02 June 2021: UPSC Exam Comprehensive News Analysis

CNA 2nd June 2021:- Download PDF Here

TABLE OF CONTENTS

A. GS 1 Related
B. GS 2 Related
POLITY AND GOVERNANCE
1. Give details on scheme for orphaned children, says SC
2. DM Act is of 2005 vintage, was first enforced during pandemic
3. Panel had warned MHA on Lakshadweep
INTERNATIONAL RELATIONS
1. BRICS will help India in fighting COVID-19, says China Minister
2. ‘Europe should speak in one voice’
C. GS 3 Related
D. GS 4 Related
E. Editorials
SOCIAL ISSUES
1. Breaking the cycle of child labour is in India’s hands
POPULATION
1. When two is too little
ECONOMY
1. What explains the surge in FDI inflows?
2. The economic toolkit revealed
F. Prelims Facts
1. Justice A.K. Mishra appointed NHRC chief
2. China reports human case of bird flu
G. Tidbits
1. IMD increases monsoon rain outlook to 101%
H. UPSC Prelims Practice Questions
I. UPSC Mains Practice Questions

2. DM Act is of 2005 vintage, was first enforced during pandemic

Context:

Hours before retiring, former Chief Secretary of West Bengal Alapan Bandyopadhyay was served a show-cause notice by the Union Home Ministry under Section 51 of the Disaster Management (DM) Act, 2005, punishable by imprisonment of up to two years or a fine or both.

Details:

• Section 51 of the DM Act, 2005 pertains to punishment for obstruction for refusal to comply with a direction given by the Central government.
• It prescribes punishment for obstruction for refusal to comply with any direction given by or on behalf of the Central Government or the State government or the National Executive Committee or the State Executive Committee or the District Authority under the Act.
• However, the section has two important caveats. Under the Act, in order to be punishable, the action on the part of the person has to be:
  • ‘without reasonable cause’
  • ‘failure of an officer to perform the duty without due permission or lawful excuse’.

Read more on this issue covered in UPSC Exam Comprehensive News Analysis. May 29th, 2021 CNA.

3. Panel had warned MHA on Lakshadweep

Context:

Concerns raised about the Lakshadweep Development Authority Regulation 2021 (LDAR).

Details:

The Parliamentary panel on Home Affairs had warned the Union Home Ministry to ensure that any decision on the development of Lakshadweep is taken after consultations with all stakeholders and elected representatives.

Read more on this issue covered in UPSC Exam Comprehensive News Analysis. May 28th, 2021 CNA.
Category: INTERNATIONAL RELATIONS

1. BRICS will help India in fighting COVID-19, says China Minister

Context:

BRICS (Brazil-Russia-India-China-South Africa) foreign ministers held a virtual meeting.

BRICS:

• The BRICS brings together five of the largest developing countries of the world, representing 41 per cent of the global population, 24 per cent of the global GDP and 16 per cent of the global trade.

Read more on BRICS.

Details:

• India hosted it in its capacity as the chair of BRICS.
• The meeting was attended by Russia’s Foreign Minister Sergey Lavrov, China’s Foreign Minister Wang Yi, South African Minister of International Relations Grace Naledi Mandisa Pandor, and Brazil Foreign Minister Carlos Alberto Franco.
• Chinese Foreign Minister said that the grouping was ready to assist the country to fight the pandemic.
• The Ministers agreed on reforming the multilateral system.
  • They have also agreed that such reform has to cover all key multilateral institutions, including the UN and its principal organs (UN Security Council, General Assembly, ECOSOC, the Secretariat, etc); international financial architecture (IMF, World Bank); multilateral trading system (WTO, UNCTAD); and the global health governance system with the WHO at its core.
  • This is the first time that such a consensus was reached.
  • They also agreed to a set of six principles that should guide the reform of multilateral institutions.
• The proposal by South Africa and India at the WTO seeking a patent waiver for Covid-19 vaccines was also among the issues discussed.
  • India and South Africa have been raising the issue of Trade-Related Aspects of Intellectual Property Rights waiver for Covid 19 vaccines.
  • All the BRICS countries have agreed to support this measure.
  • They called for supporting ongoing consideration in WTO on a Covid-19 vaccine Intellectual Property Rights waiver and the use of flexibilities of the TRIPS agreement and the Doha Declaration on TRIPS Agreement and Public Health.

2. ‘Europe should speak in one voice’

Context:

Lithuania has announced that it would pull out of the China and Central & Eastern European (CEE) 17+1 mechanism.

Details:

• China and Central & Eastern European (CEE) 17+1 mechanism is seen as a pro-China grouping of countries within the EU. 
• Lithuanian Ambassador has said that the grouping has not proved beneficial.
• Tensions between China and Lithuania have been building up over a number of issues: Lithuania’s new ties with Taiwan, its Parliament’s resolution on Uighurs, and then Chinese sanctions on Lithuanian and EU politicians, which led to the EU putting the Comprehensive Agreement on Investment on hold.

Read more on this topic covered in UPSC Exam Comprehensive News Analysis. May 24th, 2021 CNA.

Category: POPULATION

1. When two is too little

Context:

• China’s Communist Party has introduced a “three child policy”.

Background:

China’s family planning policy:

• In a bid to limit the population explosion in China, it resorted to strong state-led demographic interventions. It was in this direction that it adopted its “one child policy” of 1979.
• It offers a reward and assistance system and preferential policies for those following family planning rules.
  • After the one child policy, China’s fertility rate fell from 2.75 in 1979 to 1.69 in 2018.
• Recognizing the ill effects of its one child policy, China relaxed its stance on the number of children and introduced the two child policy in 2015. However, this measure too failed to boost birth rates.
  • The recent population census recorded 12 million births in 2020, the lowest number since 1961.

Concerns associated with Chinese policy of family planning:

• Population control measures have landed China in a population crisis.
• China’s demographic interventions have had the following unintended social and economic consequences.

Social consequences:

• The limitations on the number of children and the gender discrimination prevalent in the society led to a deeply gender-imbalanced population. Couples have been resorting to sex-selective abortions and this has reduced the sex ratio considerably. The skewed sex ratio has detrimental consequences for society.
• The number of aged people has been increasing steadily in China. As per the census, there were 264 million in the 60 and over age group, accounting for 18.70% of the population. The fast ageing population and the availability of very few people to take care of them would have a detrimental impact on their quality of life.

Economic consequences:

• The rapidly ageing population has reduced the workforce population and increased the dependency ratio.
  • The dependency ratio is an age-population ratio of those typically not in the labour force (the dependent part – ages 0 to 14 and 65+) and those typically in the labour force (the productive part – ages 15 to 64). It is used to measure the pressure on the productive population. A low dependency ratio means that there are sufficient people working who can support the dependent population. A higher ratio indicates more financial stress on working people.
• The rapidly ageing population threatens to limit the growth prospects of China.

Moral concerns:

• The intrusive family planning policy goes against the right to freedom of choice for the parents.
• The strict enforcement of the child policies in China has led to forced abortions and sterilisations.

Reasons for Chinese shift in family planning policy:

• The shift to the three child policy marks an acknowledgement of the consequences of China’s intrusive family planning measures.
• The shift to the three child policy is aimed to improve China’s population structure. It intends to tackle the challenge of the ageing population, and preserve the country’s human resource advantages.

Lessons for India from Chinese experience:

• India has been toying with the idea of population control measures through a two-child norm, which found mention in the Prime Minister’s Independence Day speech two years ago.
• The Chinese experience should serve as a warning for India that coercive population strategies can be counter-productive.

Indian experience:

Population growth in India:

• India, with 1.37 billion people, is the second-most populous country in the world. A report from the United Nations released in June had said that around 2027, India is set to overtake China as the world’s most populous country.
• Birth rates are falling, but the population continues to grow as more than 30% of the people are young and in the reproductive age group.

Skewed progress:

• India has done very well with its family planning measures and the current fertility rate is at the replacement level fertility of 2.1, which is desirable.
  • Replacement level fertility is the level of fertility at which a population exactly replaces itself from one generation to the next.
• However, the pattern has been skewed. In some states like Sikkim, Andhra Pradesh, Delhi, Kerala and Karnataka, the total fertility rate is way below replacement level. The low fertility rates in Sikkim and Lakshadweep have led to challenges of an ageing population, shrinking workforce and an increase in sex-selective practices.

For related information refer to:

UPSC Comprehensive News Analysis for 23rd Dec 2020

Recommendations for India:

Family planning as a national priority:

• Given that unchecked population growth could go against the efforts to bring millions of people out of poverty and undo the benefits of higher welfare spending for the poor, India needs to treat population stabilization and family planning as a national priority.

Addressing structural issues:

• Notably, even other developing countries, without stringent child-limitation policies like that of China, have also experienced declines in total fertility rates.
• This seems to suggest the fact that the mere relaxation or even abolishing of birth quotas would not help in raising the fertility rate and there is the need for governments to acknowledge and address structural problems like reducing the child-rearing costs (education and nutrition) borne by prospective parents. This critical aspect needs to be prioritized.

Focussing on population stabilization:

• India needs to focus its attention on population stabilisation measures rather than resort to coercive measures.
  • Population stabilization is a stage when the size of the population remains unchanged. It is also called the stage of zero population growth. Country-level population stabilization occurs when births plus in-migration equals deaths plus out-migration.
• The measures needed in this direction could include the following:
  • Incentivise later marriages and childbirths; ensuring a sufficient gap between childbirths.
  • Stepping up access to contraceptive choices and addressing socio-cultural barriers towards contraception.
  • Offering family planning support and investing in behaviour-change communication strategies and family planning.

Category: ECONOMY

1. What explains the surge in FDI inflows?

Context:

• Impressive growth in total foreign direct investment (FDI) inflow in 2020-21 reported by the Ministry of Commerce and Industry

For related information refer to:

UPSC Comprehensive News Analysis of 25th May 2021

Details:

• As against the claim being made by the government that its measures on the fronts of Foreign Direct Investment (FDI) policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country, the article raises doubts over this development based on the following arguments.

No net increase in FDI:

• The direct investment in India has actually decreased while it is the 47% increase in repatriation/disinvestment that accounts for the rise in the gross inflows into India. Hence there is a wide gap between gross FDI inflow and direct investment to India.

Surge led by FPI:

• Short-term foreign portfolio investments are entirely responsible for the surge in foreign investment.
• FDI inflows have increasingly consisted of private equity funds or portfolio investments, which are usually short-term investments in domestic capital (equity and debt) markets meant to realise better financial returns.
• In principle, private equity funds do not make long-term greenfield investment and hence is not adding to fixed investment, output growth and employment creation.

Negligible impact on domestic output:

• The ratio of net FDI to GDP has remained just over 1% (left-hand scale), with no discernible rising trend being observed over the years.
• Likewise, the proportion of net FDI to gross fixed capital formation (fixed investment) has remained range-bound between 4% and 6%.
• Thus, FDI inflow’s contribution to domestic output and investment remains modest.

Rise in stock prices:

• While the FII inflow did little to augment the economy’s potential output, it has resulted in a substantial rise in stock prices.
  • While GDP has contracted by 7.3% in 2020-21 on account of the pandemic and the economic lockdown, the BSE Sensex has nearly doubled.
  • BSE’s price-earnings (P-E) multiple — defined as share price relative to earnings per share — is among the world’s highest.

2. The economic toolkit revealed

• The article analyzing the Reserve Bank of India (RBI) ’s annual report for 2020-21 explains the limitations of monetary policy measures in helping economic revival in the post-pandemic world and argues rather for fiscal stimulus.

For related information refer to:

UPSC Comprehensive News Analysis of 21st May 2021

2. China reports human case of bird flu

What’s in News?

China reported the world’s first human infection of the H10N3 bird flu.

• It has said that the risk of it spreading widely among people was low.
• China has described H10N3 as low pathogenic — less likely to cause death or severe illness in birds.
• Several strains of bird flu have been found among animals in China but mass outbreaks in humans are rare.
• The last human epidemic of bird flu in China occurred in late 2016 to 2017, with the H7N9 virus.

Q1:  Consider the following statements:

Q2: Purchasing Managers’ Index or PMI is an economic indicator, which is derived after monthly
 surveys of different companies. For manufacturing PMI, the questionnaire is sent to 
manufacturing companies. The questions are related to 5 key variables:

Q3: Vande Bharat Mission is related to:

Q4: ‘Van Dhan Yojana’ deals with:

Q5. The object of the Butler Committee of 1927 was to

Read the previous CNA here.

CNA 2nd June 2021:- Download PDF Here