9 PM Daily Brief – June 5th,2020

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9 PM for Main examination

GS-2

1.On Trump’s proposal to expand G-7

GS-3

2.Judicial intervention in the economy
3.Will the recent Agri-reforms help farmers?
4.Understanding Human-Animal Conflict
5.Understanding Swiss Cheese Model in Indian context

9 PM for Preliminary examination

FACTLy


1.On Trump’s proposal to expand G-7

SourceIndian Express

Syllabus: GS-2- International Relations

Context: US President Donald Trump has proposed to expand G7 into a G11 or G12.

G-7 countries:

  • The G-7 or ‘Group of Seven’ is an intergovernmental organization comprising of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.
  • It was formed in 1975 by the top economies of the time as an informal forum to discuss pressing world issues.
  • The G-7 does not have a formal constitution or a fixed headquarters. The decisions taken by leaders during annual summits are non-binding.

Proposed G-11/G-12 countries: The proposed G-11 will include Australia, India, South Korea and Russia. It could be made G-12 by adding Indonesia.

Need for G-7 to expand to G-11

  • Fall in GDP: The share of G-7’s share in global GDP has fallen to around 40%.
  • Reduced Relevance:The rise of India, China, and Brazil over the past few decades has reduced the G-7’s relevance.
  • Does not represent world: According to Donald Trump, the G-7 grouping has become outdated and does not represent the world.
  • Does not Address Emerging needs: The G7 only focuses on economic issues and does not address the emerging needs such climate change and human rights.
  • Containing China: An alliance of powerful democracies is an ideological challenge to China and will contain China’s expansionary moves.

What should the G-11/G-12 focus upon?

  1. It should formulate a strategy to deal with disruptions such as protectionism, mercantilism and the global economic slowdown amid Covid-19 pandemic
  2. It should widen agenda and go beyond economic issues and include climate change and health care.
  3. Must issue a new charter of respect for human rights, adherence to international law and multilateralism in trade and security

2.Judicial intervention in the economy

Source: Live Mint

Syllabus: GS 3-Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.

Context: The Supreme Court has sought the response of the finance ministry on demands by debtors for an interest waiver during the moratorium until 31 August.

Why moratorium? 

Relief from COVID: Till 31 August, the borrowers can defer their payment of loans without being called defaulters.

Challenges to the banking sector due to recent measures:

  • For borrowers:
    • Credit charges not pardoned: The Credit charges are temporarily deferred.
    • Burden of interests:The burden will pile up month after month with the interest charged on unpaid repayments.
    • Postponement of problem: With an uncertain future due to COVID-19, it is not clear how the borrowers would meet their obligations. They may need another loan to pay their deferred dues.
  • For lenders:
    • Threaten financial viability:The RBI is opposed to any waiver of interest charges. It would also jeopardize the interests of depositors. Indian lenders cannot afford to forget their dues.Example: By its calculations, the banks would lose ₹2 trillion if just 65% of outstanding term loans (a total put at ₹59 trillion at the end of 2019) were to go interest-free for six months.
    • Already poor condition of the banking sector: The bad loans have accumulated over the years. Large-scale write-off could threaten the stability of our banking sector.
    • Suspension of Insolvency and Bankruptcy Code (IBC): The Code has briefly been suspended as an additional support measure for borrowers. The lenders uneasiness with the quality of assets of borrowers will further increase.
    • Problem to capital buffers of the Bank: The economy is in a dismal state. The capital buffers of banks may soon be at risk of getting exhausted.
    • Losing confidence in the system: The depositors need the constant assurance about the safety of money for maintaining economic stability.

Way Forward

For a stable economy, the Borrowers may need actual debt relief as well as banks need to stay afloat. The burden of Covid relief can’t be thrust upon lenders beyond a point. The Centre must balance the requirements of both.

 3.Will the recent Agri-reforms help farmers?

Source: Livemint

Syllabus: GS-3- Agriculture

Context: The government has taken a slew of measures to transform the agriculture sector, as part of the package for Aatmanirbhar Bharat.

Recent Measures taken:

Measure Details Expected Benefits
Amendment to Essential Commodities Act Commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes will be removed from list of essential commodities · Promote private investment in warehousing and storage facilities.

· Prevents agri-wastage

· Provide stable income to farmers in bumper crop season and

· Less volatile prices for consumers

· Increase farm export and promotes surplus in balance in trade

 

The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020 Aims to open agricultural marketing outside notified mandis (APMC market) for farmers and remove barriers to inter-State trade.

Lays the foundation for One India, One Agriculture Market

· open more choices for the farmer, reduce marketing costs for the farmers and help them in getting better prices

· help farmers of regions with surplus produce to get better prices and consumers of regions with shortages, lower prices

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020 Aims at facilitating contract farming · transfer the risk of market unpredictability from the farmer to the sponsor

·  enable the farmer to access modern technology and better inputs.

·  reduce cost of marketing and improve income of farmers

Will these reforms raise farmers’ price realization on their produce?

  • Though agricultural marketing reforms are necessary, they are not sufficient because of the limitation in the use of agri-markets. For example: According to NSSO, on an average, less than half of all farmers of most food crops reported selling their produce in markets.
  • The prices farmers get is not only determined by their access to markets, but also by domestic demand and supply along with international rates.
  • Creating the marketing, storage and logistical infrastructure necessary for market reforms is important. For example, Bihar abolished APMC Act but that did not lead to better price realization for farmers, nor did it result in more investment by the private sector.

Way Forward: At a time, when the economy is slowing down, it is important to revive demand for agri-produce. Any reform in the agriculture sector should be accompanied by fiscal stimulus and investment in market and storage infrastructure

4.Understanding Human-Animal Conflict

Source – The Hindu

Syllabus –GS 3 – Conservation, environmental pollution and degradation, environmental impact assessment.

Context – Killing of a pregnant elephant using food bomb in Kerala demands for urgent need of sustainable development.

Reasons for human – animal conflict 

  1. Deforestation– The natural and anthropogenic destruction of forests across India for agriculture, industrialisation and urbanisation has deprived animals of their natural habitats.
  2. Unscientific planning and development– Faster clearances without proper assessment of project’s impact on forests and wildlife has created issues like lack of migration corridor for animals.
  3. Disasters and Climate Change – Disasters like drought and floods puts stress on natural resources like food, water which force the animals to venture into human landscape – agricultural fields which lead to conflict between the two.
  4. Increasing livestock population– Domestic livestock has become an important source of prey for wild animals when the forest based food resources are disappearing fast.
  5. Human population explosion – India is the second most populated in world and the needs of 1.3 billion people for survival and comfort has put excruciating pressure on the forest resources.

Implication 

  1. ~ 1700 people in India were killed by elephants while tigers claimed over 200 lives in from 2015 to 2019.

Source – The Hindu

Suggested solutions 

  1. Use of technology – By using GPS and GIS tools researchers can identify hot spots where human-wildlife conflict is more frequent and such data can help in forming policies and plans for development.
  2. Strict implementation of existing laws – Forest Conservation Act, Environment Protection Act provides for wildlife conservation in India and prescribes punishment for the same.
  3. Promoting traditional methods – Biofencingincludes growing chilly based plants in the outer boundary to prevent animals from destroying crops. Other methods like pits and walls can be promoted which are cost effective and safe for both man and animal.

Way Forward – The solutions are simple: Inclusive development with a long-term vision that cares for the environment. Need of the hour is willingness to walk the path of conservation.

5.Understanding Swiss Cheese Model in Indian context 

Source – The Hindu

Syllabus – GS 3 – Indian Security forces and their mandate

Context – Analysing the Indian Defence system with Swiss cheese model

Swiss cheese model 

  1. Swiss cheese model is associated with accident investigation in an organisation or a system.
  2. A system consists of multiple domains or layers. These layers are visualised in the model as slices of Swiss cheese, with the holes in them being the imperfections.
  3. Generallyholes in cheese slices are ignored unless when all holes in each slice align and let an accident pass through it.

Swiss cheese Model and defence system

  1. Relation between two– In Defence System, the Swiss cheese slice works the reverse way.
    • The slices represent the major constituents in a nation’s war-making potential, while the holes are pathways through which the domains interact.
    • At the structural level, there are only three slices with holes in each. These must align to ensure that a nation’s defence posture is in tune with its political objectives; any mismatch may turn out to be detrimental to the national interest.
  1. Slices in Indian Defence system – 
    • Policy Apparatus – It comprises ofthe Department of Military Affairs (DMA) and Ministry of Defence (MoD).
    • The defence research and development (R&D) establishment and domestic manufacturing industry.
    • The three services – Army, Navy and Air Force.

Challenges and associated areas of reforms with respect to the Model 

  1. China-Pakistan nexus – Theincreasingly threatening posture of the country’s two adversaries, terrorist activities in Jammu and Kashmir, ongoing incidents along the northern border with China pose greater challenge to Indian defence forces in neighbourhood.
  2. Indo-pacific security – The ongoing great game in Indo-pacific between USA and China along with the threat of pirates and terrorism emanating from the ocean demands strengthened defence forces.
  3. Lack of R&D– Swiss cheese slice representing indigenous R&D and a manufacturing supply chain that ensures quality war-fighting equipment, at the right time and in required quantities, is still not a possibility for India.
  4. Absence of theatre commands– Indian deadline for creation of theatre commands is three years from now however the Chinese announced their ‘theaterisation’ concept in 2015 and it is still work in progress. So a clear perspective is required for what and how of the theaterisation concept  in India

Way Forward – The political, civil and military leadership need to ensure that the holes in their Swiss cheese continue to stay aligned which also involves shunning publicity and building capability first for an enhanced defence system.


9 PM for Preliminary examination

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