General Studies Paper -3 

Context: The Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman presented the Union Budget 2024-25 in Parliament.

About

• Budget Estimates of 2024-25 are
• Total receipts other than borrowings: `32.07 lakh crore.
• Total expenditure: `48.21 lakh crore.
• Net tax receipt: `25.83 lakh crore.
• Fiscal deficit: 4.9 percent of GDP.
• Government aims to reach a deficit below 4.5 percent next year.
• Inflation continues to be low, stable and moving towards the 4% target; Core inflation (non-food, non-fuel) at 3.1%.
• The focus of the budget is on Employment, Skilling, MSMEs, and the Middle

Package of PM’s five schemes for Employment and Skilling

• Prime Minister’s Package of 5 Schemes and Initiatives for employment, skilling and other opportunities for 4.1 crore youth over a 5-year period.
  • Scheme A – First Timers: One-month salary of up to `15,000 to be provided in 3 installments to first-time employees, as registered in the EPFO.
  • Scheme B – Job Creation in manufacturing: Incentive to be provided at specified scale directly, both employee and employer, with respect to their EPFO contribution in the first 4 years of employment.
  • Scheme C – Support to employers: Government to reimburse up to `3,000 per month for 2 years towards EPFO contribution of employers, for each additional employee.
  • New centrally sponsored scheme for Skilling: 20 lakh youth to be skilled over a 5-year period and 1,000 Industrial Training Institutes to be upgraded in hub and spoke arrangements.
  • New Scheme for Internship in 500 Top Companies to 1 crore youth in 5 years.

Nine Budget Priorities in pursuit of ‘Viksit Bharat’

• Productivity and resilience in Agriculture
• Employment & Skilling
• Inclusive Human Resource Development and Social Justice
• Manufacturing & Services
• Urban Development
• Energy Security
• Infrastructure
• Innovation, Research & Development and
• Next Generation Reforms

Priority 1: Productivity and resilience in Agriculture

• Allocation of 52 lakh crore for agriculture and allied sectors.
• New 109 high-yielding and climate-resilient varieties of 32 field and horticulture crops to be released for cultivation by farmers.
• 10,000 need-based bio-input resource centres to be established for natural farming.
• Digital Public Infrastructure (DPI) for Agriculture to be implemented for coverage of farmers and their lands in 3 years.

Priority 2: Employment & Skilling

• As part of the Prime Minister’s package, 3 schemes for ‘Employment Linked Incentive’ to be implemented – Scheme A – First Timers; Scheme B – Job Creation in manufacturing; Scheme C – Support to employers.
• To facilitate higher participation of women in the workforce;
  • Working women hostels and crèches to be established with industrial collaboration
  • Women-specific skilling programmes to be organized
  • Market access for women SHG enterprises to be promoted.
• Skill Development: New centrally sponsored scheme for Skilling under Prime Minister’s Package for 20 lakh youth over a 5-year period.
  • Model Skill Loan Scheme to be revised to facilitate loans up to 7.5 lakh.
  • Financial support for loans upto `10 lakh for higher education in domestic institutions to be provided to youth who have not been eligible for any benefit under government schemes and policies.

Priority 3: Inclusive Human Resource Development and Social Justice

• Purvodaya: Industrial node at Gaya to be developed along the Amritsar-Kolkata Industrial Corridor.
  • Power projects, including a new 2400 MW power plant at Pirpainti, to be taken up at a cost of `21,400 crore.
• Andhra Pradesh Reorganization Act: Special financial support through multilateral development agencies of `15,000 crore in the current financial year.
  • Industrial nodes at Kopparthy along Visakhapatnam-Chennai Industrial Corridor and at Orvakal along Hyderabad-Bengaluru Industrial Corridor.
• Women-led development: Total allocation of more than `3 lakh crore for schemes benefitting women and girls.
• Pradhan Mantri Janjatiya Unnat Gram Abhiyan: Socio-economic development of tribal families in tribal-majority villages and aspirational districts, covering 63,000 villages benefitting 5 crore tribal people.
• 100 branches of India Post Payment Bank to be set up in the NorthEast region.

Priority 4: Manufacturing & Services

• Credit Guarantee Scheme for MSMEs in the Manufacturing Sector: A credit guarantee scheme without collateral or third-party guarantee in term loans to MSMEs for purchase of machinery and equipment.
• Credit Support to MSMEs during Stress Period: New mechanism to facilitate continuation of bank credit to MSMEs during their stress period.
• Mudra Loans: The limit of Mudra loans under ‘Tarun’ category to be enhanced to `20 lakh from `10 lakh for those who have successfully repaid previous loans.
• E-Commerce Export Hubs: E-Commerce Export Hubs to be set up under public-private-partnership (PPP) mode for MSMEs and traditional artisans to sell their products in international markets.
• Critical Mineral Mission: Critical Mineral Mission to be set up for domestic production, recycling of critical minerals, and overseas acquisition of critical mineral assets.
• Digital Public Infrastructure (DPI) Applications: Development of DPI applications in the areas of credit, e-commerce, education, health, law and justice, logistics, MSME, services delivery, and urban governance.

Priority 5: Urban Development

• Formulation of Transit Oriented Development plans and strategies to implement and finance 14 large cities above 30 lakh population.
• Street Markets: New scheme to support the development of 100 weekly ‘haats’ or street food hubs every year for the next 5 years in select cities.

Priority 6: Energy Security

• Government to partner with the private sector for R&D of Bharat Small Modular Reactor and newer technologies for nuclear energy, and to set up Bharat Small Reactors.
• Advanced Ultra Super Critical Thermal Power Plants: Joint venture proposed between NTPC and BHEL to set up a full scale 800 MW commercial plant using Advanced Ultra SuperCritical (AUSC) technology.

Priority 7: Infrastructure

• Infrastructure investment by Central Government: `11,11,111 crore (3.4 % of GDP) to be provided for capital expenditure.
• Infrastructure investment by state governments: Provision of `1.5 lakh crore for long-term interest free loans to support states in infrastructure investment.
• Tourism: Comprehensive development of Vishnupad Temple Corridor, Mahabodhi Temple Corridor and Rajgir.

Priority 8: Innovation, Research & Development

• Anusandhan National Research Fund for basic research and prototype development to be operationalised.
• Financing pool of `1 lakh crore for spurring private sector-driven research and innovation at commercial scale.
• Space Economy: Venture capital fund of  `1,000 crore to be set up for expanding the space economy by 5 times in the next 10 years.

Priority 9: Next Generation Reforms

• Rural Land Related Actions: Unique Land Parcel Identification Number (ULPIN) or Bhu-Aadhaar for all lands, Digitization of cadastral maps etc.
• NPS Vatsalya: NPS-Vatsalya as a plan for contribution by parents and guardians for minors.

Highlights for Tax Collection

Indirect Taxes

• GST: Buoyed by GST’s success, tax structure to be simplified and rationalized to expand GST to remaining sectors.

Sector specific customs duty proposals

• Medicines and Medical Equipment: Three cancer drugs namely Trastuzumab Deruxtecan, Osimertinib and Durvalumab fully exempted from custom duty.
  • Changes in Basic Customs Duty (BCD) on x-ray tubes & flat panel detectors for use in medical x-ray machines under the Phased Manufacturing Programme.
• Precious Metals: Customs duties on gold and silver reduced to 6 per cent and that on platinum to 6.4 per cent.
• Telecommunication Equipment: BCD increased from 10 to 15 per cent on PCBA of specified telecom equipment.
• Trade facilitation: For promotion of domestic aviation and boat & ship MRO, time period for export of goods imported for repairs extended from six months to one year.
  • Time-limit for re-import of goods for repairs under warranty extended from three to five years.
• Critical Minerals: 25 critical minerals fully exempted from customs duties.
  • BCD on two critical minerals reduced.
• Solar Energy: Capital goods for use in manufacture of solar cells and panels exempted from customs duty.

Direct Taxes

• Efforts to simplify taxes, improve taxpayer services, provide tax certainty and reduce litigation to be continued.
• 58 percent of corporate tax from simplified tax regime in FY23, more than two-thirds taxpayers availed simplified tax regime for personal income tax in FY 24.

Simplification and Rationalisation of Capital Gains

• Short term gains on certain financial assets to attract a tax rate of 20 per cent.
• Long term gains on all financial and non-financial assets to attract a tax rate of 12.5 per cent.
• Exemption limit of capital gains on certain financial assets increased to ₹25 lakh per year.

Litigation and Appeals

• ‘Vivad Se Vishwas Scheme, 2024’ for resolution of income tax disputes pending in appeal.
• Monetary limits for filing direct taxes, excise and service tax related appeals in Tax Tribunals, High Courts and Supreme Court increased to ₹60 lakh, ₹2 crore and ₹5 crore respectively.
• Safe harbor rules expanded to reduce litigation and provide certainty in international taxation.

Employment and Investment

• Angel tax for all classes of investors abolished to bolster start-up ecosystem.
• Corporate tax rate on foreign companies was reduced from 40 to 35 per cent.

Deepening tax base

• Security Transactions Tax on futures and options of securities increased to 0.02 per cent and 0.1 per cent respectively.
• Income received on buy back of shares in the hands of the recipient to be taxed.

Social Security Benefits

• Deduction of expenditure by employers towards NPS to be increased from 10 to 14 percent of the employee’s salary.
• Non-reporting of small movable foreign assets up to ₹20 lakh de-penalised.

Changes in Personal Income Tax under new tax regime

General Studies Paper -2

Context: India will push its Indo-Pacific agenda through a meeting of Quad foreign ministers at the end of July in Tokyo.

• India plays a pivotal role through its engagements in various multilateral groupings like the Quad and BRICS.
• These platforms serve as critical arenas for India to assert its strategic interests, enhance its economic influence, and foster international partnerships.

The Strategic Significance of Quad

The Quad has emerged as a key platform for promoting a rules-based international order in the Indo-Pacific region.

• Counterbalancing China’s Influence: For India, the Quad holds immense strategic significance, particularly in balancing China’s growing assertiveness in the region.
• This is particularly crucial for India’s interests in safeguarding its maritime trade routes and ensuring freedom of navigation in international waters.
• Platform for military cooperation : It provides a platform for military cooperation, intelligence sharing, and joint exercises aimed at maintaining maritime security and ensuring the rule of law.
• Aligns with its “Act East” policy : India’s participation in the Quad aligns with its “Act East” policy, emphasizing deeper engagement with East Asian nations and strengthening maritime security cooperation.
• India benefits from enhanced relations, especially with the U.S., through Quad engagements.
• Diplomatic Leverage: The Quad also serves as a diplomatic platform for India to strengthen bilateral relationships with the United States, Japan, and Australia, forging deeper strategic partnerships that extend beyond maritime security to include areas like trade, technology, and global governance.

Importance BRICS

• BRICS focused primarily on economic cooperation, development, and global governance reform.
• Economic Cooperation: BRICS facilitates economic collaboration through initiatives such as the New Development Bank (NDB), aimed at funding infrastructure projects in member countries.
• Economic collaboration within BRICS facilitates trade diversification, technology transfer, and infrastructure development, which are crucial for India’s economic growth and development aspirations.
• Global Governance Reform: India uses BRICS as a platform to advocate for reforms in international financial institutions like the IMF and World Bank, aiming to increase the voice and representation of emerging economies in global economic governance.
• Cultural and Academic Exchange: BRICS fosters cultural and academic exchanges, promoting people-to-people ties and enhancing mutual understanding among member countries.

Challenges

• India’s involvement in the Quad has drawn reactions from China, which views the grouping as a containment strategy.
• Member countries of BRICS have diverse economic and geopolitical priorities, which can sometimes hinder consensus-building on key issues.
• Despite initiatives like the NDB, the effectiveness of BRICS institutions in driving economic development and addressing global challenges remains a subject of scrutiny.
• India, despite reservations, has reluctantly accepted BRICS expansion influenced by China and Russia’s alignment.
• Chinese influence is growing not just in the Indo-Pacific, but elsewhere too.
• ASEAN countries are getting increasingly vulnerable, with the South China Sea remaining a flashpoint.

Conclusion and Way Forward

• India’s participation in the Quad and BRICS reflects its multifaceted approach to global diplomacy, encompassing security cooperation, economic development, and global governance reform. While these groupings offer platforms for India to advance its strategic and economic interests on the global stage, they also present challenges that require careful navigation and diplomatic engagement.
• As India continues to navigate the complexities of international relations, its engagement in the Quad and BRICS remains pivotal in shaping a multipolar world order conducive to its long-term strategic and economic interests.
• India must navigate its participation in the Quad and BRICS  without undermining its longstanding policy of strategic autonomy and non-alignment.

General Studies Paper -2 

Context: Recently, the Supreme Court has reserved the decision on sub-caste reservation for SC/STs, —a topic that stirs debates and raises important questions about social justice and equity.

Historical Context and Rationale

• B. R. Ambedkar, a key architect of India’s Constitution, advocated for policies to address historical injustices faced by marginalized communities. The Constitution of India, under Articles 15(4) and 16(4), allows for reservations in education and public employment to uplift these historically disadvantaged groups. The goal is to provide them with equal opportunities and representation.

Main Components

• Legal Safeguards Against Caste Discrimination: Ambedkar proposed legal measures to combat caste-based discrimination. However, he recognized that laws alone wouldn’t guarantee a fair share for untouchables in various spheres.
  • Hence, reservation was introduced as a supplementary measure. Together, these two pillars aimed to address discrimination in the ‘present’
• Reservation in Education and Public Employment: While legal safeguards and reservations ensured representation in the current context, they had limitations in rectifying historical injustices related to property, employment, and education. Hence, the third pillar emerged—the focus on improving ownership of capital assets (such as land and businesses) and education.
  • This economic empowerment was designed to equip untouchable youth to pursue education and secure jobs under reservation.
• Economic and Education Empowerment: Reservations in legislatures, public jobs, and educational institutions were meant for untouchables as a whole, with a ‘social group focus’. Simultaneously, economic empowerment targeted individuals lacking income-earning assets and education.
• B. R. Ambedkarjustified these policy measures due to the denial of equal civic and property rights, employment, and education faced by untouchables as a whole.
• However, these measures were intended to complement each other, not act as standalone solutions.
• Legal safeguards and reservations aimed to ensure a fair share in the present, while economic empowerment measures sought to address past denials of property rights, employment, and education.

Complex Landscape of Sub-Caste Reservations

• Weak Academic Basis: The academic rationale for sub-caste reservations has been questioned. Reservation system allocates quotas for SCs and STs, and there is growing awareness that some sub-castes within these groups have benefited more than others.
  • The under-representation of certain sub-castes seeking reservation is primarily due to their lack of income-earning assets and education, rather than discrimination by other SC sub-castes.
• Lack of Income-Earning Assets: Many individuals lack capital assets, hindering their access to education and economic opportunities.
• Educational Disparities and Discrimination: Unequal educational opportunities persist, affecting representation.
  • While untouchables collectively suffered from untouchability, specific sub-castes may have faced varying degrees of discrimination.

Dilemma of Unequal Benefits

• Supporters of sub-caste reservations argue that some sub-castes have benefited more than others. Consequently, those lagging behind should have separate quotas. However, this approach raises questions: Does sub-categorization truly address the root cause of the problem? And how do we balance historical injustices with present-day realities?

Proposed Reforms

• Redesigning the System: As legal challenges to the 50% reservation ceiling and specific caste listings continue, there’s an opportunity to rethink the system.
  • One potential reform is to reduce the number of relatively wealthy beneficiaries.
• Balancing Equitable Distribution: Ensuring that benefits reach all sub-castes fairly remains a challenge.
  • Some sub-castes have indeed benefited more than others, leading to calls for separate quotas for those lagging behind.
• Education and Economic Empowerment: Addressing educational disparities and economic empowerment remains crucial.
  • Policies should focus on both group-level representation and individual-level upliftment.

Supreme Court’s Role

• In 2020, a five-member bench ruled that state governments had the right to sub-classify SC categories to achieve equitable distribution of benefits under reservation.
• The Supreme Court has upheld the right of state governments to create sub-categories within the SC category. For instance, Tamil Nadu has Arunthathiyars, Punjab has Valmikis and Mazhabi Sikhs, etc.

Related State-Level Initiatives

• Several Indian states (such as Punjab, Bihar, and Tamil Nadu) have attempted to sub-categorize SCs within the broader umbrella of Scheduled Castes. These efforts aim to determine separate quotas for different subcategories within SCs.
• The purpose is to ensure equitable distribution of socio-economic benefits under reservation.
  • Some sub-castes may have lagged behind due to a lack of income-earning assets and education, rather than discrimination by other SC sub-castes.

Way Forward

• Clarification: Any decision on sub-caste reservation must consider the interconnectedness of these three policy pillars. We need clarity on how legal safeguards, reservations, and economic empowerment work together.
• Balancing Equity: While addressing the specific needs of sub-castes is essential, we must ensure that overall equity isn’t compromised. Striking this balance is delicate but crucial.
• Data-Driven Solutions: Perhaps a caste census could provide more accurate data on sub-castes, enabling informed policy-making.
  • Additionally, sub-categorization within castes could be explored further, but it’s not a panacea.

Conclusion

• Sub-caste reservations are a multifaceted issue that requires a nuanced approach. Balancing historical justice, social equity, and economic empowerment remains a challenge.
• As we continue this dialogue, it’s essential to consider both legal and academic perspectives to arrive at fair and effective policies. It requires thoughtful consideration, empathy, and a commitment to justice.

General Studies Paper -2 

Context: The Supreme Court agreed to examine the contours of Article 361 of the Constitution which grants “blanket immunity” to governors from any kind of criminal prosecution.

Background

• A woman staff member of the West Bengal Raj Bhawan, has accused Governor CV Ananda Bose of sexual harassment.
• The plea challenges the immunity granted to the governor of a state under Article 361 of the Indian Constitution and seeks several directions and investigations.

What is Article 361?

• The Governors of state receive immunity from legal proceedings over the duration of their term in office under Article 361 of the Constitution.
• The aim of the Article is to ensure that they are not answerable to any court for the exercise and performance of their official powers and duties, nor for any acts done in the course of these duties.
  • Criminal proceedings: No criminal cases can be initiated or continued against them, and no arrest or imprisonment orders can be issued by any court under Clause (2) of Article 361.
  • Civil proceedings: The Article mandates a two-month notice for any civil proceedings related to personal acts.
  • Clause (3) of Article 361 restricts any arrest or imprisonment orders during their term.
• The article is an exception to Article 14 (right to equality) of the Constitution and provides that the president or the governor is not answerable to any court for the exercise of the powers and duties of his office.

Immunity power of the Governor

• Ceases to be in office: The police can act only after the Governor ceases to be in office, which is when either the Governor resigns or no longer enjoys the confidence of the President.”
• Rameshwar Prasad v Union of India: In the landmark 2006 ruling in Rameshwar Prasad v Union of India, that outlined the immunity enjoyed by the Governor “even on allegation of personal malafides,” the Supreme Court held that “the position in law, is that the Governor enjoys complete immunity.”

What is the role of a governor in India?

• Governors in India have the responsibility of upholding and enforcing the Constitution and laws.
• According to Articles 153 and 154 of the Constitution, governors ensure the smooth functioning of state governments within the constitutional framework.

Concluding Remarks

• Governors in India possess discretionary constitutional powers, which enable them to make critical decisions in the executive realm, particularly during times of political or administrative uncertainty.
• Although these powers are constitutionally granted, they are subject to judicial review to ensure they are exercised within legal and proper bounds.

General Studies Paper-3

Context: The Asian Development Bank (ADB) has approved a loan of USD 240.5 million to finance rooftop solar systems in India.

About

• This financing will support tranches 2 and 3 of the Multitranche Financing Facility (MFF) Solar Rooftop Investment Program, initially approved by ADB in 2016.
  • In 2023, the program was restructured to focus specifically on deploying residential solar rooftop systems.
• The approved financing will be allocated to the State Bank of India (SBI) and the National Bank for Agriculture and Rural Development (NABARD).
  • These institutions will provide loans to developers and end-users throughout India for the installation of rooftop solar systems.

Significance of Rooftop Solar Systems

• It can reduce the technical and operational burden by generating electricity close to where it is consumed, thereby decreasing the need for long-distance power supply and the associated system losses.
  • This enhances the efficiency of power distribution and provides a degree of energy independence, minimizing power supply disruptions.
• India’s Aim: India aims to achieve about 50 percent of cumulative electric power installed capacity from non-fossil fuel energy sources by 2030 in line with its global commitments to reduce carbon emissions.
  • ADB’s financing supports these goals and will contribute to the Prime Minister’s Surya Ghar program, which encourages people to install rooftop solar systems across the country

Solar Energy

• Solar energy is the most abundant & cleanest energy resource on earth.
• Solar energy can be used mainly in three ways one is direct conversion of sunlight into electricity through PV cells, the two others being concentrating solar power (CSP) and solar thermal collectors for heating and cooling (SHC).
• Indian Scenario: India is endowed with abundant solar energy, which is capable of producing 5,000 trillion kilowatts of clean energy.
  • India gets around 300 sunny days in a year and solar insolation of 4-7kWh per Sq. m per day.
  • If this energy is harnessed efficiently, it can easily reduce the energy deficit scenario and that too with no carbon emission.
  • In near future Solar energy will have a huge role to play in meeting India’s energy demand.

India’s Solar Energy

• Capacity: India’s installed solar power capacity is about 81 GW (1 GW is 1,000 megawatt), or roughly 17% of the total installed electricity.
  • India’s largest solar parks are located in the north-west, particularly Gujarat and Rajasthan.
  • India currently stands 4th globally in solar power capacity.

India has set following resolute targets to usher in a renewable revolution:

• 500 GW of renewable energy capacity by 2030;
• Meeting 50% of its energy requirement from renewable sources by 2030;
• Reducing the total projected carbon emissions by 1 Bn Tonnes by 2030;
• Reducing the carbon intensity of its economy by under 45%;
• Becoming a net zero carbon country by 2070.

Government Initiatives to Promote Solar Energy Adoption

• Solar Park Scheme, designed to establish 50 Solar Parks of 500 MW and above with a cumulative capacity of ~38 GW by 2025-26.
• PM-KUSUM — aimed to achieve solar power capacity addition of 30.8 GW by 2026 — are transforming India’s agricultural sector by setting up decentralised solar power plants, replacing agriculture diesel pumps with solar agriculture water pumps and solarising existing grid-connected agriculture pumps.
• Rooftop Solar Programme for the residential sector and the Off-grid Solar PV Applications Programme for rural areas are also making solar energy accessible by providing subsidies.
• The International Solar Alliance (ISA), launched in 2015 by the Prime Minister of India and the President of France.
  • It is a member-centric, collaborative platform focused on action aimed at creating 450 GW of renewable energy by 2030.
• The Rooftop Solar Yojana, or the PM Surya Ghar Muft Bijli Yojana, aims to provide 300 units of free electricity every month to light up one crore households.
  • The objective of this scheme is to reduce the electricity costs of the house by installing rooftop solar panels and using solar energy.

Conclusion

• Solar energy has been recognized as an alternative to conventional energy resources.
• Amongst all the clean technologies, solar energy serves as an effective renewable energy resource to mitigate greenhouse gas emissions and reduce global warming.
• Solar energy is one of the resources capable of self-reliant energy generation, reducing foreign energy dependence.
• This necessitates the wide use of solar panels with better efficiency to meet the energy requirements from solar resources.

General Studies Paper-3

Context: The sixteenth Finance Commission headed by Arvind Panagariya has begun its work by inviting suggestions from the public on the mandate set for it by the Centre.

What is the Finance Commission?

• The Finance Commission is a constitutional body constituted by the President of India under Article 280, that recommends how tax revenues collected by the Central government should be distributed among the Centre and various States in the country.
• The Commission is reconstituted every five years and usually takes a couple of years to make its recommendations to the Centre.
• The Centre is not legally bound to implement the suggestions made by the Finance Commission.

Tax Devolution

• The Finance Commission decides what proportion of the Centre’s net tax revenue goes to the States overall (vertical devolution) and how this share for the States is distributed among various States (horizontal devolution).
• The horizontal devolution of funds between States is usually decided based on a formula created by the Commission that takes into account a State’s population, fertility level, income level, geography, etc.
• The vertical devolution of funds, however, is not based on any such objective formula.
• The Centre also aids States through additional grants for certain schemes that are jointly funded by the Centre and the States.

Friction between the Centre and States

• The Centre and the States have been at loggerheads over the issue of sharing tax revenues.
• The Centre collects major taxes such as the income tax, the corporate tax, and the Goods and Services tax (GST) while the States primarily rely on taxes collected from the sale of goods such as liquor and fuels that are beyond the ambit of GST.
• This has led to complaints that the Centre has reduced the power of the States to collect taxes and that it does not give enough funds to the States to match with the scale of their responsibilities.

What are the disagreements?

• Demand for more funds: States argue they should receive more funds than recommended by the Finance Commission. States have greater responsibilities, including education, healthcare, and policing services.
• Disparities Among States: Developed States like Karnataka and Tamil Nadu feel they receive less money from the Centre than they contribute in taxes.
  • Tamil Nadu receives only 29 paise for every rupee contributed, while Bihar receives more than ₹7 for each rupee contributed.
  • In other words, it is argued that more developed States with better governance are being penalized by the Centre to help States with poor governance.
• Divisible Pool Concerns: Cesses and surcharges, which are not shared with the States, can constitute up to 28% of the Centre’s tax revenues, leading to revenue losses for States.
• Shortfall in Devolution: The Fifteenth Finance Commission recommended 41% of the divisible pool to the States. However, the Centre has devolved an average of only 38% of funds from the divisible pool to the States.
• Criticism of the Finance Commission: Critics believe the Finance Commission may not be fully independent due to the Centre’s role in appointing its members, leading to potential political influence.

Way Ahead

• In response to evolving economic and social dynamics, the Finance Commission needs to remain proactive and responsive. This entails addressing challenges stemming from GST implementation, the Covid-19 Pandemic, Climate Change, and Digital Transformation.
• Also, the concerns should be accommodated so that they do not feel penalized for development and better governance of their state.

General Studies Paper- 3

Context: With the recent announcement of India’s goal to become a developed country by 2047, the debate turns to what is a developed country, and what are the key parameters needed to focus on.

About the Developed Country

• The term ‘Developed Country’ (aka Advanced Country) doesn’t have a single accepted definition. It stands out for its high quality of life, robust economy, and advanced technological infrastructure. These nations have typically surpassed the initial stages of industrialization and agrarian economies.
• The United Nations Development Programme (UNDP) has a threshold of the 75th percentile in Human Development Index (HDI) distribution to be classified as a developed country, whereas the World Bank classifies countries whose Gross National Income (GNI) per capita is above $13,845 as ‘high-income countries’.

Key Features

• Economic Prosperity: Developed countries boast impressive economic metrics. These often include a high Gross Domestic Product (GDP) and Gross National Product (GNP) per capita. Essentially, their citizens enjoy a relatively comfortable standard of living.
• Industrialization and Infrastructure: Developed nations have well-established infrastructure—think efficient transportation networks, modern airports, and reliable electricity grids. Their cities showcase towering skyscrapers, bustling commercial centres, and well-maintained roads.
• Quality of Life: Access to quality education, healthcare, and public services is widespread. Citizens benefit from robust social safety nets, ensuring a decent quality of life for all.
• Environmental Stewardship: Developed countries prioritise environmental protection. You’ll find recycling programs, clean energy initiatives, and strict adherence to civic norms.
• Technological Advancements: Cutting-edge technology permeates daily life. From seamless digital services to advanced research institutions, these nations lead the way.

How Can India Bridge the Gap?

• India, with its rich history and diverse culture, has set ambitious goals, and declared that India should achieve developed country status by 2047—marking the 100th year of our independence.
• Economic Growth: India’s GDP growth is crucial. According to projections, India could become the world’s third-largest economy by 2030 and even surpass the US in GDP by 2060.
  • However, sustaining an annual growth rate of at least 8% is essential.
• Investment in Infrastructure: India must continue investing in infrastructure—modernising roads, railways, and digital networks. Connectivity is key to progress.
• Education and Healthcare: Ensuring quality education and accessible healthcare for all citizens is non-negotiable. A well-educated workforce drives innovation and productivity.
• Environmental Responsibility: Balancing growth with environmental conservation is critical. India can lead by adopting sustainable practices and clean energy solutions.
• Inclusive Development: Addressing income inequality and poverty eradication is paramount. No one should be left behind on the path to development.

Opportunities For India

• Demographic Dividend: India’s young population can be an asset. Properly harnessing their potential through education, skill development, and employment can drive growth.
• Robust Information Technology Sector: India’s IT industry has been a global success story. Continued investment in technology and innovation can propel the nation forward.
• Entrepreneurship Ecosystem: India has seen a surge in startups and entrepreneurial ventures. Nurturing this ecosystem can create jobs and foster innovation.
• Strategic Investments: Focused investments in human capital (education, healthcare) and infrastructure (roads, ports, digital connectivity) are crucial.
• Global Partnerships: Collaborating with other nations, sharing knowledge, and participating in global value chains can accelerate development.

Challenges India Faces in Achieving Developed Status and Related Solutions

• Population Management: Our sheer population can strain resources. Sustainable population management strategies are essential to ensure equitable growth.
• Inequality and Social Justice: Income disparities persist. Addressing this gap requires targeted policies that uplift marginalised communities, promote social justice, and provide equal opportunities.
  • Gender equality, LGBTQ+ rights, and inclusivity in all spheres of life contribute to a more developed and harmonious society.
  • Bridging the gap between urban and rural areas is crucial.
• Socioeconomic Inclusion of Rural India: By 2030, an estimated 40% of Indians will be urban residents. However, rural areas still grapple with inadequate infrastructure, limited access to quality education, and healthcare disparities. Achieving balanced development across urban and rural regions is vital.
  • Empowering rural communities through education, skill-building, and better livelihood opportunities is a pressing challenge.
• Bureaucracy and Corruption: Streamlining administrative processes, reducing red tape, and promoting transparency are perennial challenges. Efficient governance is crucial for sustained progress.
• Education Reform: Quality education is the cornerstone of development. India needs reforms that enhance both access and quality. Vocational training and digital literacy are equally important.
• Health and Sustainability: A healthy population is the bedrock of any developed nation. India faces health challenges ranging from malnutrition to non-communicable diseases. Improving healthcare infrastructure, preventive measures, and access to quality medical services is imperative.
  • Moreover, sustainability—both environmental and economic—is critical. Balancing growth with ecological responsibility is a tightrope walk. India must lead in adopting clean energy solutions, efficient waste management, and climate-conscious policies.
• Skill Development and Employment: As the world evolves, so do the skills required for success. According to the World Economic Forum, more than half of Indian workers will need reskilling to meet the demands of the future job market. Bridging this skills gap is crucial for sustained economic growth.
  • Additionally, ensuring meaningful employment opportunities for our burgeoning workforce—especially in the context of automation and digital transformation—is essential.
• Infrastructure and Connectivity: While India has made significant strides in infrastructure development, there’s still work to be done. Modernising transportation networks, ensuring reliable electricity supply, and bridging the digital divide are ongoing tasks.
  • Connectivity—both physical and digital—fuels economic progress. Investments in roads, railways, and high-speed internet are essential.

Conclusion

• India’s journey toward becoming a developed country is multifaceted. It lags behind in HDI rank mainly because of its low life expectancy and per capita income, which can be improved with government spending in the education and health sectors.

It requires a delicate balance of economic growth, social inclusion, environmental stewardship, and visionary leadership. With determination, strategic planning, and collective effort, we can transform our nation into a beacon of progress.

General Studies Paper- 2

Context: Around the world, the representation of women in political spheres has seen significant progress over the years. However, this progress has been uneven, and there’s still much work to be done.

Women and Political Representation

• Women’s equal participation and leadership in political and public life are essential to achieving the Sustainable Development Goals by 2030.
• However, data show that women are underrepresented at all levels of decision-making worldwide and that achieving gender parity in political life is far off.

Women in National Parliaments

• Only 26.9% of Parliamentarians in single or lower houses are women, up from 11% in 1995.
• Only six countries have 50% or more women in Parliament in single or lower houses: Rwanda (61%), Cuba (56%), Nicaragua (54%), Andorra (50%), Mexico (50%), New Zealand (50%), and the United Arab Emirates (50%).
• A further 22 countries have reached or surpassed 40%, including 13 countries in Europe, five in Africa, four in Latin America and the Caribbean, and one in Asia-Pacific.
• Globally, there are 21 States in which women account for less than 10% of parliamentarians in single or lower houses, including two lower chambers with no women at all.
• At the current rate of progress, gender parity in national legislative bodies will not be achieved before 2063 (another 40 years).

How do women MPs fare worldwide?

• Voluntary or legislated compulsory quotas within political parties.
• Quotas in parliament through the reservation of seats.
• Quotas within political parties allow more democratic choice for voters and flexibility for parties in selecting women candidates.

Women in Local Government

• Data from 141 countries show that women constitute more than 3 million (35.5%) of elected members in local deliberative bodies.
• Only three countries have reached 50%, and an additional 22 countries have more than 40% women in local government.

Women in Indian Politics

• The percentage of women Members of Parliament (MPs) in the Lok Sabha (the lower house of India’s Parliament) remained very low—between 5% and 10%—until 2004.
  • It marginally increased to 12% in 2014 and currently stands at 14% in the 18th Lok Sabha.
• State Legislative Assemblies fare even worse, with a national average of around 9% women representatives.
• The 73rd and 74th Constitutional Amendments of the 1992-93, provided for one-third reservation for women in Panchayats and Municipalities.
  • However, attempts between 1996 and 2008 to provide similar reservation in the Lok Sabha and assemblies were unsuccessful.

Expanding Participation in India

• 106th Constitutional Amendment: It reserves one-third of all seats for women in Lok Sabha, State Legislative Assemblies, and the Legislative Assembly of the National Capital Territory of Delhi, including those reserved for SCs and STs.
• It shall come into effect based on the Delimitation Exercise after the relevant figures of the first Census conducted after the commencement of this act is published.
  • Census is overdue since 2021 and should be conducted without any further delay to ensure that this reservation is implemented starting with the general elections in 2029.
• India ranks 143 in the list of countries in the ‘Monthly ranking of women in national parliaments’ recently published by the Inter-Parliamentary Union, a global organisation for national parliaments.
  • Naam Tamilar Katchi, a State party in Tamil Nadu, has been following a voluntary quota of 50% for women candidates in the last three general elections.
• Intersectionality Matters: It’s essential to recognize that women are not a homogenous group. Their identities intersect with other factors (such as caste, class, religion, and ethnicity), influencing their political representation.
  • Ensuring that women from diverse backgrounds have a voice in politics is crucial for genuine representation.
• Beijing Declaration and Platform for Action: Balanced political participation and power-sharing between women and men in decision-making is the internationally agreed target set in the Beijing Declaration and Platform for Action.

Conclusion and Way Forward

• Women demonstrate political leadership by working across party lines through parliamentary women’s caucuses — even in the most politically combative environments — and by championing issues of gender equality, such as the elimination of gender-based violence, parental leave and childcare, pensions, gender-equality laws, and electoral reform.
• While progress has been made, the road to equitable political representation for women remains challenging.
• Advocacy, policy changes, and societal shifts are necessary to create a more inclusive and representative political landscape.

General Studies Paper-2

Context: The Union government has stopped funds of Punjab, West Bengal, and Delhi under Samagra Shiksha Abhiyan (SSA), as the three states have refused participation in the PM-SHRI scheme.

PM SHRI scheme

• Aim: The scheme aims to turn existing government schools into model schools.
• The scheme is for existing elementary, secondary, and senior secondary schools run by the central government and state and local governments around the country.
• Funding: It is a Centrally sponsored scheme with a total project cost of 27,360 crore for the period of five years from 2022-23 to 2026-27 for transforming nearly 14,500 schools across the country.
• It will showcase all components of the National Education Policy 2020, act as exemplary schools and also offer mentorship to other schools in their vicinity.
• A ‘School Quality Assessment Framework’ is being developed to measure the progress and performance of these schools.

Key features of PM SHRI Scheme

• Development of ‘Green schools’: These will be equipped with solar panels, LED lights, nutrition gardens, and waste management, water conservation and harvesting systems.
• Modern facilities: Schools will include ICT (information and communication technologies) facilities, smart classrooms, library, digital library, science labs and vocational labs etc. Schools will also get science and math kits and annual school grants for libraries or sports.
• Mother tongue and local languages to be encouraged.

Samagra Siksha Abhiyan (SSA)

• It is an overarching scheme for the school education sector extending from pre-school to class XII and aims to ensure inclusive and equitable quality education at all levels of school education.
• The Scheme subsumes the three erstwhile Centrally Sponsored Schemes of Sarva Shiksha Abhiyan (SSA), Rashtriya Madhyamik Shiksha Abhiyan (RMSA) and Teacher Education (TE).
• The scheme treats school education as a continuum and is in accordance with Sustainable Development Goal for Education (SDG-4).
• The major objectives of the Scheme are:
  • Support States and UTs in implementing the recommendations of the National Education Policy 2020 (NEP 2020);
  • Support States in implementation of Right of Children to Free and Compulsory Education (RTE) Act, 2009;
  • Emphasis on Foundational Literacy and Numeracy;
  • Strengthening and up-gradation of State Councils for Educational Research and Training (SCERTs)/State Institutes of Education and District Institutes for Education and Training (DIET) as nodal agency for teacher training;
  • Promoting vocational
• Under the Scheme, financial assistance is provided to all the States and UTs for undertaking above activities including training for universalization and delivery of quality school education.

General Studies Paper-2

Context: Recently, the Karnataka Cabinet cleared a Bill mandating 50% reservation for locals in management jobs and 75% in non-management positions.

About

• The Karnataka State Employment of Local Candidates in the Industries, Factories, and Other Establishments Bill, 2024, has taken centre stage in the state’s legislative landscape, aiming to address the employment concerns of local candidates within the private sector.
• The bill emphasises job opportunities for Kannadigas by mandating specific reservation percentages for management and non-management positions.
• The bill comes after long-standing demands for job reservation for Kannadigas. Earlier this year, Kannada organisations organised rallies across the state, urging the immediate implementation of the Sarojini Mahishi Report, submitted in 1984, recommended quotas for locals in both government and private sector jobs.

Reservation Quotas

• Management Positions: Industries, factories, and other private sector establishments are now required to appoint local candidates for at least 50% of management positions. These roles include executive, administrative, and leadership positions within organisations.
• Non-Management Positions: For non-management positions—such as technical, operational, and support roles — 75% of the workforce must consist of local candidates.

Eligibility Criteria for Local Candidates

• According to the Bill, a local candidate is someone who:
• is born in the State of Karnataka;
• has been domiciled in the state for at least 15 years;
• can speak, read, and write Kannada proficiently (there’s even a required test for this).
• holds a secondary school certificate with Kannada as a language. If not, they must pass a Kannada proficiency test.

Minimum Thresholds

• Even if industries face challenges in finding local talent, the percentage of local candidates should not fall below 25% for management positions and 50% for non-management positions.
• Failure to comply with these thresholds may result in penalties ranging from ₹10,000 to ₹25,000.
• Fallback Measures (Training and Relaxation)
• If qualified or suitable local candidates are not available, industries and establishments must collaborate with the government to train local candidates within three years.
• In exceptional cases where sufficient local candidates are unavailable, establishments can apply for relaxation from the provisions of the Act. The government will review such requests and make final decisions.

Penalties for Non-Compliance

• Industries failing to comply with the reservation norms may face penalties ranging from ₹10,000 to ₹25,000.
• The government aims to enforce these provisions rigorously to ensure effective implementation.

Conclusion

• The Karnataka Cabinet’s move to reserve management and non-management positions for local candidates is a significant step toward ensuring equitable employment opportunities.
• While some industry leaders have criticised the move as discriminatory, proponents argue that it will empower local talent, boost regional employment, and strengthen the state’s economy.