- Comment on the trade policy that India should follow in current global scenario of trade war.
(10 marks, 150 words) Answer:
The world has been facing heavy headwinds of anti globalisation and 2 largest economies which also happen to be India’s large trading partners are directly involved. In this context India with relatively smaller presence cannot follow same strategies that the richer countries can do. Also given India’s trade situation there is enough scope for it to improve its position. This can be done by
- Improving ease of doing business to become a larger part of global supply chain
- Improving flexibility in Labour market and land market to increase investment in sectors like footwear , apparel, electronic goods, electrical appliances etc which will help in diversification of commodity basket
- Invigorating Act East so that diversification of markets is achieved. It wil reduce India’s dependence on Europe and U.S.A..
- Improving tariff policy to avoid inverted duty structure.
- Giving a sunset clause to protectionist tariff.
India with only 1.6% of global merchandise exports can always aspire to play a larger role and improve its own prosperity.
- International credit ratings agency Moody’s Investors Service upgraded India’s sovereign rating towards the end of 2017. Discuss the reasons for the upgrade, and its impact on India.
(10 marks, 150 words) Answer:
Global credit rating agency Moody’s Investors Services upgraded India’s sovereign ratings to Baa2 (from its lowest investment grade Baa3). It is the first ratings upgrade by Moody’s for India since 2004. It cited the Government of India’s wide-ranging program of economic and institutional reforms among the reasons for the move.
Measures that influenced the upgrade:
- GST: The major tax reform, GST (Goods and Services Tax), has been implemented fairly smoothly, with good urgency shown and support of all political parties.
- IBC (Insolvency and Bankruptcy Code): IBC is in place for tackling NPAs, and banks have been nudged to take action. There are already major cases which have been referred to the tribunal and the resolution process is in progress.
- Power sector reform: The power sector, which was in disarray with the state-owned SEBs running large losses, has been launched on a phase of transformation with the debt issue being taken head-on by the participating state governments (under UDAY scheme).
- Recapitalization: The recent plan to recapitalise banks shows that the issue is being tackled to ensure that banks are adequately equipped to face the challenge of future growth in credit..
- Rationalisation of subsidies: The rationalisation of delivery of public subsides was an achievement in efficiency with the UID (unique identity) scheme playing a major role.
- Monetary policy reform: The conduct of monetary policy has been aligned to global practices with the MPC (Monetary Policy Committee) being in place and an inflation-target being set.
- Most measures needed taken: Almost all major reforms (including FDI policy, labour reforms, fiscal targets, etc) that were advanced by the rating agencies have been implemented with some of them now in the final stages of fructification.
What does a higher rating mean for India?
- Good for reputation: From the point of view of reputation, the upgrade is helpful (though India is still underrated), especially as it comes at the time when the global economy is still in a tenuous state.
- Eases borrowing:
- A better rating will help Indian companies access global markets on more favourable terms.
- Generally, the sovereign rating becomes a cap when interest rates are determined globally for overseas borrowers.
- Hence, a better rating would mean that cost would come down for better-rated companies.
- Greater investment in India:
- There could be a positive impact on foreign investors especially when the decision to allocate funds for any market or country is driven by the rating.
- Even with low rating, India has already attracted one of the highest quantities of FDI in the past as well as FPI.
- Vindication of policies: It is a vindication of all the policies implemented and measures undertaken by the government to put the system in place and address all concerns of rating agencies. It gives boost to the government’s reform agenda.
It is also important to note that other major credit rating agencies like Fitch and S&P did not upgrade India’s rating citing GST and Demonetisation related instability, low per capita income, low government revenue as percentage of GDP etc. It should also be understood that Moody’s upgrade in only a small grade up, that too in moderate risk category. The pace of the reforms must be kept up, and over populism must be avoided in the election year, so that India can gradually move into the low risk category rating.
- States across India are bypassing land acquisition laws by introducing land pooling schemes to speed up the process and lower the costs of land acquisition for developmental projects. In light of this, critically evaluate the pros and cons of land pooling.
(10 marks, 150 words) Answer:
Given the pressing need for urban development in India, land acquisition by States has persistently been a key issue. The central land acquisition law makes it very difficult and expensive to acquire land and delays important projects. Problems related to land acquisition accounted for at least 15 per cent of stalled projects in India, including flagship development projects like the Ahmedabad-Mumbai Bullet Train project and Navi Mumbai International Airport.
To overcome this, States across India are bypassing land acquisition laws by introducing land pooling schemes to speed up industrial and development projects. States including Rajasthan, Gujarat and Andhra Pradesh have introduced their own laws allowing land pooling. In Andhra Pradesh, the country’s largest exercise in land pooling is under way to develop the new capital city Amaravati with 38,000 acres of land.
Land pooling involves pooling of contiguous small land parcels into large parcels, and returning a percentage of redeveloped land to owners after development is complete while the remaining land remains with state agency. The landowners would be paid a portion of the compensation sum upfront.
- Lower costs for government: Fiscally conservative scheme for Government as there is no need to pay land acquisition cost.
- Fairer to original land owners: As they do not lose all land and get developed land with substantially better infrastructure and elevated price.
- Equitable: By not taking away all land, it is more equitable than the central land legislation that often sees protests, displacement of residents, delays and lengthy court battles.
- Expediting projects: Through voluntary consent of landowners and packaging other forms of compensation (eg. for loss of crops), land pooling fast-tracks the land acquisition process.
- Development: Through mixed land use, the model fosters more planned development.
- Lacking clarity: Often, the schemes have no clarity on what the owner will get after project is complete. Often, people are largely unaware of what they are getting into.
- Lack of consent: Owners may come under pressure from the community or the state to participate. To speed up the process, sometimes land pooling made mandatory. Eg. Navi Mumbai airport project
- Tenants lose out: Poor tenant farmers and agriculture labourers who are being displaced are often given no recourse to compensation or very little compensation.
- Delays in land development: Track record of delays in implementation of projects by government authorities may cause suffering for the owners who gave away their land.
More work needs to be done to both study and fine-tune land pooling, including ensuring compensation and resettlement provisions extend to tenant farmers and agricultural labourers. Done well, land pooling can possibly enjoy greater legitimacy and trust among stakeholders than conventional land acquisition, truly allowing India to have inclusive development where all can benefit.
- Digital technologies hold great potential to transform the Indian agricultural economy and impact the lives of Indian farmers. Explain.
(10 marks, 150 words) Answer:
Over the last few decades massive technological development and opportunities have transformed people’s lives. However, these opportunities have not benefited the agriculture sector in a significant way.
Major challenges confronting Indian agriculture include declining farm productivity, unsustainable usage of resources, diminishing and degrading natural resources, stagnating farm incomes etc. The challenges in agriculture can be overcome through sustainable & scalable deployment of digital technologies & infrastructure. Digital Technology refers to the use of digital resources to effectively find, analyse, create, communicate, and use information in a digital context.
- Smart farming: Weather advisories, disease and pest-related assistance through data generation as well as the advanced analytics allow farmers to make smart decisions about farming. They can benefit from an economical use of labour and inputs, thus also preventing soil and water contamination.
- Improved pre-harvest efficacy: At the pre-harvest stage, digital technology can recommend crop and input selection and assist in obtaining credit and insurance. Monitoring technologies, including through use of drones, are being developed with the objective of creating an integrated hyperlocal farm data collection and crop analytics platform to increased pre-harvest efficacy.
- Others: Numerous farm-level applications of digital technology, including remote sensing, GIS, crop and soil-health monitoring, and livestock and farm management, have been making their mark.
Transforming agribusiness sector:
- Supply Chains: The e-commerce wave in the past few years has been fast catching up in the food supply chain aggregation space (both at the farm-end as well as the consumerend), which has greatly benefitted farmers and consumers alike.
- IoT on Dairy farms: Dairy farm optimisation and monitoring services by leveraging Internet of Things (IoT), big data, cloud and mobility are increasingly being used to improve milk production, milk procurement, storage & supply chain.
- Digital Payments: The digital payments space is fast evolving the way food processing companies engage with farmers for offering a transparent and robust payment mechanism.
- Access to markets: The electronic National Agricultural Market (e-NAM), coupled with associated ecosystem development including robust warehouse e-receipts and insurance and financing for farmers, has the potential to radically transform the price discovery & transaction efficiency of farm markets in India.
- Farming-as-a-service (FaaS): A range of service providers on the Farming-as-a-service (FaaS) model are leveraging digital technology to provide innovative farm-to-fork solutions to farmers and agri businesses.
The common barriers to commercialisation and scaling up of technology include Access to finance, Gaps in technology infrastructure, Limited access to institutionalised farmer networks etc. Inclusive growth in agriculture can be achieved by an effective policy framework, enabling technology ecosystem and innovative financing, which can empower Indian farmers and make agriculture sustainable.
- Reversing ‘brain drain’ is important to change the landscape of Indian Science & Technology and to support excellence in scientific research in India. Enumerate the initiatives of the Indian government over the past few years to reverse the process of ‘brain drain’ from the country.
(10 marks, 150 words) Answer:
Brain drain describes migration of skilled workforce from developing countries to developed ones for better professional opportunities. India has seen brain drain since its Independence, more prominently among engineers, scientists and doctors.
Importance of reversing Brain Drain:
Scientists who had left India for better opportunities have, over the years, gained vital exposure to the best global research labs. PM Modi called it “brain deposit” that would serve its motherland at an appropriate time. To this end, over the past decade, the government is focusing on devising more opportunities for making fullest use of Indian scientific talent to work in Indian academia & scientific research institutions and laboratories.
Initiatives in this regard:
Government of India is implementing several initiatives to attract Indian scientists who have settled in various parts of the world for pursuing scientific research in India in their respective field of expertise as well as in home country research programs.
- “Ramanujan Fellowships” and INSPIRE Faculty Scheme: The Department of Science and Technology (DST) has been implementing these two schemes.
- “Ramanujan Fellowships”: to attract brilliant scientists and engineers from all over the world to take up scientific research positions in India, with fellowship and Research Grant.
- “Innovation in Science Pursuit for Inspired Research (INSPIRE)”: Scientists within 32 years of age and who have completed their doctoral research from any recognized university/ academic institution in the world, recognized as “INSPIRE Faculty Awardee” receives fellowship and Research Grant.
- The Department of Biotechnology (DBT) has been implementing three schemes to encourage researchers and scientists working abroad to find work opportunities in India Ramalingaswamy Re-entry Fellowship, Welcome-DBT India Alliance and Young Investigator Meet (YIM).
- STIO: The Council of Scientific and Industrial Research (CSIR) has conceptualized and made operational a scheme to attract scientists/technologists of Indian origin (STIOs), who are given a designation of “Outstanding Scientists, STIO”. They are appointed at an identified CSIR laboratory so as to nurture a research field in their area of expertise.
- Science clusters: The Department of Biotechnology has started three major new science clusters in the National Capital Region (NCR), Mohali and Bangalore; and have expanded its institutional and other programs to provide excellent opportunities and working environment to attract he best Indian scientists working abroad to work in India.
- The Prime Minister’s Research Fellowship (PMRF) scheme is aimed at attracting undergraduate-dual degree programs in Science and Technology streams from IIEST/IISc/IITs/NITs/IISERs and centrally funded IIITs to full time Ph.D. programme in the IITs & IISc.
- Others: Several new schemes have been launched to encourage and attract the scientific community to engage in R&D activities. Some of these new schemes are: Early Career Research Award; National Postdoctoral Fellowship (N-PDF) Scheme; Visiting Advanced Joint Research (VAJRA) Faculty Scheme
The schemes launched to reverse the process of infamous ‘brain drain’ have started yielding results. The number of young scientists returning to do scientific research in India and taking up positions in research and academic institutions is steadily rising. The quality of research output of these returnees is also very high. However, Not all researchers who return get absorbed as full-time faculty in institutions of their choice due to limited, institutional capacity to absorb all of them. For India to attract the upper echelon of Indian-origin scientists to set up labs and move their research here, we need to provide them with more opportunities and resources like China has done.
- There is great potential in the use of civilian drones for development purposes but India’s security environment necessitates extra precautions. Discus in light of the ‘Drone Regulations 1.0’ released recently to create an effective drone ecosystem.
(10 marks, 150 words) Structure:
- About Drones
- Uses of civilian drones for development purpose
- Threats/Precaution from use of civilian drones
- About Drone regulations 1.0
- Final Analysis
Civilian drones or Unmanned aerial vehicles (UAV) is an aircraft which operates without a human pilot. These are also known by name of remotely piloted vehicles or remotely operated aircrafts. Civilian drones are mainly used where the risk of sending a human piloted aircraft is very high or the situation makes using a manned aircraft impractical.
There is a great potential in use of civilian drones for developmental purpose, some of these uses are as follow:
- The drone can help in crop and soil health monitoring system using hyper spectral remote sensing sensors.
- The drones can also be useful in delivering medical supplies to otherwise inaccessible regions.
- The drones areproposed to be used by E-Commerce companies such as Amazon for improvement in service delivery of their products.
- The other uses of drones for developmental purpose are like infrastructure monitoring, aerial mapping, inspection of power lines and pipelines etc.
- The drone helps in damage assessment of property and life in areas affected by natural disaster including use for surveys, critical infrastructure monitoring
Despite the above-mentioned benefits of drones, there is also a need for precautious approach in use of civilian drones considering India’s security scenario.Some theses reasons are—
- The civilian drones pose security threats for they being turned into potential carrier of weapons.
- There also poses the threat in form of risk associated with collisions and accidents with aircraft traffic.
- There is also lack of sufficient digital infrastructure for protecting drones from instance of hacking.
- The drones also pose security risk to the sensitive defence installations and defence bases of India by using them as a surveillance tool.
To overcome the above challenges recently the government released the Drone Regulation
1.0. Some of the salient feature of these regulations are:–
- Allotting a unique identification number and radio frequency tag issued by DGCA to every operating drone.
- The remote pilot of drone must be at least 18 year old and should gone through prescribed training programme.
- The regulation also provides for No Drone Zones where drones are barred form being operated such as with in 5 km of Airport or 50 km of International borders.
- All holders of drones should have insurance with third party liability.
- UAV can operate only at or above 200 feet above ground level in uncontrolled airspace.
Thus, the above regulations to a large extent will help in balancing the competing interest arising out of the use of civilian drones.
- India is facing a serious water crisis due to massive contamination of water supply and fast depletion of groundwater resources, with serious implications for health, wealth and sustainability. Discuss in light of the Niti Aayog’s report on Composite Water Management Index.
(10 marks, 150 words) Answer:
That about 600 million faced high water stress, around 2 lakhs of people died every year due to inadequate access to safe water and droughts are becoming more frequent; show India is facing a serious water crisis. The Composite Water Management Index by Niti Ayog ranked all the states based on various parameters like: include various aspects of ground water, restoration of water bodies, irrigation, farm practices, drinking water, policy and governance.
- 70% of the water resources are identified as polluted in the Composite Water Management Index.
- Contamination is a bigger issue than Availability per se.
- Waste Water Treatment is hovering around 30-33%.
- The report highlights the critical status of groundwater resources, which are being depleted at unsustainable rates. Agriculture alone accounts for about 80% of all water use, which is mostly drawn from underground sources.
- Growing Population, Urbanization, drilling of wells/ borewells etc. are causing water shortages.
- A recent report already highlighted there is 30 mcg/L of Uranium Concentration in ground water.
Implications for Health, Wealth and Sustainability:
- Water crisis breeds Food crisis which can be seen in the form of frequent droughts.
- Water contamination is a significant challenge for India, and is estimated to affect threefourth of the Indian population, contributing 20% of the country’s disease burden. (Damage to Kidneys etc.)
- If the Situation remains grim or as usual, there will be 6% loss in the country’s Gross Domestic Product by 2050.
- Not Only GDP, but the burden on individual pocket will increase due to degraded health quality as an effect of polluted water.
- Critical groundwater resources, which accounted for 40% of India’s water supply, are being depleted at “unsustainable” rates. Thus their recharge would be a problem forthcoming. Various Schemes have been taken, but their success has been under:
Water Policy Timeline In India:
This Index comes to the aid in the manner that awarding an index rank would help advance schemes for making water potable and its sustainable use and making States feel the need to be competitive. Better data collection would be boosted and the further urbanization pattern would be in sync with the analysis of such data.
- Discuss how an effective Environmental Impact Assessment (EIA) process can ensure sustainable development for a fast growing country like India.
(10 marks, 150 words) Answer:
Development & environmental management & are often considered at loggerheads with each other in a fast growing country like India. However, environmental management is truly compatible with sustainable development. And, herein lies the significance of EIA for ensuring sustainable development.
EIA process assesses the environmental and social impact of the proposed project on the local ecology & community of the region and thus helps in decision making regarding the sustainability of the project. It goes through the following 6 stages in the country-
- Public Consultation
- Decision making
But often there are concerns regarding the implementation of EIA in India as reflected in recent anti- Sterlite protests & protests against the proposed Neutrino observatory in Tamil Nadu. An effective EIA process should focus upon the following-
- The stage of scoping should be broadened to include the health & social impact of the proposed project on local community. (It is already being followed in developed countries through Strategic Environment Assessment.) Though, these categories of impact were initially proposed to be assessed but it’s hardly followed on ground in letter and spirit. That’s exactly the reason why protests against Copper Smelting unit of Vedanta group (Sterlite industries) were recurrent since the conception of the project. Various independent studies found that Sterlite Copper smelting unit is responsible for high degree of ecological degradation leading to severe health problems for locals like cancer.
- The stage of public consultation should be given its due importance. Environmental, social & health concerns of locals should be taken into consideration and addressed by project proponent & government in a time bound manner. For effective public consultation, it needs to be carried in the local languages understood by locals and not in English as is being done in some cases in the country.
- EIA report should be prepared by a specialized and credible third party agency as opposed to the current practice in which report is mostly prepared by the project proponent.
- Aim of the government should be to move towards Strategic Environment Assessment (SEA) from EIA which also gives due weightage to alternatives of the proposed project, in case the environmental & social costs of the project far outweigh the economic & social benefits.
Only a transparent & time-bound EIA process with involvement of all the stakeholders right from the conceptualization stage can pave the way for sustainable development in the country.
- India’s internal security faces significant challenges linked with border management. In this context, explain the role played by various security forces in guarding India’s borders.
(10 marks, 150 words) Answer:
India’s internal security challenges are invariably linked with border management due to the hostile attitude of some of the India’s neighbours and their tendency to exploit India’s persistent national challenges. The major border security challenges of India include Cross-border terrorism, infiltration and exfiltration of armed militants and insurgents; Narcotics, Arms and FICN smuggling; Illegal migration; Aid by external powers to LWE and separatist movements. India’s border forces play an important role in border management.
Forces guarding the borders:
The country shares a land boundary with six countries (ignoring Afghanistan) situated in varied topography and climatic zones. Deployment of forces based on the principle of ‘One border, one border – guarding force’ has been adopted for guarding the international borders. Accordingly, domination of each border has been entrusted to a particular border guarding force as under:
- Border Security Force (BSF) for Bangladesh and Pakistan borders o BSF was raised in 1965. It today has strength of more than 2.5 lakhs and 186 Battalions with Water Wing, Air Wing and other ancillary units. Its operational responsibility is spread over 6,300 km of International Border with Pakistan and Bangladesh. It is also deployed on Line of Control (LoC) in J&K under the Operational control of the Army.
- Indo Tibetan Border Police (ITBP) for China border o The ITBP was raised in the wake of Chinese aggression in 1962. Today, ITBPF guards 3,488 kms of Indo-China Border and is manning 173 Border Out Posts (BOPs) from Karakoram Pass in Ladakh to Jachep La in Arunachal Pradesh.
- Sashastra Seema Bal (SSB) for Nepal and Bhutan borders o The Special Service Bureau set up in early 1963 in the wake of India- China conflict of 1962 to build up the moral and capability of the border population, became a border guarding Force in 2001 under the Ministry of Home Affairs and was renamed as
“Sashastra Seema Bal” with an amended charter of duties. SSB is deployed on IndoNepal Border covering a stretch of 1751 kms and on Indo- Bhutan Border covering 699 kms.
- Assam Rifles (AR) for Myanmar border
- Fondly known as “Friends of the North East People”, the Assam Rifles was raised as “Cachar Levy” in 1835 and is the oldest Para Military Force in the country. The Force has a dual role of maintaining internal security in the north-eastern region and guarding the Indo-Myanmar border, spread over 1,631 kilometer.
- Assam Rifles is not a dedicated Border Guarding Force (BGF) like other BGFs, as it is also involved in counter insurgency operations. It operates in formation of Company Operating Bases (COB) and not on Border Out Posts (BOP) basis as other BGFs do.
- Indian army is guarding land borders along the LOC on Pakistan border and LAC on China border.
Coastal border forces:
- Indian Navy and Coast Guard are vested with the responsibility of coastal borders, where the State (Marine) Police is acting as the second line of defence.
Along with the forces guarding India’s borders, the strategy to deal with border security challenges involves Implementation of the Border Area Development Programme (BADP), Creation of border infrastructure as well as strengthening of coastal security infrastructure. To aid the forces in border management, and to reduce the number of people patrolling the border, the Ministry of Home Affairs is deploying a Comprehensive Integrated Border Management System (CIBMS), in the form of integration of radars, sensors, cameras, communication networks and command and control solutions.
- In the light of India resorting to the option of surgical strikes, explain the reason why it is important for India to understand and evolve a sound legal basis for extra-territorial military operations.
(10 marks, 150 words)
The doctrine of hot pursuit owes its origin to the law of the seas, and emerged as an exception to the fundamental principle of freedom of the high seas – the rights of vessels of all nations to navigate freely on the high seas. At a time when smuggling and piracy were rampant, this customary doctrine emerged to empower a coastal state to pursue on to the high seas a vessel that had violated its laws within its waters. This denied the intruding vessel the opportunity to escape punishment by claiming protection under the right of free navigation on the high seas, which had been designed to protect innocent vessels. Importantly, this customary doctrine did not extend to the territorial waters of a foreign state. Decades later, this customary doctrine was codified in the 1982 United Nations Convention on the Law of High Seas. Apart from imposing procedural restrictions, the Convention clearly spelt out that the right of hot pursuit ceases as soon as the ship pursued enters the territorial sea of its own country or a third state.
Over the years, some countries have sought to introduce an expanded doctrine of hot pursuit on land, to justify the breaches of territorial sovereignty of foreign states as part of the ongoing pursuit of offenders. For instance, in 1986, South Africa sought to justify its incursions into neighbouring African states on the basis of the doctrine of hot pursuit, inviting the condemnation of the United Nations Security Council. More recently, Kenya sought to justify its military actions against Al-Shabaab militants in Somali territory on the basis of this adapted doctrine of hot pursuit, again inviting criticism from the international community.
It is thus clear that the so-called right of hot pursuit on land is a highly controversial one, and has been generally rejected. Instead of relying on a self-standing doctrine of hot pursuit, India’s legal position may be better served by invoking the expanded doctrine of self-defence, which has witnessed a normative evolution, particularly in relation to non-state actors, following the events of September 11, 2001.
This expanded doctrine, which has gained significant acceptance in Western scholarship, permits states to use force against non-state actors and breach the territorial sovereignty of foreign states in response to an accumulation of terrorist attacks. While this expanded doctrine of self-defence is not altogether unquestionable and has its own set of critics, it is certainly more palatable within the international community than the much condemned doctrine of hot pursuit on land.
- What are Payments Banks and why are they being seen as a significant step towards financial inclusion? Do you agree that the recently launched India Post Payments Bank is ideally positioned to take banking to the doorsteps in rural areas? Substantiate with arguments.
(15 marks, 250 words) Answer:
In 201, RBI was asked to create framework for Differentiated banks to meet credit and remittance needs of small businesses, unorganized sector, low income households, farmers and migrant work force. RBI came up with guidelines for Payments Banks and Small Finance Banks.
A payments bank is a differentiated bank with the specific objective of catering to the unbanked and underbanked. Non-banking financial organisations are granted the authority to offer basic bank services like accounts for small demand deposits (up to Rs 1 lakh), remittance services, mobile payments/transfers/purchases and other banking services like ATM/debit cards, net banking and third party fund transfers. They can offer non-risk sharing simple financial products like mutual fund units and insurance products, etc.
Aid in Financial Inclusion:
- Financial Inclusion is critical for the socio-economic development of the country, but there are significant gaps in the banking services area and a large proportion of country’s population remain unbanked or underbanked.
- Payments banks will have a “multiplier impact” on the banking system and financial inclusion, as they will provide doorstep banking to people in remote areas at lower cost and compete with traditional banks in future.
- Payments banks will provide a limited range of products, but will have a widespread network of access points particularly to remote areas, either through their own branch network or through Business Correspondents (BCs) or through networks provided by others.
- The operations of the bank should be fully networked and technology driven from the beginning.
India Post Payments Bank (IPPB):
- Department of Posts was one of the applicants which were issued in-principle approval for setting up a payments bank. Through India Post Payments Bank (IPPB), the aim is to reach to every nook & corner of the country.
- With IPPB, banking at the doorstep can become a reality due to huge postal network in the country.
- All the 55 lakh post offices in the country will be linked to the IPPB system by the end of 2018. It will facilitate financial inclusion in lakhs of villages. More than 3 lakh postmen and Gramin Dak Sevaks will be utilized to provide banking services.
- The India Post Payments Bank (IPPB) was launched in 2018. It will have 650 branches and 3250 Access Points across the country.
IPPB will effectively leverage the ubiquitous post office network with its pan-India physical presence, long experience in cash handling and savings mobilization, backed by the ongoing project of IT-enablement, to bridge the gaps in Financial Inclusion and take banking to the doorstep in rural areas.
Banking is going to be more of technology-enabled and effort is now on to expand banking to every unbanked corners of the society and payments banks are perfectly suited for this. India Post Payments Bank with its wide network and experience is perfectly positioned to drive financial inclusion and should look to prioritise women SHGs in its operations.
- With the overgrown and inefficient public sector starting to prove burdensome, a decision was taken in 1991 to follow the path of Disinvestment. Critically evaluate the performance of the Government of India’s Disinvestment Policy since 1991.
(15 marks, 250 words) Answer:
The disinvestment policy is mostly done through three models:
- Promoting public ownership of CPSEs: Listing of profitable CPSEs on stock exchanges to promote ”people’s ownership” by encouraging public participation in CPSEs;
- Disinvestment through ”minority stake sale” in listed CPSEs to achieve minimum public shareholding norms of 25 per cent. Here, the Government will retain majority shareholding.
- Strategic disinvestment/sale by way of sale of substantial portion of Government shareholding in identified CPSEs upto 50 per cent or more, along with transfer of management control.
Evolution of Disinvestment policy:
For the first four decades after Independence, India pursued a path of development in which the public sector was expected to be the engine of growth. However, the public sector overgrew itself and its shortcomings started manifesting in low capacity utilisation and low efficiency, inability to innovate, large interference in decision making process etc. Hence, a decision was taken in 1991 to follow the path of Disinvestment.
Disinvestment policy since 1991:
- Period from 1991-92 to 2000-01 (Sale of minority stakes of the PSUs)
- The change process in India began in the year 1991-92, with 31 selected PSUs disinvested for about Rs.3,000 crore.
- This was the period when disinvestment happened primarily by way of sale of minority stakes of the PSUs through issue of shares in small tranches, most of which were picked up by the domestic financial institutions.
- Disinvestment was not a great success due to Unfavorable market conditions; Opposition on the valuation process; No clear-cut policy on disinvestment; Strong opposition from employee and trade unions etc.
- Against an aggregate target of Rs. 54,300 crore to be raised from PSU disinvestment from 1991-92 to 2000-01, the Government managed to raise just Rs. 20,000 crore (less than half).
- Period from 2001-02 to 2003-04 (Strategic Sale and Offer to Public)
- The disinvestment took the shape of either strategic sales (involving an effective transfer of control and management to a private entity) or an offer for sale to the public, with the government still retaining control of the management.
- Some of the companies which witnessed a strategic sale included: Bharat Aluminium Co. Ltd. Hindustan Zinc Ltc, Maruti Suzuki India Ltd. etc.
- This was the period when maximum number of disinvestments took place. The valuations realized by this route were found to be substantially higher than those from minority stake sales.
- During this period, against an aggregate target of Rs. 38,500 crore to be raised from PSU disinvestment, the Government managed to raise Rs. 21,000 crore (in just 2 years).
- Period from 2004-05 to 2008-09 (Stagnation)
- The issue of PSU disinvestment remained a contentious issue through this period. As a result, the disinvestment agenda stagnated during this period.
- In the 5 years from 2003-04 to 2008-09, the total receipts from disinvestments were only Rs. 8,500 crore.
- 2009-10 to 2015-16 (Minority sale in profitable PSUs)
- A stable government and improved stock market conditions initially led to a renewed thrust on disinvestments. The Government started the process by selling minority stakes in listed and unlisted (profit-making) PSUs. This period saw disinvestments in companies such as NHPC Ltd., Oil India Ltd., NTPC Ltd. etc. through public offers.
- However, from 2011 onwards, disinvestment activity slowed down considerably.
- Disinvestment achieved during 2009-10 to 2013-14 was more than Rs. 99,000 crore, with an yearly average of Rs. 19,873.
- The total disinvestment picked up during 2014-15 to 2016-2017 was Rs. 87,714 crore, with an average yearly realization of Rs. 29,238 crores.
- 2016-17 onwards
- For identifying CPSEs for strategic disinvestment, and implementing it, Government has organized Niti Aayog for assisting it, the Core Group of Secretaries on Disinvestment (CGD) to monitor implementation and the Department of Investment and Public Asset Management (DIPAM) to oversee the disinvestment.
- The Government has approved listing of 14 CPSEs in sectors like railways, defence, power, steel, renewable energy & insurance.
- Second tranche of CPSE Exchange Traded Fund (ETF) was floated to simultaneously divest multiple stocks spread across various sectors in one bundled instrument.
Most of India’s public sector is still a huge burden on the exchequer. The disinvestment plans must be implemented at greater pace in line with the principle of “government has no business being in business”.
- A shift in strategic direction, from a ‘production based push into markets’ towards a ‘demand based pull built on a fork-to-farm’ approach is needed. Explain with reference to Dalwai Committee report on doubling farmers’ income.
(15 marks, 250 words) Answer
The traditional concept of seamless farm-to-fork connectivity is related to food supply systems which promoted a push model from farms to market end. The model assumes that the market will absorb all that was supplied. Here the focus had been on increasing the production (output). However, even when farmers produce some crops abundantly in some years, if there is minimal real growth in demand in the market, they are not able to achieve high returns. Clearly, the production approach does not accord importance to value realisation from post-production activities.
The focus has now shifted to the income approach. Increasing the net income of farmers necessitates efficient monetisation of production, without which there would be no benefit for the farmers.
New ways of thinking are emerging for ensuring better monetisation of farmers’ produce. The government is seriously reviewing the post-production policy regime along with facilitating better understanding of what the markets demand. The existing production activities need to be restructured to be market led and take into account the rapidly changing consumption patterns and dietary habits. This points to the need for promoting “fork-to-farm” signals (demand and price), rather than a “farm-to-fork” push. This would be possible by first ensuring food security and thereafter promoting the production of that particular segment of activity which has a demand in the market.
The fork-to-farm approach to augment farmers’ income needs innovative thinking by shifting priority focus to post-production management and the agricultural marketing system. There is need for creating an enabling environment for post-production activities such as harvesting, preparing harvest for market, transportation, storage, pledge loan processing and marketing. The DFI Committee (Dalwai Committee on Doubling Farmers’ Income) has observed that, rather than an increase in the MSP, a more straightforward and beneficial means of raising farm incomes could be reforming the marketing system of agricultural produce, while also taking steps to facilitate linking of the farmer to the markets (LFTM).
While this is a step in the right direction, it is also fraught with various challenges and constraints, including the preponderance of small and marginal holdings, the absence of a major breakthrough in technology, inadequate investment in rural infrastructure and capital formation, an inefficient system of marketing of the agriculture produce, huge post-harvest losses, and lacunae in the transfer of technology to farmers.
Adopting the Fork-to-Farm strategy will ensure the greater return to farmers and hence be a major step towards doubling farmers’ income. However, success of this strategy depends on backward information flow of demand to farms through Information Communications Technology (ICT) systems and widening farmers’ market to national or even global markets, with necessary institutional and logistics support.
- ‘India should soften its demands related to the agricultural subsidies at WTO and focus more on demanding the liberal trade in services.’ Critically evaluate the statement citing the Indian stand in the recent WTO Ministerial Conferences.
(15 marks, 250 words) Answer:
For last five years since the Bali Ministerial of 2013, India has been demanding ‘permanent solution’ on the matter of the agricultural subsidies. Under this, India seeks to implement changes in the rules related to the calculation and classification of the agricultural subsidies as stated in the Agreement on Agriculture of WTO. India demands that the formula of MSP subsidy calculation needs to be revisited as it is based on the reference price taken during the 1986-88 period. It exaggerates the subsidy given by economies like India and China.
India also demands that since the MSP subsidy is being given for the purpose of food security, it should be shifted from Amber Box to the Green Box (non-trade distorting subsidies). Most of these demands are justified as the developed countries like US and those of EU, have given massive amount of subsidy to their farmers which they have shifted to the Green Box to avoid reduction. However, they give most subsidies in the form of decoupled payments, not directly linked to production unlike India.
In services, India is demanding trade facilitation which refers to the implementation of the earlier liberalization promises by the developed countries like the simplification of visa rules. India demands opening up of Mode 1 and Mode 4 services in general which can benefit Indian IT and ITES sectors along with the skilled migrants.
Although both the demands by India seem justified, as a negotiating member, focusing on one issue delivers better results. Services liberalization can have greater impact on GDP growth than that of permanent solution in agriculture. It can be defended better by India through the free trade principle also.
However, agriculture is still important for job creation and food security goals of India. Still, India’s insistence in WTO that no other agreement will be signed unless a permanent solution is sought on agricultural subsidies is impeding other negotiations. Thus, India should keep on making these demands, but remain open to other agreements as well. But, our negotiations on services should be tough so that we can maximize the benefits of services trade.
- Give a brief account of major achievements in the realm of biotechnology in India.
(15 marks, 250 words)
Biotechnology is a highly interdisciplinary field that combines biological sciences with engineering technologies to manipulate living organisms and biological systems to produce products that advances healthcare, medicine, agriculture, food, pharmaceuticals and environment control. Biotechnology can be classified into two broad categories: R&D in Biological Sciences and Industrial Processes. The biological sciences aspect deals with research and development in areas such as Microbiology, Cell biology, Genetics,
Molecular Biology etc. for understanding the occurrence and treatment of diseases, development of agriculture, food production, protection of the environment and many more. Most of the R&D work in biological sciences is carried out in the laboratory. The industrial processes aspect deals with the production of drugs, vaccines, biofuels and pharmaceuticals on an industrial scale using biochemical processes and techniques.
India has embarked upon a very ambitious program in biotechnology with a view to harnessing its available human and unlimited biodiversity resources. It has mainly been a government sponsored effort with very little private industry participation in investment.
The major thrust areas of
biotechnology development in India have been education and training, agricultural biotechnology, biofertilizers and biopesticides, tissue culture for tree and woody species, medicinal and aromatic plants, biodiversity conservation and environment, vaccine development, animal, aquaculture, seri and food biotechnology, microbial technology, industrial biotechnology, biochemical engineering and associated activities such as creation of biotechnology information system and national repositories.
The Department of Biotechnology (DBT) established under the Ministry of Science and Technology in 1986 was the major instrument of action to bring together most talents, material resources, and budgetary provisions. It began sponsoring research in molecular biology, agricultural and medical sciences, plant and animal tissue culture, biofertilizers and biopesticides, environment, human genetics, microbial technology, and bioprocess engineering, etc. The establishment of a number of world class bioscience research institutes and provision of large research grants to some existing universities helped in developing specialized centres of biotechnology.
The sector in India, which is currently growing at 20% was expected to go up to USD 11.6 Billion by 2017. The focus is on making the Indian biotechnology sector reach USD 100 billion by 2025. Currently, India’s biotech industry holds 2% of the global market share and is the third largest in the Asia-Pacific region. The sector has immense potential to grow and provides plenty of opportunities to
investors. The ‘National IPR policy’ announced by the Government of India in May 2016 while helping promote innovation, R&D and entrepreneurship, also lays down processes to expedite IPR filings, which is critical for the success of this sector.
Today, big Indian biotech companies like Avesthagen, Biocon, Life Technologies, Shantha Biotechnics, Strand Life Sciences and so forth are expanding their business. Serum Institute, Pune is believed to be the world`s largest manufacturer of DPT vaccines. Indian Immunologicals operates the world`s second largest plant for veterinary vaccines and is also the world`s largest manufacturer of the vaccine against Foot and Mouth Disease. The Biotechnology Regulatory Authority of India (BRAI) is a proposed regulatory body in India for uses of biotechnology products including genetically modified organisms (GMOs)
Upcoming sectors are bioinformatics, recombinant technology etc which India is well poised to take advantage of.
- Petrol and diesel cannot be the answer to India’s emerging fuel requirements. The scientific community must consider hydrogen as a prospective future fuel. Do you agree?
(15 marks, 250 words)
The world had been dependent on oil as the pillar of its economy with fossil fuels leading as the world’s primary energy supply. This dependence in oil was seen during the 1973 oil embargo which struck the economies of the industrialized countries for months. Countries with the highest energy consumptions are notably China followed by United States, and
Since the advent of industrial revolution, the use of oil for electricity and other industrial applications had become inevitable. The driving force of a civilization will always be energy accessibility. But with the uncertainty of the oil reserves due to failed forecasting and underestimated oil reserves along with the increasing energy demand of the growing population, the necessity to develop alternatives for fossil fuel had been the focus of the century.
According to the 2014 World Energy Outlook of the International Energy Agency (IEA), 60% of the total global energy demand is concentrated in Asia today. The growth of world primary energy demand will continue to increase and is projected to be 37% higher in 2040 where at the same time coal and oil will be reaching its plateau. On the other hand, the environmental implications of using fossil fuel as energy due to its greenhouse gas emissions causing climate change had also been a growing concern urging countries to shift to a more sustainable and clean energy conversion chains.
With the possible fossil fuel depletion and climate change impacts, the challenge at hand is to have a sustainable energy in the future. Technologies from these resources are important and are significantly growing. Conversion technologies from these resources are being developed in such a way that it is safe, secure, and compatible backed up with regulation laws and support from governments. However, the precondition for the acceptance of these energies is the availability of marketable technologies for the production, distribution, and usage. Among these technologies, hydrogen energy is starting to build its hydrogen economy paving its way to the energy market.
Hydrogen is the lightest and the most abundant element in the universe. But the hydrogen atom is chemically very reactive and due to its lightweight it easily escapes from Earth’s gravity. Hence, it is not found chemically free in nature with its availability on earth only in compounds. Since it does not readily exist as pure hydrogen gas, it is considered as secondary energy source. As of today, electricity is still the leading secondary energy carrier in the world deriving its energy primarily from fossil fuels. Hydrogen is also a high quality energy carrier which can store and deliver usable form of energy similar to electricity that is produced from a variety of resources and as byproduct of chemical processes. Hydrogen can not only be used in fuel cells to generate electricity but it can also be used to fuel internal combustion engines to replace petrochemicals such as diesel. Considering the idea that it can replace petroleum as fuel, it is necessary that it possesses certain key criteria for an ideal fuel. As an ideal fuel it has to be identified by its inexhaustibility, cleanliness, convenience, and independence from foreign control. Hydrogen is one of the most plentiful gas in the universe with the sun and stars comprising of hydrogen and helium gas.
On a weight basis hydrogen has the highest energy content among the three but in terms of its volume it is relatively low in energy; researches on storing and transporting hydrogen is highly adequate to achieve cost effective and efficient utilization of its energy. In terms of its combustion property, it is easier to ignite compared to the other two as suggested by its low minimum ignition energy. The wide range of its flammability limits allowing stable operations even at highly dilute conditions which makes it an ideal fuel for lean burn combustion engines.
Another use of hydrogen as fuel is its application in fuel cells (FC). The revival of interest in hydrogen production came about due to fuel cell technology. With the continuous price hike of oil over the years, this technology efficiently utilizes hydrogen energy to provide cheap, clean and renewable electricity. Fuel cells are an electrochemical conversion device to convert hydrogen and oxygen into water while in the process also produces electricity. The difference of a fuel cell to a typical battery is that it can never go dead as long as there are chemicals constantly flowing into the cell.
Aside from being used as fuel for ICE and FC, hydrogen is also an important raw material for several industries. One of its industrial applications is to process crude oil into refined fuels such as gasoline and diesel by removing its contaminants. It is also an important feedstock for ammonia production for use in fertilizer, semiconductor production, glass industry, hydrogenation of fats and oils, methanol production, production of HCl, plastics recycling, rocket fuel, and welding and cutting.
Several technologies have been available for the production of hydrogen fuel, one of which is the production from fossil fuels that is natural gas. Another abundant source of hydrogen on earth constitutes 70% of the Earth itself – water. Biomass is the most versatile among the renewable resources because gas can be harvested in liquid or gaseous form.
Hydrogen, a secondary energy resource, is capable of generating power as well as fuel source. However, in building hydrogen economy for the future, the reliability of hydrogen production and its long term effects must be thoroughly considered. Reliability would mean a more sustainable hydrogen energy derivation consequently producing less emissions that can be harmful to the environment.
- Draw a relation between emerging tourism industry and transformation of hazards into disasters. Also suggest some measures to mitigate negative impact of tourism on environment.
(15 marks, 250 words)
Tourism is one of the world’s fastest growing industries as well as the major source of foreign exchange earning and employment for many developing countries, and it is increasingly focusing on natural environments. However, tourism is a double-edged activity. It has the potential to contribute in a positive manner to socio-economic achievements but, at the same time, its fast and sometimes uncontrolled growth can be the major cause of degradation of the environment and loss of local identity and traditional cultures. Biological and physical resources are in fact the assets that attract tourists. However, the stress imposed by tourism activities on fragile ecosystems accelerates and aggravates their depletion. Paradoxically, the very success of tourism may lead to the degradation of the natural environment: by depleting natural resources tourism reduces the site attractiveness to tourists, the very commodity that tourism has to offer.
Negative impacts from tourism occur when the level of visitor use is greater than the environment’s ability to cope with this use within the acceptable limits of change. Uncontrolled conventional tourism poses potential threats to many natural areas around the world. It can put enormous pressure on an area and lead to impacts such as soil erosion, increased pollution, discharges into the sea, natural habitat loss, increased pressure on endangered species and heightened vulnerability to forest fires. It often puts a strain on water resources, and it can force local populations to compete for the use of critical resources.
Tourism development and excessive human interference in in disaster prone areas may turns even small hazards into disaster. It has various negative impacts like, depletion of natural resources, water resources, land degradation, pollution (Air, Noise, solid waste, littering, sewage), destruction and alterations of ecosystem. Degradation of attractive landslide sites, such as mountain tops and slopes.
Therefore it is necessary to maintain a balance between use and regeneration of resources, which is called sustainable development. Development of tourism as an industry is also a step towards economic development, which may also have some negative impacts on the country. We know that sometimes anthropogenic activities supplements transformation of hazards into disaster, like urbanization in hilly areas, development of infrastructure like roads, railways and bridges triggers the incidents of landslides, earthquake, and avalanches.
These all negative impacts have potential threats to transform even small hazards into disasters. Therefore tourism in India should be developed in such a way that it attracts tourists from around entire world, and entertains them in such a way that is minimum intrusive or destructive to the environment, in short Eco-tourism should be adopted, which means ecologically sensitive tourism, keeping in mind the sustainable growth of the country.
Additional Information on Eco-Tourism –
Tourism industry in India is growing and it has vast potential for generating employment and earning large amount of foreign exchange besides giving a flip to the country’s overall economic and social development. Eco-tourism needs to be promoted so that tourism in India helps in preserving and sustaining the diversity of the India’s natural and cultural environments. The International Union for Conservation of Nature in 1992 lists tourism as the second major threat to protected areas. Owing to the increasing negativities of tourism, several authors reiterated that tourism industry should grow carefully and in a sustainable manner.
The Rio+20 Outcome Document “The Future We Want” highlights the role of sustainable tourism so as to come out of the adverse effects of tourism The United Nations defies sustainable tourism as “Tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment and host communities.
Characteristics of Ecotourism
According to Patterson (2002), characteristics of an ecotourism business are that it: § Have a low impact upon a protected area’s natural resources and recreation techniques.
- Involve stakeholders (individuals, communities, ecotourists, tour operators and government institutions) in the planning, development, implementation and monitoring phases
- Limits visitation to areas, either by limiting group size and/or by the number of groups taken to an area in a season
- Supports the work of conservation groups preserving the natural area on which the experience is based.
- Orients customers on the region to be visited.
- Hires local people and buys supplies locally, where possible.
- Recognizes that nature is a central element to the tourist experience.
- Uses guides trained in interpretation of scientific or natural history.
- Ensures that wildlife is not harassed.
- Respects the privacy and culture of local people
- In light of changing security situation confronted by India, do you think there is a need for India to revisit its nuclear doctrine? Sketch your argument.
(15 marks, 250 words) Answer:
The major factor behind the questioning of the Nuclear Doctrine stems from concerns about NFU. Dissatisfaction with our NFU posture is not new. Ab initio, in discussions on this in the NSAB a case against it was made out on the grounds that such an approach unnecessarily kept us on the back foot and on the defensive and made it axiomatic that we would have to face the consequences of a first strike before being able to respond. Moreover, it prevented us from keeping a potential adversary off balance. This view did not, however, prevail in the subsequent discussions in the matter.
What is new about the increased opposition to the NFU posture is that it arises in part from increasing evidence of Pakistan’s proclivity to use tactical nuclear weapons against us, and in part from scepticism about our deterrent capability and about our willingness to respond to a tactical strike with a “massive” retaliatory attack. Advocates of a change in our NFU policy would like our nuclear doctrine mimic those of most of the established Nuclear Weapon States which contemplate the use of nuclear weapons even in sub nuclear conflicts.
Since an important element behind the call for revisiting our nuclear doctrine emanates from a lack of confidence in our deterrent and in our willingness to resort to the use of nuclear weapons in a massive second strike in response to an attack on us with tactical weapons the same needs to be addressed by much more effective signalling and a demonstration that the government will do what it says and will not shy from making a robust response when necessary. The following could be some moves in this direction:
- Government must restore faith in itself by doing what it says and not shying from biting the bullet. Firmness must be shown in all its actions, for instance, on issues of law and order, terrorism and addressing difficult neighbours.
- Periodic statements about the nurturing and upgradation of our nuclear arsenal and systems including alternate command structure.
- An indication that our nuclear arsenal will be large enough to take care of all adversaries and will have to be in the mid triple digits.
- Appointment of a Chief of Defence Staff and upgradation of the NTRO as a capable apex techint organization which would in a fool proof manner provide indicators of any attack on us and ensure swift and massive nuclear retaliation inflicting unacceptable damage.
An indication that we have in place multiple, well camouflaged and well secured vectors which are constantly being further refined in order to enable the country to inflict unacceptable damage even after absorbing a first strike by its adversaries
- “Being the centres of concentration of the industrial proletariat, urban areas play an important part within the political strategy of the new Democratic Revolution”. Examine this statement in the light of rising Maoist activity in the urban areas and why is it essential to keep a close watch on Maoist activities in towns and cities?
- marks, 250 words) Answer:
The Urban Movement has a defined role in the political strategy and military strategy of the CPI (Maoist). In the Maoist scheme of things the objectives/tasks of the Urban Movement could be classified under three broad heads: (a) mobilise and organise the basic masses and build the party on that basis ; (b) build the United Front ; and (c) Military tasks .
The utility of having a presence in urban centres and operate there was best illustrated in recent times when police seized empty rocket shells and rocket launchers in Mahabubnagar district, Andhra Pradesh. On many occasions important top-level leaders of the CPI (Maoist) have been arrested from cities and towns. The detection of Maoist activities in towns such as Surat, in Gujarat clearly indicates that the Maoists are attempting to penetrate the urban-based working class movement in the country. Besides, there have been reports of the detection of Maoist activities in Haryana. In Maharashtra, too, the Maoists apparently devised a plan to operate in urban areas in a big way. Some Maoist documents, reportedly, contained encrypted writings and code names for various cities and towns in Maharashtra . The Urban Movement has attracted students towards the Maoist fold in various parts of the country. Moreover, if and when the Urban Movement catches on among the industrial workers, the state will have to deal with possible sabotage activities and industrial unrest. When the Urban Movement becomes strong, the state will then have to deal with urban terrorism. Urbanisation its elf has some faultlines and the Maoists could well exploit these to their advantage. Also, the stronger the movement becomes in the urban areas the more it is likely to contribute to the agrarian revolution – in terms of providing leaders and men and material to the people’s war. Besides, the Maoists enjoy some degree of sympathy and support among the urban intellectuals and middle class, including students and teachers in schools, colleges and universities. It is, thus, essential to keep a close watch on Maoist activities in towns and cities.
- What threat does China’s increased military presence in the Indian Ocean pose for India’s security? Critically examine. Also, discuss the steps taken by India to counter the threat.
- marks, 250 words) Structure:
- Increasing Chinese military presence in Indian Ocean region
- The threats due to Chinese presence
- Steps taken by India
- Way forward
The India had the biggest advantage for exerting influence in Indian Ocean region (IOR) due to its geographical location, Economic strength and use of soft power in the neighbouring littoral countries.
But recently India’s influence in IOR has been challenged to a large extent by increasing Chinese presence. This is evident from the following examples:
- The China is creating a string of pearls by establishing various military bases in IOR. Thus, thereby aim to encircle India. For Example– Construction of Gwadar port in Pakistan, Hambantota port in Sri Lanka, Chittagong port in Bangladesh, Kyaukphyu port in Myanmar
- The China has started Maritime silk road (MSR) and wants various nations of IOR to join the same. For Example- Maldives recently agreed to be part of MSR.
- The China has also announced establishment of its first overseas official military base in
- The Chinese Navy has also increased its presence in IOR, which is evident from Chinese submarine docking at Colombo Airport.
The Chinese presence in IOR poses following threats:
- There has been a persistent threat of encirclement and restricting India using string of pearls.
- The Djibouti base will enable China to base its long-range naval assets there.
- The China using its presence in IOR may carry out surveillance over the Arabian sea as well as India’s island territories off the western coast.
- India will also not be able to play on the Chinese Malacca dilemma (China feel threatened that in case of war with India, India may cut the Chinese vital sea supply chain running via Malacca)
- On the other hand, there is fear among Indian strategic community that China by using its naval bases in IOR may cut oil supply and put embargo on Indian trade through IOR. (India imports 70% of its oil requirement and 95% of Indian trade by volume is carried out through sea)
- The increasing Chinese presence in IOR may create a situation where India may have to face Two Front War with China. (One on land and other on sea)
To overcome the above challenges/threats the India has taken following steps:
- India is trying to enhance defence capabilities, build and install maritime infrastructure through Sagarmala Project.
- It has also initiated Project Mausam to revive the ancient maritime routes and cultural linkage with countries of IOR.
- India is trying to negotiate leasing of Assumption Island in Seychelles and Agalega Island in Mauritius.
- India also took a leading role in setting up of Indian Ocean naval Symposium (IONS) and Indian Ocean rim Association for coordination of activities with other countries of IOR.
The above-mentioned steps are in right direction and they need to be substantiated by coordination with like-minded countries (for example- India signed white shipping agreement with USA).There is also a need for building up the capability of Indian Navy to overcome future challenges due to Chinese presence in IOR.