21 Dec 2020 CNA:- Download PDF Here

TABLE OF CONTENTS

A. GS 1 Related
B. GS 2 Related
INTERNATIONAL RELATIONS
1. India, U.S. mull over unfinished work
C. GS 3 Related
SECURITY
1. India to bring more nations into coastal radar network
ECONOMY
1. 5 States can borrow extra ₹16,728 crore
D. GS 4 Related
E. Editorials
HEALTH
1. Stopping the slide of healthcare in India
JUDICIARY
1. The right call
ECONOMY
1. Laying the foundations for faster growth
F. Prelims Facts
G. Tidbits
1. NGT panel for protection of Mahanadi floodplain
2. Lasting solution for monkey menace
3. New virus strain out of control: U.K.
4. Nepal set to face fresh election
H. UPSC Prelims Practice Questions
I. UPSC Mains Practice Questions

Category: ECONOMY

1. 5 States can borrow extra ₹16,728 crore

Context:

The Finance Ministry said five states, including Tamil Nadu and Telangana, had been permitted to borrow an additional ₹16,728 crore following completion of stipulated reforms to facilitate ease of doing business.

Background:

• In May 2020, the government decided to link the grant of additional borrowing permission to states with reforms undertaken by them to facilitate ease of doing business.
• For meeting the extra fund requirements of states on account of the COVID-19 pandemic, the Centre had decided to raise the borrowing limit of the states by 2% of their GSDP (Gross States Domestic Product), over and above the 3% limit set under the Fiscal Responsibility and Budget Management (FRBM) Act.

This topic has been covered in 17^th December 2020 Comprehensive News Analysis.

Category: JUDICIARY

1. The right call

Context:

• The Andhra Pradesh (A.P) High Court order on an inquiry into a ‘constitutional breakdown’ was an over-reach on the part of the judiciary.
• The Supreme Court stayed an Andhra Pradesh High Court order that looked to convene a judicial inquiry into whether there is a “constitutional breakdown” in the Y.S. Jagan Mohan Reddy-led government in the State.

Details:

• Article 356 of the Constitution which empowers the imposition of President’s Rule in a State had its notorious counterpart in Section 93 of the Government of India Act 1935 which provided for Governor’s Rule in the provinces.
• The “constitutional breakdown” is a valid ground to suspend the state executive and establish the President’s rule under Article 356 of the Indian Constitution.
• The question of a “constitutional breakdown” or the failure of constitutional machinery is dealt with under Article 356 of the Constitution, whose invoking comes under the prerogative of the executive and not the judiciary.
• The Andhra Pradesh High Court’s order represents a judicial overreach.

The story so far

• Andhra Pradesh High Court during the hearing of habeas corpus petitions filed by relatives of persons remanded in judicial custody or on bail, sought to suo motu summon the State counsel to assist in deciding “whether, in circumstances prevailing in the State of Andhra Pradesh, the court can record a finding that there is a constitutional breakdown in the State or not”.
• Legal experts have stated that in doing so the High Court overstepped its mandate.

President’s rule imposition

• The S.R. Bommai case judgement attempted to curb the blatant misuse of Article 356 of the Constitution of India by laying down certain scenarios where the imposition of President’s rule was justified and certain other scenarios that weren’t.
• One of the prerequisites that had to be followed in examining the “constitutional breakdown” was ascertaining whether objective conditions exist which render it impossible to carry out governance in the State where the proclamation has been made and the process has to be approved by both Houses of Parliament before consideration for judicial review.
• Accordingly, situations which can be remedied or do not create an impasse, or do not disable or interfere with the governance of the State according to the Constitution would not merit the issuance of a Presidential proclamation under the Article.
• But the A.P. High Court’s order appears to have jumped the gun by ordering an inquiry into a perceived ‘constitutional breakdown’.
• It seemed to have reversed the scheme of things by putting the cart before the horse in asking to ascertain if there is a “constitutional breakdown in the State”.

Tension between High Court and the Andhra Pradesh government

• The Supreme Court’s order comes in the wake of incidents pointing to a tug of war between the judiciary and the elected government in Andhra Pradesh.
• Andhra Pradesh Chief Minister (CM) Y.S. Jagan Mohan Reddy had written a letter to the Chief Justice of India complaining about the functioning of a few judges.
• Though there have been previous instances of such allegations against certain judges, the current situation is unprecedented given that the current allegations have been made by a constitutional body, the Chief Minister of a state.
• The Andhra Pradesh Chief Minister’s unprecedented letter to the CJI complained about the alleged hostile attitude of the High Court against him and his government besides making controversial allegations against a senior Supreme Court judge.
• The High Court ordered a CBI probe into what it termed was a social media campaign against the judges.
• The Supreme Court has the responsibility to put an end to this tussle between the two, the next step of SC will be watched carefully.
• Ordering an internal inquiry into the Chief Minister’s letter would be a good beginning. A clear nullification of the High Court order will also ensure that such legal adventures impinging upon the separation of powers in the State are not repeated.

Conclusion

• There is a fine line between judicial activism and adventurism. Any attempts to destabilize an elected government such as by initiating an inquiry looking into a possible “constitutional breakdown” is unnecessary and will not only disturb the separation of power equilibrium but also erode the legitimacy of the judiciary in the eyes of the people.

Category: ECONOMY

1. Laying the foundations for faster growth

Context:

• The COVID-19 pandemic and the lockdown that followed has derailed economies worldwide and India was not an exception.
• Ways are being explored to get the Indian economy back on track.

Details:

• The COVID-19-triggered economic crisis is an unprecedented one as it is an economic crisis caused by a non-economic event.
• The lockdown that was put in place to avoid the contagious virus from spreading has crippled the economy.
• The subsequent lifting of restrictions saw a slight recovery in the economic activities, this can be inferred by a reduction in contraction in the GDP data of the second quarter and also an expansion of about 0.6% in industrial output.

Economy in 2020-21

• GDP contracted by 23.9% in the first quarter and by 7.5% in the second quarter, showing the slightest of signs of recovery.
• However, the onus will now be on the third and the fourth quarters to perform well and offset the contraction of the first half of the year and this would need an increase in public expenditure.
• An increase in Goods and Services Tax (GST) collection, improved output of coal, steel and cement and an expansion in manufacturing output indicate an uptick in the performance in the private sector activity.
• It would be not wise to expect a recovery in all the sectors of the economy, like for example, the hospitality sector will take time to recover.
• Therefore, the contraction can be limited in the range of 6% to 7% as per the estimates and this is an improvement over the forecasts of the International Monetary Fund, who predicted a contraction of 10.3%.

What to expect in 2021-22?

• The Indian economy has to grow at 8% in 2021-22 to offset the contraction in 2020-21, thus the 8% GDP expansion will only take the economy to where it was before the pandemic struck.
• The government has a task on its hands, it should ideally identify sectors that can lead the recovery phase and increase the government expenditure in those sectors. In this way, public investment will be catalyzing economic activity.
• The private sector has not yet appeared decisive in its decision making. They are still circumspect about the future, though many new issues in the capital market have met with a positive response.
• The global trade landscape is not yet clear, the restrictions at the border have brought the trade to a standstill.
• A resumption in trade with adequate precautions is needed, a strong surge in exports will spur economic growth.
• Consumption led growth needs to be accompanied by investment-led growth to sustain an economy for a longer period of time.

Monetary policy

• The monetary policy will dictate credit creation and its dispersal in the economy; so far the stance taken by the Monetary Policy Committee has been accommodative.
• The monetary policy will be seen to follow a pattern on:
  • Interest rate reduction via changes in the policy rate.
  • Liquidity provision through various measures.
  • Regulatory changes such as moratorium.
• There has been a significant injection of liquidity into the system, as per the recent monetary policy report, reserve money and money supply have increased.
• With a large injection of liquidity, inflation is expected to remain high. However, the current year, being a very indifferent year, required such large liquidity injection. But caution has to be exercised to ensure that liquidity in the economy has to keep its pace with the availability of goods and services.

Fiscal initiatives

• The first-quarter data revealed that the increase in public expenditure limited the GDP contraction to 23.9%. If not for this increase, the contraction would have been even graver, but the second quarter data revealed that the economy recovered to 7.5% contraction but the public expenditure shrank vis-à-vis the first quarter.
• The current pandemic led issues in the economy requires an enhanced public expenditure, it is not the time for fiscal conservatism. The stimulus policies will help the recovery of economic activities in certain sectors.
• Government expenditures need to be increased with immediate effect. With a slower rate in government revenue, the fiscal stimulus will cause ballooning of the fiscal deficit to the range of 6% to 8% of GDP, but such is the nature of the problem at hand.
• The Government revenue in 2021-22 is expected to pick up and subsequently, the Government can begin working on fiscal management and containing the fiscal deficit.
• The following budget must contain a detailed blueprint of the sectors that will receive the fiscal stimulus.

Growth and investment

• The ill-effects of COVID-19 have caused great damage to the Indian economy, however, in the process of recovery, we must lay the foundations for faster economic growth.
• Investment rate for the past decade has been declining, the investment rate in 2018-19 was 32.2% of GDP as against 38.9% GDP in 2011-12.
• The National Infrastructure Pipeline (NIP) is an excellent initiative that can propel investment into several infrastructure projects ranging in numerous sectors.
• Infrastructure is an enabler for growth. It is expected that for India’s GDP to recover in the next five years beginning fiscal 2021 (2020-21 to 2024-25), infrastructure will play a pivotal role.
• Well-planned NIP will enable more infrastructure projects, power business, create jobs, improve ease of living, and provide equitable access to infrastructure for all, thereby making growth more inclusive.

Conclusion

• The goal of a $5 trillion economy by 2025 appears to be a distant dream now, however, the focus must be to get the economy back on track.
• The immediate goal is to empower the economy with public investment, which will go a long way in building confidence in private players and more importantly will create jobs and wage employment.

2. Lasting solution for monkey menace

What’s in News?

The first rescue and rehabilitation centre for monkeys in Telangana has been inaugurated.

• It is the second such facility for the primates in the country.
• The rehabilitation centre for the monkeys is the first such facility in south India.
• The other facility in the country is in Himachal Pradesh.

3. New virus strain out of control: U.K.

What’s in News?

• The British Health Secretary has said that the government has imposed a strict Christmas lockdown in London and southeast England because a new strain of the coronavirus was “out of control”.
• The World Health Organization is calling on its members in Europe to step up measures against COVID-19.
• Outside Britain, nine cases of the new strain have been reported in Denmark, the Netherlands and Australia.
• Scientists first discovered the new variant in a patient in September 2020.
• It is found that the new virus strain could be 70% more transmissible.

4. Nepal set to face fresh election

What’s in News?

Nepal’s Prime Minister has got the Parliament dissolved after weeks of tension within the government.

• In an emergency Cabinet meeting Prime Minister K.P. Sharma Oli recommended the dissolution of Parliament of Nepal and called for general election.
• The decision was ratified by the President. The President has called for a two-phase election in 2021.
• The dramatic move came after weeks of tension with challenger Pushpa Kamal Dahal ‘Prachanda’, who has been demanding that Mr. Oli change his style of governance.
• The move to dissolve Parliament has drawn strong criticism both from the Opposition and the members of the ruling coalition.
  • It was argued that the decision was unconstitutional as there is no provision in the 2015 Constitution to dissolve Parliament that is functioning perfectly well.

Note:

Nepal had held election in November-December 2017 and the elected 275-member Pratinidhi Sabha expected to serve a full five-year term.

Q1. Consider the following statements with respect to Guru Tegh Bahadur:

Q2. Consider the following statements with respect to sedimentary basins:

Q3. Consider the following pairs: 

Q4. Consider the following statements with respect to the Information Management and 
Analysis Centre: 

21 Dec 2020 CNA:- Download PDF Here