20 Aug 2020: UPSC Exam Comprehensive News Analysis

20 Aug 2020 CNA:- Download PDF Here

TABLE OF CONTENTS

A. GS 1 Related
B. GS 2 Related
POLITY AND GOVERNANCE
1. Govt. to set up National Recruitment Agency
INTERNATIONAL RELATIONS
1. India offers vaccine to Bangladesh on priority
C. GS 3 Related
ECONOMY
1. World Bank may forecast steeper India contraction
2. ‘India is capable of getting back to 7% growth’
3. ACMA seeks policy for scrappage of vehicles
D. GS 4 Related
E. Editorials
INTERNATIONAL RELATIONS
1. China-Russia ties as a major determinant
EDUCATION
1. Privatisation via graded autonomy
F. Prelims Facts
1. UAE connects first Arab nuclear plant to power grid
2. Ex-judge Kurian calls for intra-court appeal
G. Tidbits
1. ‘Lockdown hit 9.2 lakh women in need of abortion services’
H. UPSC Prelims Practice Questions
I. UPSC Mains Practice Questions

Category: INTERNATIONAL RELATIONS

1. India offers vaccine to Bangladesh on priority

Context:

  • Visit of the Indian Foreign Secretary to Dhaka, Bangladesh.

Background:

Deepening China-Bangladesh ties:

COVID-19 measures:

  • China had sent a medical team to assess the pandemic preparation of Bangladesh.
  • Bangladesh Medical Research Council (BMRC) has allowed China to carry out the Phase III human trial of the anti-COVID-19 vaccine produced by China’s Sinovac Biotech Ltd.

Economic:

  • China has provided a tariff-free facility for exports from Bangladesh.

Infrastructure development:

  • The Bangladesh government has recently reached an agreement with China over the building of a $1 billion irrigation project in the Teesta river command area.

Strain in India-Bangladesh ties:

  • There have been concerns regarding some signs of fracture in India-Bangladesh ties.
    • Bangladeshi Foreign minister had recently called on India to provide a tariff-free facility for exports from Bangladesh.
    • There have been concerns over the current government’s slow pace in sanctioning projects that are supported by India.
    • The construction of the Teesta irrigation project could effectively neutralise the Teesta water negotiations with India.
    • The increase in the killings of Bangladeshi nationals along the border by India’s BSF has been a constant irritant in the bilateral ties.

Details:

  • The visit by the foreign secretary has been interpreted as India’s attempt to prevent the growing Chinese influence in Bangladesh.
  • The possibility of collaboration with respect to COVID-19 vaccine development and manufacture and the proposal for a travel bubble for flights between India and Bangladesh that will allow smooth movement for business, official and medical personnel have been discussed.
  • An early meeting of the India-Bangladesh Consultative Committee has also been discussed.

2. ‘India is capable of getting back to 7% growth’

Context:

  • Ranil Salgado, the India Mission Chief at the International Monetary Fund (IMF) has expressed his opinions on important economic policies for India.

Details:

Growth dynamics:

  • The COVID-19 pandemic and the lockdown has affected both the supply side and demand side of the economy. This would result in a fall in growth in India.
  • Despite the strict pre-emptive lockdown India has not been able to gain full control of the COVID-19 situation.

Supporting vulnerable sections:

  • India needs focussed measures to mitigate the impact of the pandemic on its poorest.
  • A large proportion of any stimulus should be focused on supporting vulnerable households through in-kind transfers and food transfers.
  • The government should consider supporting rural employment and urban employment-generating interventions.

Universal Basic Income:

  • The availability of little fiscal space would weigh against interventions like the Universal Basic Income.
  • Universal Basic Income even in a limited manner has to be combined with extensive subsidy reforms. This would allow the administration to maintain a sustainable fiscal path.

Deficit monetisation:

  • Given the sharp drop in aggregate demand, some experts have called for deficit monetisation by the RBI. It is being employed in emerging markets like Indonesia.
  • However, given the concerns regarding deficit monetization, the IMF argues that it should only be the last resort for India.

For more information on this issue, refer to:

CNA dated June 9, 2020: Who’s afraid of monetisation of the deficit?

CNA dated August 6, 2020: How to pay for the stimulus?

Macroeconomic policy:

  • Given India’s condition of a generally high level of government or public debt, decisions regarding fiscal expenditure or stimulus need to be well considered.
  • Once the COVID-19 crisis has passed, India has to get back to its long-term fiscal consolidation strategy. That could help ease concerns in markets and keep rates relatively low.

Structural reforms:

  • While the IMF India mission chief lauds the substantial reforms like the Insolvency and Bankruptcy Code (IBC), the introduction of GST, steps to improve ease of doing business and issues relating to FDI, he calls for more reforms in areas like infrastructure spending, labour market reforms and land reforms.

Financial system:

  • Given the impeding liquidity crisis in the financial system, there is the need for further reforms.
  • While the aspects of recognising stressed assets, establishing the resolution framework and recapitalisation by the government of public sector banks have been implemented well, the aspect of reforms in governance issues needs more focussed attention.

Economic recovery:

  • Given that India had been averaging 7+% growth rates over the previous decade, it is possible that India could reverse the slowing growth rate.
  • A strong demographic dividend could help in this direction.
  • With the right structural reforms and infrastructure spending, India could as well recover the economic losses brought out by the pandemic.

Additional information:

The World Economic Outlook:

  • The World Economic Outlook (WEO) is a report by the International Monetary Fund that analyzes key parts of the IMF’s surveillance of economic developments and policies in its member countries.

3. ACMA seeks policy for scrappage of vehicles

Context:

  • Auto sector in India.

Details:

Crisis in the automotive sector:

  • As per data released by the Automotive Component Manufacturers Association (ACMA), the auto component industry registered a 12% decline in turnover in the previous fiscal year.
  • The following factors seem to have had an adverse impact on the performance of the auto sector:
    • Subdued vehicle demand domestically and the slowdown in key export markets have drastically reduced demand in the sector.
    • Massive investments made for transition from BS IV to BS VI by the auto companies have resulted in liquidity crunch in their financial operations.
    • The lack of clarity on policy for electrification of vehicles by the government seems to be inhibiting the investment operations of the auto companies.

Industry demands:

  • The Automotive Component Manufacturers Association (ACMA) has been requesting the government to reduce GST rates to 18% on all vehicles, and introduce an incentive-based scrappage policy. This is expected to raise demand for vehicles.

For more information on this issue, refer to:

CNA dated August 18, 2019: Trouble in the auto industry

2. Ex-judge Kurian calls for intra-court appeal

  • Article 145 (3) of the Constitution mandates that there should be a quorum of minimum five judges for deciding any case involving substantial questions of law or any reference under Article 143, which deals with the power of the President of India to consult the Supreme Court.

Also read: Code of Criminal Proceedings (CrPC)

G. Tidbits

1. ‘Lockdown hit 9.2 lakh women in need of abortion services’

  • A report has been released by Marie Stopes International based on the survey recording responses of 1,000 women aged 16-50 in India on their experiences with respect to sexual and reproductive healthcare before and during the COVID-19 pandemic.
  • The report notes that a staggering 90% or 9.2 lakh women in India estimated to require abortion services could not access them between January and June because of the stringent COVID-19 lockdown. A large number of women couldn’t get any kind of sexual and reproductive health services.
  • The inability to access sexual and reproductive health services in India could lead to as many as 10 lakh unsafe abortions, 6.5 lakh unintended pregnancies and 2,600 maternal deaths in the country.

H. UPSC Prelims Practice Questions

Q1. Which of the following report/s is/are released by the International Monetary Fund?
  1. World Economic Outlook
  2. Global Financial Stability Report
  3. World Development Report
  4. Ease of Doing Business Report
  5. Global Risks Report

Options:

  1. 1 only
  2. 1 and 2 only
  3. 1, 2, 3 and 5 only
  4. 3, 4 and 5 only
CHECK ANSWERS:-

Answer: b

Explanation:

  • World Development Report and Ease of Doing Business Report are released by the World Bank while the Global Risks Report is released by the World Economic Forum.
Q2. Barakah is located in which of the following countries?
  1. Iran
  2. UAE
  3. Saudi Arabia
  4. Syria
CHECK ANSWERS:-

Answer: b

Explanation:

  • The Barakah nuclear power plant is on the Gulf coast west of Abu Dhabi. It is located in the UAE.
Q3. Which of the following statement/s is/are correct with respect to the Election 
Commission of India?
  1. Currently, the Election Commission of India is a three-member body with one Chief Election Commissioner and two election commissioners.
  2. In case of a difference of opinion in the Election Commission of India, the matter is decided by the majority.
  3. The Chief Election Commissioner and the election commissioners have equal powers and receive equal salaries.
  4. Election commissioners cannot be removed from office except on the recommendation of the Chief Election Commissioner.

Options:

  1. 1 and 2 only
  2. 2, 3 and 4 only
  3. 1, 2, 3 and 4
  4. 1 and 4 only
CHECK ANSWERS:-

Answer: c

Explanation:

All the above statements are correct.

Q4. Which of the following statement/s is/are incorrect?
  1. The corporate social responsibility (CSR) provision is based on India’s Companies Act, 2013.
  2. India became the first country to legislate the need to undertake corporate social responsibility (CSR) activities and mandatorily report CSR initiatives.

Options:

  1. 1 only
  2. 2 only
  3. Both 1 and 2
  4. Neither 1 nor 2
CHECK ANSWERS:-

Answer: d

Explanation:

  • India is the first country in the world to make corporate social responsibility (CSR) mandatory, following an amendment to the Companies Act, 2013.
  • The rules in Section 135 of India’s Companies Act make it mandatory for companies of a certain turnover and profitability to spend two percent of their average net profit for the past three years on CSR.

Businesses can invest their profits in areas such as education, poverty, gender equality, and hunger as part of any CSR compliance.

I. UPSC Mains Practice Questions

  1. Despite the deepening relations between Russia and China which seem to be indicative of a growing strategic convergence, the Russia-China relationship does face significant challenges. Comment. (15 marks, 250 words)(GS Paper 2/International Relations)
  2. The graded autonomy model for the educational institutes envisaged in the National Education Policy (NEP) 2020 could act as a double-edged sword. Examine. (10 marks, 150 words)(GS Paper 2/Education)

Read the previous CNA here.

20 Aug 2020 CNA:- Download PDF Here

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