[Mission 2024] Insights SECURE SYNOPSIS: 10 October 2023

NOTE: Please remember that following ‘answers’ are NOT ‘model answers’. They are NOT synopsis too if we go by definition of the term. What we are providing is content that both meets demand of the question and at the same

General Studies – 1

Topic: History of the world will include events from 18th century such as industrial revolution, world wars, redrawal of national boundaries, colonization, decolonization, political philosophies like communism, capitalism, socialism etc.— their forms and effect on the society.

1.  The Cuban Missile Crisis was the closest the Cold War came to escalating into a full-scale nuclear war. It serves as a stark reminder of the dangers of nuclear brinkmanship and the importance of diplomacy and communication in averting global catastrophe. Discuss. (250 words)

Difficulty level: Tough

Reference: Indian Express , Insights on India

Why the question:

The article sets the backdrop of the Cold War, a period of intense rivalry and nuclear arms race between the United States and the Soviet Union.

Key Demand of the question:

To write about Cuban missile crisis and its impact on Cold war.

Directive word: 

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

Structure of the answer:

Introduction: 

Start by giving context of the Cuban missile crisis.

Body:

First, write about the events leading to the Cuban missile crisis.

Next, write about how the Cuban missile crisis could have led to outbreak a full-fledged nuclear war and its possible ramifications.

Next, write about the steps that were taken to diffuse Cuban missile crisis and emphasise on diplomatic solutions.

Conclusion:

Conclude by mentioning the key lessons learnt from the crisis.   

Introduction

Cuba got involved in the Cold War after Fidel Castro seized power from the USA backed dictator Batista in 1959. In 1961, USA broke diplomatic ties with Cuba which resulted in the relationship between the USSR and Cuba getting better. In 1961, Castro announced that he was a Marxist and Cuba was a socialist country.

Earlier this month, US President Joe Biden said that his Russian counterpart Vladimir Putin’s veiled threat of using tactical nuclear weapons against Ukraine marked the first prospect of nuclear “armageddon” since the Cuban missile crisis. A day later, his administration said there was no evidence for this claim.

Body

The major reasons for the Cuban Missile Crisis were

• Cuba was under threat of military invasion from the USA, so the USSR wanted to help as a gesture of solidarity with Cuba which was an ally of the Soviet Union.
• The USSR lost the lead in developing Intercontinental Ballistic Missiles (ICBMs), so it was looking for an opportunity to encircle the USA from a close range.
• In 1959, the USA deployed Jupiter missiles in Turkey. It threatened the security of the USSR, hence, Cuba seemed to be an ideal place to initiate counter-strike against the USA.
• The Soviets felt uneasy about the number of nuclear weapons that were targeted at them from Western Europe and Turkey, and deployment of missiles in Cuba could be used for bargaining with the West.

Despite lasting for a few days, the Cuban Missile Crisis had important consequences

• The world came to realise how easily a nuclear war can be started.
• A hotline was introduced between USSR and USA to allow swift consultations.
• In 1963, the USA, the USSR and Britain signed a Nuclear Test Ban Treaty, agr eeing to carry out nuclear tests only underground to avoid polluting the atmosphere any further.
• The Cuba-USSR relationship was extremely cool for several years as Cuba felt betrayed.

Conclusion

The crisis came to an end after an appeal was made by the Secretary-General of the UN. The USSR agreed to withdraw the missiles and destroy the launching sites in Cuba, and in return, the USA agreed not to invade Cuba again.

The Cuban Missile Crisis was an important event in the Cold War era, which made the world realize the threat posed by the weapon race of USA and USSR, and it proved to be a kick-start for the movements to make the world safe from the horrors of a nuclear war.

General Studies – 2

Topic: Structure, organization and functioning of the Executive and the Judiciary—Ministries and Departments of the Government;

2. The Collegium system has faced criticism for its lack of transparency and accountability in the selection and appointment of judges. Calls for reform focus on introducing greater transparency, and standardization of criteria to address these issues and enhance the credibility of the judiciary. Examine. (250 words)

Difficulty level: Easy

Reference: Indian Express , Insights on India

Why the question:

The Indian government is set to notify the appointment of a significant number of judges recommended by the Collegium. This move comes after a period of deliberation and discussions between the government and the Collegium.

Key Demand of the question:

To write about the process of selection of SC and HC and evolution of the process of the appointment of Judges to the SC and the reforms that are needed to the existing collegium system.

Directive word: 

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

Structure of the answer:

Introduction: 

Begin by giving context of collegium system.

Body:

Frist, show evolution of appointment process. Mention, in brief, the three judges’ cases and NJAC act, 2014.

Next, write about the reasons which call for reforms to the existing collegium system. Opaqueness, lack of accountability, lack of representation from weaker sections, slow pace of appointments and lack of public faith etc.

Suggest reforms to overcome the above issues that are affecting the collegium system.

Conclusion:

Conclude by writing a way forward.

Introduction

The judges of the Supreme Court and High Court in India are appointed by President as per article 124(2) and 217 of the constitution. In such appointment, the President is required to hold consultation with such of the Judges of the Supreme Court and of the High Courts in the States as he may deem necessary for the purpose.

Justice D Y Chandrachud, who is the 50th Chief Justice of India, said criticism of the Collegium system must be looked at in a “positive light” and attempts made to improve it.

Body

Collegium system:

• The Collegium System is a system under which appointments/elevation of judges/lawyers to Supreme Court and transfers of judges of High Courts and Apex Court are decided by a forum of the Chief Justice of India and the four senior-most judges of the Supreme Court.’
• The collegium of judges is the Supreme Court’s invention. It does not figure in the Constitution, which says judges of the Supreme Court and High Courts are appointed by the President and speaks of a process of consultation.
• In effect, it is a system under which judges are appointed by an institution comprising judges.
• After some judges were superseded in the appointment of the Chief Justice of India in the 1970s, and attempts made subsequently to affect a mass transfer of High Court judges across the country, there was a perception that the independence of the judiciary was under threat. This resulted in a series of cases over the years.
• The ‘First Judges Case’ (1981)ruled that the “consultation” with the CJI in the matter of appointments must be full and effective.
• The Second Judges Case (1993)introduced the Collegium system, holding that “consultation” really meant “concurrence”. It added that it was not the CJI’s individual opinion, but an institutional opinion formed in consultation with the two senior most judges in the Supreme Court.
• On a Presidential Reference for its opinion, the Supreme Court, in the Third Judges Case (1998)expanded the collegium to a five-member body, comprising the CJI and four of his senior most colleagues.
• The recommendations of the Collegium are binding on the Central Government, if the Collegium sends the names of the judges/lawyers to the government for the second time.

Procedure followed by the collegium:

• The President of India appoints the CJI and the other SC judges. As far as the CJI is concerned, the outgoing CJI recommends his successor.
• For other judges of the top court, the proposal is initiated by the CJI. The CJI consults the rest of the collegium members, as well as the senior most judge of the court hailing from the High Court to which the recommended person belongs.
• The Chief Justice of High Courts is appointed as per the policy of having Chief Justices from outside the respective States. The collegium takes the call on the elevation. High Court judges are recommended by a collegium comprising the CJI and two senior most judges.

Need for reforms in the Collegium system:

• Credibility of the SC:
  • Controversial collegium system of judicial appointments undermines the independence of judges and raises doubts about the credibility of the highest court.
  • There is a failure to make an assessment of the personality of the contemnor at the time of recommending his name for elevation.
  • Example: The controversy over the proposed elevation of Justice P.D. Dinakaran of the Karnataka High Court to the Supreme Court by the collegium of the Chief Justice and four senior-most judges of the Supreme Court was criticized for overlooking apparently suitable judges by the collegiums
  • The judiciary off late has been caught in many such situations of credibility crisis off late.
• The executive has little or no role in the appointment of judges as a result.
• Nepotism:
  • Unfortunately, in some cases, it has not covered itself with glory. There have been cases where the nearest relative of Supreme Court judges has been appointed as a high court judge, ignoring merit.
  • During the regime of Chief Justice Ranjan Gogoi, judges far lower in the combined All India Seniority of High Court judges were appointed to SC, and the reason assigned was that those selected were found more meritorious.
• Supreme court is overburdened:
  • The Supreme Court did not realize the burden it was imposing on the collegium of selecting judges for the Supreme Court and High Courts and transferring them from one High Court to another.
  • An administrative task of this magnitude must necessarily detract the judges of the collegium from their principal judicial work of hearing and deciding cases.
• Lack of Transparency:
  • The lack of a written manual for functioning, the absence of selection criteria, the arbitrary reversal of decisions already taken, the selective publication of records of meetings prove the opaqueness of the collegium system.
  • No one knows how judges are selected, and the appointments made raise the concerns of propriety, self-selection and nepotism.
  • The system often overlooks several talented junior judges and advocates.
• NJAC, A Missed Opportunity:
  • The National Judicial Appointments Commission (NJAC) could guarantee the independence of the system from inappropriate politicization, strengthen the quality of appointments and rebuild public confidence in the system.
  • The decision was struck down by the SC in 2015 on the ground that it posed a threat to the independence of the judiciary.
• Lack of Consensus among Members:
  • The collegium members often face the issue of mutual consent regarding appointment of judges.
  • The shadow of mistrust between the members of the collegium exposes the fault lines within the judiciary.
  • For instance, recently retired CJI Sharad A. Bobde was perhaps the first chief justice to have not made even a single recommendation for appointment as SC judge due to lack of consensus among the collegium members.
• Unequal Representation:
  • The other area of concern is the composition of the higher judiciary. While data regarding caste is not available, women are fairly underrepresented in the higher judiciary.
• Delay in Judicial Appointments:
  • The process of judicial appointment is delayed due to delay in recommendations by the collegium for the higher judiciary.

Reforms needed in the collegium system:

• The need of the hour is to revisit the existing system through a transparent and participatory procedure, preferably by an independent broad-based constitutional body guaranteeing judicial primacy but not judicial exclusivity.
  • The collegium members have to make a fresh start and engage with each other.
  • A transparent process adds accountability that is much needed to resolve the deadlock.
  • Individual disagreements over certain names will continue to take place, but care must be taken that the institutional imperative of dispensation of justice does not suffer.
• The new system should ensure independence, reflect diversity, demonstrate professional competence and integrity.
• The system needs to establish a body which is independent and objective in the selection process.
  • In several countries of the Commonwealth, National Judicial Appointment Commissions have been established to select judges.
  • Such judicial commissions have worked with success in the U.K., South Africa and Canada.
• Setting up a constitutional bodyaccommodating the federal concept of diversity and independence of judiciary for appointment of judges to the higher judiciary can also be thought of as an alternate measure.
• There should be a fixed time limit for approval of recommendations.
• As of now, instead of selecting the number of judges required against a certain number of vacancies, the collegium must provide a panel of possible names to the President for appointment in order of preference and other valid criteria.
• New memorandum of procedure:
  • After the Second and Third Judges Cases, a Memorandum of Procedure had been formulated to govern how the process of how the Collegium would make recommendations to the Executive.
  • The government therefore suggested that a new MOP be drafted and finalized for appointment of SC judges and the Executive to get a veto over candidates for national security reasons in this new MOP.

Conclusion

Faced with intense public scrutiny and government pressure, the judiciary’s institutional weaknesses are being laid bare. These are not simply the moral failings of one individual or the consequences of the misjudgment of a few. It is another illustration of the institution’s inability to accept its internal infirmities.

Topic: Important International institutions, agencies and fora- their structure, mandate.

3. New Delhi Declaration underscores the importance of India’s role on the global stage. Discuss the contribution of this declaration to India’s international standing. (250 words)

Difficulty level: Tough

Reference: Live Mint

Why the question:

The article discusses the significance of the New Delhi Declaration and its positive impact on India and the world.

Key Demand of the question:

To write about the significance of New Delhi Declaration.

Directive word: 

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

Structure of the answer:

Introduction: 

Begin by giving objectives of New Delhi Declaration.

Body:

First, write about the major announcements of New Delhi Declaration with respect to – Ukraine and Geopolitical Tensions, Sustainable Growth, Creating a More Inclusive World and Gender Equality etc.

Next, write about the significance of the declaration in addressing various global problems and its role in enhancing India’s global standing.

Conclusion:

Conclude with a way forward.

Introduction

At the G20 Summit in New Delhi, leaders from member countries reached a consensus and adopted the New Delhi Declaration. This declaration outlines significant commitments and agreements on various global issues.

Body

Background

• On 9 September, G20 leaders adopted the New Delhi Declaration.
• India’s diplomacy made a major success by fostering consensus and avoiding falling back on ‘Chair summary’ as it happened in a few previous G20 meetings when it was impossible to reach an agreement on the text about the war in Ukraine.
• It starts with “We are One Earth, One Family, and we share One Future.”

G20 New Delhi declaration

• War in Ukraine

• Peaceful Resolution: The G20 countries emphasize the importance of peace and call on all states to uphold the principles of international law, including territorial integrity and sovereignty.
• Humanitarian Concerns: The declaration expresses deep concern about the human suffering and adverse impacts of wars and conflicts worldwide, specifically addressing the war in Ukraine.
• UN Charter Principles: It emphasizes that all states must act in accordance with the Purposes and Principles of the UN Charter, refraining from the threat or use of force to seek territorial acquisition.
• Nuclear Disarmament: The use or threat of use of nuclear weapons is deemed inadmissible.

• Countering Terrorism and Money Laundering
  • Condemnation of Terrorism: The G20 condemns terrorism in all its forms, including those rooted in xenophobia, racism, and intolerance or carried out in the name of religion.
  • Holistic Approach: A holistic approach based on international law is advocated to effectively counter terrorism, with an emphasis on strengthening international cooperation to deny terrorist groups safe haven, freedom of operations, and financial support.
  • Illicit Trafficking: Concerns about illicit trafficking and diversion of small arms and light weapons are addressed, with an emphasis on international cooperation among states to combat these phenomena.
  • Financial Action Task Force (FATF): The G20 leaders commit to supporting the resource needs of the FATF and FATF Style Regional Bodies to combat money laundering and terrorist financing.
• Economy & Climate
  • Sustainable Growth: G20 leaders call for strong, sustainable, and inclusive growth in response to the uneven recovery from the pandemic.
  • Climate Action: Trillions of dollars will be required for countries to meet their climate goals and invest in clean energy technologies.
  • Reforming Financial Institutions: Reforms of international financial institutions are urged, along with efforts to manage debt vulnerabilities in low and middle-income countries.
  • Crypto Asset Taxation: The exchange of tax-relevant information on crypto assets is set to begin by 2027.
  • Energy Transition: The declaration calls for accelerated efforts to phase down unabated coal power and eliminate inefficient fossil fuel subsidies.
  • Financial Stability: Emphasis is placed on the need for well-calibrated monetary, fiscal, financial, and structural policies to promote growth, reduce inequalities, and maintain macroeconomic and financial stability.

• Global Growth

• Policy Coordination: The G20 leaders reiterate the need for well-calibrated monetary, fiscal, financial, and structural policies to promote growth, reduce inequalities, and maintain macroeconomic and financial stability.
• Central Banks Commitment: They also stress that central banks remain committed to achieving price stability in line with their respective mandates.
• Financial Stability Board (FSB): Initiatives by the FSB, Standard Setting Bodies (SSBs), and jurisdictions to examine lessons from recent banking turbulence are welcomed.

• Multilateral Development Banks

• Enhancing MDBs: G20 leaders emphasize the importance of delivering better, bigger, and more effective multilateral development banks (MDBs).
• Leveraging Private Capital: Financial institutions are encouraged to leverage private capital through innovative financing models and partnerships for maximum development impact.
• Capital Adequacy Frameworks (CAFs): The roadmap for implementing the recommendations of the G20 Independent Review of MDBs CAFs is endorsed.

• Cross-border Payments

• Payment Improvements: The G20 reaffirms its commitment to achieving global targets for faster, cheaper, and more transparent cross-border payments by 2027.
• CBDC Discussion: Discussions on the potential macro-financial implications of Central Bank Digital Currencies (CBDCs) are welcomed, especially concerning cross-border payments and the international monetary and financial system.

• Education

• Digital Education: The G20 recognizes the importance of investing in human capital development and supporting digital technologies to bridge educational divides.
• Scientific Collaboration: The promotion of open, equitable, and secure scientific collaboration and mobility of students, scholars, researchers, and scientists is encouraged.
• Inclusive Education: Emphasis is placed on inclusive, equitable, high-quality education and skills training, with foundational learning as a primary building block.

• Agriculture

• Trade Facilitation: Rising commodity prices contributing to cost of living pressures are addressed.
• Rules-Based Trade: The G20 leaders commit to facilitating open, fair, predictable, and rules-based trade in agriculture, food, and fertilizers, in line with relevant WTO rules.
• Food Security: Support for developing countries’ efforts to address food security challenges is emphasized, aligning with the G20 Deccan High-Level Principles on Food Security and Nutrition 2023.

• Religion

• Religious Tolerance: The G20 strongly condemns acts of religious hatred against individuals, religious symbols, and holy books.
• Cultural Diversity: Emphasis is placed on promoting respect for religious and cultural diversity, dialogue, and tolerance.
• Rights Interdependence: The interdependence of freedom of religion or belief, freedom of opinion or expression, peaceful assembly, and freedom of association is recognized as a means to combat intolerance and discrimination based on religion or belief.

• Corruption

• Zero Tolerance: The G20 reaffirms its commitment to zero tolerance for corruption.
• International Cooperation: Strengthening international cooperation and information sharing for combating corruption is urged.
• Asset Recovery: The joint Declaration also called for strengthening asset recovery mechanisms for combating corruption.

Significance of G20 New Delhi declaration

• Global Economic Cooperation: The G20, or Group of Twenty, is a forum for major economies that includes 19 individual countries and the European Union. It represents a significant portion of the global economy. G20 declarations are important because they often address pressing economic issues that have global implications.
• Policy Coordination: The G20 provides a platform for member nations to discuss and coordinate policies related to international financial stability and economic growth. The declarations typically include commitments and recommendations on areas like fiscal policy, monetary policy, trade, and investment.
• Crisis Response and Recovery: G20 declarations can be especially significant during times of economic crisis or uncertainty. They often include measures and strategies to stabilize the global economy, mitigate the impacts of financial crises, and promote recovery.
• Multilateralism and Diplomacy: G20 meetings and declarations serve as opportunities for leaders of major economies to engage in diplomatic efforts. They allow for the exchange of ideas, negotiation of policies, and the building of relationships that can have broad geopolitical implications.
• Global Challenges: In addition to economic matters, G20 declarations may address broader global challenges such as climate change, public health crises, poverty alleviation, and other issues that require international cooperation and coordination.
• Setting Agendas for International Organizations: G20 declarations can influence the priorities and agendas of other international organizations like the International Monetary Fund (IMF), World Bank, and World Trade Organization (WTO). The G20’s policies and recommendations can carry substantial weight in these institutions.
• Market Confidence and Investor Sentiment: Statements and commitments made in G20 declarations can impact market confidence and investor sentiment. Investors often look to G20 meetings for signals about the direction of global economic policies.
• Normative and Regulatory Frameworks: G20 declarations can influence the development of normative and regulatory frameworks in various areas, including financial regulation, trade rules, and sustainable development goals.
• Addressing Inequalities: Declarations may focus on inclusive growth, reducing income inequality, and promoting social development. These aspects are crucial for creating sustainable and equitable economic systems.

Conclusion

In essence, the New Delhi Declaration serves as a testament to the collaborative efforts of G20 member countries in addressing global challenges and striving for a more prosperous, peaceful, and sustainable world.

General Studies – 3

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

4. Even though the objectives of monetary policy are clear, achieving them can be a complex and multifaceted task, especially in a diverse and dynamic economy like India’s. Examine.  (250 words)

Difficulty level: Moderate

Reference: Insights on India

Why the question:

The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable.

Key Demand of the question:

To write about the role of RBI especially as part of monetary policy and impediments it faces in achieving it.

Directive word:

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

Structure of the answer:

Introduction: 

Begin by defining the monetary policy.

Body:

First, in brief, write in brief about the various objectives of monetary policy.

Next, write about the impediments it faces by RBI in achieving monetary policy objectives – Price Stability, high inflation, particularly in food and fuel prices, delicate balance between stimulating growth and controlling inflation etc. Substantiate by citing statistics.

Conclusion:

Conclude by writing a way forward to overcome the above-mentioned limitations.

Introduction

Monetary policy refers to the policy of the central bank ie Reserve Bank of India, in matters of interest rates, money supply and availability of credit.

In short, Monetary policy refers to the use of monetary instruments under the control of the central bank to regulate magnitudes such as interest rates, money supply and availability of credit with a view to achieving the ultimate objective of economic policy.

Body

Monetary policy committee performance

• Beginning in May 2022, when it held an unscheduled meeting, the MPC has raised interest rates in every meeting to tackle inflation.
• MPC increased this rate from 4% in April 2022 to 4.4% in May 2022, to 4.9% in June 2022, to 5.4% in August 2022, and to 5.9% in September 2022.
• Now in December, RBI raised the repo by 35 basis points.
• But since January this year, inflation has remained above the upper threshold of the RBI’s inflation targeting framework, as the RBI is mandated to keep inflation at 4 plus/minus 2 per cent.
• Inflation targeting has been successful till 2019 on the grounds that the inflation rate has remained within the band agreed to between the government and the RBI, and whether it has been achieved by “anchoring inflation expectations”.
• However, Inflation in India entered the prescribed band of 2% to 6% two years before inflation targeting was adopted in 2016-17.
• In fact, inflation had fallen steadily since 2011-12, halving by 2015-16.
• The MPC has mostly continued with the accommodative policy stance, where the balance of the growth-inflation dynamic has tilted more towards growth.
• Post-pandemic, the accommodative policy stance was needed given the rough ride because of the pandemic and is consistent with the overarching objective of the RBI to maintain price stability keeping in mind growth.
• Trend inflation had fallen from above 9% before flexible inflation targeting (FIT) to a range of 3.8-4.3 % during FIT, indicating that 4% is the appropriate level of the inflation target.
• However, NPAs have grown since 2016, and the cases of IL&FS, PMC Bank, PNB, and YES Bank suggest that poor management and malfeasance in the financial sector could escape scrutiny when the central bank hunkers down to inflation targeting.

Impediments faced by RBI

• Tighter money policy undermining growth: From May 2022 onward, the RBI started raising the interest rate because by then it was clear that inflation could no longer be ignored, and that, if not contained, it would undermine India’s economic recovery.
  • It is noteworthy that the RBI’s main legal mandate is to maintain price stability. It must, by law, keep inflation at 4% with a leeway of two percentage points either side in any particular month.
  • But then, these actions by the RBI — and more rate hikes are in store — will drag down economic growth.
• Unemployment and poor man’s inflation: The government is struggling to deal with massive and widespread unemployment. While in percentage terms GDP growth rates look rosy, the truth is that in real terms the economy is barely out of the contraction it witnessed during the Covid pandemic.
  • Unemployment has been a concern since 2017, when it hit a four-decade high.
• Dilemma: If RBI continues to tighten monetary policy, it will weaken economic recovery at a time when growth is already faltering and unemployment is already quite high.
  • If RBI ignores inflation then it hits the poor immediately without necessarily guaranteeing that growth and unemployment will be resolved.

Conclusion

A looming economic recession in many parts of the world, geopolitical tensions, policy rate hikes across world to control unprecedented inflation, and commodity price fluctuations are bound to catch up at some stage and impact India. So far, we have navigated the external threats through smart fiscal and monetary policy moves.  The price of crude oil and currency depreciation are two added variables that India has to navigate.

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

5. While several banking reforms have been introduced in India to address various issues, ensuring the long-term viability of the banking sector requires continuous adaptation, improved risk management, and technological innovation. Evaluate. (250 words)

Difficulty level: Easy

Reference: Insights on India , Insights on India

Why the question:

The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable.

Key Demand of the question:

To write about various banking reforms, its successes and limitations and further reforms that are needed for long term viability of baking sector.

Directive word: 

Evaluate – When you are asked to evaluate, you have to pass a sound judgement about the truth of the given statement in the question or the topic based on evidence.  You must appraise the worth of the statement in question. There is scope for forming an opinion here.

Structure of the answer:

Introduction: 

Begin by giving context.

Body:

First, write about the recent reforms in the banking sector – mergers of banks, the Insolvency and Bankruptcy Code, recapitalization of banks, digital payments, the Jan Dhan Yojana, and the licensing of small finance banks.

Next, write about the successes and shortcomings of the above.

Next, suggest reforms that must be taken in order to overcome the above mentioned limitations  – strengthening governance, addressing asset quality issues, ensuring adequate capital levels, investing in technology upgrades, promoting credit growth, and ensuring a robust regulatory framework.

Conclusion:

Conclude with a way forward.

Introduction

The banking system in India defines banking through the Banking Companies Act of 1949. With the potential to become 3rd largest banking industry by 2025 according to some reports, India’s banking and financial sector is expanding rapidly. The Indian banking industry is currently worth more than 1 trillion dollars and banks are now expanding fast as the present Central Government wants to spread the tentacles of the banking industry far and wide.

Body

Evolution of Bank reforms in India

• The government through the Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969, and nationalizedthe 14 largest commercial banks on 19 July 1969.
• Thereafter, in 1980, six more banks that were nationalized included Punjab and Sind Bank, Vijaya Bank, Oriental Bank of India, Corporate Bank, Andhra Bank, and New Bank of India.
• After India liberalized its economy in 1991, then finance minister Dr. Manmohan Singh set up Narasimham Committee – Ito analyze India’s banking sector and recommend reforms.
• In 1998, Banking Sector Committee(Narasimham Committee – II) was set up to further bring in reforms. The task of the Committee was to review the progress of the implementation of reforms and to suggest a design for further strengthening of the sector.

Banking reforms in the recent past

• The Indian government has been promoting the digitization of banking services to improve the efficiency and reach of banking services in India. The introduction of mobile banking, internet banking, and digital payment systems has made banking more accessible and convenient for the people of India.
• Since 2014, the banking sector has witnessed the adoption of the JAM (Jan-Dhan, Aadhaar, and Mobile) trinity, and the issuance of licenses to Payments Banks and Small Finance Banks (SFBs) to achieve last-mile connectivity in the financial inclusion drive.
• The Reserve Bank of India (RBI) introduced the concept of Payment Banks in 2015. Payment Banks are a new category of banks that aim to provide banking services to the unbanked population of India, by enabling them to open a bank account with a minimum balance of Rs. 0 and providing them with basic banking services.
• The RBI introduced the concept of Small Finance Banks in 2015 to provide financial services to the unbanked and underserved sections of the society, including small businesses, low-income households, farmers, and micro-enterprises. Small Finance Banks are licensed under Section 22 of the Banking Regulation Act, 1949, and have a minimum paid-up capital of Rs. 100 crore.
• In October 2015, the Government announced Mission Indradhanushunder which 7 key strategies were proposed to reform public sector banks (PSBs).
• The Ministry of Finance in its Economic Survey 2015-16suggested four R’s – Recognition, Recapitalization, Resolution, and Reform to address the problem of NPAs.
• The Insolvency and Bankruptcy Code (IBC) was introduced in 2016 to provide a time-bound and efficient mechanism for resolving insolvency cases in India. The IBC aims to improve the ease of doing business in India by enabling quick and efficient resolution of distressed assets.
• In 2017, the Indian government announced a plan to recapitalize public sector banks with a capital infusion of Rs. 2.11 lakh crore over a period of two years. This was aimed at strengthening the balance sheets of public sector banks and enabling them to lend more.
• The government recently announced new banking reforms, involving the establishment of a Development Finance Institution (DFI) for infrastructure, creation of a Bad Bankto address the problem of chronic non-performing assets (NPAs), and privatization of public sector banks (PSBs) to ease its burden in terms of mobilizing additional capital.
• In 2019, the Indian government announced the merger of 10 public sector banks into four banks, with the aim of creating stronger and more efficient banks.

Way forward

• The banking sector in India is grappling with a high level of NPAs, which has been a major challenge in recent years. To address this issue, there needs to be a concerted effort to strengthen the resolution framework and the recovery mechanism for stressed assets.

• The Indian banking sector needs to continue to enhance its digital infrastructure to improve the delivery of banking services. This will require investments in technology, data analytics, and cybersecurity to ensure that the banking sector is able to meet the growing needs of customers and stay competitive.
• Risk management can be more specific and the neo-banks can leverage the technology to further (digital) financial inclusion and finance higher growth of aspirational/new India. In this context, technologies like Blockchaincan be implemented in Indian Banking.
• Niche Banking caters to the specific and varied requirements of different customers and borrowers.
• Essentially, these specialised banks would ease the access to finance in areas such as RAM (retail, agriculture, MSMEs), infrastructure financing, wholesale banking (mid and large corporates) and investment banking (merchant banking and financial advisory services).
• The proposed DFI/niche banks may be established as specialised banks to have access to low-cost public deposits and for better asset-liability management.
• Further, the existing strong local area banks and urban cooperative banks may be converted into RAM banks and be freed from dual control.
• Differentiated Banks also may be encouraged to get listed on a recognised stock exchange and adhere to ESG (Environment, Social Responsibility, and Governance) framework to create value for their stakeholders in the long run.
• The government should tighten the loose ends by allowing them to build diversified loan portfolios, establishing sector-wise regulators, bestowing more powers to deal effectively with wilful defaulters.
• There is also a need to pave the way for the corporate bond market (shift from bank-led economy) to create a responsive banking system in a dynamic real economy.
• The Indian banking sector needs to encourage innovation and competition to drive growth and improve the quality of services. This can be done by promoting new entrants, such as fintech companies, and by encouraging collaboration between banks and other financial institutions.
• The Indian banking sector needs to invest in its human capital to ensure that it has the necessary skills and expertise to meet the changing needs of customers and the evolving regulatory environment. This will require investments in training and development programs, as well as initiatives to attract and retain talent.

Conclusion

                Thus, Banking sector in India has had multiple issues and is undergoing sea changes through timely reforms to further serve the goal of socio-economic development of India.

Topic: Disaster and disaster management.

6 The risks associated with inadequate dam infrastructure are compounded by the challenges posed by climate change. Dam failures can have severe environmental consequences, Analyse. (250 words)

Difficulty level: Moderate

Reference: Down to Earth

Why the question:

The collapse of the Chungthang Dam in Sikkim highlights the pressing need for enhanced dam safety measures and emissions reduction strategies.

Key Demand of the question:

To write about need to focus on safety and rehabilitation of dams and importance of risk assessment in them to prevent dam failures

Directive:

Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary.

Structure of the answer:

Introduction: 

Begin by giving context.

Body:

First, write the about the various threats to damns – rainy season, local seismic areas and probabilities of a flash flooding and local landfalls, structural integrity of dams, climate change etc.

Next, write about the impact of dam failures – including habitat destruction, water contamination, and disruption of aquatic ecosystems etc.

Next, highlight the need to maintain structural integrity of dams and the water needs of all the delta states and need for a collaborative approach.

Conclusion:

Conclude by writing a way forward.

Introduction

Dams are one of the vital elements for the growth of the country’s economy. In India, over the years, dams have played an important role in fostering rapid and sustained agricultural and rural growth. Substantial investment has been done in building dams and related infrastructure.

India is ranked third in the world in terms of building large dams. Of the over 5,200 large dams built so far, about 1,100 large dams have already reached 50 years of age and some are older than 120 years. The number of such dams will increase to 4,400 by 2050. This means that 80% of the nation’s large dams face the prospect of becoming obsolete as they will be 50 years to over 150 years old.

Body

However, in the past, we have noticed the mismanagement of dams has led to disastrous floods. One of the key roles was played by dams and understanding their role in floods would pave the way for enhancing our readiness.

Various causes of dam failures:

• Seismic damage: Earthquakes can subject dams to strong ground shaking, which may lead to structural damage or foundation failure.
  • Kobe Earthquake, Japan (1995):While not a dam failure, the Kobe Earthquake in Japan caused damage to dams and their components.
• Erosion and piping: Erosion occurs when the flow of water erodes the soil or rock supporting the dam’s structure. Piping, a related issue, involves the internal erosion of dam materials, creating channels through which water can escape.
• Extreme weather events: Intense and prolonged rainfall, hurricanes, or typhoons can result in dam failures due to increased water inflow, exceeding the dam’s storage capacity.
  • Kedarnath Floods, India (2013):While not a traditional dam failure, the catastrophic flooding in the Kedarnath region of Uttarakhand, India, in 2013, was triggered by heavy rainfall and the sudden release of water from a glacial lake.
• Glacial lake outburst flood(GLOF): In mountainous regions with glaciers, the sudden release of meltwater from a glacier-dammed lake can trigger a GLOF. These events can lead to massive floods downstream, posing a significant threat to communities and infrastructure.
• Human factors: This includes poor operational decisions, inadequate maintenance, conflict and war can contribute to dam failures.
• Design limitations: Flaws in the original design, including inadequate spillways, improper materials, or underestimated water flow calculations can lead to structural weaknesses.

Two examples of large dam failures:

• The recent Derna dam collapse Failure of two roughly 75 and 45-meter tall dams following heavy rain from Storm Daniel against the backdrop of the Libyan civil war resulting in the city of Derna.
• Kakhovka Dam failure: The dam in Ukraine was breached in June 2023, causing extensive flooding along the lower Dnieper River. Many experts have concluded that Russian forces likely blew up a segment of the dam to hinder the Ukrainian counter-offensive.

Consequences of ageing of dams

• As dams age, soil replaces the water in the reservoirs. Therefore, the storage capacity cannot be claimed to be the same as it was in the 1900s and 1950s.
• To make matters worse, studies show that the design of many of our reservoirs is flawed.
  • Case Study: In a paper, Supply-side Hydrology: Last gasp, Rohan D’Souza writes that the observed siltation rate in India’s iconic Bhakra dam is 139.86% higher than originally assumed.
  • At this rate, he wrote, “the Bhakra dam is now expected to function for merely 47 years, virtually halved from the original estimate of 88 years”.
• Similarly, the actual siltation rate observed for the Hirakud, Maithan and Ghod dams are way higher at 141.67%, 808.64% and 426.59%, respectively. Studies in later years showed similar findings.
• Almost every scholarly study on reservoir sedimentationshows that Indian reservoirs are designed with a poor understanding of sedimentation science.
• The designs underestimate the rate of siltation and overestimate live storage capacity created.
• Therefore, the storage space in Indian reservoirs is receding at a rate faster than anticipated.
• Reservoirs are poised to become extinct in less than a few decades with untold consequences already under way.
• In June 2018 the central government had approved the proposal for introduction of the Dam Safety Bill, 2018 which aims to develop uniform countrywide guidelines for ensuring the safety of dams.
• Dam mismanagement also leads to flooding like in 2018 incident inMullaperiyar dam between Kerala and Tamil Nadu.

Consequences of dam failures

• Loss of life: When a dam fails, the rapid release of water can lead to the loss of numerous lives, as people in downstream areas may not have sufficient time to evacuate.
  • In 1979, the Machhu Dam in Morbi, Gujaratfailed due to heavy rainfall and improper maintenance killing around 1800 to 25000 people.
• Property damage: The unleashed floodwaters can inundate homes, businesses, and critical infrastructure, causing extensive property damage.
  • The Teton Dam in Idaho, USA (1976) collapsed primarily due to design and construction flaws, causing high infrastructure and property damage.
• Environmental impact: Dam failures can have severe environmental consequences, including the destruction of ecosystems, contamination of water sources, and long-term ecological damage.

Way Forward

• A Bill seeking to set up an institutional mechanism for surveillance, inspection, operation and maintenance of specified dams across the country has been passed by the Lok Sabha.
• The provisions of the Bill are proposed to be applied to all dams inthe country which have a height of more than 15 metres, or between 10 metres to 15 metres.
• Among other things, the Bill also seeks to resolve the inter-state issues concerning maintenance and safety of dams as around 92% of dams in the country are on inter-state river basins.
• The Bill also envisages setting up of a National Dam Safety Authority to be headed by an officer not below the rank of an Additional Secretary, to be appointed by the central government.
• The main task of the National Dam Safety Authority includesimplementing the policies formulated by the National Committee on Dam Safety, resolving issues between State Dam Safety Organisations (SDSOs), or between an SDSO and any dam owner in that state, specifying regulations for inspection and investigation of dams.
• The NDSA will also provide accreditation to agencies working on construction, design, and alteration of dams.
• Since the dam safety is dependent on many external factors, the environmentalists, and the environmental angle inthis, needs to be taken.
• There is a need to strengthen the state irrigation department and the Central Water Commission.
• It should be ensured that the inspection of dams isdone by the respective state governments.
• State governments should follow the dam safety manual with precision. Especially, where human settlements are scattered all around, the building of dams has to be regulated as per the guidelines.
• Creation of buffer zonehas to be done to protect land near dams from encroachment.
• However, the growth of population will lead to encroachment, and it would be physically impossible to shift people during calamity. Proper dissemination of information has to be done in the surrounding areas on a real-time basis and regular flushing of water should be carried downstream to keep the river beds dry.Hence, dam safety and proper village, town and city planning have to be integrated.
• Ensuring “dam safety” should be a continuous exercise. The present catastrophe is more related to, how the dam should be operated when there is heavy rainfall and the water level has reached a critical level.

General Studies – 4

Topic: Attitude: content, structure, function; its influence and relation with thought and behaviour; moral and political attitudes;

7. Political attitudes are formed through a complex and ongoing process that involves various social, cultural, and personal factors. Elaborate. (150 words)

Difficulty level: Tough

Why the question:

The question is part of the static syllabus of General studies paper – 4 and part of ‘Conceptual Tuesdays’ in Mission-2024 Secure.

Key Demand of the question:

To write about the various factors that lead to the formation of political attitudes.

Directive word: 

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

Structure of the answer:

Introduction: 

Begin by defining political attitudes.

Body:

Write about the various factors shaping political attitudes – family and socialization, education, media and communication, personal experience, and peer groups and social networks.

Conclusion:

Summarise by highlighting the need to develop right political attitudes.

Introduction

Political Attitude means the beliefs and values which underpin the operation of a particular political system. These attitudes were seen as including knowledge and skills about the operation of the political system positive and negative judgments about the system. These attitudes determine how people participate, whom they vote for and which political parties they support.

Body

Elements Influencing Political Attitude

• Family: Despite family disagreements and generation gaps, children tend to grow up and vote the way their parents do.
  • Families are generally the first, and often the most enduring, influence on young people’s developing political opinions.
  • As people grow older, other influences crisscross the family, and naturally their attitudes tend to diverge from those of their parents.
  • However, the influence still remains.
• Religion: Religious beliefs often affect the way people vote. Religion is the faith of the people in values and beliefs.
  • Most of the religious leaders regard themselves as teachers and their followers usually attempt socialization of children schooling and socialization converts of all ages through preaching and religious services.
  • In USA the experiences of 1940s generally show that the Jewish voters are more likely to support democrats than are Catholics or Protestants.
  • The recent experiences have shown that thereligious right has supported more conservative candidates (in USA) for public office in more favour of the Republican party than to the Democratic Party.
• Peer Groups: Attitude formulation takes places due to peer groups. The way the peer groups behave that way only patterns of obedience and disobedience are decided.
  • The influence of peer groups becomes dominant when young people tend to become more independent of the influence of their parents.
  • The peer groups supplement the socialization function of the family and prepare an individual for more specific political roles.
• School/College:Educational institutions provide individuals the knowledge of the political world and the role they are expected to play in political process of the nation.
  • Schools transmit the values and attitude of the society.
  • They play a crucial role in shaping their attitude about the unwritten rules of the game of politics.
  • College and university education may also bring in new values and help in the formation of radical political attitude.
• Workplace: Political socialization also depends upon job, the workplace and the nature of employment.
  • Individuals identify themselves with a group and become sensitive to the norms of the group and evaluate its actions according to their opinion of what is good for the group and what it stands for.
  • One of the powerful socializing experiences for a worker or a laborer is participating in collective bargaining.

Impact of economic and psychological factors on political attitude

• Psychological Factors:Political attitude formulation is a psychological concept as it is concerned with the society in general and with individual in particular.
  • The growth of the society is a social process like the growth of the child.
  • A child develops his attitude towards the authority and obedience as per the obedience pattern at family.
  • According to Easton and Dennis there are four stages in the process of political attitude formulation.
    • A child recognizes authority through particular individual such as parents, policemen and the president of the country.
    • There should be a differences made between private and public authority.
    • The understanding about impersonal political institutions such as national legislature, judiciary and voting behaviour is developed.
    • Distinction between political institution and person engaged in the activities associated with those institutions so that idealized images of particular persons such as the president or the congress.
  • Economic Factors: In most nations, there is no economy without a political system. This is because politics is a constant contest of ideas, and whoever rides into office each election cycle is able to project their ideas onto the economy. Hence, politics shapes the economic conditions of the country and vice versa.
    • Economic self-interest: Political scientists have analysed the role of economic factors on political attitudes of the population. Personal economic” self-interest”is a huge criterion that influences political attitudes.
    • Economic welfare:The class to which they belong has a huge influence on the political affiliations people have. For eg, members of the trade unions and associations are influenced by the “pro-worker” policies and will be aligned with such parties whose ideology matches with the same ( Higher minimum wages).
      • Poor will align towards communist / socialist ideology. He’ll vote for a party promising to get food, fertilizer and kerosene subsidy.
    • Income: The higher middle class and elite section would favour a pro-capitalist party, to ensure their welfare. Eg : This class would prefer lower taxes and more incentives for corporates. Indians during the 1950’s-60’s preferred socialism and with growing income came to support capitalism.

Conclusion

Political attitude describes the way you think or feel about our government and related social and economic issues. It can be said that, both social and economic factors have a major share in determining the political attitudes. The sum total of all the factors determine whether an individual is progressive, liberal, conservative, radical or reactionary.

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