03 Feb 2022: UPSC Exam Comprehensive News Analysis

CNA 03 Feb 2022:- Download PDF Here

TABLE OF CONTENTS

A. GS 1 Related
SOCIETY
1. Process on to amend criminal laws
B. GS 2 Related
POLITY & GOVERNANCE
1. Electoral bonds worth ₹1,213 cr. sold in January
2. J&K Delimitation Commission likely to get another extension
C. GS 3 Related
ECONOMY
1. ₹3,358 cr. in MGNREGA wages not paid
D. GS 4 Related
E. Editorials
INTERNATIONAL RELATIONS
1. Ink India-Britain free trade, unlock new opportunity
GOVERNANCE
1. Creating jobs by increasing capex
POLITY
1. Imperial excess
F. Prelims Facts
G. Tidbits
1. Fitch Ratings flags high fiscal deficit target
H. UPSC Prelims Practice Questions
I. UPSC Mains Practice Questions

Category: POLITY & GOVERNANCE

1. Electoral bonds worth ₹1,213 cr. sold in January

Syllabus: GS II, Governance, Important aspects of governance, transparency and accountability

Prelims: About Electoral Bonds

Mains: Implications of the Electoral Bond Scheme

Context: The Electoral bonds worth Rs 1,213 have been sold by the State Bank of India with a majority of them being encashed in the New Delhi branch. This gave birth to controversies hinting at the national parties’ involvement to unleash bulk amounts from the electoral bonds for their electoral campaigns. 

Read all that you need to know about the Electoral Bond Scheme in the linked article.

2. J&K Delimitation Commission likely to get another extension

Syllabus: GS II, Polity and Governance

Prelims: Delimitation Exercise

Mains: Outcome of extending the Delimitation exercise

Context: The Jammu and Kashmir Delimitation Commission is likely to get a second extension which might result in the delay of assembly elections in the union territory. 

The Delimitation Commission:

• It is a three-membered commission headed by retired judge Ranjana Prakash Desai.
• The commission came into effect by an Act of Parliament and operates under Part V of the J&K Reorganisation Act, 2019.
• It provides for the redrawal of boundaries of seven additional seats for the 83 member assembly. 

Highlights of the suggestions:

• The Delimitation Commission, in its first draft proposal, recommended an increase of six assembly segments in Jammu and one in Kashmir. 
• It also suggested the reservation of seats for the scheduled castes (7 seats) and 9 seats to be reserved for the scheduled tribes. 
• These suggestions have been considered gerrymandering and termed unacceptable by the political parties of Kashmir.

What is Gerrymandering? 

• Gerrymandering is an electoral exercise that involves the manipulation of the boundaries of an electoral constituency that works only in favour of a particular political party or class. 
• This disturbs the entire system of free and fair elections thereby leading to electoral malpractice. 

Category: GOVERNANCE

1. Creating jobs by increasing capex

Syllabus: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Mains: Significance of capital expenditure in creating jobs and its associated issues

Unemployment in India

• Data from International Labour Organization (ILO) suggest that,
  • India’s employment to population (over the age of 15) ratio has steadily decreased from 55% in 2005 to 43% in 2020.
    • In 2020, it was 52% in Bangladesh, 63% in China and 73% in Vietnam.
  • Women form just 20% of India’s workforce.
    • Women comprise around 30% to 70% of the workforce in the other three countries.
• Centre for Monitoring Indian Economy (CMIE) data suggest that,
  • Across manufacturing and services, India lost nearly 1 crore jobs between December 2016 and December 2021.

The need for the Creation of Jobs

• The key in achieving India’s immense economic potential as a nation, is the creation of gainful jobs, particularly for the underemployed youth and women.
• Amidst the global and domestic situation of the economy, affected by the COVID-19 pandemic, the administration has to face the challenge of enabling the creation of sustainable jobs.

Context:

The Finance Minister in the 2022-23 Budget speech, announced that allocating money towards productive infrastructure investments is the way forward to revive the economy.

Increase in Tax Collection

• Data by the Controller General of Accounts (CGA) show that for the first nine months of the fiscal year 2021-22 (FY22), the Centre’s revenue receipts across taxes and dividends stood at ₹17.3 lakh crore, just shy of the full-year budget of ₹17.9 lakh crore. 
• Factors that contributed to this remarkable outcome. 
  • Higher-income tax and Goods and Services Tax (GST) collections are on the back of a robust performance of India’s organised sector, amidst increased formalisation of the economy. 
  • The government deserves credit for the conservative Budget projections of last year (2021-22), even as it enhanced credibility by coming clean on expenditures hidden in off-balance sheets in the books of the Food Corporation of India. 
• For the first time in many years, despite the pandemic and the challenges of unorganised sectors, tax collections for the fiscal year will end ahead of the Budget projections.

Key Figures in the Budget 2022-23

• The Budget revised the FY22 Central revenue receipts to ₹20.8 lakh crore, nearly ₹3 lakh crore higher than the original Budget. 
  • Considering the momentum in tax collections till December 2021, despite the Omicron wave, actual revenue receipts may exceed the number by an additional ₹0.5 lakh crore-0.7 lakh crore. 
  • This will help make up for the projected shortfall in the government’s disinvestment Budget for the current year.
• Despite the higher revenue receipts than budgeted, the overall FY22 fiscal deficit is projected to end at ₹15.9 lakh crore (6.9% of GDP).
  • Higher than the Budget Estimates of ₹15.1 lakh crore. 
  • Additional spending towards food and fertilizer subsidies, increased allocations towards the National Rural Employment Guarantee Scheme and export incentives, and a clean-up of the books of Air India prior to its sale all contributed towards increased expenditures.

Significance of Capital Expenditure in the Creation of Jobs

• Going forward, a sustained momentum in tax collections will provide an additional amount of fiscal policy freedom to the government as they try to foster domestic jobs and output. 
  • The government has chosen to back investments into capital expenditure as the way to achieve this.
• For the next fiscal year FY23, the government has increased the capital expenditure or investments into productive capital creation to ₹7.5 lakh crore, 24% higher than the FY22 revised estimate of ₹6 lakh crore. 
  • Between FY11 and FY21, capital expenditure averaged just 12% of the government’s overall expenditure. 
  • For the current FY22, that ratio increased to 16%, and for FY23, the government has proposed to take it to 19%.
• It is expected that sustained investment in roads, railways, freight corridors, power, renewable energy along with initiatives such as Production-Linked Incentives (PLI) and other enabling legislation will create the conditions for drawing in private sector investments into manufacturing, and foster job creation and sustainable growth.

Cause of Concern

• Not all the capital expenditure is indicative of fresh greenfield investments. 
  • The ₹0.5 lakh crore of clean-up of Air India’s books counts as capital expenditure.
  • Similarly, for FY23, the government has set aside ₹0.8 lakh crore to partly clean up the books of NHAI and BSNL.
• While there is a visible thrust on hard capital expenditure, the outlays towards critical areas such as education, healthcare and urban infrastructure remain subdued.
  • Investments in these areas are more critical than the hard infrastructure.
• The thrust on capital expenditure has resulted in higher fiscal deficit numbers than expected.
  • High fiscal deficits put pressure on interest rates and the Reserve Bank of India, risk of inflation, higher current account deficits, and threaten financial stability.

Way Forward

• Effective execution and implementation of the proposed measures is crucial.
• With the provision of funds for the infrastructure thrust, the Central, State, and local administrations have to work together to ensure that these funds are utilised in a timely manner, and result in the delivery of world-class infrastructure.
• The ease of doing investments have to be addressed, especially around key areas such as land acquisition, contract enforcement, and policy stability. 
• Sustained investments in manufacturing and value-added services hold the key to the growth of small businesses, jobs, and economic well-being.

Category: POLITY

1. Imperial excess

Syllabus: Powers, functions and responsibilities of various Constitutional Bodies

Mains: The issues and concerns associated with the office of Governor

Context:

The Chief Minister of West Bengal has expressed outrage against the state’s Governor and blocked him on a social media platform.

Details

• Tired of the Governor’s constant attack against her on Twitter, the West Bengal CM blocked him on the platform.
• The Chief Minister said the Governor was trying to treat the elected government as “bonded labour”.
• The Governor then sent her a message for dialogue and harmony amongst constitutional functionaries.
• The recent events have once again brought back the limelight on the role of the Governor in relation to the elected government and legislature.

West Bengal Case

• The governor has been summoning the Chief Secretary and the Director-General of Police on a regular basis, and taking to Twitter and often tagging the Chief Minister when they do not turn up.
• The governor also had an argument with the Assembly Speaker recently, in the State Assembly premises.
• He has withheld assent to the Howrah Municipal Corporation (Amendment) Bill 2021, delaying polls to the civic body.
• He has made allegations of misconduct in welfare schemes and questioned Government claims about investments in the State.
• He has often been criticized for taking stances that support the opposition in the Assembly.

Maharashtra case

• The Governor has stalled the election of Speaker since the post fell vacant in February 2021.
  • He has taken exception to the amendments in the legislative rules for holding the Speaker’s election through voice vote instead of secret ballot.
• The Governor’s view that the State Assembly cannot decide its own rules is unacceptable to the ruling coalition, but is being cheered by the Opposition.
• The governor was criticised in the past for supporting opposition parties and their demands for a special session of the Assembly on women’s safety and security.
• He had refused to accept the recommendation of the Council of Ministers on the nomination of 12 members to the Legislative Council, until the matter reached the High Court.

Tamil Nadu’s Case

• The governor has not acted upon the T.N. Admission to Undergraduate Medical Degree Courses Bill, adopted by the Assembly in September 2021.
  • The Governor is required to either send it to the President of India for approval or return it for reconsideration by the Assembly, but the indefinite delay in taking a decision amounts to undermining the legislature, and is regarded unjustifiable.
  • The Bill relates to a question of State-Centre relations, as it proposes to dispense with the National Eligibility cum Entrance Test (NEET) for medical graduate admissions in the State. NEET has been criticised for curtailing State powers, and the Governor’s delay in processing the Bill is aggravating the situation.

Conclusion

The imperialistic attitude of the governor has huge implications on the constitutional scheme of functioning and requires the governor to act within the prescriptions of the Constitution and be a friend, philosopher and guide to his government. 

Q1. Consider the following statements with regards to Delimitation Commission:

Q2. Which of the following is/are amongst the Ramsar sites in India?

Q3. According to the Indus Water Treaty of 1960, which of the following rivers were 
portioned/allocated to India?

Q4. Consider the following statements with regards to EXIM Bank of India:

Q5. Which of the following statements correctly explains the impact of the Industrial 
Revolution on India during the first half of the nineteenth century? (UPSC CSE 2020)

CNA 03 Feb 2022:- Download PDF Here