The sharp rise in crude prices due to the Gulf crisis.
  • Deterioration in the Exchange Rate of Rupee.
  • India’s current account deficit (CAD) had already touched 2.7% of the GDP in 1988-89.
  • From mid-1990, financing the CAD became arduous.
    • Traditional sources of financing started drying up.
    • The main factor contributing to the rising current account deficit was decline in the growth of net invisible earnings.
  • Decline in migrants’ remittance from abroad.
  • Non-resident deposits, which contributed significantly to bridge the CAD, had also started flowing out.

Reforms that improved India’s Balance of Payments

  • Abolition of Industrial licensing: Licence raj was liberalized. Many industries were delicensed.
    • Public Sector companies were revamped
  • Rupee was devalued: The first decisive action of the new government was with respect to the exchange rate. In 1991, rupee was devaluated.
    • The RBI shipped about 47 tonnes of gold to the Bank of England as security to raise foreign currency from England and Japan.
    • The government also sold 20 tonnes of gold to a Swiss Bank for acquiring foreign currency, with the condition that it would be repurchased after six months.
  • Liberalization, Privatization & Globalization were introduced for the first time
    • Import tariffs were lowered.
    • Import restrictions were eased.
    • Foreign investment was encouraged.
    • Domestic supply was promoted
    • Export subsidies were withdrawn
  • Liberalized Exchange Rate Management System: In the Union Budget 1992-93, a new system named LERMS was started. Under this, a system of double exchange rates was adopted.
    • Under LERMS, the exporters could sell 60% of their foreign exchange earning to the authorized Foreign Exchange dealers in the open market at the open market exchange rate while the remaining 40% was to be sold compulsorily to RBI at the exchange rates decided by RBI.

Present vulnerabilities with respect to India’s BoP

  • Trade deficit: India has always had deficits on its merchandise trade account, with the value of its imports of goods far in excess of that of exports. At the same time, the country has traditionally enjoyed a surplus on its ‘invisibles’ account.
  • Covid-19 impact: It has restricted economic activities and many remittances were stopped as people came back from overseas.
  • Russian invasion of Ukraine: It has sent up the oil prices and many foreign investors are removing money from Indian economy, as Sensex went down more than 1000 points on the onset ofwar.
  • Net services receipts decreased marginally over the previous quarter but increased on a year-on-year (y-o-y) basis, on the back of robust performance of the exports of computer and business services.
  • Net foreign portfolio investment was US$ 3.9 billion as compared with US$ 7.0 billion in Q2:2020-21.

Conclusion and way forward

The balance of payments data should catalyse finance ministry and RBI to jointly initiate a thorough study of the causes for the deterioration in the past. Very likely, there are measures which can be initiated quickly to arrest the slide in case the vulnerability deepens due to global factors.

Value addition


  • India’s current account balance recorded a deficit of US$ 9.6 billion (1.3 per cent of GDP) in Q2:2021-22 as against a surplus of US$ 6.6 billion (0.9 per cent of GDP) in Q1:2021-22
  • The deficit in the current account in Q2:2021-22 was mainly due to widening of trade deficit to US$ 44.4 billion from US$ 30.7 billion in the preceding quarter and an increase in net outgo of investment income.
  • Private transfer receipts, mainly representing remittances by Indians employed overseas, amounted to US$ 21.1 billion, an increase of 3.7 per cent from their level a year ago.
  • Net outgo from the primary income account, mainly reflecting net overseas investment income payments, increased sequentially as well as on a y-o-y basis.
  • In the financial account, net foreign direct investment recorded an inflow of US$ 9.5 billion, lower than US$ 24.4 billion a year ago.



20. Microfinance can facilitate the achievement of national policies that target poverty reduction, empowerment of women, assisting vulnerable groups, and improving standards of living. Elucidate. (250 words, 15 marks)


Micro financing is the delivery of financial services to poor and low income households with limited access to formal financial institutions. It can also be described as banking for the underprivileged. Microfinance institutions (MFIs) came into being in the 90s as banks’ reluctance to lend to those without credit history provided an opportunity to those willing to take risk and organize rural communities.  According to Mohammed Yunus (founder of Grameen Bank in Bangladesh) access to credit was a human right, essential for the poor to create self-employment and income.

The Reserve Bank of India (RBI) recently allowed microfinance institutions the freedom to set interest rates they charge borrowers, with a caveat that the rates should not be usurious.


Microfinance can facilitate the achievement of national policies targeting vulnerable sections

  • Empowerment of women: About 95 percent of some loan products extended by microfinance institutions are given to women, as well as those with disabilities, those who are unemployed, and even those who simply beg to meet their basic needs.
  • Poverty alleviation: They provide easy credit and offer small loans to customers, without any collateral.
    • Microfinance disrupts the cycle of poverty by making more money available. It creates the possibility of future investments.
  • Savings in rural households: It helps the poor and marginalised section of the society by making them aware of the financial instruments available for their help and also helps in developing a culture of saving.
    • Families benefiting from microloans are more likely to provide better and continued education for their children.
  • Creating employment: Microfinance is also able to let entrepreneurs in impoverished communities and developing countries create new employment opportunities for others.

Benefits from MFIs:

  • It allows people to provide for their families. Through microfinance, more households are able to expand their current opportunities so that more income accumulation may occur.
  • It gives people access to credit. “By extending microfinance opportunities, people have access to small amounts of credit, which can then stop poverty at a rapid pace,”
  • It serves those who are often overlooked in society. About 95 percent of some loan products extended by microfinance institutions are given to women, as well as those with disabilities, those who are unemployed, and even those who simply beg to meet their basic needs.
  • It creates the possibility of future investments. Microfinance disrupts the cycle of poverty by making more money available.
  • It can create jobs. Microfinance is also able to let entrepreneurs in impoverished communities and developing countries create new employment opportunities for others.
  • It encourages people to save. “When people have their basic needs met, the natural inclination is for them to save the leftover earnings for a future emergency,”

Issues with microfinance institutions

  • According to World Bank’s Global Financial Inclusion Survey (2012), only 35% of adults in India had access to a formal bank account and only 8% borrowed from institutional and formal sources.
  • As per Census 2011, only 58.7% of households are availing banking services in the country.
    • However, as compared with previous Census 2001, availing of banking services increased significantly largely on account of increase in banking services in rural areas.
  • At present, only about 5% of India’s 6 lakh villages have bank branches.
    • There are 296 under-banked districts in states with below-par banking services.
  • In a diverse country like India, financial inclusion is a critical part of the development process. Since independence, the combined efforts of successive governments, regulatory institutions, and the civil society have helped in increasing the financial-inclusion net in the country.
    • Thus, there exists both a great need and the potential to tap into the unbanked population and bring them into the financial net.
    • Microfinance institutions are a way to do the same.

Way forward:

  • There is a need for MFIs to consider adopting more flexible operating models, providing skills training and offering services such as portability of accounts to provide greater access for a longer duration of time.
  • A diversified menu of micro loan products linked to sustainable income generation activities via micro enterprises or a creation of community-based pooled enterprise could possibly make it more attractive and compatible with the requirements of women.
  • In addition, linking such developmental initiatives to an institution to nurture, monitor and handhold those activities in the formative stages is crucial for sustainability.


As per the World Bank estimates, more than 500 million people have improved their economic conditions via microfinance-related entities. Strengthening the credit check and debt collection processes and educating the villagers about products and consequences is important. A model to retain and recycle within the target population could possibly lead to a sustained route for poverty alleviation.


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