9 PM Daily Current Affairs Brief – January 11, 2021

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GS- 2 

Reimagining the school education in India 

What are the issues in ailing American democracy? 

GS – 3 

RBI’s expansionary policy and challenge of the impossible trinity

Efforts to increase Electric mobility in India

Issue of K-shaped recovery: How government budget can deal with it?


9 PM for Preliminary examination

FACTLY

Reimagining the school education in India 

Source: Indian Express 

GS-2: Issues Relating to Development and Management of Social Sector/Services relating to Education.  

Synopsis:  We need to reimagine our school education system to ensure quality education for all and to make India a knowledgeable super power. 

Background:  

    • Currently, the school as an institution has been criticised by many experts for turning into caged jails, for being run like factories, functioning like corporate enterprises and for forcing the curriculum into the child. 
    • In this backdrop, we will evaluate how the school system has been envisaged by great personalities, what are the drawbacks in our present schooling system and how we need to improve it to make school education inclusive, knowledgeable and as an institution for self-discovery. 

How the school system has been envisaged by great personalities? 

Progressive thinkers have always envisioned “free schools” for children. They always believed that school should be made to fit the child rather than the other way round. For example, 

    • Leo Tolstoy (Russian Novelist) himself founded a school for the children of poor peasants at his home (Yasnaya Polyana) without any strict schedule, homework or physical punishment. 
    • Maria Montessori (The first Italian woman to become a doctor) educational philosophy too emphasised on children’s freedom and choice.  
    • Rabindranath Tagore in his classical tale The Parrot’s Training (Totaakahini) has vehemently criticised the rote learning method followed in the Indian school system. 

What are the issues with government schools in India? 

Government schools in India faces the following challenges, 

    • Firstly, the poor Infrastructure in government schools leading to instances such as roof collapse. 
    • Second, lack of effective governance and monitoring. For example, Children’s falling sick after consuming mid-day meals.  
    • Third, there is a deep segregation of school systems in India, ignoring the 1966 Kothari Education Commission’s recommendation for a common school system. 
    • Fourth, existing inequality among children’s due to widening digital divide, the poor do not have access to mobiles, laptops and internet connectivity. 
    • Fifth, lack of political will to strengthen the government schools in India which can be understood from the point that government is pushing towards privatisation by handing over land and managements to private organisations. 

What needs to be done? 

We need to improve on the following areas to provide a healthy education to our younger generation. 

    • Firstly, we need to improve the schooling infrastructure by providing Clean toilets, drinking water, library, a tinkering lab, and a playground. 
    • Second, we need to think on having classes with mixed age groups instead of segregating children by age. This will allow children to learn at their own pace and make learning a fun activity. For example, David Horsburgh’s Neel Bagh School in Kolar, Karnataka, Here, Children’s could study Class V Telugu, Class III English and Class VII math all at the same time. 
    • Third, we need to identify the champions from within the government system and use them as effective resource people. This will surely motivate many teachers to perform better and achieve excellence. 
    • Fourth, government needs to cooperates with best NGO’s like PRATHAM to bring in best practices from all over the country. 
    • Fifth, we need to envision a plan to bring tens of thousands of retired professionals as teachers as they will bring years of practical experience to learning. 
    • Sixth, as we reimagine the school system, we must strive to bring more neighbourhood learning spaces as places for community learning. This can be done by utilising community halls in large housing societies and by creating an “activities centre” in each housing society. 
    • Seventh, we need to build a free archive for Indian languages such as archive.org where nearly 1.5 million people log in every day. The recent announcement by the government that it will buy bulk subscriptions of scientific journals to make them accessible for all is a step in the right direction. 
    • Lastly, we need to reimplement the success of Delhi government schools throughout India where government schools have become better than private ones by improving infrastructure (no stinky toilets), giving dignity to teachers, constituting school management committees and by involving many good NGOs for innovating learning methods 

We need to reimagine our school as a place where children with different backgrounds class, caste, religions, abilities can study together and learn to care and empathise. They should also be trained to excel in soft skills such as cooperation, group work, compassion, human dignity and plurality of opinions.


What are the issues in ailing American democracy?  

Source: Indian Express 

Gs2: Effect of Policies and Politics of Developed and Developing Countries on India’s interests, Indian Diaspora. 

Synopsis: The rioting by the Donald Trump supporters in the US Capitol seeking to stall President-elect Joe Biden’s certification by Congress personifies the decaying Democracy in America. 

Background 

    • Recently, a violent mob (loyal to President Donald Trump) in an attempt to overturn America’s Presidential election stormed the U.S. Capitol and forced lawmakers into hiding. 
    • This act of violence indicates that American democracy is critically ill. 

What are the reasons to perceive that American democracy is under threat? 

According to the author, American democracy suffers from five disorders. 

    • Firstly, the major headache of what the American democracy is witnessing is the breakdown in the culture of bipartisanship (opposing political parties find common ground through compromise) that was so intrinsic to American politics and kept the system working.  
      • Bipartisanship in America has been replaced by ideological chauvinism built on a psychology of hate that sees competitors as the enemy within. This mindset particularly is incapable of compromise, consensus and difficult to cure. 
  • Second, is the rise of the plebiscitary leader which is similar to Max Weber’s concept of charismatic personality has created a partisan constituency 
    • A Plebiscitary leader speaks to his followers, directly, bypassing institutions, that are supposed to limit his powers.  It is like every person voting on every policy-matter.  
    • For example, the ideologies built by Mr. Trump such as “make America great again”, “drain the swamp”, “lock her up”, “stop the steal” has exaggerated the feeling of grievance and have created a partisan constituency. 
    • In this type of politics, institutions becomes weaker and locus of power shifts to the  political leader. 
  • Third, is the weakening of America’s democratic institutions by disrupting its checks and balances by Mr. Trump. For instance, 
    • Bureaucrats who have opposed his views, have been replaced immediately and media too was supressed by dubbing their reports as Fake news when they highlighted about his transgressions 
    • Institutions are the life and soul of a democracy as they check the excesses of power, socialise elected representatives into democratic politics, embody the rules and conventions to maintain balance between private and public interests. Any nation that subverts its institutions, do not thrive. 
  • Fourth, is the evolution of the political formula of neo-liberalism that has been used by capitalist elites to not just accumulate wealth but to make the non-elite feel that such accumulation is in the public interest. 
    • These Political formulas gives legitimacy to elite rule and American democracy today has become the textbook example of the political formula of neo-liberalism. 
  • Fifth, is the increasing inequality in American society, which provided lifeblood to all of the above problems. With the help of charismatic leadership of Trump and use of vigilante politics the government was successful from diverting the citizens from the real issue of rising inequality in American society. 
    • vigilante politics: an organized effort outside legitimate channels to suppress or eradicate any threats to the status quo 

American democracy will need to self-examine itself and need to fix the loop holes that allowed a narcissistic leader, with plebiscitary power to expose the fragility of its institutions. It needs to reform itself to set a precedent to other nations such that this model of politics, the politics of hate will not be entertained in any other country. 


RBI’s expansionary policy and challenge of the impossible trinity 

Synopsis: RBI need to exit out of its expansionary policy and manage ‘the impossible trinity’, i.e. Capital inflow, inflation and exchange rate. 

Syllabus: GS-3, Economy 

Source: The Hindu   

Introduction 

    • RBI adopted the extraordinary expansionary policy after Covid-19.  
    • It reduced policy interest rates aggressively to increase the liquidity in the market. It also provided targeted assistance to especially distressed sectors. 
    • But, now RBI should consider an exit plan out of expansionary policy to avoid any loss in the macroeconomic terms. 
    • In this process RBI might face the challenge of managing ‘the impossible trinity’, i.e.  Keeping doors open for capital flows while simultaneously maintaining a stable exchange rate and restraining inflation. 

What are the challenges in managing ‘the impossible trinity’? 

Firstly, RBI need might face a dilemma of managing Inflation and support to economic recovery 

    • Inflation is above the RBI’s target band for the past several months and is expected to remain above target for the next several months.  
    • Whereas, MPC is not able to decide against expansionary monetary policy, out of concerns for growth and financial stability.  
    • MPC expects inflation to soften by itself due to bumper winter crop and normalisation of supply chain post-lockdown.  

Second, RBI need to think about the savers, offered low interest rates at a time of high inflation. Thus, value of their saving is getting reduced.  

Third, RBI require to withdraw the ‘excess’ liquidity from the market.  

    • Banks are routinely depositing trillions of rupees with the RBI is the evidence that the liquidity increase by RBI is not giving the intended results.   
    • Mispricing of risk of too much liquidity for too long can lead to financial crisis.  

Fourth, RBI might face the challenge of ‘taper tantrums’ at the later stage, which triggers the panic sell-off by the investors in the market.  

    • Taper tantrum: In May 2013, U.S. Federal Reserve Chairmen announced that they were considering gradually tapering/reducing ‘quantitative easing’.  
    • Although the announcement should have been taken as signs of a robust recovery in the economy, instead panic sell-off started in the financial market.  
  • Thus, RBI also need to frame their communication strategy in a way that it doesn’t trigger the panic sell-off.  

Fifth, RBI will have to stop the rupee from appreciating, in the face of policy change.  

    • Current Account Surplus this year together with massive capital flows has caused increase in flow of dollar in the system.  
    • It is putting the upward pressure on the Rupee, which is already overvalued in the real terms.  
    • RBI has already absorbed this year, nearly $90 billion to prevent exchange rate appreciation and to maintain the competitiveness of the rupee.  
    • Thus, RBI’s ability to keep the Rupee value in control will be constrained by increasing inflation.  

In the upcoming days, managing the impossible trinity will be a tricky challenge for RBI given the condition of the economy after COVID-19.


Efforts to increase Electric mobility in India 

Source: The Hindu 

GS3: Infrastructure: Energy, Conservation, Environmental Pollution and Degradation. 

Synopsis: Significance of shifting towards electric vehicles for India and how the government has actively facilitated this process

What are the significances of shifting to electric vehicles for India? 

Transition to electric vehicles is important for India as not only it will save public money but also the environment. 

    • The progression to electric vehicles will make India sustainable as it has the potential to reduce carbon emissions and build self-reliant domestic energy sector. 
    • it can reduce dependence on crude oil and help to save government money especially the FOREX. For example, India is the third-largest oil importer in the world in terms of value. In 2018–19, India imported 228.6 MT of crude oil worth $120 billion. 
    • Besides being an economically and environmentally viable option, India’s transition to electric vehicles will also allow us to improve our infrastructure 
    • This will also have a significant impact on our foreign policy as our energy security dependence will shift from West Asia to Latin America. 

Sourcing Lithium  

In India, In the last two years, lithium imports have tripled from $384 mn to $1.2 bn and its demands are being fulfilled by imports from China, Vietnam, and Hong Kong. 

    • Latin America’s famous lithium triangle Argentina, Chile, and Bolivia, encompasses about 80% of the explored lithium of the world.  
    • Currently, India’s majority of trade from Latin America is concentrated on crude oil which includes 14%-20% of India’s total crude oil imports which is likely to change towards Lithium and cobalt. 
    • government is looking to buy overseas lithium reserves to develop domestic battery manufacturing capacity.  
      • In 2019, a joint venture agreement was signed between three Indian CPSE’s (National Aluminium Company (NALCO), Hindustan Copper Limited (HCL) and Mineral Exploration Corporation Ltd (MECL)) to form Khanij Bidesh India Limited (KABIL) that has the objective to explore strategic mineral assets like lithium and cobalt abroad for commercial use and to meet the domestic requirement for battery manufacturers. 

What were the steps taken by government to facilitate the shift towards electric vehicles? 

With the vision to have 30% electric vehicles plying the roads by 2030 the government of India has taken up the following initiatives.  

    • First, under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles and Fame 2.0, the government has allocated $1.3 billion in incentives for electric buses, three-wheelers and four-wheelers to be used for commercial purposes till 2022, and earmarked another $135 million for charging stations.  
    • Second, NITI Aayog has proposed for a $4.6 billion subsidy for battery makers to facilitate domestic manufacturing of Lithium batteries. 
    • Third, In September 2019, government gave its nod to set up a manufacturing unit in Gujarat by Japanese consortium (Suzuki Motor+ Denso+ Toshiba) to venture into the production of lithium-ion batteries and electrodes.  

The Indian government’s pre-emptive policy action will not only help the lithium and cobalt industry to grow domestically but also help India to chalk out a long-term solution to clean our cities, build new markets, and skill people for new jobs towards an ‘Atmanirbhar Bharat’.


Issue of K-shaped recovery: How government budget can deal with it?

Source- The Indian Express 

Syllabus- GS-3: Indian Economy- Growth and development 

Synopsis The macro-implication of K-shaped recovery and labour market pressure. How government budget will deal with it? 

Introduction-   

  • COVID Vs Economic Mobility  India has broken the link between COVID virus proliferation and mobility earlier and more successfully. 
  • India’s GDP estimates for 2020-21 show that the economy is expected to perform much better than earlier projections. 
  • However, the present economic recovery is very hopeful developments but, juxtaposed with a stronger-than-expected recovery, is confirmation of labour market scarring. 

What are the present economic developments in India?  

  • Industrial sector - The large firms have endured the crisis better and are gaining market share at the expense of smaller firms. 
      • Although it will increase medium-term productivity, but it will also increase the dominance/pricing power of big companies in the market.  
  • Employment  CMIE’s [Centre for Monitoring Indian Economy] labour market survey reveals 18 million fewer employed (about 5 per cent of the total employed) compared to pre-pandemic levels.  
      • These labor market projections not incompatible with a sharper near-term rebound, as this recovery is led by capital and profits, not labour and wages 
  • Household sector– Households at the top of the pyramid are seen their incomes largely protected, and savings rates forced up during the lockdown, increasing ‘fuel in the tank’ to drive future consumption. 
      • Meanwhile, households at the bottom are likely to have witnessed permanent hits to jobs and incomes. 

What are the implications of a K-shaped recovery? 

K-shaped recovery happens when, following a recession, different sections of an economy recover at starkly different rates or magnitudes. The macro-implication of K-shape recovery in India are- 

  • Firstly, issue of Income- Upper-income households have benefitted from higher savings for two quartersPresent recovery is led by these savings.  
      • But lower-income household are facing loss of income in the forms of jobs and wage cuts. This will be a recurring drag on demand, if the labour market does not heal faster. 
  • Second, the issue of Consumption– To the extent that COVID has triggered an effective income transfer from the poor to the rich, this will be demand-hindering because the poor have a higher marginal propensity to consume (i.e. they tend to spend (instead of saving) compared to higher marginal propensity to import among rich.  
      • Consumption pattern– Passenger vehicle registrations (proxying upper-end consumption) have grown about 4 per cent since October while two-wheelers have contracted 15 per cent. 
  • Third, increases the inequality– COVID-19 reduces competition or increases the inequality of incomes and opportunities between rich and poor. 
      • This could affect the trend growth in developing economies by hurting productivity and tightening political economy constraints. 

 How upcoming budget may help India to deal with K Shape recovery?  

Policy needs to look beyond the next few quarters and anticipate the state of the macroeconomy post the sugar rush, for the wellbeing of poor citizens and increase its income level. 

  • First, Policy will look for the private sector to start re-investing and re-hiring, and thereby sets the economy onto a more virtuous path. Barring that, the labor-market hysteresis could sustain with the manufacturing and service sectors. 
    • Private investment revival policy may be implemented first for recovery of the private sector. 
  • Second, Ensure exports should benefit from increasing global growth as the world gets vaccinated steadily.  
  • Third, Government may invest in large physical and social (health and education) infrastructure push. It may provide employment for who lost job due to COVID. It may reduce inequalities. 
  • Fourth, a reliable medium-term fiscal plan will be key to anchoring the bond market and underscoring an adherence to macro stability. 
  • Lastly, the investment model for public investment must be balanced to push and financed by aggressive public asset sales.

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