UPSC MAINS 2017 GS PAPER IV

UPSC MAINS 2017 GS PAPER IV

India’s rank rises to 100 in World Bank’s doing Business Report, 2018

India’s rank rises to 100 in World Bank’s doing Business Report, 2018
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The World Bank, today released the Doing Business (DB) Report, 2018. The Department of Industrial Policy and Promotion (DIPP) is pleased to announce that India ranks 100 among 190 countries assessed by the Doing Business Team. India has leapt 30 ranks over its rank of 130 in the Doing Business Report 2017.

The DB Report is an assessment of 190 economies and covers 10 indicators which span the lifecycle of a business. The table below provides a comparison of this year’s and last year’s report. India has improved its rank in 6 out of 10 indicators and has moved closer to international best practices (Distance to Frontier score). The credit for this significant improvement is credited to the mantra of “Reform, Perform, Transform” given by the Prime Minister, wherein a strong leadership has provided the political will to carry out comprehensive and complex reforms, supported by a bureaucracy committed to perform. The Government has undertaken an extensive exercise of stakeholder consultations, identification of user needs, government process re-engineering to match Government rules and procedures with user expectations and streamlined them to create a more conducive business environment. An extensive exercise is also undertaken to increase awareness among users about reforms to ensure extensive use of newly created systems.

This edition of the report acknowledges India as a top improver, with an improvement of 30 ranks compared to last year’s report, the highest jump in rank of any country in the DB Report, 2018. India is the only country in South Asia and BRICS economies to feature among most improved economies of the DB Report this year.

2. Major achievements in the World Bank in the Doing Business Report
The important highlights of India’s performance are:

1. Resolving Insolvency -

a. Rank improved from 136 to 103

b. Distance to Frontier (DTF) score improved from 32.75 to 40.75

c. Strength of insolvency framework index increased from 6 to 8.5

d. Insolvency & Bankruptcy Code created for efficient handling of restructuring & insolvency proceedings

e. Professional institutes set up for handling restructuring & insolvency proceedings

2. Paying Taxes -

a. Rank improved from 172 to 119

b. DTF score improved from 46.58 to 66.06

c. Payments reduced from 25 to 13 in a year

d. Time reduced from 241 to 214 hours

e. Total tax rate reduced from 60.6% to 55.3% (% of profit)

f. Post filing index improved from 4.3 to 49.31

g. Enabled electronic registration, return & payment of ESI & EPF contributions

3. Getting Credit –

a. Rank improved from 44 to 29

b. DTF score improved from 65 to 75

c. Strength of legal rights index improved from 6 to 8

d. Credit bureau coverage increased from 21.4% to 43.5% (% of adults)

e. Increased coverage of security interest registration under SARFAESI Act

f. Secured creditors prioritized over Government dues for purposes of recovery

4. Enforcing Contracts -

a. Rank improved from 172 to 164

b. DTF score improved from 35.19 to 40.76

c. Cost reduced from 39.6% to 31% (% of claim)

d. Quality of judicial process index improved from 9 to 10.3

e. Dedicated commercial courts established

f. National Judicial Data Grid (NJDG) to monitor and manage court cases

5. Protecting Minority Investors –

a. Rank improved from 13 to 4

b. DTF score improved from 73.33 to 80

c. Strength of minority investor protection index increased from 7.3 to 8

d. Extent of conflict of interest regulation index increased from 6.7 to 7.3

e. Extent of shareholder governance index increased from 8 to 8.7

f. Greater transparency requirements for interested parties transactions

g. Greater shareholder protection through action against directors & claims for damages

6. Construction Permits -

a. Rank improved from 185 to 181

b. DTF score improved from 32.83 to 38.80

c. Procedures to obtain construction permits reduced from 35.1 to 30.1

d. Time reduced from 190.0 to 143.9 days

e. Cost reduced from 25.9 per cent to 23.2 per cent of warehouse value

Indian Air force contingent leaves for Israel to Participate in ‘Ex Blue Flag-17’

पहली बार इजरायल में संयुक्त युद्धाभ्यास 'ब्लू फ्लैग' में शामिल होगी भारतीय वायु सेना
Indian Air force contingent leaves for Israel to Participate in ‘Ex Blue Flag-17’
#blueflag17
A 45 member contingent of the Indian Air Force left for Israel today to participate in exercise ‘Blue Flag-17’. Blue Flag is a bi-annual multilateral exercise which aims to strengthen military cooperation amongst participating nations. Indian Air Force is participating with the C-130J special operations aircraft along with Garud commandos. The exercise would provide a platform for sharing of knowledge, combat experience and in improving operational capability of the participating nations. The exercise is being conducted at Uvda Air Force Base in Israel from 02-16 Nov 17. The team consists of personnel from various combat elements of the IAF and is led by Gp Capt Maluk Singh VSM.

This is the first time the Indian Air Force is operating with Israeli AF in a multilateral exercise setting. Exercise Blue Flag gives opportunity to the IAF to share and learn best practices with some of the best professionals from other Air Forces.

भारतीय वायु सेना ने इजरायल में होने वाले संंयुक्त युद्धाभ्यास में भाग लेने के लिए C-130J सुपर हरक्यूलिस एयरक्राफ्ट समेत अपना 45 सदस्यीय दस्ता मंगलवार को रवाना किया। भारतीय दस्ते में गरुड़ कमांडो भी शामिल हैं। भारतीय दस्ता यहां 2 से 16 नवंबर तक होने वाले बहुपक्षीय युद्धाभ्यास 'ब्लू फ्लैग-17' में भाग लेगा।
इजरायल के उवादा में होने वाले इस युद्धाभ्यास में भारत और इजरायल के अलावा अमेरिका, फ्रांस, जर्मनी, इटली, यूनान और पोलैंड भी हिस्सा लेंगे। यह पहली बार है जब भारत ने इजरायल में किसी युद्धाभ्यास में भाग लेने के लिए अपनी सैन्य टुकड़ी भेजी हो। पीएम नरेंद्र मोदी की इस साल हुए इजरायल दौरे के बाद यह टुकड़ी अभ्यास के लिए गई है।

एक अधिकारी ने बताया कि ब्लू फ्लैग एक बहुपक्षीय युद्धाभ्यास है। इसके जरिए इसमें हिस्सा लेने वाले देशों के बीच सैन्य सहयोग मजबूत करने का लक्ष्य होता है। उवादा एयर फोर्स बेस पर होने वाले इस अभ्यास में युद्ध कला की बारीकियां सीखने को मिलेंगी।

उन्होंने बताया, 'पहली भारतीय वायु सेना इजरायली वायु सेना के साथ बहुपक्षीय युद्धाभ्यास में भाग लेगी। इस युद्धाभ्यास में हमें दुनिया की बेहतरीन सेनाओं के साथ अनुभव साझा करने और सीखने का मौका मिलेगा।'

India falls to 108 on World Economic Forum’s gender gap index

India falls to 108 on World Economic Forum’s gender gap index
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The World Economic Forum’s Global Gender Gap report says at current rates, it will take 100 years before women achieve equality in the four areas measured by it
If it seems women’s progress has stalled lately, new data from the World Economic Forum puts a finer point on it: The gap between the achievements and well-being of men and women widened in the past year, the first time that’s happened in the 11 years that the group has issued its annual Global Gender Gap Report.

At current rates, it will take 100 years before women achieve equality in the four areas measured by the WEF: political empowerment, economic participation, health and education. When the Geneva-based group did its study last year, it estimated it would take 83 years to close the gap.

“It was a disappointing year,” said Saadia Zahidi, head of education, gender and work at the WEF. The global backsliding reflects a general slowing of progress in the world’s larger economies.

The US fell to 49th among the 144 countries ranked, down from 45th last year and 23rd just 11 years ago. The country is only 77% of the way to gender parity in economic opportunity, a gap that’s been narrowing, but not as quickly as in other countries.

Political imbalance

In politics, women make up less than 20% of Congress and just 17% of President Donald Trump’s cabinet, an imbalance that the WEF says puts the country just 12% of the way to political equality. Women in the US do find parity with men in educational attainment and get close on metrics of health and survival.

India, which sank to No. 108 overall, down 10 places from 2006, was the reverse of the US, with high rankings for women’s political empowerment but near the bottom in health, education and economic participation. Economics is a particular area of concern, Zahidi said, because women do a disproportionate amount of unpaid work, like childcare.

Ranked 100 overall, China was No. 144—dead last—for gender parity when it came to women’s health. One metric was life expectancy: Chinese women outlive men by less than two years on average, compared with a global average of five years. While about 70 percent of Chinese women participate in the work force, they earn only 64% of men’s wages.

Progress signs

The news isn’t all bleak: Countries at the top of the list are continuing to make progress. Women in No. 1 ranked Iceland, for instance, may soon be equal to men in their contribution to the national economy. “That’s a message the world needs to absorb,” Zahidi said. She also cited governments in France and Canada for naming gender-balanced cabinets recently.

The WEF collaborated with LinkedIn to delve more deeply into economic data in selected countries, with a focus on gender imbalance by industry. It found that while women’s numbers have increased in most industries, they are not at parity in leadership in any of them—even in fields such as education, where women make up the majority of employees.

In fact, hiring of women hasn’t increased along with the number of women earning appropriate degrees in areas such as information technology and manufacturing. A large proportion of women are choosing not to go into those fields, Zahidi said, adding that retention of the women who do go into a field is also an issue.

“Gender equality has to be looked at in a holistic way,” Zahidi said. “Just making progress in one area isn’t enough.

.................................

What is the gender gap (and why is it getting wider)?

The world is being deprived of a huge untapped resource.

So says Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, at the launch of its Global Gender Gap Report 2017.

And despite the slow but steady progress made towards gender equality over the past decade, 2017 was not a success.

In fact, the gap between men and women across health, education, politics and economics widened for the first time since records began in 2006.

“Overcoming the biases – unseen or otherwise – that are keeping us from closing the gender gap represents an overwhelming economic as well as moral imperative,” Professor Schwab said.

What is the gender gap?

Image: WEF Global Gender Gap Index
The gender gap is the difference between women and men as reflected in social, political, intellectual, cultural, or economic attainments or attitudes.

The Global Gender Gap Index aims to measure this gap in four key areas: health, education, economics and politics.

So the gap in economics, for example, is the difference between men and women when it comes to salaries, the number of leaders and participation in the workplace.

Since the report measures these differences irrespective of overall income levels, some relatively poor countries can perform well on the index.

Both Rwanda and Nicaragua are found in the top 10, for example, showing how these countries distribute their resources and opportunities relatively well.

But there is a notable absence of any of the world’s leading industrialized nations – the so-called G20 – within the top 10, showing that economic power is not necessarily a recipe for better equality between the sexes.

Iceland has been the world’s most gender-equal country for nine years, forming part of a trend for Nordic countries to perform especially well.

But Pakistan, Yemen, Iran, Saudi Arabia and Syria all landed in the bottom 10 out of the 144 countries scrutinized.

On average, the 144 countries in the report have nearly closed the gap in health outcomes and educational attainment.

But the gap is still wide open in political and economic participation.
Countries need to pay attention to the gender gap not only because such inequality is inherently unfair.

But also because numerous studies suggest greater gender equality leads to better economic performance.

The report quotes recent estimates that suggest economic gender parity could add an additional $250 billion to the GDP of the UK, $1,750 billion to that of the US and $2.5 trillion to China’s GDP.

At the current rate of progress the overall global gender gap will take a hundred years to close, while the gap in the workplace will now not be closed for 217 years.

It is a gap the world can’t afford to ignore

Reforms are paying off, now up the ante

Reforms are paying off, now up the ante
The ease of doing business rankings may not be the sole determinant for attracting investment, but the improvement is likely to boost investor confidence as it reflects the government’s commitment to reforms
The Narendra Modi government had plenty of reasons to be pleased with the latest edition of the World Bank’s Doing Business (DB) report. India jumped 30 notches in the rankings to reach the 100th position. It was one of the top 10 improvers in this year’s rankings and has implemented reforms in eight out of 10 doing business indicators tracked by the World Bank. Not only has India improved its position in terms of rankings, which is relative, it has also made improvement in absolute terms, measured by the so-called “distance to frontier” metric.

The improvement in rankings is the result of coordinated efforts made by the government over the past few years. It is aiming to break into the top 50. According to the World Bank, India has adopted 37 reforms since 2003 and about half of them have been implemented in the last four years. In this year’s rankings, India has shown improvement in areas such as paying taxes, dealing with construction permits and resolving insolvency.

One indicator that deserves special mention is the protection of minority investors. India is at the fourth position globally in this category. This is a huge achievement and the government and the securities market regulator deserve credit. What is encouraging is that the Securities and Exchange Board of India is constantly working to enhance investor confidence. Implementation of the recommendations made by the Uday Kotak committee on corporate governance will further augment minority shareholder confidence in the market. The implementation of the bankruptcy code is a big boost, as it will help inefficient firms exit the market and improve overall allocation of capital. The implementation of the goods and services tax (GST) has not been accounted for in this year’s rankings. Therefore, if the teething problems are addressed quickly, it is likely that the GST will help boost India’s ranking further next year.

While the government deserves credit for this impressive improvement in the DB rankings, it should not lose sight of the distance India still needs to cover. For instance, despite all the effort, India’s rank in dealing with construction permits is 181 among 190 countries. The time taken for enforcing a contract has, in fact, worsened from what it was 15 years ago. Consequently, India’s rank in this category is a poor 164.

To be sure, the scope and coverage of the DB survey has limitations and the government needs to work on a much broader canvas to be able to actually encourage investment. Also, as Matthew Lillehaugen and Milan Vaishnav argued in these pages recently (goo.gl/MzsFZV), a wide divergence exists between de jure and de facto realities in most economies. What firms face on the ground is often very different from what is written in the rule book.

While the DB survey takes inputs from professionals, a recent report by NITI Aayog and the IDFC Institute—based on a survey of over 3,000 enterprises—gives an idea of the kind of challenges that policymakers need to address. For instance, it shows that just about 20% of start-ups reported using the single-window facility for setting up a business, and only about 41% of the experts knew about the facility. Further, the survey finds that labour- intensive sectors are constrained by labour market regulations. They also reported that finding skilled workers and dismissing employees are severe impediments. Interestingly, while India ranks 29 in getting electricity in the DB rankings, firms still face power shortages. The NITI Aayog and IDFC Institute report notes that on average, firms face power shortage of around 46 hours in a month. So, what this means is that both the Central and state governments will need to work in a number of areas to improve India’s competitiveness.

Even though the DB rankings may not be the sole determinant for attracting investment, the improvement is likely to boost investor confidence as it reflects the government’s commitment to reforms. At a broader level, a number of things are now falling in place for India and should help augment growth in the medium term. India now enjoys a significant level of macroeconomic stability; the government has taken a decisive step to sufficiently recapitalize public sector banks, and is implementing reforms to improve the business climate. With its demographics, the size of the economy and a well-functioning capital market, India stands a real chance of projecting itself as a preferred destination for investments. The fact that China is likely to slow down further in coming years will also help India’s case.

Therefore, policymakers would do well to build on recent gains with an accelerated pace of reforms in areas such as land, labour and contract enforcement, which will help push investment and growth in the medium to long run.

Will improvement in ‘Doing Business’ rankings help attract investments

FSSAI plans ‘one nation, one food safety law’

FSSAI plans ‘one nation, one food safety law’
Food safety regulator FSSAI seeks to standardize surveillance, sampling, inspection and testing across states to increase transparency
The concept of ‘one-nation, one-tax’ behind the goods and services tax (GST) implemented across the country seems to be influencing other organisations. The Food Safety and Standards Authority of India (FSSAI), the country’s apex food regulator, is working on a ‘one-nation, one-food-safety-law’ so that every state-level food authority follows a standard practice for the implementation, compliance and surveillance of food safety regulations, which in turn will ensure smoother operations for food companies.

“The law has always been same for everyone. But there have been consistency issues at state level. Also, we need to standardize food testing laboratories. With ‘one-nation, one-food-safety-law’, we will be able to remove those and make things more transparent,” said Pawan Kumar Agarwal, chief executive officer, FSSAI.

Under the ‘one-nation, one food-safety-law’ regime, state-level food safety officers will have to follow a 10-point code-of-ethics set by FSSAI. “At present, there is no such thing, and food safety officers across states do things the way they think best. This should not be the practice. We need to standardize this,” said Agarwal.

Under the regime, FSSAI wants to erase discrepancies in food safety regulations across states, and standardize surveillance, sampling and inspection. “This is to enable states with good practices,” said Agarwal. Under the new regime, inspection and sampling will be monitored as everything will be “on the cloud” as part of the agenda to increase transparency, he added.

To bring consistency in food testing, FSSAI is introducing guidelines that food testing laboratories will have to abide by. Under the draft norms, laboratories will have to come under the Indian Food Laboratory Network (InFoLNet), a digital solution to connect all food labs in India to a centralised lab management system.

So far, 154 laboratories have listed on InFoLNet. FSSAI has made this compulsory for all FSSAI-notified laboratories. With this, details of all tests and the results will be available on this platform.

“In the past, there have been questions regarding authenticity of tests done by certain laboratories. Besides upgrading the laboratories, InFoLNet will abolish the discrepancies and ensure transparency,” said Agarwal.

The regulator, which owns and operates two laboratories and has approved 82 others in various states, allocated Rs482 crore earlier this year to strengthen the food testing infrastructure, including upgrading and modernizing laboratories. Besides, FSSAI will also set up 62 mobile testing labs. There are currently four mobile food testing labs in Punjab, Gujarat, Kerala and Tamil Nadu.

In 2015, FSSAI questioned safety standards of Swiss packaged food company Nestle India Ltd’s Maggi instant noodles based on reports by one of its testing laboratories in Kolkata, prompting questions about the capacity and state of the laboratory.

Under the new regime, the food regulator also wants to abolish intervention of multiple agencies for things such as import of food products. Going forward, there will be a single standard for every authority.

Rashtriya Krishi Vikas Yojana (RKVY) as RKVY-RAFTAAR (Remunerative Approaches for Agriculture and Allied sector Rejuvenation)

Rashtriya Krishi Vikas Yojana (RKVY) as RKVY-RAFTAAR (Remunerative Approaches for Agriculture and Allied sector Rejuvenation)

The RKVY was launched during 2007-08 to achieve 4% annual growth in farm sector by ensuring a holistic development as per a resolution of the National Development Council (NDC). The Centre had allocated Rs 25,000 crore for this scheme during 11th plan period (2007-12) and Rs 63,246 crore during 12th plan period (2012-17).
The scheme is being implemented as a 'special additional central assistance' scheme to incentivise states to draw up comprehensive plans taking into account agro-climatic conditions and natural resources for ensuring more inclusive and integrated development of agriculture and allied sectors.
It has, at present, six sub-schemes including spreading green revolution to eastern India, initiative on vegetable clusters, national mission for protein supplements, saffron mission (economic revival of J&K saffron), crop diversification and Vidarbha intensive irrigation development programme.

Cabinet allocates Rs15,722 crore for next three years under revamped agricultural scheme
The Union government on Wednesday earmarked fresh funds for an agricultural programme designed to enable farmers to produce and sell crops which net better remuneration.

The government has already committed itself to doubling farm income by 2022.

The Union cabinet renamed the Rashtriya Krishi Vikas Yojana (RKVY) as RKVY-RAFTAAR (Remunerative Approaches for Agriculture and Allied sector Rejuvenation) with an allocation of Rs15,722 crore for the next three years.

“(It has been done) with the objective of making farming a remunerative economic activity through strengthening the farmer’s effort, risk mitigation and promoting agri-business entrepreneurship,” said an official statement.

According to an official of the agriculture ministry who did not want to be identified, the scheme has been structured such that states will be incentivized to link farmers to the market and also produce more value added crops.

The officer added that for the first time the scheme has earmarked 8% of its budget for innovation, incubation and development of agri-enterprises.

The RKVY-RAFTAAR funds would be provided in the ratio of 60:40 to all states except for North-East and Himalayan states which will get 90:10 grant. For 2017-18, the scheme has been allocated Rs4,750 crore.

Under the revamped scheme, which was launched in 2007 to achieve an agricultural growth rate of 4% annually, the government said about 70% of the annual outlay will be provided for setting up infrastructure, assets and value addition while 20% of the outlay will be for special sub-schemes of national priority.

The Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) has been making efforts to reach out to farmers and strengthen its voter base in rural areas for political gains. The recently concluded assembly polls of Uttar Pradesh had witnessed strong support of farmers and rural population in favour of BJP enabling the party to return to power in the state after a gap of 15 years.

In the last few months, BJP-ruled states such as Uttar Pradesh and Maharashtra have announced farm loan waivers to fulfil electoral promises, reduce farm distress and aid rural consumption. And last year, the government had revamped the crop insurance scheme to help mitigate growing risks in Indian farming as farmers diversified into more value-added produce like cash crops.

Separately, the cabinet on Wednesday also gave ex-post facto clearance to implementation of the Special Banking Arrangement (SBA) of Rs10,000 crore for payment of outstanding claims towards fertiliser subsidy in 2016-17. The cabinet also approved to amend the National Council for Teacher Education (NCTE) Act to grant one-time retrospective recognition to the central and state universities who are running teacher education courses without NCTE permission.