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Insights SECURE SYNOPSIS: 26 DECEMBER 2019

SECURE SYNOPSIS: 26 DECEMBER 2019


NOTE: Please remember that following ‘answers’ are NOT ‘model answers’. They are NOT synopsis too if we go by definition of the term. What we are providing is content that both meets demand of the question and at the same time gives you extra points in the form of background information.


 

Topic: Indian Culture will cover the salient aspects of Art forms, Literature and Architecture from ancient to modern times.

1. Trace the rise of Bhakti Movement. Discuss its nature with reference to Dvaita and Advaita Vada. (250 words)

Medieval history class XI by R S Sharma

Why this question:

The question is straight forward and is based in the topic of Bhakti movement and its connection with the philosophies of Dvaita and Advaita Vada.

Key demand of the question:

One must explain the rise of Bhakti movement and influence of Dvaita and Advaita Vada upon it.

Directive:

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

Structure of the answer:

Introduction:

Trace the evolution of Bhakti movement.

Body:

 Bhakti movement preached using the local languages so that the message reached the masses. The movement was inspired by many poet-saints, who championed a wide range of philosophical positions ranging from theistic dualism of Dvaita to absolute monism of Advaita Vedanta.

Explain in detail the concept of the two philosophies and in what way it influenced Bhakti movement.

Conclusion:

Conclude with its significance.

Introduction:

The word ‘Bhakti’ means devotion to God. Bhakti was accepted as a means to attain moksha along with jnana and karma. The Bhakti movement empowered those on the lowest rungs of Indian society and provided impetus for the growth of vernacular literature. Bhakti poets emphasized surrender to god. Equally, many of the Bhakti saints were rebels who chose to defy the currents of their time through their writings. The Bhakti Saints moved against the austerities propagated by the Buddhist and Jain schools and professed that ultimate devotion to god was the means to salvation. The Bhakti tradition continues in a modified version even in the present day.

Body:

Rise of Bhakti movement:

  • The movement probably began in the Tamil region around the 6th and 7th century AD and achieved a great deal of popularity through the poems of the Alvars and Nayanars, the Vaishnavite and Shaivite poets.
  • In the eighth century A.D. Shankaracharya is said to have been the first and principal exponent of the reform movement.
  • After that Ramanuja and Namadeva gave their sermons to people. Gradually this movement also spread to the north. Ramanuja, Vallabhacharya, Kabir, Srichaitanya and Guru Nanak led this movement.
  • Hailing from both high and low castes, these poets created a formidable body of literature that firmly established itself in the popular canon.
  • In the Kannada region, the movement begun by Basavanna (1105-68) in the 12th century for a time threatened the caste hierarchy and stretched the fabric of local society.
  • Vachana sahitya composed by Basava himself as well as his disciples Akkamahadevi, Allama Prabhu, Devara Dasimayya and others consisted of pithy aphorisms conveyed in unambiguous terms certain astute observations on spiritual and social matters.
  • In neighbouring Maharashtra, the Bhakti movement began in the late 13th century. Its proponents were known as the Varkaris. Among its most popular figures were Jnanadev (1275- 96), Namdev (1270-50) and Tukaram (1608-50), who have left behind many verses that embody the essence of Bhakti.
  • In northern India, from the 13th to the 17th centuries, a large number of poets flourished who were all Bhakti figures of considerable importance.
  • Kabir, the renowned saint of northern India, falls squarely in this tradition of singer-songwriter-critic.
  • Another singer-songwriter was Guru Nanak (1469-1539), an iconoclast and, yes, critic of the dominant societal values of his time. Nanak was of a syncretic mindset and attempted to fuse the tenets of Hinduism and Islam to serve as a guide for all humanity.
  • A near-contemporary of Nanak was Ravi Dass (1450-1520), who was born into a family of leather workers (chamars) in Varanasi. Like Nanak, Ravi Dass too spoke of the need for a casteless society, though, unlike Nanak, he had suffered its slings and arrows as he belonged to an untouchable caste.
  • In 19th century Karnataka, Shishunala Sharif (1819-89) was an influential figure. A Muslim by birth, Sharif also accepted the tenets of Hinduism and often sang of communal harmony.
  • During the freedom struggle, the poet-revolutionary Ram Prasad “Bismil” (1897-1927) composed the songs Sarfaroshi ki tamanna ab hamare dil mein hai and Rang de basanti chola that were sung by many revolutionaries.

Dvaita philosophy:

  •  Madhvacharya propounded this philosophy.
  • According to dvaita, the world is real.
  • God, the creator of this world, is also real.
  • There is a natural difference between the ordinary, ignorant soul who experiences sorrow in this world and the God who knows all and is omnipotent.
  • This is the essence of dvaita siddhanta.
  • The very thought helps in preventing escapism and motivates one to perform duties sincerely.
  • It also establishes the Supremacy of God and indicates the path to devotion.
  • It cautions us about His omnipresence thus stressing the importance of righteousness.

Advaita philosophy:

  •  Adi Shankaracharya is considered the propagator of this philosophy.
  • Advaita propounds that the world is an illusion.
  • All actions and emotions including sorrow are just false impressions.
  • Ignorance of the reality is what causes suffering, and liberation can be obtained only by true knowledge of Brahman.
  • Fundamentally, the soul and God are one; when the soul releases itself from this illusion; it merges with Brahman, the Universal Consciousness.
  • The quintessence of Shankara’s philosophy is “Brahma satya jagat mithya, jivo Brahmaiva na aparah“. meaning Brahman (the absolute) alone is real; this world is unreal, and the jiva or the individual soul is non-different from Brahman.

Conclusion:

 The only similarity between advaita and dvaita philosophies is that of bhakti or devotion, which is very essential. Bhakti cult was out-of-the-box thoughts on religion. It was mainly against the common religious views, and most importantly, it was strongly against the caste system

 

Topic: Welfare schemes for the vulnerable sections of population by the Centre and states and the performance of these schemes

2 .Discuss the problems of elderly in India. Do you think there is a need for a societal and attitudinal change in the way we treat our elderly? Explain. (250 words)

PIB

Why this question:

During the Book release of Health and Wellbeing in Late Life: Perspectives and Narratives from India, Vice President emphasized that strengthening of the family system is the need of the hour.

Key demand of the question:

One must analyse the causes for declining status of elderly in the society.

Directive:

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

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

Structure of the answer:

Introduction:

In brief highlight the status of elderly population in the Indian society.

Body:

Due to the tendency to ape western culture, there is a need for a societal and attitudinal change in the way we treat our elderly.

This needs going back to the Indian family system, values, culture and traditions which comprise respect for parents, teacher and nature ingrained in Indian philosophy.

India is ageing fast and it can be seen where by 2050 almost 20% of Indian population will be more than 60 years old becoming the country with

Highest population in the world.

Conclusion:

Conclude with solutions.

Introduction:

In 2009, there were 88 million elderly people in India. By 2050, this figure is expected to soar over 320 million. Between 2000 and 2050 the overall population of the country is anticipated to grow by 60 per cent whereas population of people of age 60 years and above would shoot by 360 per cent. The Maintenance and Welfare of Parents and Senior Citizens (Amendment) Bill, 2019 was cleared by the Cabinet recently

Body:

Problems of elderly population in India:

  • Isolation and loneliness among the elderly is rising.
    • Nearly half the elderly felt sad and neglected, 36 per cent felt they were a burden to the family.
  • Rise in age-related chronic illness:
    • Heart disease, cancer, diabetes, and other chronic diseases will cause more death and illness worldwide than infectious or parasitic diseases over the next few years.
    • In developed nations, this shift has already happened. Dementia and Alzheimer’s disease are expected to almost double every 20 years, as life expectancy increases.
  • Special challenges for less developed nations:
    • Poorer countries will carry the double burden of caring for older people with chronic diseases, as well as dealing with continued high rates of infectious diseases.
  • Increasing need for long-term care:
    • The number of sick and frail elderly needing affordable nursing homes or assisted living centers will likely increase.
  • Rise in the Health care costs:
    • As older people stop working and their health care needs increase, governments could be overwhelmed by unprecedented costs.
    • While there may be cause for optimism about population aging in some countries, the Pew survey reveals that residents of countries such as Japan, Italy, and Russia are the least confident about achieving an adequate standard of living in old age.
  • Elderly women issues:
    • They face life time of gender-based discrimination. The gendered nature of ageing is such that universally, women tend to live longer than men.
    • In the advanced age of 80 years and above, widowhood dominates the status of women with 71 per cent of women and only 29 per cent of men having lost their spouse.
    • Social mores inhibit women from re-marrying, resulting in an increased likelihood of women ending up alone.
    • The life of a widow is riddled with stringent moral codes, with integral rights relinquished and liberties circumvented.
    • Social bias often results in unjust allocation of resources, neglect, abuse, exploitation, gender-based violence, lack of access to basic services and prevention of ownership of assets.
    • Ageing women are more likely to get excluded from social security schemes due to lower literacy and awareness levels.
  • Ageing individual is expected to need health care for a longer period of time than previous generations but elderly care for a shorter period of time

Conclusion:

The elderly are the fastest growing, underutilized resource that humanity has to address many other problems. Re-integration of the elderly into communities may save humanity from mindlessly changing into a technology driven ‘Industry 4.0’ which futurists are projecting: an economy of robots producing things for each other. Healthy elderly citizens can share their wealth of knowledge with younger generations, help with child care, and volunteer or hold jobs in their communities.

Way forward:

  • As a signatory to Madrid International Plan of Action on Ageing (MIPAA), India has the responsibility to formulate and implement public policy on population ageing.
  • Issues of poverty, migration, urbanization, realization and feminization compound the complexity of this emerging phenomenon. Public policy must respond to this bourgeoning need and mainstream action into developmental planning.
  • Gender and social concerns of elderly, particularly elderly women, must be integrated at the policy level.
  • The elderly, especially women, should be represented in decision making.
  • With the WHO declaring 2020 to 2030 as “Decade of Healthy Ageing”, there is a need for Institutes like AIIMS to be in the forefront in promoting healthy ageing.
  • Increasing social/widow pension and its universalization is critical for expanding the extent and reach of benefits.
  • Renewed efforts should be made for raising widespread awareness and access to social security schemes such as National Old Age Pension and Widow Pension Scheme. Provisions in terms of special incentives for elderly women, disabled, widowed should also be considered.
  • Government must proactively work on life style modification, non-communicable disease management, vision and hearing problem management and accessible health care through Ayushman Bharat.

 

Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

3. What is the office of Chief of Defence staff (CDS)? Discuss the significance of such a post to the Indian setup. (250 words)

The Hindu

Why this question:

The Cabinet Committee on Security (CCS) has approved the creation of a chief of defence staff (CDS).

Key demand of the question:

Discuss the significance of the post of CDS and its significance.

Directive:

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

Structure of the answer:

Introduction:

Define the post of CDS in general and its significance.

Body:

He will be the single-point military adviser to the government as suggested by the Kargil Review Committee in 1999.

CDS oversees and coordinates the working of the three Services.

Explain what are key features,  its significance.

The charter of the CDS, if implemented properly, will prepare the 15-lakh strong armed forces for the wars of the future. The CDS is mandated to ensure the Army, Navy and IAF, which often pull in different directions, truly integrate to slash wasteful expenditure amidst the ongoing severe fund crunch for military modernization because of the ballooning pay and pension bills.

Conclusion:

Conclude with way forward.

Introduction:

The Chief of Defence Staff (CDS) is a high military office that oversees and coordinates the working of the three Services, and offers seamless tri-service views and single-point advice to the Executive (in India’s case, to the Prime Minister) on long-term defence planning and management, including manpower, equipment and strategy, and above all, “jointsmanship” in operations. It shall provide “effective leadership at the top level” to the three wings of the armed forces, and to help improve coordination among them.

Body:

Need for office of CDS:

  • The move was considered necessary after the 1999 Kargil War and was first approved by the Atal Bihari Vajpayee cabinet in May 2001.
  • India has had a feeble equivalent known as the Chairman, Chiefs of Staff Committee (CoSC); but a toothless office in the manner of its structure.
  • The senior-most among the three Service Chiefs is appointed to head the CoSC, an office that lapses with the incumbent’s retirement.
  • The post did not further tri-service integration, resulting in inefficiency and an expensive duplication of assets.
  • By 2001, it had become clear to the leaders of India’s strategic establishment that jointnessthe combination of land, sea and air power—was necessary to effectively combat adversaries, who employed everything from terrorists and militants to regular troops through to nuclear weapons.
  • With information, cyberspace and space becoming military domains already, the jointness which is required surpasses merely getting the groups in uniform together.

CDS – a significant defence policy reform:

  • The appointment of the CDS will certainly change the civil-military balance, and, if done correctly, will address some of the grievances of the Armed Forces pertaining to their status vis-à-vis the civil services.
  • The underlying rationale for appointing a CDS is to separate management and command of the Armed Forces.
  • To take the logic of the CDS to its conclusion, the Armed Forces must be operationally restructured into theatre commands—complete joint war-fighting formations—led by combatant commanders.
  • In the years ahead, a combination of climate change, violent non-state actors and volatile politics will increase the demands on the government to deploy military forces beyond the subcontinent.
  • Despite a multitude of threats, India’s Armed Forces have very limited capacity to operate overseas. Hence, the need for an expeditionary CDS.
  • From a defence policy perspective, the CDS presents us with the opportunity to optimize defence economics and make expenditure more effective.

Way forward:

  • To take the logic of the CDS to its conclusion, the Armed Forces should be operationally restructured into theatre commands
  • The late strategic thinker K. Subrahmanyam argued that the army and navy chiefs should first hand over their command to theatre commanders, with the air chief doing so at a later stage.
  • Three theatres are straightforward: Northern, Western and Southern to address the threats from China, Pakistan and the Indian Ocean, respectively.
  • He envisaged doubling the air force to 60 squadrons by 2030 and placing them under theatre commands.

Conclusion:

Most countries with advanced militaries have such a post, albeit with varying degrees of power and authority. The United States Chairman Joint Chiefs of Staff Committee (CJCSC), for example, is extremely powerful, with a legislated mandate and sharply delineated powers. The role of the CDS becomes critical in times of conflict.

 

Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

4. Despite implementation of various programmes for better management of ground water, dropping ground water level still persists as an alarming issue’. Explain by giving reasons and suggest way forward. (250 words)

Economic Times

Why this question:

The question is in the backdrop of recently launched Atal Bhujal Yojana that aims at better management of Ground water.

Key demand of the question:

One must analyse and present arguments the causes of depleting ground water levels and the failures of the past policies to address the issue.

Directive:

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

Structure of the answer:

Introduction:

In brief explain with facts the ground water situation of the country.

Body:

Explain the causes of the depleting water levels of the ground water.

Discuss the efforts made by the government in this direction.

Comment upon the recently launched Atal Bhujal Yojana and explain in what way the Central Government scheme will promote Panchayat led ground water management and Behavioural change with primary focus on demand side management.

Conclusion:

Conclude by suggesting more solutions.

Introduction:

The United Nations Educational, Scientific and Cultural Organization (UNESCO) World Water Development Report states that India is the largest extractor of groundwater in the world. Fifty-four percent of India’s groundwater wells have declined over the past seven years, and 21 major cities are expected to run out of groundwater by 2020. Erratic monsoon rains and skewed farm incentives have led to the growing groundwater crisis, impacting farm incomes and availability of drinking water.

Body:

Ground_Water_Stressed

Reasons for ground water exploitation in India:

  • Groundwater is one of the most important water sources in India accounting for 63% of all irrigation water and over 80% of the rural and urban domestic water supplies.
  • Subsidies:
    • Subsidies on electricity are thought to play a central role in the Indian groundwater crisis.
    • The vast majority of groundwater pumps are unmetered, and if charged, are billed at a flat, non-volumetric, and highly subsidized tariff.
  • Water intensive crops:
    • Government encourages farmers to produce water-intensive crops like rice and sugarcane through increased minimum support prices (MSP). This has also led to groundwater depletion, income inequality and unsustainable agriculture.
    • Farmers are digging more and more borewells, but the sources of the problem are many, including transition to water-intensive crops and spate of construction activity along catchment areas.
  • Unpredictable monsoon:
    • Successive droughts and erratic rainfall have led to excess extraction of groundwater. That explains 61 per cent decline in groundwater level in wells in India between 2007 and 2017.
  • Land use changes:
    • India’s huge groundwater-dependent population, uncertain climate-reliant recharge processes and indiscriminate land use changes with urbanization are among the many factors that have rendered the Indian groundwater scenario to become a global paradigm for water scarcity, for both quantity and quality.
    • Trans-boundary upstream water sources and archaic irrigation methods for the water shortage.
  • Government failure:
    • The government finance for well digging and pump installation with capital subsidies, massive rural electrification and pervasive energy subsidies all have enabled this process to aggravate.
    • In the north western parts of India and southern peninsula, the early and rapid rural electrification, free or subsidized power to the farm sector, large productive farmers and attractive procurement prices for major cereals led to intensive use of groundwater.
    • Zero marginal cost of pumping and lack of restriction on volume of water resulted in inefficient and unsustainable use of the resource.
  • Lack of adequate planning, crumbling infrastructure, indiscriminate drilling of borewells, large-scale consumption of water, and a false sense of entitlement in using water carelessly are causing water shortages.

Measures needed:

  • Reducing electricity subsidies:
    • An analysis of panel data across 370 districts in India found that a reduction in electricity subsidy was correlated with a decrease in groundwater extraction.
    • Most empirical studies are in favour of pricing electricity on the basis of actual consumption. They show that the energy prices at which the farmers start responding to tariff changes in terms of reducing the demand for water and electricity would be socio-economically viable.
  • Micro-irrigation:
    • Encouraging farmers to adopt micro-irrigation techniques such as drip irrigation and micro-sprinklers.
    • According to the CWMI report, adopting micro-irrigation techniques can save roughly 20% of the groundwater used annually on irrigation in India.
  • Creating awareness:
    • Creating sustainable change would require a bottom-up approach by empowering the local community to become active participants in managing groundwater.
  • Proper implementation of initiatives:
    • 12th five-year plan proposed a policy of participatory groundwater management (PGM), which involves a collaborative approach among government departments, researchers, NGOs and community members.
    • The plan involves training community workers to carry out aquifer mapping and implement innovative ways to use groundwater conservatively with the local community.
    • Government has come up with a 6,000-crore World Bank-aided Atal Bhujal Yojana with community participation to ensure sustained groundwater management in overexploited and ground water-stressed areas in seven States.
    • World Bank’s Water Scarce Cities Initiative seeks to promote an integrated approach to managing water resources and service delivery in water-scarce cities as the basis for building resilience against climate change.
    • India needs better policies that directly help small-holders and labourers to adapt and adjust to risks associated with groundwater depletion and a more variable future climate.
  • Crisis can be tackled by restoring and enhancing groundwater recharge areas, stopping polluted water from recharging groundwater, rainwater and roof top harvesting and the restoration of ponds, lakes and other river systems.
  • Growing less water-intensive crops in the dry season and transitioning away from irrigation-intensive systems where there is little water.
  • Behavioral economics and other novel approaches can be brought to bear on maximizing agricultural production with minimal water use instead of focusing on marginal increases in yields with unbounded water use.
  • Water-deficient states should promptly move towards micro-irrigation systems. These techniques have significantly higher efficiency vis-à-vis flood irrigation techniques.
  • States should continue to focus on command area development (CAD). This is now part of Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) which focuses on “more crop per drop”.
  • The cropping patterns in the states should be changed as per the agro-climatic zones. Improper cropping patterns affect both crop productivity and irrigation efficiency.
  • Farmer producer organizations (FPO) provide a sense of ownership to farmers and encourage community-level involvement with lower transaction costs.
  • India needs to establish data networks to track not only crop transpiration but also total inflows and recoverable outflows of irrigation water but also the losses to unrecoverable sinks such as evaporation.

Conclusion:

There is a need to modernize the regulatory framework for accessing groundwater soon after massive expansion in mechanical pumping led to the realization that recharge could not keep pace with use.

 

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

5. Discuss the concept of monetary transmission mechanism. Explain in what way it can facilitate RBI in ensuring the pass-through of its policy decisions. (250 words)

Economic Times

Why this question:

The question is based on the concept of Monetary transmission and the article provides a detailed analysis of the concept as applied to the Indian economy.

Key demand of the question:

Explain and discuss the concept of monetary transmission in detail, explain its importance to the context of Indian economy.

Directive:

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

Structure of the answer:

Introduction:

Define what Monetary transmission mechanism is.

Body:

The monetary transmission mechanism is the process by which asset prices and general economic conditions are affected as a result of monetary policy decisions. Such decisions are intended to influence the aggregate demand, interest rates, and amounts of money and credit in order to affect overall economic performance.

The traditional monetary transmission mechanism occurs through interest rate channels, which affect interest rates, costs of borrowing, levels of physical investment, and aggregate demand. Additionally, aggregate demand can be affected through friction in the credit markets, known as the credit view. In short, the monetary transmission mechanism can be defined as the link between monetary policy and aggregate demand.

Monetary transmission is the process through which RBI’s policy actions reach its effective end goal of tackling inflation and addressing growth concerns.

Take hints from the article and explain why monetary transmission is important to Indian context.

Conclusion:

Conclude with the benefits of inculcating such mechanism.

Introduction:

The monetary policy refers to a regulatory policy whereby the central bank maintains its control over the supply of money to achieve the general economic goals. Since February 2019, the Reserve Bank of India (RBI) has aggressively cut the repo rate. By cutting the repo rate, the RBI has been sending a signal to the rest of the banking system that the lending rates should come down.

The Monetary Policy Committee of the Reserve Bank of India (RBI) decided to keep the interest rate unchanged at 5.15% in the fifth bimonthly policy review (Dec 2019), citing inflation concerns despite economic growth continuing to slow down.

Body:

Monetary policy scenario in India:

  • In India, the process of monetary policy transmission is inefficient.
  • For example, between February and December, the RBI cut repo rate from 6.5% to 5.15%.
  • But, the interest rate charged by banks on fresh loans fell just 27% of the amount by which the repo rate came down.
  • Further, RBI has urged banks to link their lending rates to the repo rate

Reasons for poor monetary policy transmission:

  • Repo rates have little impact on a bank’s overall cost of funds.
  • Reducing lending rates just because the repo rate has been cut is not feasible for banks.
  • This is because, for banks to be viable, there must be a clear difference between the lending rate (charged on loans) and the deposit rate (given on deposits).
  • The difference between the two has to be not only positive but also big enough for the bank to make profits.
  • Notably, to attract deposits, banks pay a high deposit rate.
  • Such deposits make up almost 80% of all banks’ funds from which they then lend to borrowers.
  • On the other hand, banks borrow a minuscule fraction from the RBI under the repo.
  • So even sharply reducing the repo rate does not change the overall cost of funds for the banks.
  • In effect, unless banks reduce their deposit rates, they will not be able to reduce their lending rates.
  • However, if a bank were to reduce its deposit rates, depositors would shift to a rival bank that pays better interest rates.
  • Otherwise, they would park more of their savings in small saving instruments (public provident fund, Sukanya Samriddhi Yojana, etc.) that pay much higher interest rates.
  • Also, 65% of total deposits are “term” deposits (fixed for a certain duration) and take, on an average, up to 2 years to get repriced at fresh rates.
  • So, banks cannot always reduce deposit rates immediately as deposits take longer to get repriced.
  • Moreover, if banks are under pressure to reduce the interest rate they charge on new loans, they could possibly push up the interest rates on old loans that allow for such flexibility.

Measures needed:

  • Enabling effective monetary transmission would not only increase the credibility of the Central Bank but also help in strengthening the financial structure.
  • Impounding of bank money by RBI is too high with 4% cash reserve ratio carrying no return whatsoever.
  • To make transmission work, the least the RBI can do is to reduce CRR.
  • Timely transmission of policy rates could be considerably improved if the banking sector’s non-performing assets (NPAs) are resolved more quickly and efficiently.
  • If the government wants to reduce lending rates, it could focus on bringing down its own fiscal deficit and public sector borrowing.
  • At the current low levels of per capita income, the savers are far more risk-averse in India and unwilling to invest in higher-risk instruments other than bank deposits.
  • For a repo-linked regime to work, the whole banking system in India would have to shift to that.
  • In other words, along with banks’ lending rates, their deposit rates too must go up and down with the repo.

 

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

6. The present economic slowdown is a consequence of both cyclical and structural factors. Comment. (250 words)

The Hindu

Why this question:

India is now in the midst of a significant economic slowdown, the International Monetary Fund has said, urging the government to take urgent policy actions to address the current prolonged downturn.

Key demand of the question:

Explain the recent trends being witnessed in the economy and provide for an analysis as to in what way it is the result of both cyclical and structural factors.

Directive:

Comment– here we have to express our knowledge and understanding of the issue and form an overall opinion thereupon.

Structure of the answer:

Introduction:

Briefly discuss what a cyclic slowdown is; A cyclical slowdown is a period of weak economic growth that occurs at regular intervals. A structural slowdown is a more deep-rooted phenomenon signifying weak economic growth for over a long time.

Body:

Discuss first the structural factors responsible for these issues ranging from investment, Failure of the Insolvency and Bankruptcy Code (IBC), Unemployment etc.

Discuss then the cyclical factors – consumption, savings factor etc.

Explain the recent steps taken by the govt. and the RBI.

Suggest way forward.

Conclusion:

Conclude by suggesting solutions and suggestions as to what can be done to address these issues.

Introduction:

According to a research paper by former Chief Economic Adviser Arvind Subramanian, Indian economy is facing both structural (that is, more long-term issues related to the overall framework of the economy such as the flexibility or inflexibility of labour laws etc.) and cyclical (that is, more short-term issues such as a bad monsoon that disrupts production of food articles etc.) challenges.

Body:

Reasons for economic slowdown:

Cyclical factors:

  • Poor policy making like FPI surcharge, angel tax, penalizing for non-compliance of Corporate Social Responsibility (CSR) have deterred investments in the economy thereby affecting the GDP growth.
  • Tightening monetary and fiscal policies have left little room for the government to increase its spending to pump-prime the economy.

Shadow banking stress (NBFC crisis):

  • NPAs of Banks and Too Much Debt on corporates affecting investment cycle- NPAs have resulted tightening of lending leading to a freeze on investment by industrial houses and corporates. The IL&FS crisis also triggered the Non-Banking Financial Companies’ (NBFC) credit crunch in 2018.
  • While the unresolved TBS problem provided a progressively weakening ecosystem of banks and companies, the collapse of some of the leading NBFCs has proven to be trigger for the sharp growth deceleration.
  • The failure was completely unexpected, prompting markets to wake up and re-assess the entire NBFC sector.
  • Much of the NBFC lending had been channeled to one particular sector, real estate. And that sector itself was in a precarious situation.

Weaker global demand:

  • India is a net commodity exporter and thus there has been a slump in the volumes of exports due to global slowdown.
  • With rising retreat of globalization like Brexit, Trump’s protectionist policies and the US-China trade war, global sentiments have remained poor making the prospects of an export led growth bleak.

Structural factors include:

  • The slowdown is also part of a longer-term structural shift wherein the Economy is shifting gears from the high investment era to a low investment era as well as a transition from being cash-driven economy to a digitally enabled economy.
  • Irregular monsoonal pattern causing droughts in some parts and floods in another has severely affected the agricultural output, transportation facilities leading to imbalance in trade of commodities thereby affecting the economic growth.
  • Demonetization and GST has led to a collapse in private consumption as consumers suddenly prefer to hoard cash or keep it in the bank and investments have also been affected mainly by the small and medium businesses (SMEs)as they are forced to withhold inventories until they are compliant with the new rules and regulations.
  • The rates of savings and investment in the Indian economy have declined, as also exports and total credit.
  • This has led to a slowdown among the major industries, like the automobiles, diamond, textiles industry, and several Micro, Small and Medium Enterprises (MSME) are experiencing a continuous decline, which has led to the retrenchment of 3.5 lakh workers so far.
  • Agriculture is in crisis today on account of rising costs of inputs and low prices of produces, and low public investments in this sector.
  • Apart from it, there is income stagnation in urban areas.
  • The slowdown in consumption is the major worry for India’s economic slump (consumption has been the main driver of India’s growth).
  • There is a sharp fall in Private Consumption and as well as Public Expenditure.

Measures needed:

  • The Reserve Bank of India (RBI) can quickly increase the amount of cash in the economy.
  • Then banks, especially public sector banks, can use that together with interest rate policy to provide easy credit. A larger supply of credit should lead to cheaper credit.
  • This will have to be supported by reduction of the administered price of credit, which is the RBI’s repo rate.
  • There could be hurdles to credit off-take due to fiduciary or prudential reasons, so those need to be tackled. Same for mismatched expectations.
  • Higher liquidity and disposable income, and increased employment can pull us out of the quagmire.
  • reduction and reform of direct individual and corporate taxes, and indirect taxes.
  • Labour laws also need to be amended to generate employment.
  • The government needs to hold granular conversations with the private sector.
  • A skills and industrial policy which can make full use of an abundant pool of reasonably priced labour

 

Topic: Public/Civil service values and Ethics in Public administration: Status and problems; ethical concerns and dilemmas in government and private institutions; laws, rules, regulations and conscience as sources of ethical guidance; accountability and ethical governance; strengthening of ethical and moral values in governance; ethical issues in international relations and funding; corporate governance.

7. What is ethical climate? Why is ethical climate important? Discuss with relevant examples. (250 words)

Ethics by Lexicon publications

Why this question:

The question is based on the concept of Ethical climate and its importance.

Key demand of the question:

Explain the principle of ethical climate, its relevance and significance in detail.

Directive:

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

Structure of the answer:

Introduction:

Define what you understand by Ethical climate.

Body:

Explain that Ethical climate is the culture of an organization as it pertains to questions of right and wrong. It derives from the governance, values, norms and habits that exist within an organization. Ethical climate results from both a firm’s history and its leadership.

Discuss the key features in detail. Provide for illustrations wherever necessary.

Explain the advantages and need for good ethical climate and relate its relevance to the Governance.

Conclusion:

Conclude with way forward.

Introduction:

Ethical climate is the culture of an organization as it pertains to questions of right and wrong. It derives from the governance, values, norms and habits that exist within an organization. Ethical climate results from both a firm’s history and its leadership. Generally speaking, poor ethical practices at the top of an organization translate to a poor ethical climate.

Body:

Importance:

  • Ethical climate is focused on the ethical aspects of decision making and actions of members of an organization. Ethics provides the values and morals that an individual, organization or society finds desirable or appropriate (Northhouse, 2015).
  • An organization’s ethical climate is important because it can improve employee morale, enrich organizational commitment, and foster an involved and retained workforce.
  • Organization and Ethical climate are important because these conditions will impact the behavior, motivation and effectiveness of the workforce.
  • These forces if positive and supportive can strengthen and increase morale and productivity, but when caustic and destructive, can cause withdrawal, dysfunctional and unwanted behaviors.
  • Organization climate is important because it can be a driver and indicator of job performance, psychological wellbeing and withdrawal of individuals in an organization

Conclusion:

Ethical climates develop as a result of organizational policies, practices, and leadership, and exert significant influence on the ethical decision making of organizational members and their subsequent attitudes and behavior at work.