📰 Supreme Court in favour of increasing random physical verification of VVPATs
No institution, including the judiciary, should insulate itself from making improvements, Chief Justice Gogoi said in response to ECI’s resistance to increase physical counting of VVPATs
•The Supreme Court on Monday said it was in favour of increasing random physical verification of Voter Verified Paper Audit Trail (VVPAT) in parliamentary and Assembly polls, even as the idea was met with stiff resistance from the Election Commission of India.
•Deputy Election Commissioner Sudeep Jain said the current practice of physically checking the VVPAT paper slips of one randomly selected polling station in an Assembly constituency and each Assembly segment in case of Lok Sabha election was “all that is needed”. There was no need whatsoever to extend the physical count of VVPATs, he said.
•Mr. Jain told a Bench comprising Chief Justice of India Ranjan Gogoi and Justice Deepak Gupta that VVPATs were “working absolutely right” and everything that the Election Commission of India (ECI) does was based on expert statistical data. He said the Commission, on its own, constantly betters its parameters.
•A visibly annoyed Chief Justice Gogoi replied to Mr. Jain’s comments in court, asking him why the Election Commission had not introduced VVPATs on its own after introspecting on its parameters.
•“It was the judges of this court that pushed you into introducing the VVPATs in the first place. If you are so conscious of improving your parameters, why did you not take the first step to introduce VVPATs in elections. Why did the judges of this court have to think for you?” Chief Justice Gogoi asked the Election Commission.
Question of satisfaction
•In 2013, the Supreme Court held in the Dr. Subramanian Swamy case that paper trail through VVPAT of votes cast was an indispensable requirement of free and fair elections.
•“You (Mr. Jain) may not have been in the Election Commission at the time, but do you know how much of opposition the Supreme Court had to face from the Election Commission to bring in VVPATs?” Chief Justice Gogoi asked.
•The Chief Justice said “no institution, however high, including the judiciary, should insulate itself from improvements”.
•“We are only asking you to do a little more for the sake of purity of the elections… We would like you to increase the physical counting. This is not about casting aspersions on you, but this is a question of satisfaction… Anyway, two is better than one, is it not? So, can you do it on your own or do you have any difficulty to do so?” the CJI asked Mr. Jain again.
•The court finally directed the Election Commission to file an affidavit by Thursday, explaining why it seemed to be so “fully satisfied” about restricting physical counting of VVPATs to one polling station. The affidavit should also indicate the logistics and time required in case the sample verification of VVPATs was extended to more than one polling station.
•The court was hearing a joint petition filed by 21 Opposition parties demanding the random verification of at least 50 percent EVMs-VVPATs in every Assembly segment or constituency.
•The Opposition sought to quash an Election Commission guideline that physical counting should be conducted “only for VVPAT paper slips of one randomly selected polling station of an Assembly constituency in case of election to State Legislative Assembly and each Assembly segment in case of election to the House of the People”.
•The petition has been filed in the names of Andhra chief minister and Telegu Desam Party leader N. Chandrababu Naidu, Nationalist Congress Party leader Sharad Pawar, Indian National Congress K.C. Venugopal, All India Trinamool Congress Derek O’Brien, Samajwadi Party leader Akhilesh Yadav, DMK leader Stalin, Delhi chief minister Arvind Kejriwal, National Congress leader Farooq Abdullah, Loktantrik Janta Dal leader Sharad Yadav, Rashtriya Janta Dal leader Manoj Jha, among others.
📰 55% internet users scared of airing political views: report
Report from the Reuters Institute shows that online news and social media has outpaced print among English-speaking Indian Internet users
•As many as 55% of sampled English Internet users were concerned that expressing their political views online could get them into trouble with the authorities, an India digital report prepared by the Reuters Institute showed.
•“These high levels of concern could be based in part on recent events in India. Since 2012 at least 17 people have been arrested for posting material that was considered offensive or threatening to a politician,” the report said on Monday.
•As many as 68% of those surveyed identified smart phones as their main device for online news with 52% stating that they got their news from Facebook. WhatsApp (52%), Instagram (26%), Twitter (18%), and Facebook Messenger (16%) were the other sources of news.
•“Online news generally (56%), and social media specifically (28%) have outpaced print (16%) as the main source of news among respondents under 35, whereas respondents over 25 still mix online and offline media to a greater extent,” the Reuters Institute report said.
•“The fact that our survey covers only English speakers with Internet access is key here; the number of people accessing news via print and television will be higher fore regional language news consumers…though as mobile web use spreads we expect to see this change in the years ahead,” it argued.
•Respondents overall had low trust in news overall (36%) but expressed higher levels of trust in news search (45%) and social media (34%). As many as 57% of those surveyed were worried whether the news they consumed was fake or real.
•The report warned that in a competitive market for online advertising, with audiences resorting to ad blocking, Indian publishers reliance on advertising put them to risk.
•Significantly, the survey showed a considerable willingness to pay for online news in the future. “Of our respondents who do not currently pay, 39% said they are at least ‘somewhat likely’ (much more than users in the United States) and 9% said they were ‘very likely’ to pay for online news in the future.”
•“This suggests that Indian publishers who can put together a convincing content offering around great journalism, and deliver it in a compelling way, have an opportunity to reach a significant number of potential subscribers,” the report added.
•The Reuters Institute said that the report was based on data from a survey of English-speaking, online news users in India. “Our respondents are generally more affluent, have higher levels of formal education, skews male, and are more likely to live in cities than the wider Indian population and our findings only concern our sample, and thus cannot be taken to be more broadly representative.”
Public policy must launch an assault on capability deprivation and rising unemployment
•As the general election approaches, we are reminded of the observation by the philosopher Ludwig Wittgenstein that while raisins may well be the better part of a cake, “a bag of raisins is not a cake”. For, while elections may be an integral part of democracy, surely they cannot be its end. The end is the demos, or the people, and the content of their lives. However, going by the actions of political parties when in power and their pronouncements when they are not, the end of democracy gets overlooked in the political process in India.
Nationalism, secularism
•In the run-up to the present, indeed through the greater part of the past five years, two constructs have repeatedly been projected by the main political formations in the country. These are nationalism and secularism, associated with the Bharatiya Janata Party (BJP) and the Congress, respectively. As are raisins to the cake, so we might say these two ideals are to Indian democracy. But unlike the fruit which, given to us in a natural state, is not malleable, the concepts of nationalism and secularism have proved to be quite that in the use to which they are put by India’s political parties. This by itself may have proved to be less disappointing if they had not in addition privileged these constructs over everything else.
•Actually, it is possible for nationalism and secularism to be part of state policy even in the absence of democracy. Thus both Iran under the last Shah and Iraq under Saddam Hussein ran a secular state, though they were both dictators. The People’s Republic of China is so nationalist that even its socialism is said to be imbued with ‘Chinese characteristics’. Its state is not just secular but avowedly atheist. However, it is not a democracy. What is at stake here is that democracy is meant to be something more than just nationalism and secularism. None of this suggests that these two concepts are unrelated to democracy. Indeed they are of it.
•Take nationalism first, once we have imagined ourselves as a democratic community we must defend our national interest. Threats to India come from two sources. There are authoritarian regimes in the region that are hostile to India. Second, the western powers have captured global bodies to promote their economic and political interests, for which think of the multilateral agencies that attempt to prise open India’s market without yielding the West’s to migration.
•Take secularism next. Based on first principles, we would say that a democracy cannot allow any religious influence on the state’s actions. However, there is a reality in India today that requires a contextual understanding, and this would require the secular state to go beyond this limited brief to protect religious minorities. The relevance of this is brought home by an incident that took place on Holi day when a gang of hoodlums, attacked without provocation, a Muslim family including young children with iron roads in broad daylight in Gurugram outside the national capital. The video, uploaded on the Internet, makes for horrific viewing. It should leave every thinking Hindu raging with anger that terror is directed at innocent Indians in his or her name.
Political responses
•To accept the relevance of both nationalism and secularism to Indian society does not, however, entail agreement with the use made of these constructs by India’s political parties. We have just completed five years during which a toxic nationalism has been unleashed. In the BJP’s hands, nationalism or national pride has shown itself to be a means to establish Hindu majoritarian rule, a project with potentially destructive consequences for the country. A substantial part of India views this with trepidation. For its part, over the past 30-plus years the Congress party has often resorted to a sham secularism, the high mark of which came in the form of its response to the Supreme Court ruling on the Shah Bano case. Many citizens, including Muslim Indians, were deeply demoralised. In the State of Kerala, the Congress routinely shares power with sectarian parties while proclaiming its secular credentials. Nobody is fooled.
•Of all the leaders India has produced, it is Jawaharlal Nehru who has been the most clear-eyed on the goals of Indian democracy. When asked by the French writer André Malraux as to what he considered his biggest challenge Nehru had replied: “creating a just state by just means [and] creating a secular state in a religious country.” The significance of this was that Nehru saw these goals as challenges to be overcome. Not for him the thought that these tasks were done merely by stating “acche din aane wale hai” or publicised visits to mahants and imams. Some years earlier, at the moment of the ending of colonial rule, Nehru had stated that it was an opportunity to create a “prosperous, democratic and progressive” India. He had read the aspirations of his compatriots astutely. Prosperity was not considered second to progressive thinking, even if the latter meant nationalism and secularism.
Just society by just means
•In the close to three quarters of a century since, the goal of Indian democracy had been articulated prosperity is not in sight for the vast majority. On the other hand, a section of Indians has surged ahead economically. Not just the very rich but the middle classes too are now much richer than they were. For the rest of the country, however, it is an ongoing struggle to earn a living. A just society must seem far away to these Indians. But a just society by just means is no longer a pipe dream, it is entirely feasible, and in our times at that. The pathway to it lies in adopting the right public policies, and it is in the hands of India’s political parties to do so.
•To address the economic hardship of the majority of Indians, public policy should now shift gear to launch an assault on the capability deprivation which underlies India’s low human development indicators. The poorly educated millions are helplessly caught in the eddies of a market economy. Their skills do not match what is required for them to earn a decent living. Overcoming this requires two actions to be undertaken. It would require committing resources to education and training and then governing their use. In fact, we elect and then maintain a political class to govern the system. Instead, it acts as if its sole task is to lecture the public on either nationalism or secularism, as the case may be, leaving the task of governance entirely to the bureaucracy. This empowers the bureaucracy in an undesirable way, amounting to its not having to be accountable.
•The second task of public policy in India at this moment is to raise the tempo of economic activity. Jobs are an issue. The government cannot create jobs directly but it can create the preconditions. It does so through public investment and macroeconomic policy. For about a decade now, the latter has been conducted unimaginatively. Amateurish economic management is responsible for rising unemployment. India’s political parties cannot say that the pathway to the ends of democracy has not been shown to them. If they fail to take the country there, they must assume responsibility.
📰 Paradigm shift for TB control
Ending TB by 2025 is impossible but sustaining its decline is in the realm of reality
•Tuberculosis (TB) remains the biggest killer disease in India, outnumbering all other infectious diseases put together — this despite our battle against it from 1962, when the National TB Programme (NTP) was launched. All hope was pinned on mass BCG vaccination to prevent TB. In 1978, the Expanded Programme on Immunisation (EPI) began, giving BCG to all babies soon after birth and achieving more than 90% coverage. Yet, when evaluated in 1990, the NTP and the EPI had not reduced India’s TB burden.
•In 1993, the Revised National TB Control Programme (RNTCP) was launched, offering free diagnosis and treatment for patients, rescuing them from otherwise sure death. However, treatment is not prevention. Prevention is essential for control.
Short on control
•Why did the NTP and the EPI fail? Visionary leaders had initiated a BCG vaccine clinical trial in 1964 in Chingelpet district, Tamil Nadu. Its final report (published in the Indian Journal of Medical Research in 1999) was: BCG did not protect against TB infection or adult pulmonary TB, the ‘infectious’ form. By then, the RNTCP was in expansion mode; experts hoped that curing pulmonary TB might control TB by preventing new infections. That assumption was without validation in high prevalence countries.
•BCG immunisation does prevent severe multi-organ TB disease in young children, and must be continued but will not control TB.
•In countries with 5-10 cases in a lakh people annually, curing TB sustains the low disease burden. In India, with 200-300 cases in a lakh in a year, curing TB is essential to reduce mortality, but is not sufficient to prevent transmission. By 2014-15, the RNTCP was found to be very successful in reducing mortality, but failing to control TB. Why? From when a person becomes infectious to when he/she turns non-infectious by treatment, there is a gap of several weeks during which the infection saturates contacts in the vicinity. Delays in care seeking and diagnosis are the result of lack of universal primary health care.
•The way forward to control TB and to monitor its trajectory was proposed in 2009, in an editorial in Tropical Medicine & International Health titled “Paradigm shift for tuberculosis control in high prevalence countries”. According to the editorial, an innovative strategy was necessary.
Tamil Nadu pilot model
•True to its reputation as being one of the most progressive in health management, Tamil Nadu is planning to implement this new strategy in one revenue district, Tiruvannamalai. If successful, it will be replicated in all other districts. To ensure public participation — a missing element in the RNTCP — the new model will be in public-private participation mode. The Rotary movement, having demonstrated its social mobilisation strengths in polio eradication, will partner with the State government in the TB control demonstration project.
•Tiruvannamalai, a pioneer district in health management, was the first in India (1988-90) to eliminate polio using the inactivated polio vaccine (IPV), under a Health Ministry-Indian Council of Medical Research-Christian Medical College project.
•The Directorate of Public Health and Preventive Medicine and the National Health Mission will lead all national, State and district health agencies, district and local administration, departments of education, social welfare and public relations and government medical college. The Rotary will ensure the participation of all players (health and non-health) in the private sector.
•Last year we wrote in these columns that TB control requires the slowing down of infection, progression and transmission. Pulmonary TB causes transmission, resulting in infection which leads to progression as TB disease. To transform this vicious cycle into a virtuous cycle of TB control, spiralling down TB prevalence continuously, transmission, infection and progression must be addressed simultaneously — this is the Tiruvannamalai TB mantra.
Health etiquette
•TB bacteria float in the air, people inhale that air and get infected. The closer one is to a pulmonary TB person, the greater the probability of catching infection. We must reduce chances of transmission by insisting that the TB affected should cover their mouth and nose while coughing and sneezing and not to spit in open spaces. Only when the public at large practise cough and sneeze etiquette and refrain from spitting in the open, can we ensure that the TB affected also will follow suit. The Rotary will spearhead public education for behaviour modification, starting in all schools and continuing through to adults.
•Progression to TB disease from infection can be prevented by giving World Health Organisation-recommended short-term ‘preventive treatment’. Infection is silent, but diagnosable with the tuberculin skin test (TST). Testing all people periodically is not possible. Cohorts of schoolchildren (5, 10 and 15 years) can be tested and those TST positive given preventive treatment. This tactic achieves three results at one go — an infected child gets preventive treatment and points to adults with undiagnosed TB in the household. Finally, the annual TST positive rate provides an objective measure of annual infection frequency for plotting the control trajectory.
•World TB Day is observed on March 24. In 2019 the slogan was “It’s Time…” to take TB control seriously. On March 13, 2018, the Prime Minister, who was inaugurating the End TB Summit, declared that India would end TB by 2025. On September 26, 2018, the first ever United Nations High Level Meeting on TB declared the urgent agenda “United to end TB – an urgent global response to a global epidemic”. Rhetoric and declarations cannot control TB; a strategy of simultaneously using all biomedical and socio-behavioural interventions can.
•Ending TB by 2025 is impossible but pulling the TB curve down by 2025 and sustaining the decline ever after is in the realm of reality. True to the spirit of World TB Day theme, we laud Tamil Nadu for deciding ‘It’s time — to take bold and imaginative initiatives to create a TB control model’. Tamil Nadu, an erstwhile global leader in TB research during the 1960s through the 1990s, will now become the global leader in TB control.
📰 Encouraging secret donations
The electoral bonds scheme needs to recognise the complementary nature of the rights to privacy and information
•Despite massive campaign spending in India, there is barely any public scrutiny of such spending because of the opaque nature of the transactions. The electoral bonds scheme amplifies such opacity by not disclosing the identity of the donor. Recently, in an affidavit countering the CPI(M)’s petition challenging the scheme, the Central government argued that the scheme has a two-fold purpose: one, it enhances transparency in political funding; two, it protects the right to privacy of donors. In reality, the scheme undermines the complementary nature of the rights to privacy and information, namely, to make the state more transparent.
•Electoral bonds were introduced in 2017 when the Finance Act amended four different statues: the Reserve Bank of India Act, 1934; the Representation of Peoples Act, 1951; the Income Tax Act, 1961; and the Companies Act, 2013. The government argued that the use of bank routes would likely reduce under-the-table cash transactions and promote transparency in election funding. It said that transactions through banks would incentivise the use of white money, and KYC requirements of banks would ensure paper trails.
Dismantling previous restrictions
•However, the terms of the scheme appear to have disastrous consequences for political transparency. Under the scheme, both the purchaser of the bond and the political party receiving the money have a right to not disclose the identity of the donor. Also, the policy dismantles several restrictions that checked illegal corporate sponsoring previously — for example, by removing a cap on corporate sponsorship. Donations can now be made by any “artificial juridical person”. This means that even foreign donations are now allowed. The requirement that a company has to be in existence for three years for it to make political donations has also been removed. This ignores all the concerns regarding the use of shell companies to siphon black money into the system.
•These changes show that access to the paper trails will be outside the scope of public scrutiny as it will lie exclusively with the banks. As bonds can be issued only by public sector banks, the only entity with full knowledge of the transactions will be the Central government. History has shown that money laundering often takes place through banks, so the government’s argument that the use of banks will reduce under-the-table transactions does not hold.
Two rights, many wrongs
•The Centre informed the Supreme Court that protecting the privacy of electoral bond buyers is vital. While the right to privacy in India safeguards the individual’s autonomy and dignity, it is subject to restriction on the basis of “compelling public interest”. If the information pertains to matters which affect the lives of others, or is closely linked to a public person, it must be disclosed. The policy choices and decisions of public officials have to be brought under public scrutiny to ensure that they have not acted in a manner that unfairly benefits them or their benefactors. The same logic can then be extended to the funding of political parties, where the funder’s actions are bound to have an influence on the policy decisions of the party, if the party wins. A clear conflict of interest would likely arise if important policy decisions are taken that could affect the donors to the party. Let’s imagine that an Indian company decides to make a huge political donation through the electoral bonds scheme and the political party it donates to emerges victorious. What if the government decides to provide favourable deals to the sector in question? The public will have no way of knowing what guided such a biased action.
•The Central government in its affidavit further argued that the right to keep the identity of the donor private was an extension of their right to vote in a secret ballot. The Supreme Court has almost unequivocally read a right to information and knowledge implicit in the right to freedom of speech and expression. The freedom to vote (as different from the right to vote) is seen as an essential facet of Article 19 of the Constitution. It is difficult to understand how a liberal democratic structure can sustain its legitimacy when information is not fully available to voters exercising their choice. The policy on electoral bonds thus needs to recognise the complementary nature of the rights to privacy and information, namely, to make the state more accountable.
📰 Golan Heights belongs to Israel: U.S.
Trump signs proclamation in Netanyahu’s presence
•With Prime Minister Benjamin Netanyahu at his side, U.S. President Donald Trump declared on Monday that the Golan Heights belongs to Israel. Mr. Netanyahu spared no praise as he watched Mr. Trump sign the Golan proclamation at the White House, likening him to President Harry S. Truman, who recognised Israel, and even to Cyrus the Great, the Persian king who freed the Jews of Babylon.
•“Your decision to recognize Israel’s sovereignty on the Golan Heights is so historic,” Mr. Netanyahu told Mr. Trump. The Jewish state captured the territory from Syria during the Six-Day War of 1967. “Your recognition is a two-fold act of historic justice. Israel won the Golan Heights in a just war of self-defence, and the Jewish people’s roots in the Golan go back thousands of years,” he said. Mr. Netanyahu was visiting Washington for the conference of the American Israel Public Affairs Committee but cut his visit short after a rocket fired on Monday from the Hamas-controlled Gaza Strip hit a house north of Tel Aviv, wounding seven Israelis in an unusually long-range attack.
•Just as Mr. Netanyahu entered the White House, Israeli warplanes struck targets in Gaza linked to Hamas with the Prime Minister vowing to respond “forcefully to this wanton aggression”.
📰 PSLV-C45 project will mark several firsts for ISRO
Emisat mission scheduled forlaunch on April 1
•For the sheer number of ‘firsts’ to its credit, the PSLV-C45/Emisat mission scheduled for an April 1 lift-off from Sriharikota will be a memorable one for the Indian Space Research Organisation (ISRO).
•For one, it will be ISRO’s first attempt at placing payloads in three different orbits. The chief payload — the 436 kg Emisat — will be injected into a 749 km orbit. After that, the fourth stage of the rocket will be manoeuvred to a 504 km orbit for releasing 28 international satellites.
•Once that job is over, the fourth stage will be restarted and guided to an altitude of 485 km.
•For the next six months, this stage will serve as an orbital platform for space-based experiments. This is another first for the ISRO. Normally, the spent stage simply becomes space junk.
•The orbital platform will also sport solar panels, which too is a first, official sources said. But that’s not all: the launch vehicle itself is a new variant, designated PSLV-QL. For the first time, ISRO will be employing four XL strap-on motors on the first stage.
•Again, the PSLV-C45 mission marks a milestone for ISRO’s Indian Institute of Space Science and Technology (IIST). One of the three experiments aboard the orbital platform is the IIST’s Advanced Retarding Potential Analyser for Ionospheric Studies (ARIS). T
•his is the first time that an IIST payload is flying aboard an ISRO mission, IIST Director V. K. Dadhwal said. ARIS will study the structure and composition of the ionosphere.
•The other two experimental payloads aboard the orbital platform are the Automatic Identification System (AIS), an ISRO payload for maritime satellite applications, and the Automatic Packet Repeating System (APRS), meant to assist amateur radio operators.
•Emisat, the chief payload on PSLV-C45, is meant for electromagnetic spectrum measurements, according to the ISRO. It will released into an orbit at 749 km, the ISRO said. C-45, which is set for lift-off from the second launchpad at Sriharikota, will mark the 47th flight of the PSLV.
Foreign co-passengers
•As many as 28 small foreign co-passenger satellites will also travel to space with it, but to a lower orbit at 504 km. They include 24 small satellites from the U.S., among them 20 which are part of previous customer Planet Labs’ earth observation constellation. The other four customers are from Lithuania, Spain and Switzerland.
•Knowledgeable sources said the 436-kg satellite would serve as the country’s roving device for detecting and gathering electronic intelligence from enemy radars across the borders as it circles the globe roughly pole to pole every 90 minutes or so. Other highly placed officials confirmed that its payload comes from one or more laboratories of the Defence Research & Development Organisation. For the third successive PSLV mission, the ISRO plans to reuse the rocket’s spent fourth stage or PS4 to host short experiments.
📰 Chinook will be a game changer, says Air Force chief
IAF inducts 4 combat-ready Chinook helicopters
•The Indian Air Force (IAF) on Monday inducted the first batch of four Chinook CH-47F(I) heavy-lift helicopters, which will significantly improve airlift to high-altitude areas.
•“The induction of Chinook will be a game changer the way Rafale is going to be in the fighter fleet… This modern, multi-mission-capable, heavy-lift transport helicopter will enhance our heli-lift capability across all types of terrain to the full effect,” Air Chief Marshal B.S. Dhanoa said at the ceremony at the Air Force Station Chandigarh.
•The service ceiling of 20,000 feet would redefine heavy lift not just in operations, inter-valley transport and artillery transport but also in humanitarian assistance and disaster relief efforts in far-flung areas, he said.
•These helicopters will be deployed in the northern and eastern regions, the IAF said in a statement. Besides Chandigarh, another unit will be created at Dinjan in Assam.
•India finalised a contract for 15 Boeing Chinook helicopters in September 2015. The first batch arrived at the Mundra Port in Gujarat in February this year. All helicopters will be delivered by March next year.
•The first batch of 12 pilots and as many flight engineers underwent training in the U.S. in October 2018.
•The Chinook can carry a maximum payload of 11 tonnes and 54 combat-ready troops or 24 stretcher patients. The Army’s recently inducted M-777 Ultra-Light Howitzers can be carried under slung to forward areas. This will significantly improve the rapid reaction capabilities along the western and eastern borders.
•“The helicopter has been customised to suit the IAF’s future requirements...,” the IAF said.
📰 Delaying bad news: on proposed banking reforms
Banks that do not recognise their problems will likely not resolve them
•For now, Indian banks burdened by sour loans will not have to admit the true size of their likely losses. On Friday, the Reserve Bank of India postponed the implementation of the Indian Accounting Standards (Ind AS) norms for banks indefinitely, citing the need for amendments to be made by the government to the relevant banking laws. The RBI had initially planned to implement the norms starting April 1, 2018 in order to bring Indian accounting standards in line with international standards, but the Centre’s delay in enacting the necessary amendments had given breathing space for banks for another year. It is believed that the adoption of the accounting standard could cause significant credit losses to banks, which will be forced to prematurely recognise losses on their loans and build up the necessary underlying capital required to overcome the impact of such losses. Under the proposed norms, financial institutions like banks will have to calculate expected credit losses (ECL) on their loans during each reporting period and make necessary adjustments to their profit-and-loss account even before a borrower may default on a certain loan. This is in contrast to the present accounting norms wherein banks incur credit losses in their books only after outstanding loans have been in a state of default over a certain number of days as stated in the rules laid down by the RBI.
•Given the losses they would likely have to incur, it is understandable why banks would try to avoid adopting the accounting norms for as long as possible. So the delay in the implementation of the Ind AS norms is not surprising at all. Further, to adjust to the new norms, banks will have to improve their ability to forecast future credit losses with precision. Until this happens, bank earnings could experience volatility. The Central government, which has been trying to bail out public sector banks without carrying out the structural reforms required to clean up balance sheets, might also prefer to delay the enactment of the legislation. For the new norms will cause more outstanding loans to be added to the huge existing pile of bad loans and cause further headaches to the government. According to estimates made by India Ratings & Research, public sector banks would have to make additional provision of over a trillion rupees if the norms are adopted right away. The Centre may not be able to foot the bill, and may instead prefer to help public sector banks to hide the true size of their bad loans. This does not bode well for the health of the banking system as banks that do not recognise their problems might not resolve them.
📰 Balancing work
Only if men share the burden of unpaid care work can more and more women be a part of the workforce
•The underlying gender bias in unpaid care work is a critical factor contributing to gender inequality, says the International Labour Organization’s (ILO) latest report. The ILO’s 2017 global sample survey established that 70% of women were eager to be in paid employment outside their home. But an ILO study last year found that only about 45% of women had jobs. This underscores the gap between their desires and reality.
•The report, ‘A quantum leap for gender equality: For a better future of work for all’, which was launched earlier this month, shows that unpaid care work posed the biggest impediment to women’s employment. Some 21.7% of women of working age are engaged full time in caregiving without pay, says the report. Only 1.5% of men fall in this category.
•The impact of unpaid work on women manifests itself at many levels. There is motherhood penalty (which means that mothers in the workforce experience additional disadvantages compared to women who are not mothers). This is more acute for women with children in the 0-5 age group than among those with older children. In addition, there is also the parenthood employment gap that unfairly privileges fathers. The ILO reports an increase in both these groups in several countries that were surveyed. More starkly, there is a wage penalty associated with motherhood, as opposed to a wage premium linked to fatherhood, over an entire career span. This translates into a leadership penalty. Only about 25% of women with young children are said to occupy managerial positions. This contrasts with some 75% among fathers in comparable situations.
•A skewed distribution of unpaid work yields unequal dividends from educational attainments. Gender enrolment gaps were said to have closed by 2017 in secondary and tertiary education. But women make up over 69% of youth who are not in employment, education or training. These numbers should explain why the bulk of women drift into unpaid care activities. In most of the developing world, even when they are engaged in paid work, it is predominantly in the unorganised sector.
•Among adults with a university degree, 41.5% of women are either unemployed or outside the labour force, compared to 17.2% among men. But those who manage to break through barriers are better qualified than men and rise to the top even faster. Across the world, over 44% of women managers hold an advanced degree, as compared to 38.3% among male counterparts.
•A rebalancing of current roles is critical to expand the arena of paid work for women and reduce the long working hours for men. That may also be the answer to promoting women’s participation in the workforce.
📰 U.S.-China trade war poses the biggest risk to global stability, says IMF official
‘Fiscal stabilisation needed to respond to economic shocks in Europe’
•The U.S.-China trade war poses the biggest risk to global stability and fiscal stabilisation is needed to respond to economic shocks in Europe, IMF First Deputy Managing Director David Lipton said on Monday.
•“Obviously, this is not a matter for Europe alone. The United States needs to get its fiscal house in order as well. U.S.-China trade tensions pose the largest risk to global stability,” Mr. Lipton said at a conference here.
•The trade dispute, which began eight months ago, had affected the flow of billions of dollars of goods between the biggest and second-biggest economies in the world.
•Mr. Lipton said he believed fiscal stabilisation capacity must be at the heart of risk reduction in Europe, describing it as crucial to “respond to macroeconomic shocks and improve the fiscal-monetary policy mix.”
•“In its absence, the Euro area will remain over-reliant on monetary policy for stabilisation and too much of the burden of crisis response will fall on individual countries, with their ability to respond depending on each country’s fiscal space.”
•Mr. Lipton said Britain’s planned exit from the EU was also breeding uncertainty in Europe and beyond.
Deceleration in Europe
•Regarding Europe’s recent economic deceleration, he said each EU member state should “strengthen their defences ahead of a potential downturn,” including those countries that have not addressed “glaring vulnerabilities,” notably Italy.
•“A serious recession could be very damaging for these countries, because they will be shown to be ill-prepared,” he said. “Their weaknesses could present a serious setback for Europe’s goal of convergence of standards of living, productivity, [and] of national well-being.”
