Welfare of Handicraft Artisans | PIB Summary

Ministry of Textiles and Ministry of Social Justice and Empowerment have come together to step up interventions for the economic development of an estimated 12 lakh scheduled caste Handicraft Artisans.

Handicraft Artisans | About the MoU

It was signed between Development Commissioner (Handicrafts), Ministry of Textiles and National Scheduled Castes Finance and Development Corporation (NSCFDC), a Central PSU under Ministry of Social Justice and Empowerment, with the objective of working together to improve the earnings of artisans across the country, belonging to Scheduled Castes categories. 

Handicraft Artisans | Highlights of the MoU

  • The MoU provides for continuous and extensive collaboration between Office of DC (Handicrafts) and NSCDFC, aiming at the following:
  • Need assessment and gap identification through popularising various schemes by holding awareness camps.
  • Extensive need-based skill upgradation in the identified clusters having dominant presence of Scheduled Caste artisans, in the field of innovative and market-friendly designs, and adoption of modern tools and techniques.
  • Enhanced participation of Scheduled Caste artisans and their producer groups in domestic and international marketing events.
  • Working capital credit for Scheduled Caste artisans at concessional rates, by combining the benefits provided by Ministry of Textiles and Ministry of Social Justice and Empowerment

Handicraft Artisans

It has also been agreed in the MoU that the Office of the DC(Handicrafts) through its various schemes, will support NSCDFC in formulation of project reports, undertaking field studies for identifying felt needs of Scheduled Caste artisans, in addition to extending assistance of six Regional Offices and 52 Marketing & Service Extension Centres of the Office of the DC(Handicrafts).

United States Policy Shift in Afgan-Pak Region

The United States under the Trump Administration seems to be undertaking a review of its Afghanistan-Pakistan policy. The top military commander of US and NATO troops in Afghanistan, General John Nicolson Jr. has called for a holistic policy review towards Pakistan. While President Obama had declared that the official combat mission in Afghanistan was over in 2014, roughly 13,000 international troops, of them about 8,400 US troops remain in that country. However, General Nicolson has hinted the need to deploy a few thousand more troops of the US in Afghanistan if the war against terrorism is to be won. Up till now, hardly any specific details have emerged regarding the possible change in the stance of the US strategy towards Af-Pak region. What could be the reasons of a rethink of such policy? What are the factors shaping the new policy?

Will there be a change in the policy of the United States towards Afghanistan and Pakistan?

There are three concerns which are important pillars to address this rethink of policy. The first two concerns are intertwined, while the third remains a standalone due to its significance for the Americans.

  1. Is the Taliban ready for peace with Kabul? Are they willing to adopt some accommodative approach with Kabul under the leadership of Haibatullah? There are no definite answers to it yet.
  2. Is Pakistan ready to re-evaluate its basic thrust towards Afghanistan? It is about Pakistan having a preponderant influence over Afghanistan’s external policies, especially with India.
  3. What are the plans of the Russians and Iranians in the region? General Nicolson indicates in his testimony that they are embedded with the Taliban now and Taliban is carrying alien weaponry now.

Pakistan’s role in the Taliban issue

The contemporary policy of the United States simply caters to a combination of a hard-line approach with incentivising Pakistan in the name of curbing extremism in Afghanistan.

The United States has to rethink if it can ever win its fight against Taliban if Pakistan does not end its support to the Taliban militant groups and other externally sponsored groups in Afghanistan. These groups retreat back to the safe soil in Pakistan after launching terrorist attacks in Afghanistan. These groups target foreigners, diplomatic and consular missions in order to gain attention and legitimacy in the terror business.

Pakistan is recalibrating its policy towards Taliban by regulating the ‘Ishaqzai’ faction of Taliban, due to strong factionalism prevailing in the Taliban regime. These elements hold considerable influence in the Taliban regime today amidst the growing despondency in the otherwise disintegrated terror module.

Pakistan is also trying to bring several powerful factions together to establish a stronger force of Taliban which would present long-lasting effects on the peace aspirations of Afghanistan and the region beyond it. Moreover, it is not a big secret anymore that all the factions of the Taliban are having linkages with Pakistan as they are based in Quetta (Pakistan). Pakistan can squeeze the Taliban regime on any day of their choice even to the extent of suffering a little backlash then.

What are the interests of the United States in the region? Are they limited to counter-terrorism?

NO, the interests are not confined to counter-terrorism alone. The primary interest of the United States is to ensure the stability of Pakistan because it is a nuclear weapon state and a fragile, if not a failing state. These concerns have crippled the American policy on Afghanistan since 2001.

President Trump has cast aspersions on the Russian and Iranian rapprochement towards the Taliban, whereas he is also concerned about the growing influence of Tehreek-e-Taliban Pakistan (TTP). He is concerned about the growing export of radical extremists to the Islamic State militants in Syria by the TTP grouping.

What does a holistic review of American Af-Pak policy (as per General Nicolson’s terms) could actually mean?

Before addressing this question, let us understand that there are two main groups of Taliban which are active now – Mullah Rahim group and the other is Sirajuddin Haqqani network. The latter one lies low at present with a small presence in the east Afghanistan. But Mullah Rahim group is powerful in Helmand province and North and West Afghanistan.

Most ostensibly, the ‘holistic view’ would mean a hardening of the American stance to dismantle the Haqqani network, which is directly supported by Pakistan. But Pakistan seems to be not anxious about this position and it thinks that it is a business as usual for America to seek such favours. Defence Secretary General Mattis testifies that the US needs to engage with Pakistan and incentivise those responses, which is an ‘old wine in a new bottle’. At the most, there could be some muscle flexing and rhetoric to secure Pakistan’s cooperation, but it has already been done by the previous administrations.

Is there a possibility of more US troops in Afghanistan?

The war in Afghanistan is costing $13 million to the US taxpayers. The public is also against the United States playing the role of world policeman. But, General Nicolson has advocated maintaining a balance in the region by not letting the situation to get adverse to the Kabul authorities. He suggests that combat assistance is required at this time apart from following the training procedures. Given the strategic importance of the region, the US Congress may approve a few more thousand troops without much hassle.

How can America make costly for Pakistan for supporting Afghan Taliban?

Hudson Institute has called for a reevaluation of the United States policy towards Pakistan. It said that the Trump Administration should make it more and more costly for Pakistani leaders to employ a strategy of supporting terrorist proxies to satisfy regional strategic goals.

It is of prime importance to reign in the Haqqani network which is the brainchild of the Pakistani establishment. Another significant development could be driving the Afghan Taliban to the negotiating table. There could be a harsher approach in the following terms –

  • Reduction of economic and military support.
  • Increasing number of drone strikes on the Af-Pak border.
  • Sanctions against Pakistan-based entities and individuals who are responsible for terrorist activities in the region.
  • Moving towards declaring Pakistan, as a state sponsor of terrorism.
  • Extending the travel ban to Pakistan or at least forbidding certain individuals of Pakistani State authorities from entering the US soil.

These measures might not be adopted in the immediate future, especially in the context of the Hudson report. But the Trump Administration possess an enormous scope for embarrassing the Pakistani State for their immoral activities around the world.

But the concerns of America regarding Pakistan revolve around the Chinese support for Pakistan and Pakistan’s ability to sabotage American interests in a wider Islamic world. Hence, the room of manoeuvring for the Americans is severely constrained by such considerations. In symbolic terms, there could be some actions oriented towards embarrassing the Pakistani State, but in substantive terms, the choices are limited to raise the actual costs for Pakistan for its support to the terror dens.

What are the interests of the Russians in supporting the Taliban regime?

Trump administration should also keenly observe the developing nexus of Russia, China and Pakistan which could present a serious challenge to American authority in the region.

Some factions of Tehreek-e-Taliban Pakistan have morphed into Islamic State or Wilayat Khurasan inside to the eastern Nangarhar (Afghanistan). These elements could displace towards some disturbed regions of Chechnya in south-west Russia. Therefore, the strategic thinkers portray that this support for these groups is more of a quid-pro-quo than a direct support for oscillating terrorism on Afghan soil. But this policy is myopic because if you want to control the TTP, then the Russians should have contacted the Pakistanis because TTP is a Pakistan-based group, operating in Pakistan itself. Hence, it is compelling to believe that it is a large design of President Putin to take on the Americans in the same Afghan quagmire that fuelled the disintegration of USSR.

How does the United States Af-Pak policy concern India?

America has been welcoming towards India’s initiatives of helping the National Unity Government of Kabul in both economic and military terms. Any such policy would stay away from the Kashmir issue because the Americans have realised it historically that the experience of meddling in the internal affairs of India has not been fruitful in strategic terms. Moreover, the content of this change in approach has not yet come out of the box, so the crystal ball gazing might not be effective in addressing this critical issue through the lens of India.

Conclusion

After President Trump came in, there were speculations that he would wield more sticks than the carrots towards the Taliban regime in general. As discussed earlier, before jumping to any conclusion or speculation, a lot more is to be seen in the Afghan theatre and how the opera directed by multiple actors plays out in the theatre before the Americans start puppeteering the stage.

General Anti Avoidance Rule (GAAR) | AIR Spotlight

GAAR is basically a set of rules designed to give Indian revenue authorities the right to scrutinise and tax, transactions which they believe are structured solely to avoid taxes. The rules would be applicable to all taxpayers.

GAAR | Background

  • It was originally proposed in Direct Tax Code of 2009 and was postponed for implementing it.
  • It will address those cases which are technically not illegal but those cases which are not ethical i.e. to say the cases which are concerned with ‘tax avoidance’ and not ‘tax evasion’.
  • General Anti Avoidance rule (GAAR) is a set of rules or a framework which helps the revenue authorities decides whether a particular transaction has commercial substance or not. 

GAAR | Concerns

  • GAAR gives more unilateral/arbitrary powers to the revenue authorities. Therefore, the industry is concerned about the ambit and the arbitrary interpretations the revenue authorities may have regarding the GAAR provisions.
  • Tax experts point out given the limited timeframe for taxpayers and tax authorities to understand the pending guidelines, it will be practical to defer the effective date for implementation by a reasonable period.
  • The guidelines should clarify that GAAR is a deterrent provision, and not a tax collection provision. It should be invoked only in cases of patently abusive, contrived and artificial arrangements.
  • Another issue faced by tax experts is that there are no specific penalty provisions in case GAAR provisions are invoked. Accordingly, tax authorities are likely to take recourse to two broad categories under normal penalty provisions – “under-reporting’’ (entailing 50 per cent penalty) and “mis-reporting” (entailing 200 per cent penalty).
  • It is critical to have guidelines laying down objective criteria for distinguishing cases of gross abuse from other cases, as well as clarifying the situations or circumstances and providing parameters for initiating and levy of penalty.
  • It is important to implement the provisions of GAAR in a way that they do not lead more litigation.
  • It will override tax treaty provisions and tax officials are allowed to deny tax benefits if a deal is found without any commercial purpose other than tax avoidance.

GAAR | Importance

  • It will allow the government to raise more revenue. It empowers the revenue authorities to generate more revenue from all those transactions which are not paying their taxes.
  • The objectives of any tax laws are to promote or incentivise real investments. It ensures that investments are maximised to the advantage of the national economy.
  • The entire GAAR activity would also the Government to meet its fiscal deficit target (under the FRBM Act) with the enhanced tax revenues for the government.
  • It creates a better business environment for the people to recognise that the state exists for the purpose of bringing genuine investments. This would recognise India as a serious country promoting free and fair trade practices rather than providing free tax advantages.

 GAAR | Conclusion

It will be implemented from 1st April, 2017 and the government has considered the minimum threshold where the GAAR provisions can be implemented. The genuineness of the transactions remains intact and only covers those transactions which have been taking an advantage of the loopholes present and the small tax players will not to be harassed.

To Read the PIB Release : Click Here

Digital Economy Post Demonetisation

Demonetisation has pushed India in the race towards a digital economy. It is unprecedented in various aspects such as efficiency in management, tracking of economic transactions and real time information about the illegal activities being perpetrated under the nose of the Government agencies.

Digital Economy | Forms of Transactions

  • The most convenient form of digital transactions is internet banking. Through this money can be transferred to any account through RTGS, IMPS and
  • Mobile wallet services provided by banks and other private service providersfacilitate furnishing funds into the mobile wallet from the bank account or utilise private mobile wallet services providers. This sector has seen a massive growth after demonetisation. Various such service providers have been accorded the ‘Payment Bank’ status by the RBI.
  • Most common form of digital transactions is the use ofdebit cards and credit cards which are referred as plastic money cards. These cards can be used in Point of Sale (PoS) machines that are maintained by various vendors.
  • Government has come up with a transformative mobile platform providing exercise known as Unified Payment Interface (UPI) through which money can be transferred from one account to another such that both the users are connected to UPI platform.
  • For those who do not own a smartphone, Government has also facilitated USSD (*99#) service to make digital transactions directly linked to your bank account and phone number.

Digital Economy | Challenges

  • We are yet to fully realise the potential of mobile phones. There is no legislation passed by the parliament which legalises mobile payments. It’s a contractual payment.  India must come forward with a forward looking legal framework to support mobile payments at a time when 67% of all Indian online users are accessing internet from the mobile devices. If we do that the mobile payments will permeate across all urban sectors and will further go down to the rural and panchayat level. 
  • The majority of the mobile payment service providers are non-compliant with the strict provisions for dealing, handling and processing sensitive personal data including financial data as mandated by Information Technology Act, 2000 and rules and regulations made under.
  • Moreover, the Government has also failed to ensure cyber security of transactions and a dedicated Pan-India helpline for cyber complaints which facilitate one-point grievance registration for the new users.

Digital Economy | Need of the Hour

  • RBI has mandated certain parameters for information security. There is an Aadhar ecosystem which is available with more than 107 crore citizens which becomes a unique methodology to engage in participatory governance and also use Aadhar as a mechanism for promoting digital payments and mobile payments.
  • It is important that the existing frameworks must provide for adequate effective remedies and redress mechanisms available for customers per se. The banking network and nation as a whole needs to have a dedicated cyber security law on place which mandates the Rights, Duties and Obligations of all stake holders. At the end of the day effective remedies have to be given to the customer because in the entire digital ecosystem the customer is the king.
  • All the stake holders in the digital payment ecosystem have to go for the cyber insurance in a big way. Through this they will be able to provide redress mechanisms and relief to customers who are made victims to cybercrime in the digital payment ecosystem. Today there is no mandate to have cyber insurance covers which complicates the scenario.
  • Cyber insurance is the big way forward for providing consumer protection and for providing massive covers to the mobile payments service providers which help them to reduce their losses. In the longer run this helps in the robust growth of mobile payments and digital payments in India.

Digital Economy | Government Efforts

  • The government has announced that those who use online payments for buying railway tickets or insurance will be given specific discounts. This is a step in the right direction. This encourages citizens not just save money by doing online payments but also move broadly in the direction of digital payments.
  • Financial technology by start-ups has been used to link the information sources of bank accounts and mobile wallets so that there can be a reception and transmission of electronic payments.
  • Government has also started monetary rewards for those who are moving towards the digital economy. The initiative is managed by NITI Aayog.
  • On the other hand, various State Governments have also started similar monetary rewards and awareness campaigns to facilitate easier transition of people towards a digital economy.

Digital Economy | Conclusion

The customer wants his money to be secure, comfort in doing digital transactions without any hurdles and wants to be reassured that if there is a problem then some agency should be available where he can go through. If we are able to address these concerns, we will go a long way going forward in digital payments.

104 Satellites in a Single Flight | PIB Summary

104 Satellites were launched by ISRO. In its thirty ninth flight (PSLV-C37), ISRO’s Polar Satellite Launch Vehicle successfully launched the 714 kg Cartosat-2 Series Satellite along with 103 co-passenger satellites today morning (February 15, 2017) from Satish Dhawan Space Centre SHAR, Sriharikota.

104 Satellites | Highlights

This is the thirty eighth consecutively successful mission of PSLV.  The total weight of all the 104 satellites carried on-board PSLV-C37 was 1378 kg. The total number of Indian satellites launched by PSLV now stands at 46.

104 Satellites | Cartosat-2 satellites

  • The imagery from the Cartosat-2 series satellite will be useful for cartographic applications, urban and rural applications, coastal land use and regulation, utility management like road network monitoring, water distribution, creation of land use maps, change detection to bring out geographical and manmade features and various other Land Information System (LIS) and Geographical Information System (GIS) applications.
  • The data sets could be used for urban planning of 500 cities under the AMRUT Planning Scheme. The government initiative of 100 smart city programme in which these data sets could be used for master plan preparation and detailed geospatial data preparation for rural roads and infrastructure development.

104 Satellites

  • Of the 103 co-passenger satellites carried by PSLV-C37, two – ISRO Nano Satellite-1 (INS-1) of India. 
  • The remaining 101 co-passenger satellites carried were international customer satellites from USA (96), The Netherlands (1), Switzerland (1), Israel (1), Kazakhstan (1) and UAE (1).

104 Satellites | Significance of the mission

  • This mission involved many technical challenges like realising the launch of a large number of satellites during a single mission within the time frame sought by the customers from abroad.
  • Besides, ensuring adequate separation between all the 104 satellites during their orbital injection as well as during their subsequent orbital life was yet another challenge associated with this complex mission.
  • With today’s successful launch, the total number of customer satellites from abroad launched by India’s workhorse launch vehicle PSLV has reached 180.

Indian Seed Congress | PIB Summary

Shri Radha Mohan Singh inaugurated the function of Indian Seed Congress – 2017, in Kolkata today. The theme of the Indian Seed Congress is “Seed of Joy” which is very much in line with vision of this government to bring happiness and prosperity in the lives of farmers by doubling their farm income by 2022.

Indian Seed Congress | About the initiatives of Government

  • The availability of certified / quality seeds in the country has increased from less than 40 lakh quintal during decade of 60 to 370 lakh quintal in 2015-16.
  • The Department of Agriculture, Cooperation & Farmers Welfare has asked the State Governments to prepare variety wise seed rolling plants to meet year wise, season wise requirements of quality seeds. This seed rolling plant will fulfil the double purpose of improving the Seed replacement rate along with Variety replacement rate so that sustainable agricultural production and productivity could be ensured.

Indian Seed Congress | Highlights of the event

  • Agriculture Minister said that Indian Seed Market is growing fast and during the recent past, hybrid seed market of vegetables and cereals has shown remarkable growth.
  • Indian Seed Industry can emerge as a prominent industry for supplying seeds in international markets.
  • India has great potentiality to produce hybrid seeds especially costly vegetable seeds on cheap rates as compared to the seeds of the other countries.
  • Apart from vegetables, the hybrid seeds of maize, paddy, pearl millet and cotton may be exported to SEI and African countries in magnitude.
  • The opportunities of employment have been created for the skilled men and women and the girls in the field of agriware housing, cold chain, supply chain, dairy, poultry, meat, fisheries, horticulture, agriculture mechanization as well as micro irrigation. Skill India Mission is being implemented for imparting opportunities as well as skills to the rural youth in rural areas.

Indian Seed Congress | Seven point programme to double farmers’ income by 2022

  1. Big focus on irrigation with large budgets, with the aim of “per drop-more crop”.
  2. Provision of quality seeds and nutrients based on soil health of each field.
  3. Large investments in warehousing and cold chains to prevent post-harvest crop losses.
  4. Promotion of value addition through food processing.
  5. Creation of a national farm market, removing distortions and e-platform across 585 stations.
  6. Introduction of a new crop insurance scheme to mitigate risks at affordable cost.
  7. Promotion of ancillary activities like poultry, beekeeping and fisheries.

Urban Traffic – The Menance

Urban Traffic a core element of SMART city should be focused more efficiently during the urban planning. While more money, less corruption, more infrastructure and better design are indeed medium-term and long-term solutions, they are complex and unlikely to be easily addressed in the churn of India’s democratic politics. Even so, we must push forward on them. However, in the meantime, if we focus on improving flows we can enjoy some respite from the tyranny of traffic almost immediately.

Urban Traffic | The blame lies on….

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  • On the one hand policymakers blame lack of funds, and it is true that the municipal corporation’s entire annual budget is smaller than what is required to upgrade the road network to modern standards.
  • On the other, citizens blame the pyramid of corruption that brazenly siphons off even what little funds are allocated for the purpose. There are also issues of master-planning, infrastructure design and maintenance.

Urban Traffic | Improvements Required

This is an eight-fold path to improving traffic in the short term, without requiring to spends massive amounts of money 

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  • Focus on the flow Try to improve the width the road uniformly. Unless a road is of uniform width throughout its length, flow is unlikely to improve much by widening. In fact, uneven road width causes congestion and can actually worsen the situation. Do not widen a road unless you can widen it along its entire length.
  • Remove road cholesterol – In many places almost 40% of the road is unusable because, like clogged arteries, circulation of traffic is choked by various blockages. Potholes, construction materials, parked cars, auto rickshaw stands and street vendors interrupt traffic flow and not only cause congestion points but also endanger safety of motorists and pedestrians. They should be regulated to minimise the impact on traffic flow. Make it compulsory for construction material and debris to be placed in bins, with a fee charged for occupying road space. Make parallel parking compulsory, draw parking lots and assign a serial number to each of them. Move auto-rickshaw stands away from street intersections. Similarly, ensure street vendors occupy designated lots.
  • Get cows and other animals off the road – It should be astounding that a city that connects India to the global economy, and one that suffers so much traffic congestion, tolerates herds of cows on its major roads. Cows might be holy but that does not prevent them from causing congestion and endangering their own lives and the lives of motorists.
  • Make all lanes of uniform width – Today, lanes are mostly not marked, and where they are marked, they bisect the available road width. The lack of lane markings and lanes of varying widths create no behavioural triggers for people to drive in a disciplined manner. Lane markings should always be clearly visible and not left to drivers’ imaginations.
  • Enforce queuing for right turns – One of the biggest reasons for congestions on major roads is that when vehicles wait to turn right, they do not queue up one behind the other. Instead, they line up side-by-side in a right-turning arc. What this means is that all the vehicles that intend to go straight ahead or turn left are blocked. It doesn’t matter how wide the road is, if right-turning vehicles do not queue up. Barricades can be placed to create a right-turn queue to create this driving behaviour norm.
  • Directional signs – There have to be a lot more directional signs on our roads. Overhead gantries identifying lanes for left, right and straight ahead are necessary. These must be placed well-ahead of the intersection so that vehicles can change lanes much before the intersection.
  • Stop-line at intersections – The stop line at intersections must be prominent. Right now its exact position is left to the imagination and discretion of drivers. This makes it impossible for pedestrians to cross safely or other traffic to pass across the junction. The stop line must be a ‘lakshman rekha’ crossing which should attract severe penalties. Cameras already exist that can enforce this easily.
  • Heavy vehicles management – Movement of heavy vehicles and tractor-trailors cannot be unrestricted as it is now. Slow moving vehicles such as these not only slow down traffic but also create incentives for illegal and dangerous overtaking by other motorists. If they cannot be limited to certain corridors and certain times, then they must be compelled to move only in the left-most lane. Again, camera footage can be used for penalising offenders without burdening on-ground police personnel.

Urban Traffic | Way-forward

Although pedestrians ought to have the first right on the road, they are constantly robbed of their safety and dignity. Traffic lights for pedestrian crossings seem to have been designed for Olympic sprinters, as it is almost impossible to cross even a mid-sized road in the ten seconds that are allocated for the purpose.

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Sky-bridges and underpasses are impractical if they have steep staircases or are located at unnatural crossing points. At times where traffic lights are sought to be synchronised to create “green channels” and smooth traffic flows, the pedestrian’s rights must not be sacrificed. Give them more time to cross the road; and dissuade them from crossing where they shouldn’t.

UPSC Mains 2016 | Expected Questions

UPSC Mains 2016 | Expected Questions (Paper II)

  • Creation of small states and good governance.
  • Conflict between judiciary and executive.
  • Niti Aayog and Cooperative Federalism.
  • Electoral Reforms: Holding simultaneous elections to parliament and states and State Funding of Elections.
  • Definition of Hindutva and use of religion in politics.
  • Successes and failures of RTI.
  • SMART Cities and RURBAN Mission.
  • Comparison between parliamentary and presidential democracies.
  • Special category status for states.
  • 14th Finance Commission recommendations and its impact on centre-state relations.
  • Corporate Governance – TATA Crisis
  • Misuse of Article 356, Role of Governor
  • One Rank One Pension
  • Copyrights Case Verdict
  • Merger of rail and general budget
  • Surrogacy bill
  • Lateral entry into civil services
  • All India Judicial Services – Feasible idea?
  • Amendments to child labour act: problems and solutions
  • Politicization of education in higher learning institutions
  • Universal Health Insurance – Is it the solution for health sector in India?
  • Future of BIMSTEC, can it replace SAARC?
  • India-Africa relations
  • India-Iran (Chabahar, INSTC) and route to Central Asia
  • India, China and Pakistan – Trilateral relationship with special reference to PoK and Balochistan
  • Russian tilt towards Pakistan
  • Reforms in IMF and World Bank
  • Centrally Sponsored Schemes and the recent changes
  • Sharing of river waters and role of river water tribunals
  • GST and concerns of States
  • Increasing regionalism in Indian Politics and its impact on Federalism in India.
  • Reforms in Legislature, anti-defection law, speaker, role of Rajya Sabha etc
  • Digital Governance: reasons for failure and solutions
  • Pay Commission recommendations and reforms in bureaucracy
  • Pressure Groups and their influence on public policies
  • Brexit and future of EU
  • Education Policy: Subramanyam committee recommendations
  • How to make Divyang friendly society?
  • Drug Trafficking and its impact on security and society
  • Corporate lobbying – Should it be legal in India?
  • PPP: Reasons for failure?
  • Poverty alleviation programmes: reasons for their failure and solutions
  • Patriotism v/s nationalism: intolerance 
  • Sedition Act
  • Panchayati Raj – Failure and solutions

UPSC Mains 2016 | Expected Questions (Paper III)

  • 25 years of economic reforms, impact on poverty, unemployment, balanced regional development etc.
  • Farmers suicide and rural distress
  • Impact of NAIROBI Summit on agriculture in India
  • NPAs of Banks
  • Railways safety and reforms
  • High speed railways – Feasible or not?
  • Water transport in India: Issues and solutions
  • Fertilizer subsidies (Economic survey)
  • India’s rank in global competitive index falls. Why?
  • Reforms in Public Sector Units. Privatisation is the key?
  • Agriculture insurance – PM Fasal Bima Yojana
  • Universal Basic Income
  • Internet Governance – ICANN
  • Cross border terrorism
  • Multilateralism v/s Customs Union, regional trade agreements superseding WTO
  • Tax to GDP ratio in India is one of the lowest in world, how to improve it
  • Cashless economy, Unified Payments Interface
  • Sharia Banking/Islamic Banking
  • Flood control
  • Water Crisis – Mihir Shah Committee
  • Interlinking of river waters, problems and solutions
  • Increasing pollution levels in cities
  • Public Distribution Systems: FCI reforms
  • Stagnation in Indian economy – Why?
  • Labour Law reforms and impact on employment
  • Monetary v/s Fiscal Policy
  • Inflation targeting
  • FRBM Act amendments – (MOST IMPORTANT this year)
  • Secessionist movements in North East, Inner Line Permit
  • Communal violence is increasing, the reasons for it
  • Police Reforms
  • Role of NIA
  • Stagnation in exports – Volume and Value analogy should be given
  • UDAY, Power sector reforms
  • Human intelligence in combating terrorism
  • Agricultural marketing reforms, privatisation of trade in food grains.
  • Rural-urban divide
  • International Solar Alliance
  • Kigali Agreement
  • Natural Gas in India: KG Basin
  • Coastal Regulation Zone- Reasons for violation and new rules
  • Self-driving cars (Autonomous Vehicle Technology) – Feasible for India?
  • Air Defence System
  • Virtual and Augmented Reality
  • China’s Quantum Satellite – MICIUS, technique and operations

Economy: Liquidity Revamp is not QE

RBI’s liquidity revamp is not QE

Context :

Reserve Bank of India have cut lending rates by 25 basis points and have asked banks to pass on the rate cut benefits to the consumers.Some observers have described the Reserve Bank of India’s (RBI) revised liquidity management framework as quantitative easing (QE).

RBI Liquidity

VISION OF RBI
The new framework modernizes liquidity management by making it more market-based i.e. lowering down the rates and injecting more liquidity into market .
WHY HAS RBI DONE SO?

  1.  Complaints by banks that liquidity is too tight
  2. Need To Move From A Fixed Rate System To Floating Rate Regime ( to increase liquidity as per the needs of the economy)

NOTE:

Until a few years ago, if banks were in need of funds, it was done by banks borrowing at the central bank’s FIXED OVERNIGHT REPO window, if they were short, or by parking surplus liquidity at the lower FIXED OVERNIGHT REVERSE REPO window. But now  RBI relies on its DAILY MARKET-DRIVEN management in the LIQUIDITY ADJUSTMENT FACILITY (LAF), which is used to aid banks with their short-term liquidity mismatches.

Earlier, In order to encourage the use of term repos, RBI governor Raghuram Rajan had CAPPED liquidity injection at the overnight repo rate window while offering the balance via term repo auctions. The aim was that over time, banks would have to stop relying on RBI for liquidity support solely at the FIXED RATE WINDOW and INSTEAD adapt to FLOATING RATES at each auction.

     3. The availability now of variable rate reverse repo auctions also eliminates a pesky aspect of the earlier framework ; excess liquidity pushing the overnight rate away from the repo policy rate to the reverse repo rate, the lower end of the LAF corridor.
Why is the step not Quantitative easing?

To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before. The new money swells the size of bank reserves in the economy by the quantity of assets purchased—hence “quantitative” easing. Like lowering interest rates, QE is supposed to stimulate the economy by encouraging banks to make more loans. The idea is that banks take the new money and buy assets to replace the ones they have sold to the central bank. That raises stock prices and lowers interest rates, which in turn boosts investment.

Here, in this case there is no excessive money creation, which is the hallmark of QE. RBI will inject liquidity (i.e. reserve money) as needed and then adjust the short-term liquidity to be consistent with its stance.

Syllabus for GS Paper 3 (UPSC)

Syllabus for GS Paper 3

This is a 250 Marks Paper in the mains examination of UPSC. The Topics/Subjects covered under GS-3 paper are :-
Technology, Economic Development, Bio diversity, Environment, Security and Disaster Management

  1. Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
  2. Inclusive growth and issues arising from it.
  3. Government Budgeting.
  4. Major crops cropping patterns in various parts of the country, different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers.
  5. Issues related to direct and indirect farm subsidies and minimum support prices; Public Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing.
  6. Food processing and related industries in India- scope and significance, location, upstream and downstream requirements, supply chain management.
  7. Land reforms in India.
  8. Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth.
  9. Infrastructure: Energy, Ports, Roads, Airports, Railways, etc.
  10. Investment models.
  11. Science and Technology – developments and their applications and effects in everyday life Achievements of Indians in science & technology, indigenization of technology and developing new technology.
  12. Awareness in the fields of IT, Space, Computers, robotics, nano-technology, bio-technology and issues relating to intellectual property rights.
  13. Conservation, environmental pollution and degradation, environmental impact assessment.
    Disaster and disaster management.
  14. Linkages between development and spread of extremism.
  15. Role of external state and non-state actors in creating challenges to internal security.
  16. Challenges to internal security through communication networks, role of media and social networking sites in internal security challenges, basics of cyber security; money-laundering and its prevention.
  17. Security challenges and their management in border areas; linkages of organized crime with terrorism.
  18. Various Security forces and agencies and their mandate.