[Mission 2024] Insights SECURE SYNOPSIS: 12 March 2024

NOTE: Please remember that following ‘answers’ are NOT ‘model answers’. They are NOT synopsis too if we go by definition of the term. What we are providing is content that both meets demand of the question and at the same

General Studies – 2

Topic: Appointment to various Constitutional posts, powers, functions and responsibilities of various Constitutional Bodies.

Topic: Appointment to various Constitutional posts, powers, functions and responsibilities of various Constitutional Bodies.

1. What criteria does the Finance Commission consider when devolving funds to the states? Examine the issues related to it and suggest measures that the Sixteenth Finance Commission must take to ensure a fair and equitable distribution of funds among the states. (250 words)

Difficulty level: Tough

Reference: The Hindu , Insights on India

Why the question: The articles discusses issue of decline in shares of allocation of some States by the Finance Commission. Key Demand of the question: To write about the criteria for fund devolution and measures needed for an equitable allotment. Directive word: Examine – When asked to ‘Examine’, we must investigate the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications. Structure of the answer: Introduction: Begin the giving the context of article 280. Body: In the first part, write about the criteria used by the Finance Commission to devolve funds – income distance, population size, area and geographical features, fiscal discipline, tax effort and revenue capacity, demographic performance, special needs of states etc. In the next part, mention the major issues with respect to the above – reducing devolution to certain states, geographical disparities, recognition of special state needs etc. Next, write about the steps that are needed to have a fair and equitable distribution of funds among the states. Conclusion: Conclude with a way forward.

Why the question:

The articles discusses issue of decline in shares of allocation of some States by the Finance Commission.

Key Demand of the question:

To write about the criteria for fund devolution and measures needed for an equitable allotment.

Directive word:

Examine – When asked to ‘Examine’, we must investigate the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications.

Structure of the answer:

Introduction:

Begin the giving the context of article 280.

In the first part, write about the criteria used by the Finance Commission to devolve funds – income distance, population size, area and geographical features, fiscal discipline, tax effort and revenue capacity, demographic performance, special needs of states etc.

In the next part, mention the major issues with respect to the above – reducing devolution to certain states, geographical disparities, recognition of special state needs etc.

Next, write about the steps that are needed to have a fair and equitable distribution of funds among the states.

Conclusion:

Conclude with a way forward.

Introduction

The Finance Commission is constituted by the President under article 280 of the Constitution, mainly to give its recommendations on distribution of tax revenues between the Union and the States and amongst the States themselves. Two distinctive features of the Commission’s work involve redressing the vertical imbalances between the taxation powers and expenditure responsibilities of the centre and the States respectively and equalization of all public services across the States.

Criteria of Finance Commission consider when devolving funds to the states

Issues related to this devolution process

• Potential reduction of funds to certain states

• Geographical disparities

• Need for recognition of special state needs.

• Progressive states fear losing out if the population is based on the 2011 census, as states with better population control could be penalized, which was a concern with the 15th Finance Commission.

Areas on which the 16th FC should concentrate:

• Horizontal distribution: The very nature of the horizontal distribution is that richer States compensate poorer States. The challenge of the government before defining the ToR of the 16th FC is to ensure that this happens without further deepening the divide between States(North-South).

• The very nature of the horizontal distribution is that richer States compensate poorer States.

• The challenge of the government before defining the ToR of the 16th FC is to ensure that this happens without further deepening the divide between States(North-South).

• Restraining levying of cesses and surcharges: Raising taxes is the obvious choice for increasing revenue, but doing so would require the Centre to provide the States 41 paise (for every Rs raised). On the other hand, it gets to retain every rupee if it raises it through a surcharge. The FC should specify conditionsunder which cesses and surcharges may be imposed as well as a mechanism for capping the amount that may be raised.

• Raising taxes is the obvious choice for increasing revenue, but doing so would require the Centre to provide the States 41 paise (for every Rs raised).

• On the other hand, it gets to retain every rupee if it raises it through a surcharge.

• The FC should specify conditionsunder which cesses and surcharges may be imposed as well as a mechanism for capping the amount that may be raised.

• Restraint on freebies In theory, the restraints imposed by the Fiscal Responsibility and Budget Management (FRBM) Actshould have acted as a check on such populist spending. Governments have, however, devised innovative methods to increase debt without it showing up in the budget books. The FC, in the interest of long-term fiscal sustainability, should lay down guidelines on the spending on freebies.

• In theory, the restraints imposed by the Fiscal Responsibility and Budget Management (FRBM) Actshould have acted as a check on such populist spending.

• Governments have, however, devised innovative methods to increase debt without it showing up in the budget books.

• The FC, in the interest of long-term fiscal sustainability, should lay down guidelines on the spending on freebies.

To ensure a fair and equitable distribution of funds, the Sixteenth Finance Commission could consider the following measures:

• Expand the scope of tax devolution to include a portion of cess and surcharge, enhancing revenue sharing among states.

• Implement a more nuanced formula that accounts for states’ contributions to central taxes, ensuring that states receive a fair share relative to their contributions.

• Provide targeted grants for specific developmental programs, especially in states with special needs or those facing geographical disadvantages.

• Incentivize states to adopt fiscal reforms that promote efficiency and resource optimization, rewarding states with higher tax collection efficiency.

Conclusion

These measures could help address the disparities and concerns raised by the states, leading to a more balanced financial ecosystem within the country.

Topic: Structure, organization and functioning of the Executive and the Judiciary—Ministries and Departments of the Government;

Topic: Structure, organization and functioning of the Executive and the Judiciary—Ministries and Departments of the Government;

2. Prohibiting judges from participating in politics is a crucial step to uphold judicial independence. Analyse. (150 words)

Difficulty level: Moderate

Reference: The Hindu

Why the question: Ex-Calcutta HC Judge Abhijit Gangopadhyay is not the first judge to join politics, but his pronouncement that as a sitting judge he was in touch with the BJP has cast aspersions on his orders, often critical of the TMC government in West Bengal. Key Demand of the question: To write about preventing judges from joining politics to uphold judicial independence. Directive word: Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary. Structure of the answer: Introduction: Begin by giving context. Body: In the first part, write about the need of preventing judges from joining politics – ensures the separation of powers, upholds impartiality, preserves the integrity of the judiciary, prevents political interference, and contributes to a positive public perception of the legal system etc. Next, write about the steps that are needed to do so. Conclusion: Conclude by writing a way forward.

Why the question:

Ex-Calcutta HC Judge Abhijit Gangopadhyay is not the first judge to join politics, but his pronouncement that as a sitting judge he was in touch with the BJP has cast aspersions on his orders, often critical of the TMC government in West Bengal.

Key Demand of the question:

To write about preventing judges from joining politics to uphold judicial independence.

Directive word:

Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary.

Structure of the answer:

Introduction:

Begin by giving context.

In the first part, write about the need of preventing judges from joining politics – ensures the separation of powers, upholds impartiality, preserves the integrity of the judiciary, prevents political interference, and contributes to a positive public perception of the legal system etc.

Next, write about the steps that are needed to do so.

Conclusion:

Conclude by writing a way forward.

Introduction

Prohibiting judges from participating in politics is indeed a crucial step to maintain judicial independence. Judicial independence is the cornerstone of democracy, ensuring that the judiciary remains free from external pressures and influences, particularly from the political branches of government.

Stand on the Post-retirement job by Government for retired judges:

• The 16-point code of conduct for judges, also called the “Restatement of Values of Judicial Life” is a forgotten code.

• It was adopted at a Chief Justices Conference in May 1997, the code lays the basis of how post-retirement conduct ought to be.

• It states that a judge should practice a degree of aloofness consistent with the dignity of his office.

• It also says that a judge shall not hear and decide a matter in which a member of his family, a close relation or a friend is concerned.

• 14th report of the Law Commission of Indiaconsidered the question of such nominations and appointments before forming a negative opinion.

• The report said it is clearly undesirable that Supreme Court Judges should look forward to other Government employment after their retirement.

• the Law Commission report says, “The Government is a party in a large number of causes [cases] in the highest Court and the average citizen may well get the impression, that a judge who might look forward to being employed by the Government after his retirement, does not bring to bear on his work that detachment of outlook which is expected of a judge in cases in which Government is a party.”

Importance of Prohibition

• Separation of Powers: It reinforces the separation of powers, which is fundamental to the functioning of a democratic system.

• Impartiality: It preserves the impartiality of the judiciary by preventing judges from having political biases that could affect their judgment.

• Integrity: It maintains the integrity of the judiciary by avoiding conflicts of interest and ensuring that decisions are made based on law and not political convenience.

• Public Confidence: It enhances public confidence in the judiciary, as people are more likely to trust a system that is free from political maneuvering.

Impact on impartiality and integrity of the judiciary:

• This code of conduct also lays the basis of how post-retirement conduct ought to be.

• If a judge after deciding politically sensitive cases involving particular political parties or politicians, soon after retirement seeks and gets a plum post such as a Rajya Sabha nomination by those very politicians or parties.

• it would obviously raise serious questions about his or her independence as a judge when he or she had decided those cases.

• If the cooling-off period is not enforced, independence of judiciary comes under scrutiny.

• Nomination of Justice Gogoi to a Rajya Sabha seat by the government raise serious doubts about the fairness of many critical judgments.

• As for the government, making such an offer to a just-retired CJI is not mere brazenness.

• It indicates an alarming intention to undermine judicial authority so that the elected executive is seen as all-powerful.

• If people get the perception that their judges are not entirely and fiercely independent and that the government of the day can influence them with post-retirement promises, the credibility of the Supreme Court as an institution will shatter.

• If there is even an iota of doubt in the minds of the litigants that our judges are not independent, that is the end of the independent judiciary.

• With this nomination, even the judgments which Justice Gogoi may have given on sound legal footing have now become controversial judgments.

Need of the hour:

• There is a creeping worry that post-retirement jobs are a result of pre-retirement judgments.

• Above all, public confidence in the judiciary cannot be shaken through such appointments. The issue needs to be resolved convincingly.

• Besides, ethics demand that no retired judge of the highest court accepts a post that will room to criticism and controversy.

• Retirement age of judges should be raised to 70 years.

• They should be given their last salary as pension and not given any post that does not involve judicial or quasi-judicial work for at least three years.

• The post-retirement perks of judges should be identical to the benefits they were being given while in service.

Conclusion

Prohibiting judges from engaging in political activities is essential to safeguard the independence of the judiciary and ensure that justice is administered without fear or favor. The Sixteenth Finance Commission must consider implementing robust measures to reinforce this principle and address the related challenges effectively.

Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

3. The Citizenship Amendment Act (CAA), 2019 remains a complex and divisive issue, prompting ongoing discussions about its role in the Indian socio-political landscape. Critically examine. (250 words)

Difficulty level: Moderate

Reference: Live Mint , Indian Express , Insights on India

Why the question: With the implementation of the CAA, non-Muslim migrants from Bangladesh, Pakistan and Afghanistan can easily get Indian citizenship. Key Demand of the question: To write about the pros and cons of CAA 2019. Directive word: Examine – When asked to ‘Examine’, we must investigate the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications. Structure of the answer: Introduction: Begin the giving the context of The Citizenship Amendment Act (CAA), 2019. Body: In the first part, write about the major features of The Citizenship Amendment Act (CAA), 2019. In the next part, write about the considerations behind the CAA 2019 – addresses the persecution of religious minorities in neighbouring countries, humanitarian intent etc. Next, mention the major limitations of the act – discriminatory and violating India’s secular principles, protests against the act in certain parts of the country, not recognising all refugees etc. Conclusion: Conclude with a balanced opinion.

Why the question:

With the implementation of the CAA, non-Muslim migrants from Bangladesh, Pakistan and Afghanistan can easily get Indian citizenship.

Key Demand of the question:

To write about the pros and cons of CAA 2019.

Directive word:

Structure of the answer:

Introduction:

Begin the giving the context of The Citizenship Amendment Act (CAA), 2019.

In the first part, write about the major features of The Citizenship Amendment Act (CAA), 2019.

In the next part, write about the considerations behind the CAA 2019 – addresses the persecution of religious minorities in neighbouring countries, humanitarian intent etc.

Next, mention the major limitations of the act – discriminatory and violating India’s secular principles, protests against the act in certain parts of the country, not recognising all refugees etc.

Conclusion:

Conclude with a balanced opinion.

Introduction

The Citizenship (Amendment) Act, 2019 (CAA) was notified on December 12, 2019 and came into force from January 10, 2020. It seeks to amend the Citizenship Act, 1955.

A Hindu, Sikh, Buddhist, Jain, Parsi or Christian from Pakistan, Bangladesh and Afghanistan, who entered India before December 31, 2014, can now seek Indian citizenship without producing a valid passport of these countries or a valid visa from India, according to the Citizenship (Amendment) Act, 2019, (CAA) rules notified recently.

Provisions of CAA

• The objective of the CAA is to grant Indian citizenship to persecuted minorities — Hindu, Sikh, Jain, Buddhist, Parsi and Christian — from Pakistan, Bangladesh and Afghanistan.

• Those from these communities who had come to India till December 31, 2014, facing religious persecution in their respective countries, will not be treated as illegal immigrants but given Indian citizenship.

• The Act provides that the central government may cancel the registration of OCIs on certain grounds.

CAA is in consonance with principles of Constitution

• This Bill will come as a big boon to all those people who have been the victims of Partition and the subsequent conversion of the three countries into theocratic Islamic republics.

• Government has cited that the partition of India on religious lines and subsequent failure of the Nehru-Liaqat pact of 1950in protecting the rights and dignity of the minorities in Pakistan and Bangladesh as the reasons for bringing this Bill.

CAA is not in consonance with principles of constitution

• The first is that the Citizenship (Amendment) Act is against the letter and spirit of our Constitution. Articles 5 to 11 of the Constitution deal with citizenship, and the Citizenship Act, 1955, lays down criteria for citizenship based on birth, descent, registration, naturalization, and citizenship by incorporation of territory.

• By setting new criteria, the Citizenship (Amendment) Act goes against the premise of common citizenship regardless of differences of caste, creed, gender, ethnicity and culture.

• Further, Article 14 of the Constitution lays down that the “State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India”.

• The Citizenship (Amendment) Act is divisive, deeply discriminatory and violative of human rights.

• Our national unity was won through struggle; the Citizenship (Amendment) Act is one of the many threats to its survival. Our hard-won Constitution recognizes individual and social differences, and that we must weave the cord of unity by creating a sense of belonging and inclusiveness for all.

• The Citizenship (Amendment) Act attempts to create and deepen communal division and social polarization in the country.

• The Act gives eligibility for citizenship to Hindus, Sikhs, Buddhists, Jains, Parsis and Christians from Afghanistan, Bangladesh and Pakistan who entered India on or before December 31, 2014, and specifically excludes Muslims from that list.

• In granting citizenship on the basis of religion, it discriminates against Muslims and rejects the basic concept of secularism.

• That the Citizenship (Amendment) Act is discriminatory and violative of human rights has been recognized by those who have come out on the streets in many States, in opposition to the Act.

• The agenda of Hindutva and its ultimate goal of establishing a “Hindu Nation” underlie the Citizenship (Amendment) Act, is well established both by past experience and the present actions of the BJP-Rashtriya Swayamsevak Sangh.

• In the days since the passage of the CAA, multiple protests across north and Northeast India last week. Ironically, these protests are themselves expressions of India’s overlapping multi-religious, multi-ethnic character that the CAA seeks to undermine.

• The mobilizations in the Northeast were about anxieties of ethnicity, culture and language as much as religion while the protests in Delhi, Aligarh and Lucknow are chiefly about religious identity and discriminatory exclusion of Muslims from the CAA.

Conclusion

The onus is now on the Supreme Court, being the Guardian of the Constitution, to interpret the provisions of the Act and test its Constitutionality that whether the “classification” done in the Act is “reasonable” or not if tested against Article 14. The policy towards illegal migrants and refugees needs wider debates and deliberation. However, religion can never be the basis of Indian Citizenship.

General Studies – 3

Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment

Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment

4. Addressing the challenges faced by Regional Rural Banks is crucial for their sustained success in promoting rural development. Examine. (250 words)

Difficulty level: Easy

Reference: Insights on India

Why the question: The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable. Key Demand of the question: To write about the role of RRBs, challenges faced them and steps to overcome them. Directive word: Examine – When asked to ‘Examine’, we must investigate the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications. Structure of the answer: Introduction: Begin by defining a Regional Rural Banks (RRBs) as financial institutions and their aims. Body: First, write about role played by RRBs in rural development – providing access to credit, promoting financial inclusion, creating jobs, contributing to rural development, and acting as a channel for the delivery of government schemes. Next, write about the limitations of RRBs- including low capital base, asset quality issues, lack of skilled manpower, inadequate technology, governance issues, and financial sustainability. Next, write about the steps that are needed to overcome the above challenges. Conclusion: Conclude by writing a way forward.

Why the question:

The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable.

Key Demand of the question:

To write about the role of RRBs, challenges faced them and steps to overcome them.

Directive word:

Structure of the answer:

Introduction:

Begin by defining a Regional Rural Banks (RRBs) as financial institutions and their aims.

First, write about role played by RRBs in rural development – providing access to credit, promoting financial inclusion, creating jobs, contributing to rural development, and acting as a channel for the delivery of government schemes.

Next, write about the limitations of RRBs- including low capital base, asset quality issues, lack of skilled manpower, inadequate technology, governance issues, and financial sustainability.

Next, write about the steps that are needed to overcome the above challenges.

Conclusion:

Conclude by writing a way forward.

Introduction

The Regional Rural Banks (RRBs) were established in 1975 under the provisions of the Ordinance promulgated on 26th September 1975 and Regional Rural Banks Act, 1976. RRBs are financial institutions which ensure adequate credit for agriculture and other rural sectors. RRBs combine the characteristics of a cooperative in terms of the familiarity of the rural problems and a commercial bank in terms of its professionalism and ability to mobilise financial resources.

Significance of RRBs

• Every RRB operates as a commercial bank, and in addition to directly granting short-term and long-term loans, it has the authority to mobilise savings.

• They give loans for agriculture, allied activities, retail trade, and small rural industries.

• They also specifically target the group of small and marginal farmers, landless labourers, rural artisans, and others through the Integrated Rural Development Programme by extending credit to the poorest of the poor in rural areas.

• The Regional Rural Banks has a Priority Sector Lending (PSL) target of 75% where loans are lent to agricultural activities and vulnerable sectors.

• These banks are also providing financial assistance to regional cooperative institutions inlow-incomestrengthen their financial bases and enable them to play a more positive role as viable financial institutions engaged in rural development.

Shortcomings

• RRBs focus mainly on offering government’s schemes like direct benefit transfer in the rural areas of the country.

• RRBs are dependent on NABARD to collect finance for their further operation.

• Poor rural people are unable to save anything due to poverty and low per capita income.

• The low level of savings of these customers create obstacles for RRBs to collect sufficient deposits.

• The most troubling aspect of RRB operation is that they are, on average, losing money.

• RRBs are creating this problem by concentrating their branches in some specific states and districts & losing other prospective groups of customers

• The main factor that has contributed to their loss of profitability is that they exclusively lend to the poorer sections at low-interest rates, despite the fact that their operational costs in handling small loans are quite high.

• Aside from that, loan recovery is unsatisfactory, and debts are piling up.

Way forward

• The costs of operations of RRBswere much lower as compared to scheduled commercial banks but that has increased now and the government wants them to work towards increasing their earnings.

• The RRB may be permitted to lend up to 25% of their total advancesto the richer section of the village society.

• The State Governmentshould also take keen interest in the growth of RRB.

• Participation of local people in the equity share capitalof the RRB should be encouraged.

• Cooperative societies may be allowedto sponsor or co-sponsor with commercial banks in the establishment of the RRB.

• A uniform pattern of interest rate structureshould be devised for the rural financial agencies.

• The RRB must strengthen effective credit administrationby way of credit appraisal, monitoring the progress of loans and their efficient recovery.

• The RRB may initiate certain new insurable policieslike deposit-linked cattle and other animals insurance policy, crop insurance policy or the life insurance policy for the rural depositors.

• Coordination between district level development planning and district level credit planningis also required in order to chart out the specific role of the RRB as a development agency of the rural areas.

Conclusion

The RRBs have had a great deal of success in bringing banking services to previously unbanked areas and making institutional credit available to the weaker sections of the population in these areas.

Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.

Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.

5. Throw light on major issues facing the banking sector in India in the recent times. Suggest measures that will ensure long-term viability of the banking sector. (250 words)

Difficulty level: Easy

Reference: Insights on India , Insights on India

Why the question: The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable. Key Demand of the question: To write about various banking reforms, its successes and limitations and further reforms that are needed for long term viability of baking sector. Directive word: Evaluate – When you are asked to evaluate, you have to pass a sound judgement about the truth of the given statement in the question or the topic based on evidence. You must appraise the worth of the statement in question. There is scope for forming an opinion here. Structure of the answer: Introduction: Begin by giving context. Body: First, write about the recent issues in the banking sector – high NPAs, inadequate capitalization, technological adaptation issues, governance and risk management concerns, financial inclusion gaps etc. Next, suggest reforms that must be taken in order to overcome the above mentioned limitations – strengthening governance, addressing asset quality issues, ensuring adequate capital levels, investing in technology upgrades, promoting credit growth, and ensuring a robust regulatory framework. Conclusion: Conclude with a way forward.

Why the question:

The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable.

Key Demand of the question:

To write about various banking reforms, its successes and limitations and further reforms that are needed for long term viability of baking sector.

Directive word:

Evaluate – When you are asked to evaluate, you have to pass a sound judgement about the truth of the given statement in the question or the topic based on evidence. You must appraise the worth of the statement in question. There is scope for forming an opinion here.

Structure of the answer:

Introduction:

Begin by giving context.

First, write about the recent issues in the banking sector – high NPAs, inadequate capitalization, technological adaptation issues, governance and risk management concerns, financial inclusion gaps etc.

Next, suggest reforms that must be taken in order to overcome the above mentioned limitations – strengthening governance, addressing asset quality issues, ensuring adequate capital levels, investing in technology upgrades, promoting credit growth, and ensuring a robust regulatory framework.

Conclusion:

Conclude with a way forward.

Introduction

The banking system in India defines banking through the Banking Companies Act of 1949. With the potential to become 3rd largest banking industry by 2025 according to some reports, India’s banking and financial sector is expanding rapidly. The Indian banking industry is currently worth more than 1 trillion dollars and banks are now expanding fast as the present Central Government wants to spread the tentacles of the banking industry far and wide.

Evolution of Bank reforms in India

• The government through the Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969, and nationalizedthe 14 largest commercial banks on 19 July 1969.

• Thereafter, in 1980, six more banks that were nationalized included Punjab and Sind Bank, Vijaya Bank, Oriental Bank of India, Corporate Bank, Andhra Bank, and New Bank of India.

• After India liberalized its economy in 1991, then finance minister Dr. Manmohan Singh set up Narasimham Committee – Ito analyze India’s banking sector and recommend reforms.

• In 1998, Banking Sector Committee(Narasimham Committee – II) was set up to further bring in reforms. The task of the Committee was to review the progress of the implementation of reforms and to suggest a design for further strengthening of the sector.

Banking reforms in the recent past

• The Indian government has been promoting the digitization of banking services to improve the efficiency and reach of banking services in India. The introduction of mobile banking, internet banking, and digital payment systems has made banking more accessible and convenient for the people of India.

• Since 2014, the banking sector has witnessed the adoption of the JAM (Jan-Dhan, Aadhaar, and Mobile) trinity, and the issuance of licenses to Payments Banks and Small Finance Banks (SFBs) to achieve last-mile connectivity in the financial inclusion drive.

• The Reserve Bank of India (RBI) introduced the concept of Payment Banks in 2015. Payment Banks are a new category of banks that aim to provide banking services to the unbanked population of India, by enabling them to open a bank account with a minimum balance of Rs. 0 and providing them with basic banking services.

• The RBI introduced the concept of Small Finance Banks in 2015 to provide financial services to the unbanked and underserved sections of the society, including small businesses, low-income households, farmers, and micro-enterprises. Small Finance Banks are licensed under Section 22 of the Banking Regulation Act, 1949, and have a minimum paid-up capital of Rs. 100 crore.

• In October 2015, the Government announced Mission Indradhanushunder which 7 key strategies were proposed to reform public sector banks (PSBs).

• The Ministry of Finance in its Economic Survey 2015-16suggested four R’s – Recognition, Recapitalization, Resolution, and Reform to address the problem of NPAs.

• The Insolvency and Bankruptcy Code (IBC) was introduced in 2016 to provide a time-bound and efficient mechanism for resolving insolvency cases in India. The IBC aims to improve the ease of doing business in India by enabling quick and efficient resolution of distressed assets.

• In 2017, the Indian government announced a plan to recapitalize public sector banks with a capital infusion of Rs. 2.11 lakh crore over a period of two years. This was aimed at strengthening the balance sheets of public sector banks and enabling them to lend more.

• The government recently announced new banking reforms, involving the establishment of a Development Finance Institution (DFI) for infrastructure, creation of a Bad Bankto address the problem of chronic non-performing assets (NPAs), and privatization of public sector banks (PSBs) to ease its burden in terms of mobilizing additional capital.

• In 2019, the Indian government announced the merger of 10 public sector banks into four banks, with the aim of creating stronger and more efficient banks.

Way forward

• The banking sector in India is grappling with a high level of NPAs, which has been a major challenge in recent years. To address this issue, there needs to be a concerted effort to strengthen the resolution framework and the recovery mechanism for stressed assets.

• The Indian banking sector needs to continue to enhance its digital infrastructure to improve the delivery of banking services. This will require investments in technology, data analytics, and cybersecurity to ensure that the banking sector is able to meet the growing needs of customers and stay competitive.

• Risk management can be more specific and the neo-banks can leverage the technology to further (digital) financial inclusion and finance higher growth of aspirational/new India. In this context, technologies like Blockchaincan be implemented in Indian Banking.

• Niche Banking caters to the specific and varied requirements of different customers and borrowers.

• Essentially, these specialised banks would ease the access to finance in areas such as RAM (retail, agriculture, MSMEs), infrastructure financing, wholesale banking (mid and large corporates) and investment banking (merchant banking and financial advisory services).

• The proposed DFI/niche banks may be established as specialised banks to have access to low-cost public deposits and for better asset-liability management.

• Further, the existing strong local area banks and urban cooperative banks may be converted into RAM banks and be freed from dual control.

• Differentiated Banks also may be encouraged to get listed on a recognised stock exchange and adhere to ESG (Environment, Social Responsibility, and Governance) framework to create value for their stakeholders in the long run.

• The government should tighten the loose ends by allowing them to build diversified loan portfolios, establishing sector-wise regulators, bestowing more powers to deal effectively with wilful defaulters.

• There is also a need to pave the way for the corporate bond market (shift from bank-led economy) to create a responsive banking system in a dynamic real economy.

• The Indian banking sector needs to encourage innovation and competition to drive growth and improve the quality of services. This can be done by promoting new entrants, such as fintech companies, and by encouraging collaboration between banks and other financial institutions.

• The Indian banking sector needs to invest in its human capital to ensure that it has the necessary skills and expertise to meet the changing needs of customers and the evolving regulatory environment. This will require investments in training and development programs, as well as initiatives to attract and retain talent.

Conclusion

Thus, Banking sector in India has had multiple issues and is undergoing sea changes through timely reforms to further serve the goal of socio-economic development of India.

Topic: Achievements of Indians in science & technology; indigenization of technology and developing new technology.

Topic: Achievements of Indians in science & technology; indigenization of technology and developing new technology.

6. What is Multiple Independently Targetable Re-entry Vehicle (MIRV) technology? Mission Divyastra marks a very important milestone in India’s march towards greater geo-strategic role and capabilities. Discuss. (150 words)

Difficulty level: Tough

Reference: The Print , pib.gov.in

Why the question: Prime Minister Narendra Modi today announced the development of “Mission Divyastra” — an indigenously developed, landmark weapons system that alters the country’s geopolitic and strategic position and significantly changes the situation in southeast Asia. Key Demand of the question: To write about MIRV technology and significance of Mission Divyastra. Directive word: Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary. Structure of the answer: Introduction: Begin by giving context of Agni-V and mission Divyastra. Body: First, explain the MIRV technology in detail. Next, write about the importance of Mission Divyastra – advancement in India’s strategic capabilities, strategic deterrence, demonstrates India’s technological prowess and places it among a select group of nations with MIRV capability, mastering miniaturized nuclear warhead technology etc. Conclusion: Conclude by writing about importance of the above.

Why the question:

Prime Minister Narendra Modi today announced the development of “Mission Divyastra” — an indigenously developed, landmark weapons system that alters the country’s geopolitic and strategic position and significantly changes the situation in southeast Asia.

Key Demand of the question:

To write about MIRV technology and significance of Mission Divyastra.

Directive word:

Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary.

Structure of the answer:

Introduction:

Begin by giving context of Agni-V and mission Divyastra.

First, explain the MIRV technology in detail.

Next, write about the importance of Mission Divyastra – advancement in India’s strategic capabilities, strategic deterrence, demonstrates India’s technological prowess and places it among a select group of nations with MIRV capability, mastering miniaturized nuclear warhead technology etc.

Conclusion:

Conclude by writing about importance of the above.

Introduction

A Multiple Independently Targetable Re-entry Vehicle (MIRV) is a ballistic missile payload designed for exo-atmospheric deployment, housing multiple warheads, each capable of targeting distinct objectives. While primarily associated with intercontinental ballistic missiles equipped with thermonuclear warheads, the concept extends beyond strict limitations. An intermediate variant, the Multiple Re-entry Vehicle (MRV) missile, disperses multiple warheads without individual targeting.

Prime Minister Narendra Modi announced the development of “Mission Divyastra” — an indigenously developed, landmark weapons system that alters the country’s geopolitic and strategic position and significantly changes the situation in southeast Asia.

Background

• India on Monday carried out maiden flight test of the indigenously developed Agni-5 missile with the Multiple Independently Targetable Reentry Vehicle (MIRV) technology which allows the weapon system to tackle multiple nuclear warheads, strengthening the country’s strategic deterrence capability.

• The missile launch carried out under Mission Divyastra (divine weapon), made India’s entry into the elite list of the countries that have the capability to deploy MIRV missile systems, including the United States, the United Kingdom, France, Russia and China.

MIRV technology

• According to the Washington-based Centre for Arms Control and Non-Proliferation (CACNP), MIRVs were originally developed in the early 1960s to permit a missile to deliver multiple nuclear warheads to different targets.

• Right now, some countries are reported to have the capabilities to have a single missile carry up to 16 warheads, each in a separate re-entry vehicle.

• Warheads on MIRVed missiles can be released at different speeds and in different directions, with such missiles capable of hitting targets as far as 1,500 km apart.

• MIRV is a complex technology because it needs a very delicate combination of large missiles, small warheads, accurate guidance, and a complex mechanism for releasing warheads sequentially during flight.

• The US was the first country to develop MIRV technology, deploying a MIRVed Intercontinental Ballistic Missile (ICBM) in 1970 and a MIRVed Submarine-Launched Ballistic Missile (SLBM) in 1971.

• The Soviet Union caught up quickly and developed their own MIRV-enabled ICBM and SLBM technology by the end of the 1970s.

• Besides these two countries, the UK, France and China have MIRV technology.

• However, deploying MIRV technology also poses complex challenges, including miniaturisation of warheads, development of advanced guidance systems, and ensuring the reliability of individual re-entry vehicles

Importance of Mission Divyastra

• Deployment of MIRV can enhance first-strike proficiency for strategic forces and also provide greater target damage for a given thermonuclear weapon payload.

• Moreover, as it can release multiple warheads, it serves the purpose of a cluster munition, as it reduces the number of missiles and launch facilities required.

• A single missile by India can deploy multiple war heads at different locations or at the same location with a time gap.

• These warheads could also include decoys to hoodwink the enemy’s ballistic missile defence programme.

• With the MIRV, the effectiveness of an anti-ballistic missile system that relies on intercepting individual warheads is also reduced.

• Possession of MIRV technology not only exhibits a country’s nuclear prowess but plays a crucial role in shaping international security and nuclear deterrence strategies.

Conclusion

The Agni-V adds to India’s existing arsenal of the Agni missile series, enhancing its deterrence capabilities. With missiles ranging from Agni-I to Agni-IV, India joins an elite league of nations possessing intercontinental ballistic missile capabilities, including the US, Russia, China, France, and Britain.

*Value addition*

*Agni-V*

• The Agni-5 weapon system is equipped with indigenous avionics systems and high-accuracy sensor packages, which ensured that the re-entry vehicles reached the target points within the desired accuracy.

• Weighing close to 50,000 kilograms and standing at 1.75 meters tall with a diameter of two meters, the Agni-V boasts impressive specifications.

• It carries a formidable 1,500-kilogram warhead atop three-stage rocket boosters powered by solid fuel.

• The missile can clock at 24 times faster than the speed of sound, reaching a staggering 8.16 km per second or 29,401 km per hour.

• Equipped with advanced navigation systems including a ring laser gyroscope inertial navigation system (NavIC) and satellite guidance, the missile ensures precise targeting capabilities, further enhanced by its launch flexibility from mobile launchers.

• With a range extending across Asia, Europe, and parts of Africa, the Agni-V significantly bolsters India’s strategic capabilities.

• Having undergone seven successful trials, the missile, with a range exceeding 5,000 kilometers, has attracted attention from global players, particularly China.

• India’s relentless testing regime underscores its commitment to bolstering its defence capabilities.

General Studies – 4

Topic: role of Family society and educational institutions in inculcating values.

Topic: role of Family society and educational institutions in inculcating values.

7. The guidance provided by parents forms the bedrock of a child’s moral development. Elaborate. (150 words)

Difficulty level: Easy

Why the question: The question is part of the static syllabus of General studies paper – 4. Key Demand of the question: To write about the role of family in providing emotional and ethical foundation to their children. Directive word: Elaborate – Give a detailed account as to how and why it occurred, or what is the context. You must be defining key terms wherever appropriate and substantiate with relevant associated facts. Structure of the answer: Introduction: Begin the answer by mentioning the role of family in inculcating values in children. Body: First, write about family as an institution of socialization for a person is his/her family. Since values have an affective component, family plays a major role in an individual subscribing to certain values. Mention as to how these lay foundation to strong emotional and ethical foundation in children’s life. Next, write about the importance of above. Conclusion: Conclude by summarising.

Why the question:

The question is part of the static syllabus of General studies paper – 4.

Key Demand of the question:

To write about the role of family in providing emotional and ethical foundation to their children.

Directive word:

Elaborate – Give a detailed account as to how and why it occurred, or what is the context. You must be defining key terms wherever appropriate and substantiate with relevant associated facts.

Structure of the answer:

Introduction:

Begin the answer by mentioning the role of family in inculcating values in children.

First, write about family as an institution of socialization for a person is his/her family. Since values have an affective component, family plays a major role in an individual subscribing to certain values. Mention as to how these lay foundation to strong emotional and ethical foundation in children’s life.

Next, write about the importance of above.

Conclusion:

Conclude by summarising.

Introduction

Values are “things that have an intrinsic worth in usefulness or importance to the possessor,” or “principles, standards, or qualities considered worthwhile or desirable.” Values constitute an important aspect of self-concept and serve as guiding principles for an individual. These human values have the effect of bonding, comforting, reassuring and procuring serenity.

Role of family in developing values

• Family is the first social organization that provides the immediate proximity from which the kid can learn his behavior.

• The family and society is important in developing the moral values of child. There is a close contact between the parents and children, which determine the personality of child. Family is the foundation on which values are built.

• Moral values like truthfulness, happiness, peace, justice are instilled in children’s thoughts, feelings and actions and they function as ideals and standards that govern their actions in their life.

• The value system practised in the family becomes automatic to the young family members if they are taught moral values systematically.

• The family, shapes the child’s attitude towards people and society, and helps in mental growth in the child and supports his ambitions and values. Blissful and cheerful atmosphere in the family will develop the love, affection, tolerance, and generosity.

• A child learns his behavior by modelling what he sees around him.

• Family plays a major role in helping a child socialize and has great influence and bearing on the progress of the child. Joint family system, the presence of elders in the family plays the effective role in social and moral development of the children.

• It will also help young generation of the family to imbibe human values and eradicate their negative mental tendencies when they are among elders.

• Children identify themselves with their parents, other family elders and adopt them as their personal models for emulation and imitation. The behavioural problems are set correct only by the involvement of family in the child’s life as they spend most of their time in adolescence with the parents.

Conclusion

Family is the foundation on which values are built. Moral values like truthfulness, happiness, peace, justice are instilled in children’s thoughts, feelings and actions and they function as ideals and standards that govern their actions in their life.

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