AMIGOS IAS Daily Current Affairs (18^th July 2024)

Terror upswing in Jammu – the path to counter Pak’s proxy war

GS 3: Internal Security – Proxy war

Why is it in the news?

• The recent surge in terrorist encounters in Jammu, resulting in numerous casualties among Indian security forces, raises questions about the Army’s effectiveness.
• Pakistan’s renewed focus on Jammu, exploiting its terrain for terrorist activities, marks a strategic shift post-August 5, 2019, aimed at maintaining its relevance and disrupting upcoming assembly elections.

More about the news

• Jammu’s geography, with its jungles and rocky terrain near the Line of Control (LoC) and the international border (IB), provides ideal hideouts for terrorists.
• Unlike Kashmir, where urban and village hideouts have become difficult to sustain, Jammu offers favourable conditions for infiltration and return. Historical instances like the Hilkaka hideouts in 2003 illustrate these challenges.
• Therefore, a comprehensive counter-strategy is essential.

1) Diplomatically:

• India must highlight the risks of reigniting a proxy war to Pakistan and the international community, asserting that conventional conflict initiation will hold Pakistan accountable.
• The influential international powers must pressure Pakistan’s leadership, leveraging India’s enhanced global stature.

2) Politically:

• Successful Lok Sabha elections in the Valley demonstrate the need for early assembly elections to integrate J&K. Despite security concerns, historical precedents show elections can be conducted under challenging conditions, enhancing India’s democratic image.

3) Militarily:

• A significant operation is needed to turn around the security situation. Proper orientation of troops, a comprehensive “sweep and churn” operation in Pir Panjal South, and utilizing technology and intelligence capabilities are crucial.
• Moreover, the media should exercise restraint, avoiding pressure on the government or the Army.
• Hence, counter-proxy war efforts require patience, acknowledging that setbacks and successes are both part of the process.

Additional Information:

• Proxy War: Pakistan has employed a strategy of proxy war in Jammu & Kashmir. This involves supporting and sponsoring militant groups within Indian Administered Jammu & Kashmir to wage an insurgency against Indian rule, rather than engaging in direct military conflict with India.
• Historical Background: After the 1947-1949 Indo-Pakistani conflict over Jammu & Kashmir, Pakistan unable to achieve its territorial claims through conventional warfare, resorted to supporting local and foreign militants to undermine Indian control, initiating a proxy war in the region.

Modus Operandi of the Proxy War in J&K:

• To run a malicious campaign from Pakistan and PoK to mar India’s image in print and electronic media
• To facilitate infiltration of terrorists from across the border and keep Indian security forces constantly engaged in fighting terrorists
• To attack the secular foundation of the state and support fundamentalist Islamic activities and ensure exodus of Hindus from the Valley
• To Internationalise the Kashmir issue at every forum and paint India as persecutor of Muslims
• To increase terrorist activities in Muslim dominated districts of Jammu region
• To change the low intensity war to high intensity war at an appropriate strategic time and term it as war of independence.

PM’s Vision For ‘Naya Kashmir’: Ending Pakistan’s Proxy War

• Situations in Naya Kashmir:
• Shift in Public Sentiment:
• Since 1989, Pakistan has sought to destabilize Jammu and Kashmir (J&K) with external backing, fostering sentiments like “Kashmir banega Pakistan.”
• Post Article 370 abrogation, there’s been a shift in India with the slogan “PoJK banega Hindustan,” yet a dual mindset in Kashmir persists, requiring gradual neutralization.
• WHAM Policy Implementation: The Indian Government’s strategy now prioritizes non-military approaches, focusing on “winning hearts and minds” (WHAM) through visible development programs, youth, and women empowerment initiatives.
• Civilian-Centric Governance: Reduced military presence has normalized civilian administration, bolstering socio-economic outreach and development projects that instil hope among Kashmiris, reflecting an integrated governmental approach.
• Economic Development as Stabilizer: Direct governance from Delhi via a Lieutenant Governor has enhanced economic growth, acting as a force multiplier in the region’s stabilization efforts.
• Integrated Military Outreach: The Indian Army’s outreach initiatives have been effectively integrated into broader governance strategies, leveraging their experience to support stability and development in Jammu and Kashmir.

IMF’s World Economic Outlook update for India: Holding Steady

GS 3: Economy: IMF’s Economic outlook

Why is it in the news?

• The International Monetary Fund (IMF) has revised its forecast for India’s economic growth to 7 percent in 2024, a 0.2 percentage point increase from its earlier assessment. This reflects improved prospects for private consumption, especially in rural areas.
• Other agencies like the Asian Development Bank (ADB) and the Reserve Bank of India (RBI) have similar growth projections, indicating a healthy underlying economic momentum.

More about the news

• Global Growth Forecasts: The IMF projects stable growth rates of 3.2 percent in 2024 and 3.3 percent in 2025.
• While it has raised growth forecasts for Spain and France among developed economies, it has lowered expectations for Japan, the Middle East, Central Asia, and parts of Latin America, but increased prospects for China and India.
• Inflation remains a global concern, slowing progress on disinflation and raising the prospect of prolonged higher interest rates.
• The US Federal Reserve and the European Central Bank are taking cautious stances, waiting for more favourable macroeconomic data before making further rate changes.
• Findings Related to India:
• India’s GDP growth forecast for FY2024-25 to 7 percent, up by 20 basis points from its earlier projection of 6.8 percent in April.
• For the year 2025, the IMF projected India’s growth rate at 6.5 percent, citing strong domestic demand and an increasing working-age population as key factors driving the projections.
• In India, despite some calls for rate cuts, uncertainty over inflation, especially food prices, makes immediate policy changes unlikely.

Additional Information:

About International Monetary Fund (IMF):

• It was set up in 1945 along with the World Bank out of the Bretton Woods conference. Hence, they are known as the Bretton Woods twins.
• The IMF is a global organization primarily dedicated to fostering economic growth, ensuring financial stability, promoting international trade, and combating poverty worldwide.
• In addition to its primary role, the IMF also conducts economic research, monitors global economic trends, and provides technical assistance to help countries enhance their macroeconomic policies and institutions.
• Reports by IMF:
• Global Financial Stability Report.
• Fiscal Monitor
• World Economic Outlook.
• Publication Schedule: Published biannually in April and October for comprehensive reports, followed by less detailed updates in July and January.
• Data include: It provides member countries’ economic data and analyses global economic trends and developments in both the near and medium term.

UPSC Civil Services Examination, Previous Year Question (PYQ)

Prelims:

Q. “Rapid Financing Instrument” and “Rapid Credit Facility” are related to the provisions of lending by which one of the following? (UPSC 2022)

(a) Asian Development Bank

(b) International Monetary Fund

(c) United Nations Environment Programme Finance Initiative

(d) World Bank

Answer: B

Q. “Gold Tranche” (Reserve Tranche) refers to (UPSC 2020)

(a) a loan system of the World Bank

(b) one of the operations of a Central Bank

(c) a credit system granted by WTO to its members

(d) a credit system granted by IMF to its members

Answer: D

Q. ‘Global Financial Stability Report’ is prepared by the (UPSC 2016)

(a) European Central Bank

(b) International Monetary Fund

(c) International Bank for Reconstruction and Development

(d) Organization for Economic Cooperation and Development

Answer: B

Mains:

Q. The World Bank and the IMF, collectively known as the Bretton Woods Institutions, are the two inter-governmental pillars supporting the structure of the world’s economic and financial order. Superficially, the World Bank and the IMF exhibit many common characteristics, yet their role, functions and mandate are distinctly different. Elucidate. (UPSC 2013)

Arguments against Karnataka’s Bill on Quota for Locals in the Private Sector

GS 2: Polity and Governance: Karnataka’s bill on local reservation

Why is it in the news?

• The Karnataka government has approved a Bill requiring industries, factories, and other establishments to appoint 50 percent of local candidates in management categories and 75 percent in non-management categories.

More about the news

• The Bill, known as the Karnataka State Employment of Local Candidates in the Industries, Factories, and Other Establishments Bill, 2024, mandates that if qualified local candidates are unavailable, firms must train and engage local candidates within three years.
• Similar laws have been enacted in states like Andhra Pradesh and Haryana.
• However, these laws discriminate among Indians, as demonstrated by the Punjab and Haryana High Court’s decision to strike down a similar law in November last year, citing a violation of constitutional morality and curtailing the fundamental rights of citizens from other states to earn a livelihood.
• While the political motivation for such laws stems from widespread unemployment and the desire of state governments to secure the interests of local voters, there are several reasons why this approach is flawed.

1) Firstly, the proposed law discriminates against citizens by restricting their constitutionally protected freedom to move freely across India and earn a livelihood.

2) Secondly, it could reintroduce the inspector-raj, empowering bureaucrats to decide whether a firm should face penalties for employing people from outside the state, leading to potential rent-seeking behaviours.

3) Lastly, and often overlooked, is the negative impact on the private sector. Governments in India cannot create enough jobs for the youth, so the solution lies in enabling the private sector to grow and create jobs. This law would increase compliance costs for private firms, undermine their ability to attract the best talent, and reduce overall efficiency and profitability.

• Hence, such restrictive quotas could significantly harm the economic dynamism of cities like Gurugram and Bengaluru, which thrive due to their open economies.

Karnataka halts jobs Bill as industry raises uproar

• The Karnataka government has halted a draft Bill that proposed job reservations for locals in the private sector after facing significant backlash from industry leaders and trade bodies.
• Chief Minister Siddaramaiah announced the decision, indicating that the Bill is still in its early stages and will undergo further review following widespread discussions.
• The announcement came after the Cabinet’s approval of the Bill on July 15, which drew opposition primarily from industry figures like Kiran Mazumdar-Shaw and Mohandas Pai, as well as industry associations such as NASSCOM and FKCCI.
• These stakeholders expressed concerns about potential impacts on skilled talent recruitment and the state’s competitive position, particularly in the technology sector.
• While Kannada organizations welcomed the initiative, industry leaders stressed the need for exemptions for highly skilled roles to preserve Karnataka’s status as a technology hub.

The State of India’s Informal Economy

GS 3: Economy: Economic output and Employment

Why is it in the news?

• Recent surveys by the National Sample Survey Office (NSSO) reveal the current state of India’s informal sector, which includes small and medium enterprises, as well as household proprietary and partnership establishments.
• This informal sector accounts for nearly half of India’s economic output and over three-quarters of employment.
• However, data from the Annual Survey of Unincorporated Enterprises (ASUSE) indicates significant challenges, with many units shutting down and a loss of approximately 16.45 lakh jobs over the last seven years.
• Further, the 2021-22 and 2022-23 surveys highlight the impact of demonetization (2016), the rollout of GST (2017), and the Covid-19 pandemic (2020) on the economy.

More about the news

• Unincorporated enterprises, which comprise Ministry of Micro, Small and Medium Enterprises (MSMEs), household units, and own-account enterprises, were surveyed across manufacturing, trade, and other services.
• These surveys excluded units covered under the Factories Act, 1948, but included informal establishments involved in activities such as cotton-ginning and bidi manufacturing.
• Data shows a decrease in informal sector employment, even though the number of enterprises increased. Own-account enterprises grew by nearly 4% over seven years, while hired-worker enterprises contracted by 3.2%, reflecting a deterioration in employment quality and a shift towards self-owned units.

• This trend aligns with the Periodic Labour Force Survey (PLFS), which shows an increase in agricultural employment and a decrease in manufacturing employment.
• The informal sector witnessed a drop in workers from 11.13 crore in 2015-16 to 10.96 crore in 2022-23. Manufacturing units saw a 9.3% decline, and the number of workers fell by 15%. Trade sector units contracted by 2%, with a marginal increase in workers.
• In contrast, the services sector recorded significant growth in both units and workers. Despite these increases, the overall growth rate was slower compared to the period between 2010-11 and 2015-16.
• In terms of output, the Gross Value Added (GVA) per enterprise and per worker increased at current prices, but real-term growth was slower.
• The real GVA of unincorporated sector enterprises grew by 6.9% in 2022-23, still below pre-pandemic levels. This slow growth contrasts with the 7.4% compounded annual growth rate (CAGR) observed from 2010-11 to 2015-16, which has since contracted by 0.2%.
• Employment patterns across states reveal that 16 out of 34 states and Union Territories recorded a decline in informal sector workers in 2022-23 compared to 2015-16. The share of informal sector workers increased in most states following the pandemic, indicating economic distress and a shift away from the formal sector.
• Data for the top 10 states, which account for almost three-quarters of informal sector workers, show significant variations in employment trends.

Additional Information:

What is Informal Economy?

• According to the OECD, informal jobs are characterized when workers’ employment lacks legal or practical adherence to national labour laws, income taxes, social protections, or entitlements such as advance notice of dismissal, severance pay, and paid leave benefits.
• Informal businesses encompass street vending, artisanal production, home-based enterprises, local transport services, retail shop operations, domestic service, community services like street cleaning and garbage collection, as well as small workshops such as shoe making, garment production, and embroidery.

Government Initiatives to Formalize the Indian Informal Economy:

• PM SVANidhi: Micro Credit Scheme for Street Vendors
• Atmanirbhar Bharat Abhiyan
• Deendayal Antyodaya Yojana National Urban Livelihoods Mission
• PM Garib Kalyan Ann Yojana (PMGKAY)                                                            
• Make in India
• PM Vishwakarma Scheme
• E-Shram Portal
• Labour Codes                         
• Pradhan Mantri Kisan Samman Nidhi
• World Bank Support to India’s Informal Working Class

About National Sample Survey Office:

• The National Sample Survey Office (NSSO) is responsible for conduct of large-scale sample surveys in diverse fields on All India basis.
• Data primarily collected from nationwide household surveys, the Annual Survey of Industries (ASI), and NSSO efforts, which include collecting rural and urban price data and maintaining urban area units for sample surveys.
• On 23rd May 2019, NSSO merged with the Central Statistical Office to form the National Statistical Office (NSO), aimed at improving coordination, overseen by the Ministry of Statistics and Program Implementation (MOSPI).

About Periodical Labour Force Survey (PLFS):

• PLFS, India’s first computer-based survey on labour force data, was launched by the National Statistical Office (NSO).
• Objectives:
• To estimate employment and unemployment indicators such as Worker Population Ratio, Labor Force Participation Rate, and Unemployment Rate every three months specifically for urban areas under the Current Weekly Status (CWS), and
• To annually estimate employment and unemployment indicators under both ‘Usual Status’ (principal status + subsidiary status) and CWS in both rural and urban areas.

On Political Representation of women

GS 2: Polity and Governance: Women reservation in legislature

About the news

• In the recent U.K. general elections, a record 263 women MPs (40%) were elected to the House of Commons. South Africa’s National Assembly has around 45% women representation, and the U.S. House of Representatives has 29%.
• Universal suffrage was achieved worldwide after prolonged political movements, with New Zealand granting it in 1893, the U.K. in 1928, and the U.S. in 1920.

An Analysis

• India granted women the right to vote in its first general elections in 1952. However, women’s representation in the Lok Sabha and State legislative assemblies has been low.
• Until 2004, women MPs in the Lok Sabha were between 5% and 10%, rising marginally to 12% in 2014 and 14% in the 18th Lok Sabha. State Legislative Assemblies fare worse, with a national average of around 9%.
• The 73rd and 74th constitutional amendments in 1992/1993 provided for one-third reservation for women in panchayats and municipalities, but similar reservations in the Lok Sabha and assemblies have been unsuccessful.
• Women’s representation in parliament varies worldwide. Methods to ensure higher representation include voluntary or legislated quotas for candidates within political parties and quotas in parliament through seat reservations.
• Party quotas provide democratic choice and flexibility, while reserved seats in parliament can be seen as undermining merit. Countries with political party quotas often fare better than those with reserved parliamentary seats, as seen in Bangladesh and Pakistan.
• As of April 2024, India ranks 143rd in the ‘Monthly ranking of women in national parliaments’ by the Inter-Parliamentary Union. The Trinamool Congress has the highest proportion of women MPs at 38% in the current Lok Sabha, while the BJP and Congress have around 13% each.
• Naam Tamilar Katchi, a Tamil Nadu party, has maintained a voluntary quota of 50% for women candidates in the last three general elections.
• Despite efforts, voluntary or legislated party quotas have not achieved desired representation in India.
• The 106th constitutional amendment, passed in September 2023, mandates one-third reservation of seats for women in the Lok Sabha and State legislative assemblies. It aims to increase gender sensitivity in parliamentary processes and legislation and hopefully increase the number of women ministers at the Centre and State levels.
• This reservation will be implemented based on the delimitation exercise after the first Census figures are published following the act’s commencement. Therefore, the overdue 2021 Census should be conducted without delay to ensure this reservation is in place for the 2029 general elections.

UPSC Civil Services Examination Mains Previous Year Questions:

Q. What are the continued challenges for Women in India against time and space? (2019)

Q. Discuss the desirability of greater representation to women in the higher judiciary to ensure diversity, equity and inclusiveness. (2021)

The Problems with Sub-Caste Reservations

GS 2: Polity and Governance: Reservations

Why is it in the news?

• The Supreme Court has currently reserved its decision on sub-caste reservations for SC/STs, prompting a scrutiny not only on legal grounds but also on academic validity.

An Analysis

• Dr. B.R. Ambedkar originally advocated three main policy instruments to address the historical injustices faced by Dalits: legal safeguards against caste discrimination, reservations in education, public jobs, and legislatures, and measures to enhance ownership of capital assets such as land and businesses.
• Ambedkar’s rationale centred on the collective social and economic exclusion faced by Dalits as a whole due to untouchability, rather than specific sub-castes. He emphasized that these measures—legal safeguards, reservations, and economic empowerment—were intended to complement each other rather than act as standalone solutions.
• While legal safeguards were crucial to securing present rights, reservations were proposed to supplement legal measures by ensuring equitable representation. Moreover, Ambedkar highlighted the limitations of these measures in addressing the historical denial of property rights, employment, and education to Dalits.
• Thus, he advocated for economic empowerment as a necessary third pillar, aimed at improving the economic capabilities and educational opportunities of Dalit individuals lacking income-generating assets.
• Supporters of sub-caste reservations argue that some sub-castes within the SC/ST community have not equally benefited from general reservations, often due to disparities in educational attainment and economic resources. They contend that specific sub-caste quotas are necessary to rectify these inequalities and ensure fair representation.
• However, critics, including Sukhadeo Thorat, caution that sub-caste reservations may not effectively address these disparities if they are implemented without addressing underlying economic and educational deficits.
• They argue that improving access to education and economic resources among disadvantaged sub-castes would better equip individuals to compete for jobs and educational opportunities under existing reservation policies.
• Thorat suggests that focusing on individual economic and educational empowerment, as originally proposed by Ambedkar, could provide a more effective alternative to sub-caste reservations. This approach, he argues, would enhance the capabilities of disadvantaged individuals to benefit from existing reservation policies, thereby reducing dependence on sub-caste-specific quotas.

Conclusion

• While the debate on sub-caste reservations continues, understanding the socio-economic realities and ensuring effective implementation of existing policies remains critical to addressing the complex challenges faced by Dalit communities in India.

Additional Information:

Judicial Pronouncements on Reservation in India:

• Indra Sawhney & Others v. Union of India (1992): Established a 50% cap on reservations under Article 16(4) with exceptions requiring extreme caution; introduced the concept of ‘creamy layer’ who must be excluded from the benefits of reservations.
• M. Nagaraj v. Union of India (2006): Imposed conditions for reservations in promotions, including quantifiable backwardness data, inadequate representation evidence, and administrative efficiency justification.
• Jarnail Singh & Ors. v. Lachhmi Narain Gupta & Ors. (2018): Removed the need for quantifiable data on backwardness for SCs and STs in promotions.
• Janhit Abhiyan v. Union of India (2022): Upheld the 103rd Constitution Amendment Act, introducing reservations for Economically Weaker Sections (EWS) based on economic criteria.