Gist of EPW February Week 2, 2023

The Economic and Political Weekly (EPW) is an important source of study material for IAS, especially for the current affairs segment. In this section, we give you the gist of the EPW magazine every week. The important topics covered in the weekly are analyzed and explained in a simple language, all from a UPSC perspective.

TABLE OF CONTENTS

1. Digital Personal Data Protection Bill, 2022
2. Green Finance: Perspectives in Sustainable Finance Instruments
3. Mechanisation without Decent Job Alternatives
4. Indian Academic Patenting
5. India’s Exclusive Growth

1. Digital Personal Data Protection Bill, 2022

What is meant by data protection?

• The data protection law can be defined as a legal framework that outlines the degree of access and control over personal data by the following three major actors: 
  • The  data principal (individual user to whom the personal data relates), 
  • The  data fiduciary and data processor (the former is the company which determines the purpose and means of the processing of personal data and the latter is the company which processes personal data on behalf of a data fiduciary), and 
  • The state.

What is data principle?

• Data Principal means the individual to whom the personal data relate and where such an individual is a child, this includes the parents or lawful guardian of such a child.

What is data fiduciary? 

• Data Fiduciary is defined as any person who alone or in conjunction with other persons determines the purpose and means of the processing of personal data. 

Draft Data Protection Bill: 

• Currently, the data regime is managed under Sections 43A and 72A of the Information Technology Act, 2008. But these bills seem to be inadequate under the present context of the rising volume of data flow in the country.

Read more on the Information Technology Act, 2000 in the linked article. 

Critique of data protection in India:

• Though the bill empowers the data principal to give consent regarding the way in which the data can be used, it presumes that the data principles have all the knowledge to understand the complexities of the law. 
  • It creates an unequal playing field, where the data fiduciary is better organised, and the data principle does not hold the ability and the requisite knowledge to make an informed decision about the numerous consequences of the collection, use, and sharing of their data.
• It empowers the data fiduciary to collect any personal data after getting consent. The new bill has shifted the burden on the data principle. 
• It provides special safeguards for children below 18 years of age from the harms of targeted advertising and the processing of personal data. But an unresolved issue in all the bills is the age of digital consent; it is wrong to place a toddler and a teenager under the same age bracket. 
  •  It would result in the infringement of children’s privacy and autonomy.
• The present status exempts the state and “any instrumentality of the state” from data protection obligations. The state, being the largest data fiduciary for governance, is given blanket exemption.
• The existing legal framework for communications surveillance in India is mired with numerous issues:
  • There exist inadequate procedural safeguards
  • There is no transparency and accountability over state surveillance, and the oversight mechanism is governed exclusively by the executive
  • There are serious issues of non-compliance of procedural safeguards

Data constitutes one of the most important assets of any country and therefore all-out effort should be made to protect against the breach of data in the country. Prevailing shortcomings in the data regime should be addressed through discussions with various stakeholders. 

2. Green Finance: Perspectives in Sustainable Finance Instruments

Context: Climate finance is central to achieving the target of reducing the temperature to sustainable levels.

What is climate finance? 

• Climate finance refers to local, national or transnational financing drawn from public, private and alternative sources of financing that seeks to support mitigation and adaptation actions that will address climate change.
• The increasing threat of climate change to limit a global temperature rise to no more than a 1.5 degree Celsius increase requires a lot of investments in the field of green technology. 

Concerns with regard to climate finance: 

• Fossil fuel still dominates the energy market creating a problem for the expansion of renewable energy. 

Image: Global emission VS Global GDP

Image source: EPW

• As less than 15% of the required capital flows into environmental conservation, a large chunk of it is contributed by philanthropic entities rather than by corporations leading to a financial gap of $70 billion in climate finance accounting.
• Sustainable growth seems to be more ambitious as the current use of fossil fuel in the world threatens to increase the planet’s temperature by 2.7 degrees celsius above the pre-industrial level. 
• Greenwashing has become another important concern with climate financing. It is a practice of diverting green bond revenues to projects or activities that have marginal or negative environ­mental benefits. Know more about greenwashing in the linked article.
• One major issue with green financing is measuring the carbon footprint of projects. It is difficult to get corporations to disclose their total net carbon footprint.
• There is a lack of incentive on the part of the government to incentivise the carbon emitter to give away their lucrative business. 

Funding instruments: 

• Green finance predominantly consists of financial instruments like debt and equity. 
  • Equity financing is the investment in the company stock for an ownership interest called stocks or shares. 
  • Debt financing is used at later stages of the development of a company to raise funds for its projects.
• The Institute of International Finance has reported that green bond issuance nearly doubled to $500 billion in 2021 from 2020 and forecasts that by 2025, annual issuance could be as high as $1.2 trillion. 
• The focus is also shifting from a narrow “environment-based” financing towards a broader “sustainability-based” approach in green fin­ancing. 

In order to go ahead with attaining the 2030 Sustainable Development Goals (SDGs), there is a major push required for green projects and boosted funding for environment-friendly investments thro­ugh instruments like green bonds, green banks, carbon credits, community-based green funds, etc, collectively called “green finance.”

3. Mechanisation without Decent Job Alternatives

Introduction:

• In the Union Budget 2023–24, the finance minister introduced a new initiative called National Action for Mechanised Sanitation Ecosystem (NAMASTE) that aims at 100% mechanisation of the cleaning of sewers and septic tanks in the country. 
• This central sector scheme is a joint initiative of the Ministry of Social Justice and Empowerment and the Ministry of Housing and Urban Affairs. 
• The budget speech of the finance minister stated that “All cities and towns will be enabled for 100% mechanical desludging of septic tanks and sewers to transition from manhole to machine-hole mode.”

Positives:

• This scheme has some positive sides, which include ensuring zero fatalities in sanitation work, no contact with human faecal matter, only skilled workers to perform this task, access to alternative livelihoods for sanitation workers, etc. 
• Further, this scheme aims to identify and enumerate sewer and septic tank workers with an added focus on the informal and contractual workers engaged in what are described as “hazardous cleaning operations.”

Issues with the scheme:

• The easy recourse to mechanisation envisaged by this scheme treats the issue of sewage cleaning as merely a technological issue rather than a social one. Merely replacing “manholes” with “machine-holes,” will not essentially alter the stigma associated with the task of cleaning waste in India. 
• If these cultural factors are not taken into account, sanitation initiatives may fail.
  • The word “caste”which constitutes the social origin of differential occupations that places the obligation of a sewage cleaning on only certain social groups—found no mention in the policy document of NAMASTE.
• Community involvement is crucial for the success of sanitation initiatives. Treating sewage cleaning as a purely technological issue may result in a lack of community involvement, reducing the likelihood of sustainable, long-term solutions.

Negative Outcomes of Mechanisation:

• Mechanization refers to the use of machines to perform tasks that were previously done by hand. 
• While mechanisation can increase productivity and efficiency, it can also lead to job displacement if workers are replaced by machines.
• If mechanisation occurs without the creation of decent job alternatives, it can result in significant job losses and economic hardship for workers who are no longer needed in their previous roles. 
• This can particularly impact workers in low-skill and manual labour jobs, who may have fewer opportunities to retrain and transition into new roles.

Way Forward:

• Policymakers and businesses must consider the potential impact of mechanisation on workers and to invest in creating decent job alternatives. 
• Government shall invest in education and training programs to help workers develop new skills.
• Government shall also focus on supporting the growth of industries that are less susceptible to mechanisation. 
• Additionally, policymakers may need to consider implementing policies such as job training programs, income support, and retraining assistance for workers who are displaced by automation.

4. Indian Academic Patenting

Details

• Encouraging patenting and entrepreneurial culture in universities is crucial for technology transfer, commercialization, knowledge creation, and growth.
• Countries across the globe, particularly emerging economies are encouraging universities to nationally and internationally file patents.
• In this regard, India also adopted the performance-based funding mechanism for institutes in 2002–03 and launched the Atal Innovation Mission in 2015–16.
• Despite existing policy measures, the contribution of academic institutions in the Indian intellectual property application landscape is very weak.
• India formulated the national IPR policy in 2016 and made several amendments to its IPR Act to promote start-ups and entrepreneurship.

Also read: National IPR policy (Advantages and Concerns) – UPSC Notes (GS III)

Significance of patenting

• Patents are filed to claim priority.
• They Protect imitation.
• They also attract collaborations, fame, and financial rewards.
• It also helps in career advancement.

Factors impacting academic patenting

• INSTITUTIONAL FACTORS:
  • Institutional factors include:
    • Intellectual property rights (IPR) policies
    • Intellectual property management activities
    • Intellectual property-linked incentive schemes
    • IPR awareness of faculty members
  • It should be noted that institutional factors are important for academic entrepreneurship.
  • Universities’ regulations have an insignificant impact on academic innovation performance.
• DEPARTMENTAL FACTORS:
  • Scientific departments where technologies are difficult to invent but easy to imitate (such as chemical compounds) are more patent-intensive in comparison to other departments (such as mechanical engineering or metallurgy).
  • Departments with more potential for industrial collaboration generate better results for patent filing.
• The biological age of researchers is also a factor. For instance, the first (and highest) peak in one’s life is when he/she is in his/her late thirties, and another peak comes at about the age of 60 years.
• Another important factor is the career stage of the researcher. It is found that researchers in their early and mid-career files more patents for career advancement and peer recognition.
• The place of Ph.D. training and research exposure in developed countries also affects the motivation and decision of a researcher to patent their scientific invention.
• Legal and IPR policy regime also has a bearing on researchers filing a patent application.
• It should be noted that the concept of patenting is still at a nascent stage in developing countries like India.

Associated concerns

• Reasons for non-patenting are:
  • Non-patentability of output
  • Difficulties in expressing novelty
  • Absence of intellectual property office
  • Inconvenient interaction with intellectual property staff
  • High patenting cost
  • Time-consuming process
• There are challenges like lack of time, financial resources, experience, or institutional support.
• Despite an increase in the absolute number of patent applications by Indian academic researchers, it is very low in comparison to developed countries.

Conclusion and Recommendation

• Governments in various developing countries have launched initiatives to strengthen the innovation capacity of universities and to facilitate collaboration between universities, industries, and start-ups.
• It is found through an analysis that financial rewards and licensing revenue are the least important reasons for patenting.
• The Indian IPR Act has been recently amended to provide an expedited patent examination of applications filed by start-ups. It should be extended to university patents as it can further accelerate the rate of converting inventions into commercial products or services.
• IPR policy should be complemented with a structured reward system like incentives for different research outputs and rewards upon completing each stage of the patent application.
• Researchers should be made aware of available provisions through official notifications, emails, websites, and circulars.
• Academic institutes/universities should align their focus with the national goal of technological growth.
• Universities can also create a dedicated webpage for disseminating information associated with intellectual property-related facilities and provide support through its IPR cell.
• The IPR office in India can create a dedicated website and mobile application for university scientists and students.
• Apart from the above measures academic scientists should be encouraged to disclose their patentable inventions.

5. India’s Exclusive Growth

Context: Recent Oxfam report highlights the uneven story of India’s growth trajectory.

What is exclusive growth?

• Exclusive growth is a term which defines lopsided growth in the economy. In other words, here the growth trajectory tends to benefit the rich more in comparison to the poor.
• Exclusive growth is growth from the gains from which the poorer segments of the population are largely excluded.
• The exclusion results essentially from the non-utilisation of the factors of production of unskilled and low-skilled labour held by the poorer segments of the population.

State of the growth story in India: 

• The richest 10% of the population has been the recipient of a large and growing share of the incremental income generated by growth. 
• India’s top 1% owned more than 40.5% of its total wealth in 2021, according to a new report by Oxfam. 
  • In 2022, the number of billionaires in the country increased to 166 from 102 in 2020, the report said. Meanwhile, it added that the poor in India “are unable to afford even basic necessities to survive.”

Source: Business Today

• Therefore, exclusive growth is associated with increasing income inequality as also with decelerating employment growth. 

Indicators of exclusive growth: 

• India’s economy grew at close to 7% per annum during 1993–2017. But, it did not bring equal benefits for everyone. The severe disconnect between growth and development is the first indicator of exclusive growth.
• Income inequality, which had remained quite stable between 1983 and 1992, started growing steadily and speedily thereafter. The Gini coefficient remained around 0.47 in the years between 1983 and 1992 but then increased steadily to 0.63 in 2014. 
• Increasing inequality essentially reflected the rapidly growing income share of the richest 10% of the population. This share remained stable at around 36% between 1983 and 1992 but then increased steadily to 57% in 2014. 
  • Correspondingly, the share of the bottom 90% declined steadily from 64% in 1992 to 43% in 2014.

Image: Income inequality

Source: EPW

• The Indian economy exists at many levels like final goods, and intermediate goods, and growth does not take place at all the levels simultaneously. Thus, growth leads to changes in the commodity composition of output, which in turn brings changes in the spectrum of technologies in use, and thus in the composition of demand for factors of production.
  • Most of these factors of production are owned by the rich and therefore all the money goes to them. 
• One of the main causes of income inequality in India is underemployment. A lot of people are working at posts and profiles which are not equivalent to their qualifications which results in low productivity. This ultimately leads to income inequality. This happens due to the fact that people are not in a position to get the desired kind of employment. 
• In the early 1990s, in the wake of the economic reforms of 1991, that period of high economic growth began and services became both the dominant and the fastest growing sector of India’s economy. 
  • The services sector has traditionally been the most skill-intensive sector of India’s economy.
• India’s rapid growth that began in 1993 was led by “communication, financial and business services,” the quintessentially skill-intensive services. 
• The main initial beneficiaries of growth, therefore, had been the holders of capital and skills, that is, the rich, who had been the recipients of a large share of the incremental income generated by growth.

Inclusive growth is the prime requirement of any healthy society. It ensures that the benefits of development flow through equality in society. Inclusive growth is also necessary for establishing harmony in society. So, efforts should be made to ensure inclusive growth and development. 

Read previous EPW articles in the link.

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