10 April 2020 CNA:- Download PDF Here
TABLE OF CONTENTS
A. GS 1 Related B. GS 2 Related POLITY AND GOVERNANCE 1. Charting a Common Minimum Relief Programme in times of pandemic 2. ₹15,000 crore sanctioned to States 3. NSA invoked against four for attacking policeman HEALTH 1. Kerala gets nod for trial of plasma therapy C. GS 3 Related D. GS 4 Related E. Editorials INTERNATIONAL RELATIONS 1. A double whammy for India-Gulf economic ties HEALTH 1. In time of need ECONOMY 1. Will COVID-19 affect the course of Globalisation? F. Prelims Facts 1. Input–Output Model 2. Gamosa G. Tidbits 1. Kejriwal launches ‘Operation SHIELD’ against COVID-19 2. Ahmedabad adopts South Korean model 3. Outfit with LeT link under scanner 4. World faces new ‘Great Depression’ 5. Sanitation app upgraded 6. ‘Half billion more people face poverty due to virus’ H. UPSC Prelims Practice Questions I. UPSC Mains Practice Questions
A. GS 1 Related
Nothing here for today!!!
B. GS 2 Related
Category: POLITY AND GOVERNANCE
1. Charting a Common Minimum Relief Programme in times of pandemic
Issue:
The economic pandemic that is likely to succeed COVID-19 threatens to be as large in scale if not larger than the public health crisis that we continue to battle.
Categories and the areas of concern that the government needs to address in a Common Minimum Relief Programme:
1) Economic upheaval
- Daily wage earners, labourers and migrant workers are at the greatest risk of economic and social insecurity. They face widespread economic upheaval and geographic displacement. The sheer importance of a social security net in helping them tide over this predicted period of unemployment and privation cannot be overstated.
- Among several other pertinent concerns is also providing them protection against evictions.
- Most importantly, the unorganised sector (be they registered or unregistered) must be covered by a robust cash and food distribution system. This concern is extremely legitimate and urgent given that over 80% of the population is currently employed in the unorganised sector.
- There should be a uniform mechanism for the dispersal of both income support as well as essential items such as rice, wheat, millets, medicines, water and anything else that these families will require.
2) Farmers left in the lurch
- Given the vital role agriculture plays both in the economy and in ensuring staples for every single citizen, the resulting crisis is likely to have a widespread negative impact on food security nationwide.
- Farmers are in dire need of immediate support.
- Due to the lockdown, the ensuing unavailability of seasonal labour and lack of clarity on procuring arrangements, agencies and prices, the farmer is left in the lurch.
- They also face the wrath of unseasonal and inclement weather.
- To ensure the problem doesn’t become cyclical, the government needs to make immediate arrangements for ensuring the availability of fertilisers, pesticides, other inputs (including access to lines of credit) for the planting of the next kharif crop as well.
- Supply chain disruptions need to be addressed head on instead of in an ad-hoc manner if mass panic is to be avoided post the lockdown.
- Supply chain disruptions for fast moving consumer goods due to unavailability of labour, difficulty in transporting goods across borders during the lockdown is leading to a shortage of foodstuffs and other essential items.
- This in turn is leading to massive hoarding, black marketing and runaway inflation.
- Medium and Small-Scale Enterprises need a clear buffer strategy for survival.
- There are currently close to 4.25 crore registered MSMEs which contribute 29% to India’s GDP (or nearly 61 lakh crores) and these have been hit hardest by the COVID-19 crisis imperilling, in turn, the livelihood of crores.
- The government must lay out an action plan, including a financial package, to fortify this sector.
3) Protection to the middle class
- The middle class, facing growing vulnerability, needs to be protected. Owing to the inevitable economic crisis, middle class (as a percentage of the population) is likely to be diminished in size unless immediate action is taken.
- Companies and employers are cutting salaries and even declaring layoffs to cope with this time.
- This is aggravated by unjustifiably high petrol, diesel and gas prices.
- The twin strategy of increased EMIs (as a result of deferment) and the lowered interest rates on all small savings schemes (as also by the SBI) hitting at the hard earned savings of the elderly, pensioners, professionals and women, have had the exact opposite of a desired impact.
- They have reduced the value of savings while simultaneously increasing debt obligations.
- A long-term plan for economic revival is needed if the middle class is to emerge stronger on the other side of this crisis.
- Two obvious solutions could be considered:
- Nyay, the Minimum Income Guarantee Programme was devised for times exactly like these. It will give much needed security — both financial and mental — to those who have no other sources of income due to the lockdown. The Central government must devise and implement this scheme, at least as a temporary measure.
- The other measure is to strengthen our manufacture and production policies by an extensive financial package with an impetus to and focus on local manufacturing.
Conclusion:
- The government should publish and execute a road map that provides forward guidance and economic clarity, especially to those at the margins.
- While States will come up with varying measures for support and relief, the Centre must lead this effort to ensure uniformity, optimisation and coordination amongst States of varying economic capability.
- Every crisis offers opportunities. Manufacturing strategies must be redrawn to reduce dependence on foreign manufacturing, to create new jobs and boost exports.
2. ₹15,000 crore sanctioned to States
Context:
The Centre has announced that ₹15,000 crore has been sanctioned to States under the India COVID-19 Emergency Response and Health System Preparedness Package.
Details:
- The 100% Centrally-funded scheme will be utilised for immediate COVID-19 Emergency Response (₹7,774 crore) and rest for medium-term support (1-4 years).
- This is to be provided under a mission mode approach.
- The project will be implemented in three phases between January 2020 and March 2024.
- Phase 1 will span January 2020 to June 2020.
- Phase 2 from July 2020 to March 2021.
- Phase 3 from April 2021 to March 2024.
- Key objectives of the package include:
- Mounting emergency response to slow down and limit COVID-19 through the development of diagnostics and dedicated treatment facilities.
- Strengthening national and state health systems to support prevention and preparedness.
- Procurement of essential medical equipment, consumables and drugs.
- Strengthening of surveillance activities including setting up of laboratories and biosecurity preparedness.
- The major share of the expenditure will be used for mounting robust emergency response, strengthening pandemic research, community engagement and risk communication and implementation, management, capacity building, monitoring and evaluation component.
- The Union Health Ministry is authorized to re-appropriate resources among components of the package and among the various implementation agencies which are NHM, Central Procurement, Railways, Department of Health Research, Indian Council of Medical Research (ICMR), National Centre for Disease Control on the basis of the evolving situation.
Phase-1:
- The Union Health Ministry is releasing funds under the immediate response of this package for states/UTs under the National Health Mission (NHM) for the implementation of Phase 1.
- Other activities to be done in the first phase will be procurement of personal protection equipment (PPE) and procurement of N95 masks and ventilators, over and above what is being procured and supplied by the government.
- During Phase 1, states would also be strengthening identified laboratories and expanding diagnostics capacities, including procurement of diagnostic equipment, testing kits and other reagents and mobility support for sample transport, disinfection of hospitals, government ambulances, information education and surveillance activities.
3. NSA invoked against four for attacking policeman
Context:
The Indore police have invoked the National Security Act against four persons who allegedly attacked a policeman while he was on lockdown enforcement duty.
National Security Act has been covered in 17th February 2020 Comprehensive News Analysis. Click here to read.
Category: HEALTH
1. Kerala gets nod for trial of plasma therapy
Context:
Kerala has won the Indian Council of Medical Research’s (ICMR) approval to explore the feasibility of administering convalescent plasma transfusion on critically ill patients.
Details:
- Convalescent plasma therapy is not new and has been used by doctors to treat critically ill patients during earlier epidemics like H1N1, SARS and Ebola.
- It may be noted that plasma from the blood of previously infected yet healthy individuals had been transferred to five critically ill patients in China and their condition had steadily improved and were subsequently discharged from hospitals.
- The proposal submitted to the ICMR says that the Transfusion Medicine Department of Sree Chitra Tirunal Institute for Medical Sciences and Technology would help the State Health Department in exploring the feasibility of plasma therapy for COVID-19 treatment.
Convalescent Plasma Therapy:
- Convalescent Plasma therapy involves transfusing certain components from the blood of people who have recovered from a virus attack into people who are very sick with the virus or people who are at high risk of getting the virus.
How does it work?
- As people fight the virus, they produce antibodies that attack it. Those antibodies, proteins that are secreted by immune cells known as B Lymphocytes, are found in plasma or the liquid part of blood that helps the blood to clot and supports immunity.
- Once a person recovers, that person has developed antibodies that will stay in their blood waiting to fight the same virus. Those antibodies, when injected into another person with the disease, recognise the virus as something to attack.
- In the case of coronavirus disease, scientists say antibodies attack the spikes on the outside of the virus, blocking the virus from penetrating human cells.
C. GS 3 Related
Nothing here for today!!!
D. GS 4 Related
Nothing here for today!!!
E. Editorials
Category: INTERNATIONAL RELATIONS
1. A double whammy for India-Gulf economic ties
Context
- This article highlights the issues the Gulf region faces in the middle of the COVID-19 crisis. It is at the epicentre of not only the COVID-19 pandemic, but also, its economy is in deep jeopardy due to oil price meltdown.
- Given India’s vital relations with the eight Gulf countries, the situation’s impact on bilateral economic ties needs to be anticipated and managed.
Impact on the Gulf region
- A Goldman Sachs report published recently estimated that COVID-19 had lowered the world crude consumption by 28 million bpd.
- In a rare joint statement on March 16, the heads of OPEC and the International Energy Agency (IEA) warned that developing countries’ oil and gas revenues will decline by 50% to 85% in 2020 with potentially far-reaching economic and social consequences.
- The economic outlook for the Gulf has indeed deteriorated.
- Saudi Arabia’s fiscal deficit expected to cross 8% in 2020.
- The tourism and hospitality sectors, the core of Dubai’s economy, may take much longer to revive.
- The pandemic has already made Hajj and Dubai Expo doubtful.
Note: The drop in price of oil is majorly because the Organization of the Petroleum Exporting Countries and other crude producers (OPEC+) failed to reach a production-curtailing strategy as Saudi Arabia and Russia, the cartel’s two biggest producers, held different views.
India’s economic ties with the Gulf States
India has two dominant verticals: the economic symbiosis and India’s expatriate community.
- Bilateral economic ties are strong: the India-Gulf trade stood at around $162 billion in 2018-19, being nearly a fifth of India’s global trade.
- It was dominated by import of crude oil and natural gas worth nearly $75 billion, meeting nearly 65% of India’s total requirements.
- Some of these countries have large Indian investments and some have planned large investments in India.
- Second, the number of Indian expatriates in the Gulf States is about nine million, and they remitted nearly $40 billion back home.
- The Gulf’s lower oil revenues means less bilateral trade and investments as well as expatriates’ remittances — all of them adding to India’s current financial stress.
Impact on expatriates
Oil is a cyclic commodity and the Gulf producers have long evolved a pattern to handle its periodic lows. As the drop in oil continues the effect tends to fall on the last person in line, viz. the Asian expatriate.
- The fresh recruitment stops, salaries are either lowered or stalled, taxes raised and localisation drives launched.
- The net result is that a large number of expatriates return to their homes.
- This time there is an added complication of the pandemic, to which the Asian expatriates living in densely populated camps are particularly vulnerable.
- In case the pandemic worsens in the lower Gulf, panic-stricken, wage-deprived Indians may prefer to come back.
- This would create an exodus of epic proportions, the nearest example being the evacuation of over 1,50,000 Indians from Kuwait in 1990-91, albeit for political reasons, an event that upset India’s economy.
- Apart from creating a logistical nightmare of transporting millions of expatriates back, they would need to be resettled and re-employed.
Way forward
In the longer run, we need to find new drivers for the India-Gulf synergy.
- This could begin with cooperation in healthcare and gradually extend outward towards pharmaceutical research and production, petrochemical complexes, building infrastructure in India and in third countries, agriculture, education and skilling as well as the economic activities in bilateral free zones created along our Arabian Sea coast eventually leading to an India-Gulf Cooperation Council Free Trade Area.
- Only then would we have sufficiently diversified the India-Gulf economic ties to protect from such shocks.
Conclusion
- Gulf States going forward should contain the pandemic and the oil shock and at the same time India needs to come up with contingency plans in consultation with the individual countries.
- It should do whatever it takes to enhance their capacity to handle COVID-19 cases among the Indian expatriates.
- India’s missions there also need to monitor the situation and try to avoid panic among its nationals.
For more on this, please check CNA dated April 8, 2020.
Category: ECONOMY
1. Will COVID-19 affect the course of Globalisation?
Globalisation
- It is the accelerated flow of goods, people, capital, information, and energy across borders, often enabled by technological developments. Over the past three decades, globalising trends were assumed to be the new normal.
- Globalisation has two sides
- On the positive side, the cross-border flow of people, goods, money and information creates new wealth and opportunity.
- On the negative side, though, it can exacerbate global disparities, enable international terrorism and cross-border crime, and allow for the rapid spread of disease.
- SARS outbreak in 2003
- But compared to the start of this century, the cross-border movement of people has increased dramatically, and the speed of the spread of this novel coronavirus has been of an entirely different order.
- Stagnation in the Globalisation of goods and capital
- With time, it has become increasingly apparent that not all countries, societies, and people were benefitting equally from globalisation, and that soon began to be reflected in national and international politics.
- The United States’ (US) sub-prime mortgage crisis of 2007-08, and its spillover to the eurozone, exacerbated national sentiment in Europe, which had previously been a model of international integration.
- The assumption that China’s rise would result in similar development opportunities for others proved unfounded. As one business leader cynically put it, “China, after climbing up the ladder, is kicking it out from under everyone else.”
- In hindsight, the economically nationalist impulses of countries as different as the US (“America First”) and India (“Make in India”) were a natural consequence.
Slowbalisation
- A defining feature of the global economy since at least the 1970s has been globalisation—the bringing together of economies predominantly via more liberal trade flows.
- With time, the global volume of merchandise trade has slowed down dramatically.
- This means globalisation has given way to ‘slowbalisation’
- It is the continued integration of the global economy via trade, financial and other flows but albeit at a significantly slower pace.
- Globalisation has given way to a new era of sluggishness.
‘The Economist’ identified several key indicators of what it calls “slowbalisation.”
- The portion of trade as part of global GDP has fallen.
- Multinationals have seen a drop in their share of global profits.
- Foreign direct investment tumbled from 3.5 percent of global GDP in 2007 to 1.3 percent in 2018.
Thus, the coronavirus pandemic may further slowdown (or possibly even reverse) certain globalizing trends that had already decelerated.
Reorganization of the economy
- Add to slowbalisation, the trade wars and the WTO talks process coming to a grinding halt has shown that globalisation might be on the fall. Now, with this pandemic, there is another recognition of the vulnerability that global economic interdependence creates.
- So some countries are facing difficulties in getting medical supplies, some find their manufacturing can’t run as value chains are linked with China.
- Countries will reconfigure their economies to look at import substitution with a greater clarity now, as the perils and pitfalls of over-dependence on foreign supplies become clear.
- Import substitution, that had become a bad word, may be back in currency.
China’s manufacturing sector is back on track despite COVID-19
- Despite the coronavirus pandemic, manufacturing in China is showing an upward trend and factory activity has expanded.
- Other countries will remain in a lockdown phase for at least another two months.
- So, if the Chinese get this sort of a lead in getting their act together, they are going to consolidate their position in the global economy further.
- One needs to look at two major events that took place in the last 20 years — the 9/11 attacks (which coincided with China joining the WTO) and the 2008-09 global recession.
- After each of these episodes, China came out stronger and acted with alacrity, did all the pump-priming to stimulate the economy and enhance their global heft.
- Therefore countries are going to be extremely wary of the superpower that China will become and would like to disengage. India will disengage too.
World Trade Organisation
- There are worse days ahead for the WTO. Trade rules have worked best when the global economy is booming and isn’t facing a crisis. The last time serious discussions took place at WTO was in 2008.
- It’s only going to get worse, because if countries need to bring their domestic industries back, they would need space for policy flexibility.
- And WTO will be redundant there — for instance, on the issue of subsidies for small industries, no country will like the WTO to be telling them what to do or what not to do.
- But if the WTO rules are junked, then it’s a free-for-all situation. That’s the problem. Then we go back to the situation of the 1930s when it was just brute economic strength that determined the economics.
Future course of action
- The first thing that will happen is countries will try to build themselves up.
- In India, for instance, we can see the disruption that is taking place — almost 50% of our trade is directly linked with the Micro, Small and Medium Enterprises (MSMEs) sector as even large players have sub-contracted to the smaller producers.
- There will almost certainly be calls for the re-nationalization of manufacturing, particularly for what are considered critical or essential goods.
- This crisis has exposed the gaps in the health sector and social protection and the stimulus packages should focus on closing these gaps which will also help in achieving sustainable development goals. The priority will be to create jobs for those rendered jobless.
- National governments will weigh the risks of contagious diseases against the benefits of ease of travel or may consider stronger safeguards.
- At the personal level, this new awareness of the risks associated with the free movement of people, there are some who may avoid future life, business or leisure plans that require crossing borders.
Conclusion
- Going forward, most economies, with the exception of China, are going to see a very different kind of dynamic as they will try to build up from where they would be in a few months’ time and then think in terms of how to integrate themselves again with other countries.
- The project of globalisation is going to settle at a new normal and it will be a very different WTO and trade governance framework, with different kinds of regional and bilateral engagements.
F. Prelims Facts
- It is a form of macroeconomic analysis based on the interdependencies between economic sectors or industries.
- It represents the interdependencies between different sectors of a national economy or different regional economies.
- Wassily Leontief is credited with developing this type of analysis and earned the Nobel Prize in Economics for his development of this model.
Significance
- This method is commonly used for estimating the impacts of positive or negative economic shocks and analyzing the ripple effects throughout an economy.
- It provides detailed sector-wise information of output and consumption in different sectors of the economy and their inter-linkages, along with the sum total of wages, profits, savings, and expenditures in each sector and by each section of final consumers (households, government, etc.).
- The key advantage of such a model is that it allows the calculation of the impact of any change in any sector in both direct and indirect terms, which has made this model somewhat ubiquitous in the computation of the economic impact of disasters.
2. Gamosa
What’s in News?
‘Gamosa’ evolves from memento to mask in Assam. The ubiquitous decorative cotton towels are being repurposed as protective gear to fight the Coronavirus.
- Assam has traditionally had two types of gamosas:
- The uka or plain kind used to wipe sweat or dry the body after a bath.
- The phulam is decorated with floral motifs to be gifted as a memento or during festivals such as Bihu.
- Cultural historians say the gamosa came to symbolise Assamese nationalism in 1916 when the Asom Chatra Sanmilan, a students’ organisation was formed, followed by the Assam Sahitya Sabha, a literary body.
- Wearing the phulam gamosa around the neck became a standard for cultural identity.
- The gamosa’s graph as a symbol of protest rose during the anti-foreigners Assam Agitation from 1979 to 1985.
This topic has been covered in 26th November 2019 Comprehensive News Analysis. Click here to read.
G. Tidbits
1. Kejriwal launches ‘Operation SHIELD’ against COVID-19
- The Delhi government will carry out ‘Operation SHIELD’ at 21 locations identified as containment zones in the Capital.
- ‘Operation SHIELD’ includes sealing, identifying and quarantining people in containment zones, doorstep delivery of essential items and door-to-door checking of people in those areas by the Delhi government.
2. Ahmedabad adopts South Korean model
- The Ahmedabad Municipal Corporation has adopted the South Korean model of aggressive testing to ascertain the scale of the COVID-19 pandemic.
- Ahmedabad is battling to contain the spread of the pandemic with intensive surveillance and aggressive testing to detect the maximum number of cases of infected people, and isolate them to curtail further spread of the disease and break the chain of transmission.
3. Outfit with LeT link under scanner
- A newly floated outfit, the Resistance Front, has come under the scanner of enforcement agencies for its suspected links with the banned Lashkar-e-Taiba (LeT).
- Its five alleged terrorists were recently gunned down by security forces in an encounter in Jammu and Kashmir’s Kupwara.
- It is believed that the outfit is a front for the LeT and has been launched to evade the Financial Action Task Force (FATF) scrutiny and avoid further sanctions.
- FATF is to review Pakistan’s performance in acting against terror funding at its meeting in Beijing to be held in June 2020.
- Pakistan has currently been retained in the FATF Grey List.
- The agencies are trying to unearth the channel of funding to the new outfit, which is also called JK Fighters.
- Investigations have revealed that they were allegedly receiving instructions from a Pakistan-based handler through a mobile app.
- According to the officials, attempts are being made to project that Pakistan-based elements are not involved in any terror activity in Kashmir. However, recent encounters have revealed that regular infiltration attempts are being made.
4. World faces new ‘Great Depression’
- The International Monetary Fund (IMF) anticipates the worst economic fallout since the 1930s; 17 million workers lose jobs in the U.S.
- It is warned that the U.S. economy is moving with alarming speed towards very high unemployment.
- The World Trade Organization has also warned of the worst recession of our lifetimes.
- Alongside the personal tragedies and the pressure on overburdened hospitals, there has been a stark economic toll.
- The worst pandemic-hit countries in Europe — the worst-hit continent — are Italy and Spain, where daily death tolls are now down from their peaks but still running high, despite strict lockdowns.
- Madrid and Rome are seeking assistance from EU partners to rebuild their economies.
What’s in News?
Sanitation app ‘Swachhata-MoHUA’ has been updated to include features such as reporting of suspected cases of COVID-19 and lockdown violations.
- The Swachhata-MoHUA is the official app of the Ministry of Housing and Urban Affairs (MoHUA), GOI.
- The app enables a citizen to post a civic-related issue (eg; a garbage dump) which is then forwarded to the city corporation concerned and thereafter assigned to the sanitary inspector of the particular ward.
- The app’s primary use was to report sanitation-related grievances but nine features have been added to support citizens.
- The app has been built by IChangeMyCity – a division of Janaagraha, a Bengaluru based non-profit working to improve the quality of life in India’s cities and towns.
6. ‘Half billion more people face poverty due to virus’
- Around half a billion people could be pushed into poverty as a result of the economic fallout from the pandemic unless richer countries take urgent action to help developing nations, a leading aid organisation has warned.
- The report, which is based on research at King’s College London and the Australian National University, warns that between 6% and 8% of the global population could be forced into poverty.
- Oxfam has urged richer countries to step up their efforts to help the developing world. Failing to do so, it added, could set back the fight against poverty by a decade and by as much as 30 years in some areas, including Africa and West Asia.
H. UPSC Prelims Practice Questions
Q1. The National Health Mission aims to reduce:
- Total Fertility Rate (TFR) to 2.1.
- Infant Mortality Rate (IMR) to 25 per 1000 live births.
- Maternal Mortality Rate (MMR) to 1 per 1000 live births.
Which of the given statement/s is/are correct?
- 2 and 3 only
- 2 only
- 1, 2 and 3
- 3 only
Q2. Consider the following statements:
- Inter-State migration and quarantine fall under the Union List.
- Prevention of infectious diseases moving from one State to another is under the State List.
Which of the given statement/s is/are correct?
- 1 only
- 2 only
- Both 1 and 2
- Neither 1 nor 2
Q3.Consider the following statements:
- In the blood, apart from RBC, WBC and platelets, all the other fluid content is known as Plasma.
- The main role of plasma is to carry hormones, nutrients and proteins to different parts of the body.
- Plasma constitutes 30% of the total blood volume.
Which of the given statement/s is/are incorrect?
- 1 only
- 3 only
- 1 and 3 only
- 2 and 3 only
Q4.Consider the following statements with respect to the Strait of Hormuz:
- It is a strait between the Persian Gulf and the Gulf of Oman.
- About half of the global oil consumption passes through the Strait.
- It provides the only sea passage from the Persian Gulf to the open ocean.
Which of the given statement/s is/are correct?
- 1, 2 and 3
- 1 and 2 only
- 1 and 3 only
- 2 and 3 only
Answer
Answer: c
Explanation:
Strait of Hormuz is a strait between the Persian Gulf and the Gulf of Oman. It provides the only sea passage from the Persian Gulf to the open ocean. About 1/5th of the global oil consumption passes through the strait, making it a highly important strategic location for international trade.
I. UPSC Mains Practice Questions
- Will the coronavirus outbreak bring a gradual end to the spirit of globalization? Critically analyze.
- India’s relationship with the Gulf will require a transformation moving beyond the narrow confines of oil and diaspora. Elaborate.
Read the previous CNA here.
10 April 2020 CNA:- Download PDF Here
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