Editorial Simplified : 13th Day of June 2016

This Series of posts covers the essential Editorial from prominent newspapers. The Editorial from the newspapers are compiled by the Subject Teachers form the Academy and provided in notes format so that the aspirants does not waste their precious time in sifting through the newspapers. 

The aspirants are advised to bookmark this page for future reference 

Click on the tab below to read the Editorial Simplified for each newspaper

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[accordion_content accordion_label=”Business Standard”]

Editorial : The April blues

Context:

Industrial output numbers warn against policy complacency

What is the news?

The IIP number, released last Friday,

Points to be noted (Not to be remembered)

• Headline number for industrial output, as measured by the Index of Industrial Production (IIP), showed a decline of about one per cent for April 2016.
• In the last five years, annual industrial growth has stayed below three per cent, including a decline in 2013-14.

Declining Sectors

• Manufacturing sector, which has a weight of over 75 per cent in IIP.
• Food products and beverages, tobacco products and electrical machinery.
• Capital goods sector
• Consumer non-durables sector

Positive Sectors

• Electricity sector
• gems and jewellery,
• telephone instruents,
• commercial vehicles and diesel.
• mining sector

Implications of such volatality

• Retail inflation has inched up to over five per cent
• food inflation in particular has crossed the six per cent mark,
• Crude oil prices are on the rise, putting pressure on fuel prices and the government’s subsidy numbers.
• Exports with a decline

Conclusion

With industrial output in contraction mode, the current financial year has not begun too well for the economy, and the government ought not to relax on fiscal consolidation and further reforms that can revive both investment and consumption demand.

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Editorial : Internet opportunities

Context

Internet opportunities

What is the news?

• The Indian internet user-base reached 317 million by October 2015, overtaking the United States, courtesy year-on-year growth of 40 per cent.
• The report by Ms Meeker, a general partner at Kleiner Perkins Caufield & Byers LLC, has come up with a report for “ internet oppurtunities “ in India.

What does the report say?

Growth should zoom in

• voice-operated computer interfaces,
• image-based e-commerce platforms,
• mobile video advertising,
• messenger-based marketing
• communication
• on-demand transportation.
• live streaming of sports events with value-addition like real-time statistical updates and interactions on social media

What should be done?

• review of the telecom policy to enable the building of better physica infrastructure.
• removal of barriers that hinder investment into multi-brand retail and above all, legislation to ensure data security and privacy of users.
• Data privacy

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[accordion_content accordion_label=”Indian Express”]

Editorial : A rejig in time

Context

Six months after the operationalisation of the National Infrastructure Investment Fund (NIIF), the government has indicated that the investment model would be altered.

NIIF Tweak

• The NIIF had been conceived as a fund of funds to finance projects, both greenfield and brownfield, and also those stuck on the ground with a substantial initial corpus of Rs 40,000 crore.
• The economic signals have been mixed, with some segments such as commercial vehicle sales and cement production showing improvement besides consumption demand, while railway freight fell 13.5 per cent, and exports continue to be on a negative trajectory.
• Any changes in the NIIF’s investment framework which could lead to higher capital expenditure, especially in infrastructure projects, is bound to be welcomed.

Role of Government

• State owned banks are also lobbying for a fund or a “bad bank” which will buy out some of their bad loans
• If the vision is to create an investment vehicle which will be run professionally without undue pressure on returns like in the case of private equity funds, the investment focus ought to stay on infrastructure projects
• That’s where long term investors such as global sovereign wealth funds are willing to partner a venture where the government too has a stake.
• It is all the more important, therefore, for the government to act as a facilitator to get more projects off the ground.

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[accordion_content accordion_label=”The Hindu”]

Editorial : Voting to defeat

Context

The editorial studies the results of recently concluded elections to Rajya Sabha.

Important points

• Surprise victories and shock defeats which are usually a part of direct elections were unexpectedly a part of recent elections (indirect) to the Rajya Sabha.
• The unexpected jolts in the last round of Rajya Sabha elections were caused by by MLA’s in Congress in Haryana and Janata Dal (Secular) in Karnataka.
• Strategies drawn at party levels failed as legislators dissatisfied with the choice of candidates or the style of decision making ensured defeat of official nominees.
• In Haryana the strategy of Congress joining hands with Lok Dal back fired.
• The national leadership of Congress now needs to delve into the message from Haryana.
• In Karnataka, the Congress was the beneficiary of bickering in Janta Dal(Secular).
• The cross voting in Karnataka is alleged to have happened due to dissatisfaction with the leadership’s style of functioning.

Analysis

• Like in some earlier Rajya Sabha elections there was evidence of wealthy candidates securing votes across party lines.
• This has reinforced the belief that elections to Upper House continue to be influenced by power of  money.

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Editorial Simplified : 10th Day of June 2016

This Series of posts covers the essential Editorial from prominent newspapers. The Editorial from the newspapers are compiled by the Subject Teachers form the Academy and provided in notes format so that the aspirants does not waste their precious time in sifting through the newspapers. 

The aspirants are advised to bookmark this page for future reference 

Click on the tab below to read the Editorial Simplified for each newspaper

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[accordion_content accordion_label=”The Hindu”]

Editorial : The new symphony in India-U.S. ties

Context

Recently Indian Prime Minister visited the USA. The editorial delves into the trip and budding Indo-US relations.

Present scenario

• Bilateral relations between India and USA have been becoming better and better especially since past two years.
• Defence ties have consolidated in three ways:
  1. In defence procurement and co development.
  2. Co-ordination between the two forces
  3. Working together on piracy etc.
• Most importantly the strategic alliance between India and USA has also changed for the better with declarations such as the one declaring ” India as a major defence partner”
• The Indian side has also made statements such as ” A stronger and more prosperous India is in America’s strategic interest” suggesting proximity of strategies for both nations.

Issues and Challenges ahead

• The US government is going to change as elections are just around the corner. India must thus reassess the situation after the change in regime.
• India must also consider its alliances with neighbouring countries like China and Russia before making any statements on security etc.
• The editor also feels the need to explain to the Parliament of India the details of the new Info-US relation.

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Editorial : Preparing cities for high water

Context

The editorial lays emphasis on the need for protection of cities from calamities.

Important points

• Indian cities are estimated to produce 80% of total economic goods and services of the country.
• Events such as floods in Chennai and Mumbai and huge losses to life and property along with a haphazard response from the administration underscore the vulnerability of the cities.
• Mindless encroachments, construction in flood plains and lack of information systems have increased the vulnerability of the cities.

What needs to be done

The following steps need to be taken to strengthen the cities and reduce vulnerability :

1. More facilities for water harvesting must be provided.
2. Suburban lakes should be revived.
3. A transparent building code should be devised.
4. Smooth supply of basic requirements like water should be ensured during all times.

Concluding remarks

On the positive side city residents have higher degree of education and financial resources and these might help administrators find durable solutions. Much of urban India is yet to be built and it may be built safer.

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[accordion_content accordion_label=”Indian Express”]

Editorial : Close your eyes

Context:

The Central Board of Film Certification (CBFC) determination to trip up the film Udta Punjab on the ground that it defames Punjab by projecting the state’s drug problem has created a controversy.

CBFC’s role

• When Bollywood seems to be emerging from its cocoon of fantasy films to create works that reflect India’s current realities, the CBFC seems to be making a deliberate attempt to stall it.
• Chairperson Pahlaj Nihalani has got it all wrong that the CBFC has not been established to provide a moral compass to filmmakers or act as a political filter.
• Films, like all works of art, try to speak the uncomfortable and inconvenient truth.

Drug problem in Punjab

• The drug problem in Punjab, has many layers. It’s as much about politics as it is about law and justice.
• With the assembly elections a few months away, the State govt seem to attack any discussion of Punjab’s drug problem as “a conspiracy to defame” the youth of the state.
• It was better if movie was taken as timely and much needed wake-up call to a social problem that needs to be addressed urgently.

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[accordion_content accordion_label=”Business Standard”]

Editorial : Ending uncertainty

Context:

New Spectrum Formula

What is the news?

Uncertainty over new rate at which Indian mobile telecom service operators should pay spectrum usage fees to the Govt. is likely to come soon.

Recommendations by Telecom Commission

Telecom Commission has made two recommendations:

• It has prescribed a weighted average formula for calculating the spectrum usage fee for all bands available to a telecom service provider.
• Usage fee for the spectrum to be auctioned later this year would be 3 % of adjusted gross revenues of telecom service operators. Then this rate would be included for calculating the weighted average formula for spectrum usage fee to be paid by an operator.

How is it calculated presently

• Spectrum usage fee varies depending on the bands and the manner in which the spectrum has been acquired.
• For instance, spectrum allocated through administrative orders attracts an escalating charge linked to the usage pattern; the auctioned spectrum is charged at the rate of five per cent of the service provider’s adjusted gross revenues; and the spectrum in the 2,300 MHz band auctioned in 2010 for broadband wireless access is levied a charge at the rate of only one per cent.

What have been the past issues regarding spectrum allocation?

• confusion and uncertainty over what the spectrum usage fee ought to be for different bands.
• Varying rates have also given rise to continuing lobbying by telecom companies.

Benefits of the recommendations:

• It is reassuring that the government did not succumb to enforce a flat fee for all operators using all kinds of spectrum bands..
• A weighted average formula is based on logic, as it respects the sanctity of the rate that was fixed at the time of allocating the spectrum and also links the levy to the extent of use of a certain spectrum band.

Way forward

Commission’s recommendations will now be taken up by the Union Cabinet and the new spectrum usage charge regime should address many of these concerns.

Conclusion

• There will be no immediate benefit for the companies since they would continue to pay the amount they paid last year.
• Hopefully, the weighted average formula would lay the foundation of a more stable regime for levying spectrum user charges in the future.

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Editorial Simplified : 30th day of May 2016

This Series of posts covers the essential Editorial from prominent newspapers. The Editorial from the newspapers are compiled by the Subject Teachers form the Academy and provided in notes format so that the aspirants does not waste their precious time in sifting through the newspapers. 

The aspirants are advised to bookmark this page for future reference 

Click on the tab below to read the Editorial Simplified for each newspaper

[accordion_wrapper]
[accordion_content accordion_label=”Business Standard”]

Editorial : Avoiding reform

Context:

Two years of the Govt, major reforms seem off the table

What is the news?

Appraisal of two years of Modi Govt.

What is the issue?

There is a mismatch between the over-the-top tone of the publicity blitz and the relatively limited ambitions of the government with regard to future policy reforms.

What are the achievements?

Signs of green shoots in the economy.

Policy areas that stand out and should be addressed:

• Labour law reform
• Land acquisition law
• Privatisation of Govt Sector Enterprises.

Conclusion

 Recognition of how many major reforms have been actually effective in past two years.

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Editorial : Only a price controller

Context:

Pharmaceuticals department has achieved little.

What is the news?

Department of pharmaceuticals has released the list of its achievements in the past 2 years.

Achievements as per the govt

Government‘s greatest achievement in the sector: expanding the scope of price control.

Issues to be addresses

• Quality medicines at affordable prices to all.
• Drug quality control in India: Central Drug Standard Control Organization (CDSCO) under the Union health ministry and the state-level drug authorities that have to address the issue of substandard drugs in India
• Merely placing price caps on drugs can be counterproductive as this deters the drug industry to produce more to meet demand and encourages it to find clever ways of dodging the system.
• Efficient public procurement system under which the state negotiates for bulk discounts with the producers of drugs of adequate quality.
• To have an approved list of quality drug manufacturers.
• Inability to revive prosperity in public sector pharmaceutical companies.
• Expanding the footprint of the National Institute of Pharmaceutical Education and Research.

Has there been any committee on the issue yet?

Pronab Sen committee recommended “malpractices” be curbed in bulk purchase mechanisms but little has been done since then.

Health care in other countries

One reason why European health care costs are lower than the US’ is that the former negotiates bulk procurement of drugs for the public health care system whereas the latter does not.

Way forward

• As for the robust private pharma sector, it can only keep growing fast if there is greater ease of doing business.
• For this it is critical to have a smooth, transparent and predictable approval procedure for new drugs.
• It may be a good idea to disband the pharmaceuticals department and consider options such as placing drug price control under the Tariff Commission into which the Bureau of Industrial Costs and Prices has already been merged.

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[accordion_content accordion_label=”Indian Express”]

Editorial : Task undone

Context:

Even after coming out with new Defence Procurement Policy (DPP), India’s armed forces are still ill equipped.

Requirements galore

• The Indian Air Force has only 33 fighter squadrons while it needs 45.
• The navy has only 14 submarines, half the number it wants.
• The army doesn’t have equipment for the new strike corps being raised on the China border

DPP

• The new DPP is still not out in its entirety.
• A major chapter on the strategic partnership model is still pending, as are the details on other new models that have been proposed.
• Both foreign and domestic defence manufacturers are thus awaiting clarity on the business models they need to build for the future

New committees

• After Dhirendra Singh Committee report on defence procurement, two more expert committees are formed by Defence Minister.
• One of them, headed by Vivek Rae, has been tasked to reform the organisation, system and process of acquisition in the ministry.
• Another committee, headed by Lt General (retd) D.B. Shekatkar, has been tasked with rationalizing expenditure

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Editorial : A grim reality

Context:

Masunda Kitada Oliver, who was beaten to death in the capital following an altercation, has let face of prevalent racism in India come out in open.

Response

• Incident has stirred diplomats from the African nations to anguished action, and had caused them to consider boycotting Africa Day
• Citizens of Kinshasa capital of Congo, had retaliated, targeting shops and establishments owned by Indians in the city
• Government is of view that the issue of racism would go away if it was ignored with sufficient obstinacy

Racism in India

• People of African origin are being baited and attacked in India with shocking regularity
• Racism is a social affliction which cannot be cured overnight, but the government and social organisations must acknowledge the gravity of the problem and act on it
• India hopes to compete with China for land, resources and markets in the African continent, but it does not stand a chance if its citizens’ view of humanity is coloured by racist ideas

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[accordion_content accordion_label=”The Hindu”]

Editorial : Enter the superbug?

Context:

SUPERBUG

WHAT IS THE NEWS?

A woman in the U.S. was detected with bacteria resistant to a last-resort antibiotic.

Details:

The 49-year-old was carrying E. coli bearing a new gene, mcr-1.

What is the worry all about?

This new gene is resistant to even colistin, which is last available antibiotic that works against strains that have acquired protection against all other medication.

Has there been such cases before this?

First reported case of the mcr-1 gene in an E. coli strain found in a person living in America, but it raises worries about how far it may have spread.

Has there been any study on this particular issue?

The results of mcr-1 gene identification were published recently in the journal Antimicrobial Agents and Chemotherapy.

When was the gene first identified?

The mcr-1 gene was first identified in China in November 2015, following which there were similar reports from Europe and Canada.

What are the issues to be addressd?

• In this case a small piece of DNA (plasmid) found outside the chromosome carries a gene responsible for antibiotic resistance.
• But were the gene to spread to bugs treatable by only last-resort antibiotics, we could be facing the dreaded — and indeed, long-anticipated — superbug.
• Thus, the discovery of mcr-1 in more countries and settings increases the chances of the emergence and spread of resistance against all available antibiotics.
• It could well lead to an era without effective drugs to treat bacterial infections .

Effect on animals

• Unchecked use of antibiotics in livestock is a major reason for the development of drug resistance.
• Given the widespread use of colistin in animals, the connection to the drug-resistant mcr-1 gene appears quite clear.
• A November 2015 paper in The Lancet noted that a significantly higher proportion of mcr-1 positive samples was found in animals compared with humans, suggesting that the mcr-1 gene had emerged in animals before spreading to humans.

NOTE:

Besides being administered for veterinary purposes, colistin is used in agriculture.

Is it communicable?

Since the gene is found outside the chromosome, it can spread easily among different types of bacteria, as well as among patients.

Conclusion

Global community needs to urgently address the indiscriminate use of antibiotics in an actionable manner, and fast-track research on the next generation of drugs.

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Editorial : Awash in red ink

Context:

NON PERFORMING ASSESTS

What is the news?

It’s been a year since the RBI came up with norm that allowed banks to avoid treating restructured loans as substandard.

Facts about the NPA issue:

• Forced by the central bank’s time-bound Asset Quality Review to classify troubled loans correctly and make appropriate provisions for them, lender after lender has reported sizeable losses or dramatic declines in profit in recent quarters.
• The SBI, has said that while gross NPAs (as a percentage of the entire Rs.15 lakh crore it has advanced to borrowers) jumped to 6.5 per cent, or Rs.98,173 crore, at the end of March, it was placing loans amounting to another Rs.31,000 crore on a watch list for ‘exposure under stress’.

What does this reflect?

• Disclosures of bad and stressed loans reflect the extent of distress its borrowers representing various sectors of the real economy are experiencing.
• Iron and steel, engineering, power and construction are some of these key industries that undergird the economy.

Way forward

• An autonomous Banks Board Bureau is now in place, tasked with the specific brief of ensuring that state-owned lenders will hereafter be ring-fenced from political interference in the selection of top management and on business strategy.
• A Bankruptcy Code intended to improve the legal framework for assisting creditors in taking defaulters’ assets through liquidation and recovery process has won parliamentary backing and could soon be in operation.

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