PM IAS JAN 18 NEWS ANALYSIS

Legacy of Subhas Chandra Bose

Context

• There is an element of intrigue that trails Subhas Chandra Bose’s persona, his life, disappearance and death.

Key Points

• Role in Freedom Struggle:
  • He was a dynamic personality of India’s freedom movement who inspired hundreds of Indians to join the struggle.
  • He resigned from the Indian Civil Service to join the freedom movement, threw a challenge to the Congress leadership and took up an extremist stance against the British, evaded the intelligence network to travel to Europe and Southeast Asia, formed two governments and raised two armies, all in a span of two decades. 
  • Bose’s political activities surrounded revolutionary groups in Bengal, Punjab, Maharashtra and the United Provinces.
• Bridging Communal Divide:
  • Bose made efforts to bridge the increasing communal divide.
  • The lesson that Netaji and his army brings to us is one of self-sacrifice, unity — irrespective of class and community — and discipline.

Netaji Subhas Chandra Bose

• Early Life:
  • He was born on January 23, 1897, in Cuttack, Orissa. 
  • His father Janaki Nath Bose was a famous lawyer and his mother Prabhavati Devi was a pious and religious lady. 
  • He was a brilliant student right from childhood.
  • He was strongly influenced by Swami Vivekananda’s teachings and was known for his patriotic zeal as a student. 
  • He was known in particular for his militant approach to independence and his push for socialist policies.
• Famous Slogans:
  • “Give me blood, and I shall give you freedom!”
  • “Jai Hind.”
  • The first person to call Mahatma Gandhi “Father of the Nation”, in his address from Singapore.
• Death:
  • He is said to have died in 1945 when his plane crashed in Taiwan. However, there are still many conspiracy theories regarding his death.

Major Events linked to him

• 1919: Went to London to give the Indian Civil Services (ICS) examination and got selected but he was deeply disturbed by the Jallianwalla Bagh massacre and left his Civil Services apprenticeship midway to return to India in 1921.
• 1938: After his return, took over as the elected President of the Indian National Congress in Haripur and stood for unqualified Swaraj (self-governance).
• He recommended the use of force against the British which then combated against Mahatma Gandhi and his views.
• 1939: Re-elected as President of INC in Tripuri.
  • However, soon resigned from the presidency and formed the All India Forward Bloc, a faction within the Congress that aimed at consolidating the political left.
• 1942: Travelled to Japan and took leadership of the Indian Independence Movement in East Asia. With Japanese aid and influence, he took the leadership of a trained army of about 40,000 troops in Japanese-occupied Southeast Asia known as the Indian National Army (Azad Hind Fauj).
• 1942: Earned the title ‘Netaji’, in Germany by the Indian soldiers of the Azad Hind Fauj.

China’s shrinking population and India’s surging ahead

In News

• The issues & potential of China’s shrinking population and India’s surging ahead, are huge. 

More about the news

• Case of China:
  • China’s population, according to its National Bureau of Statistics, fell to 1,411.8 million in 2022, from 1,412.6 million in the previous year. 
• India’s case:
  • India has not conducted an official headcount Census after 2011. But going by the United Nations’ projections, its population stood at 1,417.2 million in 2022 (more than China’s) and is expected to reach 1,428.6 million in 2023.

Drivers & indicators of population changeMortality rate:A country’s population increases with reduction in mortality or relative number of deaths. Mortality falls with Increased education levels, Public health and vaccination programmes, Access to food and medical care, and Provision of safe drinking water and sanitation facilities. The crude death rate (CDR): It is the number of persons dying per year per 1,000 population CDR was 23.2 for China and 22.2 for India in 1950. It fell to single digits for China first in 1974 (to 9.5) and for India in 1994 (9.8), and further to 7.3-7.4 for both in 2020.Life expectancy at birth:Another mortality indicator is life expectancy at birth. Between 1950 and 2020, it went up from 43.7 to 78.1 years for China and from 41.7 to 70.1 years for India.Fertility rate:The population growth slows and may even go into reverse, like it has now for China with declining fertility rates.The total fertility rate (TFR): The number of babies an average woman bears over her lifetime — was as high as 5.8 for China and 5.7 for India in 1950. The TFR has fallen sharply for India in the past three decades. Between 1992-93 and 2019-21, it came down from 3.4 to 2; the fall was especially significant in the rural areas.Replacement-level fertility:A TFR of 2.1 is considered as “replacement-level fertility”. Meaning, a woman having two children replaces herself and her partner with two new lives. Since all infants may not survive, the replacement TFR is taken at slightly above two.

Issues with China’s declining population

• TFR is below the replacement rate:
  • China’s TFR, according to its 2020 Census, was 1.3 births per woman which is marginally up from the 1.2 in the 2010 and 2000 censuses.
    • Issue is that the TFR is way below the replacement rate of 2.1. 
  • China officially ended its one-child policy, introduced in 1980, from 2016. But that’s unlikely to stop the decline in the country’s population, which the UN has projected at 1,312.6 billion in 2050, a near 100 million drop from the 2021 peak.
• Decline working age population:
  • The real crisis for China is the decline in its population that is of prime working age.
    • If there is a large population that’s able to work and earn, not only will there be relatively fewer people to support — those too old or too young — but also greater tax revenues and savings potential from the generation of incomes. 
  • As these are directed to finance investments, a virtuous cycle of growth is unleashed, as it happened in China.
  • But that cycle has started to reverse, and the share of China’s working-age population is projected to fall below 50% by 2045.

India’s potential

• TFR & replacement levels:
  • India has just begun seeing fertility rates fall to replacement levels, including in rural areas.
    • The spread of education, farm mechanisation and fragmentation of landholdings are primary contributors to this fall.
    • Reduced labour requirements in agricultural operations and smaller holdings make it that much less necessary to have large families working the land.
  • But even with fertility rate declines, India’s population is projected to expand and de-grow only after touching 1.7 billion about 40 years from now.

• Working age population:
  • More important is the working-age population: its share in the overall population crossed 50% only in 2007, and will peak at 57% towards the mid-2030s.

Challenges for India:

• Focus on key areas:
  • A population of more than 1.4 billion will require the unflinching focus of policymakers on areas fundamental to human well-being — education, nutrition, healthcare, housing, and employment. 
• Productivity and economy:
  • The youth will have to be equipped with skills that are indispensable to the knowledge economy. 
  • People’s productivity will have to increase for any given per capita income.
  • Will need policies to increase jobs so that labour force participation rate increases for both men and women.
• Climate change:
  • The climate crisis and other ecological imperatives will mean that the footprints of many activities are kept light. 
• Democratic challenges:
  • Most importantly, the challenges will spur debate, discussion, even dissension, and require that diverse voices are heard. 
  • India’s democratic traditions and the strength of its institutions will be needed to navigate the way forward from here.
• State-wise focus:
  • Much more needs to be done on this, of course, in large parts of the country, including in Uttar Pradesh, Bihar and Madhya Pradesh, whose TFR is higher than the national average and where gender discrimination has deep social roots.
• Choice to women:
  • To actually realise Population Control, educating women and giving them freedom to make choice and implement it, should be first to have attention by the Government.
  • States must ensure contraceptives are accessible, affordable and available in a range of forms acceptable to those using them.

Way ahead

• Overall then, India has a window of opportunity well into the 2040s for reaping its “demographic dividend”, like China did from the late 1980s until up to 2015. 
• However, this is entirely contingent upon the creation of meaningful employment opportunities for a young population — in the absence of which, the demographic dividend can well turn into a demographic nightmare

India’s new proposal for migrant voting

In News

• Recently, ECI proposed a new Remote Electronic Voting Machine (RVM) that would allow domestic migrants to vote in national and regional elections.

What is RVM?

• The Remote Electronic Voting Machine (RVM) is the proposed new voting system in India that would allow domestic migrants to vote in national and regional elections
• The RVM is being developed by the Election Commission of India (ECI)
• These are similar to the existing EVMs in terms of security system and voting experience.
• RVMs can handle multiple constituencies (up to 72) from a single remote polling booth.
• Instead of a fixed ballot paper sheet, the RVM has been modified to have an electronic dynamic ballot display which will present different candidate lists corresponding to the constituency number of the voter read by a constituency card reader.
• An additional digital public display unit or a monitor to act as an interface between the constituency card reader and the Ballet Unit(BU) display.
• The electronic ballot will be prepared by the Returning Officers (ROs) of home constituencies of voters, and forwarded to the remote RO for uploading in the Symbol Loading Unit(SLU).

The ECI has, however, not yet demonstrated a prototype of the RVM.

EVMs in India

• About:
  • Electronic Voting Machines (EVMs) are a system of voting used in India for national and regional elections
  • EVMs have been in use in India on a larger scale since 1992, with the latest version being the M3 model, which has been in use since 2013
  • In 2010, multiple political parties approached the ECI to develop a mechanism to verify that EVMs recorded votes correctly, leading to the development of the Voter Verified Paper Trail Audit (VVPAT) machine, which has been in use since mid-2017
• Working of EVM:
  • The current EVM setup includes a Balloting Unit (BU) and a VVPAT printer, both inside the voting compartment, and a Control Unit (CU) with the Presiding Officer (PO) that totals the number of votes cast.
  • The VVPAT is connected to the Control Unit (CU), which sits with the Presiding Officer (PO) and totals the number of votes cast, on its display board
• The VVPAT, which is essentially a printing machine, prints a slip with the poll symbol and candidate name, once the voter presses the key on the BU. 
• This slip is visible to the voter on the VVPAT’s glass screen for seven seconds after which it gets dropped off in a box inside the VVPAT.
• The use of VVPATs has become universal in elections since mid-2017.

Advantages of EVMs

Challenges with EVMs

EVMs have significantly reduced the instances of booth capturing, electoral malpractice, and riggingThey have led to a faster counting process as they eliminate the need for manual counting of votes and thus reduces the possibility of human errorEVMs are tamper-proof and prevent the manipulation of vote countsIt allows for faster and more efficient transmission of election resultsThey eliminate the need for paper ballots which can save resources and reduce the amount of waste generatedThey are more accessible for people with disabilities or older citizens and reduce the barrier for these groups to participate in the electoral processThese have been credited for increasing voter turnout in many areasThese are more secure than paper ballots as it eliminates the possibility of voter fraudEVMs with VVPAT (Voter Verified Paper Audit Trail) allows for a paper trail of the vote which ensures transparency and improves the credibility of the election.

The lack of transparency in the design, prototype, software, and hardware of EVMs.They are available only for black-box analysis and not accessible for technical and independent review,thus raising doubts and mistrust among citizens in the electoral process.The requirement of reliable electricity and power supply to operate EVMs.The need for proper maintenance and security of EVMs to ensure they are not tampered with or damaged before or during an election.The cost of purchasing and maintaining EVMs can be high, which can be a burden for some countries with limited financial resources.The possibility of power outages, network failures, or other technical issues during voting.The need for a robust system of voter education and voter awareness of their rights and responsibilities as voters.The lack of accessibility for citizens who are not literate or are visually impaired.

Way Forward

• RVM is a great decision in the right direction to address issues of accessibility and convenience for domestic migrants who may not be able to physically travel to their voting location.
• However, there is a need to address the logistical and administrative challenges of remote voting, and thus, ECI should work to restore trust in the electoral system” and address fears of the misuse of existing EVMs.

Good Governance

In News

• The Union Home Minister recently stated that “Governance Models should build trust between the government and people”.

More about the news

• Model of Good Governance:
  • The minister stated that the model should be such that it reaches the last person in the queue. 
  • It should be inclusive, corruption-free, transparent, accountable, sensitive, innovative and stable. 
  • It should strike at the root of problems and build trust between the government and the people.
  • The key to good governance is a people-centric development policy. 
• Different models for different situations:
  • India needed its own models as per the situational aand evaluation of the condition of people. 
  • If we try to impose an imported model from a country with a population of 2-10 crore onto a nation as diverse as ours, we are bound to fail. And for this, the thought process must start at the grassroots level and reach the top. 

More about Governance

• Governance:
  • The concept of “governance” is not new. It is as old as human civilization. 
  • It is the process of decision-making and the process by which decisions are implemented (or not implemented). 
  • Governance can be used in several contexts such as corporate governance, international governance, national governance and local governance.
• Good Governance:
  • It assures that corruption is minimized, the views of minorities are taken into account and the voices of the most vulnerable in society are heard in decision-making. 
  • It is participatory, consensus ,oriented, accountable, transparent, responsive, effective and efficient, equitable and inclusive and follows the rule of law.
  • It is also responsive to the present and future needs of society.
• Challenges:
  • Politicisation of bureaucracy: The political dominance on bureaucracy goes unchallenged by the bureaucracy. On the contrary, many bureaucrats willingly or meekly submitted to this dominance because of this, good governance has suffered
  • Lack of ethics and fairness: The lack of ethics and fairness in governance is felt by the common people as well as those in high offices. Today, government servants are used to ‘cushy’ postings which is a gift of the political bosses.
  • Corruption: Corruption had been identified as the biggest hurdle to economic development. Corruption undermines the public’s trust in its government. It also threatens market integrity, distorts competition, and endangers economic development.
  • Other challenges include:
    • Criminalization of Politics
    • Gender Disparity
    • Delay in Justice
    • Low levels of Awareness of the Rights and Duties of Citizens etc.
    • The rising gap between urban and rural areas, 
    • The use of technology is critical in engendering good governance. 

Government initiatives for improving Governance in India Good Governance Day:It was established in 2014 and  it was also celebrated to commemorate the birth anniversary of India’s former Prime Minister, Atal Bihari Vajpayee.The theme for this year is ‘Prashasan Gaon Ki Aur’.The day aims to let the citizens, the students  know about the government’s responsibilities and duties that it needs to fulfill. Good Governance Index (GGI):Prepared by: Department of Administration Reforms and Public Grievances (DARPG).Indicators: Good Governance Index Framework covers ten sectors and 58 indicators. Agriculture and Allied SectorsCommerce & IndustriesHuman Resource DevelopmentPublic HealthPublic Infrastructure & UtilitiesEconomic GovernanceSocial Welfare & DevelopmentJudicial & Public SecurityEnvironmentCitizen-Centric Governance. Objectives: The objective of GGI is to create a tool which can be used uniformly across the States to assess impact of various interventions taken up by the Central and State Governments including UTs. Based on the GGI Framework, the Index provides a comparative picture among the States while developing a competitive spirit for improvement.District Good Governance Index (DGGI):The DGGI is a framework comprising of performance under ten governance sectors having 58 indicators with 116 data points.  The criteria has been adopted after following a rigorous and robust process of data collection, screening and validation by each of the Districts.India’s first “District Good Governance Index (DGGI)” was initiates with the UT of Jammu and Kashmir.With the governance model successfully set up for UT of J&K, the framework will be replicated for many states and UTs.National e-Governance Plan: It has the vision to “make all government services accessible to the common man in his locality, through common service delivery outlets and ensure efficiency, transparency & reliability of such services at affordable costs to realize the basic needs of the common man.Right to Information Act, 2005: It plays an effective role in ensuring transparency in governance.iGoTKarmayogi Portal:Launch of Mobile Application of iGoTKarmayogi Portal by Karmayogi Bharat (SPV) will aim at creating professional, well-trained and future-ready civil service for India.Revamped Probity Portal: It is launched for Government Employees will demand the right attitude towards public service with ‘integrity’ and ‘probity’.Other Initiatives: E-Governance, Vigilance Awareness Week, Decentralization, JAM Trinity for Direct Benefit Transfer (DBT), PRAGATI Platform, SVAMITVA Scheme, Mission Karmayogi, etc

Reassigning of Goods and Services Tax (GST) to States

In News

• The Union government needs to reassign Goods and Services Tax (GST) to States to address fiscal imbalance between the Union and State governments.

About

• Major Economic Changes in Recent Past: 
  • The divisible taxes of the Union government expanded from two to all the Union taxes, thus enlarging the revenue base to be shared with the States. 
  • Fiscal responsibility legislation was implemented to constrain the fiscal deficits of the States. States directly borrow from the market subject to limits imposed by the Union government. 
  • The Union Planning Commission was dissolved, leading to the withdrawal of Plan grants. 
  • GST was introduced in 2017. 
• Concerns:
  • These changes have considerably altered the States’ revenue structure. 
  • States have little revenue autonomy and are more dependent on the Union government. 
  • The vertical fiscal imbalance (VFI) ratio increased to 0.594 from 0.530, indicating that only 40% of the State’s own expenditure is financed by their own revenue.

Vertical fiscal imbalance (VFI)This means inappropriate allocation of revenue powers and spending responsibilities. This state can be remedied by reassignment of revenue raising powers.The simplest of the many empirical measures of VFI is ‘VFI equals one minus the ratio of the State’s own revenue to own expenditure’. If this VFI ratio is zero, the States have enough own revenue to meet their own expenditure and there is no need for financial transfers.

Goods and Services Tax (GST)

• About:
  • The GST is a harmonised tax on commodities across the country. 
  • Individual States have little power to unilaterally change this tax. 
• Dual Structure:
  • The Union and State governments concurrently levy GST on commodities with 50% as Central GST (CGST) and 50% as State GST (SGST). 
  • There is an Integrated GST (IGST) on inter-State trade, so that 50% of it goes to the final destination State. 

Challenges

• Disparity Amongst Centre & States:
  • The Union government is endowed with more tax powers than the States, while the States are assigned more expenditure responsibilities than the Union government. 
  • This gives rise to a vertical fiscal imbalance (VFI) between the Union and State governments.
  • The unequal tax base with unequal expenditure requirements between the States creates horizontal fiscal imbalance among the States. 
• Increasing vertical fiscal imbalance (VFI):
  • For the last three Finance Commissions (2005-06 to 2020-21), the VFI ratio shows an increasing trend. 
  • For the latest period of 2015-16 to 2020-21, the ratio was 0.530, which means that only 47% of the States’ own expenditure was financed by their own revenue in that period. 
• Veto for Union Government:
  • The GST Council gives the Union government a veto to thrust its preferences on the States.

Way Ahead

• Reassigning of Tax Powers:
  • The Union government has exclusive power to levy excise duty on petroleum products, and the States have exclusive power to levy excise duty and sales tax on liquor. All other commodities fall under the GST. 
  • The CGST and the excise duty on petroleum products could be assigned to the States so that the entire GST is assigned to the States.
  • There is a need to bring all commodities, including petroleum products, under GST. 
• Harmonisation of GST:
  • The Union government should continue to collect IGST only to settle revenue on a destination basis. 
  • This will ensure harmonisation of GST across States. GST shall continue as a tax determined by the GST Council. 
  • Commodity taxation should be moved to State List II of the Seventh Schedule of the Constitution, with a rider that harmonisation of commodity taxation should be maintained.
• Removing Veto Power of the Union government:
  • The veto power of the Union government should be removed. 
  • Then, the GST Council will truly become a body by the States to settle tax issues among themselves, with the Union government facilitating the arrival of consensus among the States on tax issues. 
  • This may once again require some constitutional amendments. 
• Benefits of Reassignment:
  • The assignment of excise duty on petroleum products to the States will hasten the process of integrating taxes on petroleum products into GST and remove the cascading effects of the current excise duty on petroleum products. 
  • This will reduce the tax potential of the States, but higher buoyancy of GST should compensate for this revenue loss. 
  • The positive aspect of this reassignment of tax will be the increase in the tax revenue of the States. 
  • This will also improve accountability of the States to their people on fiscal matters.
• Addressing horizontal fiscal inequality:

• The Union government should effect equalisation transfers to address the issue of horizontal fiscal inequality. 
• The revenue surplus of the Union government after this tax reassignment should be enough to provide for this equalisation transfer to the States.

National Financial Reporting Authority (NFRA)

In News

Auditors of 1,000 large listed companies in India will have to file transparency reports with the National Financial Reporting Authority (NFRA) in the specified format, from the current financial year

• It will improve the credibility of auditors and boost investor confidence in them.

About National Financial Reporting Authority (NFRA)

• It was constituted in 2018 by the Government of India under Sub Section (1) of section 132 of the Companies Act, 2013.
• Objectives:    To continuously improve the quality of all corporate financial reporting in India.
• Functions and Duties: Recommend accounting and auditing policies and standards to be adopted by companies for approval by the Central Government;
  • Monitor and enforce compliance with accounting standards and auditing standards;
  • Oversee the quality of service of the professions associated with ensuring compliance with such standards and suggest measures for improvement in the quality of service;
  • Perform such other functions and duties as may be necessary or incidental to the aforesaid functions and duties.