📰 Another quota question: On creamy layer for SCs
Supreme Court needs to decide whether ‘creamy layer’ norms can be extended to SCs
•The time may have come for an authoritative pronouncement on the question whether the concept of ‘creamy layer’ ought to be applied to Scheduled Castes and Scheduled Tribes. The Union government has called upon the Supreme Court to form a seven-judge Bench to reconsider the formulation in M. Nagaraj vs Union of India (2006) that it should be applied to the SC and ST communities. This verdict was a reality check to the concept of reservation. Even while upholding Constitution amendments meant to preserve reservation in promotions as well as consequential seniority, it contained an exposition of the equality principle that hedged reservation against a set of constitutional requirements, without which the structure of equal opportunity would collapse. These were ‘quantifiable data’ to show the backwardness of a community, the inadequacy of its representation in service, and the lack of adverse impact on “the overall efficiency of administration”. This placed a question mark on the continuance of quota policies of various State governments due to non-compliance with these parameters. In Jarnail Singh (2018), another Constitution Bench reaffirmed the applicability of creamy layer norms to SC/STs. On this ground, it felt that Nagaraj did not merit reconsideration. However, it ruled that Nagaraj was wrong to require a demonstration of backwardness for the Scheduled Castes and Tribes, as it was directly contrary to the nine-judge Bench judgment in Indra Sawhney (1992), which had laid down that there is no need for a test of backwardness for SC/STs, as “they indubitably fall within the expression ‘backward class of citizens’.”
•It is curious that Jarnail Singh accepted the presumption of the backwardness of Scheduled Castes and Tribes, but favoured applying the ‘means test’ to exclude from the purview of SC/ST reservation those who had achieved some level of economic advancement. In this, it specifically rejects an opinion by the then Chief Justice K.G. Balakrishnan in Ashoka Thakur (2008) that the ‘creamy layer’ concept is a principle of identification (of those who should not get reservation) and not one of equality. While the Centre has accepted that the ‘creamy layer’ norm is needed to ensure that only those genuinely backward get reservation benefits, it is justifiably upset that this principle has been extended to Dalits, who have been acknowledged to be the most backward among the backward sections. Another problem is the question whether the exclusion of the advanced sections among SC/ST candidates can be disallowed only for promotions. Most of them may not fall under the ‘creamy layer’ category at the entry level, but after some years of service and promotions, they may reach an income level at which they fall under the ‘creamy layer’. This may result in the defeat of the object of the Constitution amendments that the court itself had upheld to protect reservation in promotions as well as consequential seniority. Another landmark verdict in the history of affirmative action jurisprudence may be needed to settle these questions.
It is crisis-ridden, understaffed and underfunded
•The furore surrounding fee hikes at the Jawaharlal Nehru University has spurred deeper questions about the quality of university education. India’s higher education system is structurally flawed and underfunded. This crisis will affect innovation and human capital, the two pillars of labour productivity and GDP growth, while cheating India’s largest demographic of its potential.
•The mammoth system deserves better than the superficial data that is being bandied about. For example, a surge in women’s enrolment has been much-talked about but this does not necessarily imply better outcomes. The latest ‘India Skills Report’ suggests that only 47% of Indian graduates are employable — a problem exacerbated by startlingly low faculty figures.
Faculty shortage
•Faculty vacancies at government institutions are at 50% on average. A Deloitte gathering of 63 Deans of top-tier institutions revealed that 80% of those listed lack of quality faculty as their biggest concern. The problem lies in increased demand, and stagnant supply. The number of institutions has surged in India since the 2000s, while the number of students doing PhD has remained constant. Meanwhile, there are over a 1,00,000 India-born PhDs in universities around the world, kept away by paltry salaries and poor funding. China solved this problem by attracting Chinese-origin PhDs back home with dollar salaries and monetary incentives for published research. Tsinghua University, for example, is designed on the Western model of teaching and research, and is even ahead of MIT in terms of published papers.
•However, Indian universities persist in separating research and teaching activities, depriving students of exposure to cutting-edge ideas. Monetary incentives for academia are practically non-existent, and Indian R&D expenditure at 0.62% of GDP is one of the lowest in emerging economies. It is not surprising, then, that Indian universities rank low in both research and teaching. The Council of Scientific and Industrial Research, at rank 155, was our highest in the Scimago Institutions Rankings (SIR) for research while six Chinese institutes figured in the top 50.
Macroeconomic impact
•Such flaws could affect macroeconomic indicators such as labour productivity, which is determined by innovation and human capital, among other things. The workers of tomorrow need to transition to the formal, non-agricultural sector, armed with higher education credentials. In addition, an increase in research could lead to more innovation in the economy, which might in turn drive up labour productivity. Higher education has a potential twofold effect on productivity. The government released a Draft National Education Policy (DNEP) in June 2019, which proposed ambitious reforms. The DNEP aims to double education spending to 6% of GDP, and close the research-teaching divide in higher education. This is coupled with an ‘Institutions of Eminence’ programme started in 2018 that gave increased funding to some research universities. Experts, however, are doubtful about whether the dramatic increases will be politically feasible, and whether the implementation of such reforms will go the path of previous NEPs — watered down and eventually shelved.
•What lies ahead? The government needs to recognise the systemic anger at play, and ensure that higher education’s role in innovation and human capital is not ignored. The DNEP is a great first-step, but the reforms must be pushed through and must lead to legislation that will fund research-based universities. Only this can bring a culture of discovery and accountability to India’s higher education institutions.
📰 Government procured just 3% of pulses, seeds targeted under PM-AASHA scheme
Under the Pradhan Mantri Annadata Aay Sanrakshan Abhiyan scheme, only 1.08 lakh tonnes have been procured so far.
•Less than 3% of this season’s sanctioned amount of pulses and oilseeds have actually been procured so far under the once-hyped PM-AASHA scheme, Agriculture Ministry data show. Arrivals of these crops began in October and will end by February.
•A total of 37.59 lakh metric tonnes of procurement had been sanctioned under the Centrally funded scheme. However, only 1.08 lakh tonnes have been procured so far, according to data placed in the Lok Sabha on December 3. In fact, of the eleven States that opted for the scheme this season, procurement has not even started in Uttar Pradesh, Madhya Pradesh and Odisha.
Direct purchase
•The PM-AASHA or Pradhan Mantri Annadata Aay Sanrakshan Abhiyan, was announced with great fanfare in September 2018, as an effort to ensure that farmers growing pulses, oilseeds and copra actually get the minimum support prices they are promised for their crops each year. Apart from initiatives to allow cash payment to farmers or procurement by private traders, PM-AASHA’s main feature was a price support scheme whereby Central agencies would procure pulses and oilseeds directly from farmers.
‘Holistic approach’
•The Centre had budgeted ₹15,053 crore over two years to implement the scheme apart from an additional government credit guarantee of ₹16,550 crore for agencies undertaking procurement. “The government is working with a holistic approach...Increasing MSP is not adequate and it is more important that farmers should get full benefit of the announced MSP,” said a Cabinet statement at the time of launch.
Late monsoon
•The main crops covered under the scheme this season are moong, urad, arhar, groundnut and soyabean. The late arrival of the monsoon means that harvests and crop arrivals also began slightly later than expected, especially for arhar or tur dal, so procurement is likely to continue, though tapering, until February.
•However, procurement is still lagging badly in most States. The highest sanctioned procurement is in Maharashtra, where 10 lakh tonnes of soyabean procurement were sanctioned, apart from 58,000 tonnes of moong and urad dal. However, barely 1,709 tonnes have been procured in the State so far, including just 14 tonnes of soyabean.
•The highest procurement so far has taken place in Rajasthan, where more than 51,000 tonnes of moong and groundnut have been procured, against a total sanctioned amount of 9.6 lakh tonnes. While almost 5 lakh tonnes had been sanctioned in Madhya Pradesh, and 1.18 lakh tonnes in Uttar Pradesh, procurement has not yet begun in either State.
📰 Union Environment Ministry to challenge Uttarakhand forest notice
To contest definition of ‘deemed forest’
•The Union Environment Ministry is likely to challenge a recent notification by the Uttarakhand Forest Department on its definition of a “deemed forest”. Deemed forests, which comprise about 1% of India’s forest land, are a controversial subject as they refer to land tracts that appear to be a “forest”, but have not been notified so by the government or in historical records.
•In a notification on November 21, the Uttarakhand government said that in areas recorded as “deemed forest” only tracts 10 hectares and above and having a canopy density of greater than 60%, would be considered forest. The freedom to define which tracts of forest qualify as forest has been the prerogative of States since 1996. However, this only applies to forest land that has not already been historically classified as “forest” in revenue records, or categorised so by the government as “protected” or “reserve forest”.
•The notification appears to extend this definition even to tracts already recorded as forest in revenue records. “We will be writing to the State. There is a hearing in the Supreme Court on this,” Siddhanta Das, Director General (Forest) said.
‘Destructive order’
•Environmentalists say that Uttarakhand’s criteria paves the way for large parts of forestland to be captured by builders and industrialists. “This is a destructive order and would hurt landscapes,” said Peter Smetacek, founder, Butterfly Research Centre, Bhimtal.
•Jai Raj, Uttarakhand’s Principal Chief Conservator-Forests, said that the hue and cry was needless. The new definition did not touch areas already recorded as “forest” and this constituted 70% of Uttarakhand’s geographic area. “The new definition refers to revenue land that is outside this forest. We will only be adding extra forest over and above what exists,” he told The Hindu in a conversation.
•The notification also goes on to say that in areas not recorded as forest in Uttarakhand, only 10-hectare woods with 75% “native species” and a canopy density greater than 60% would count as “forest”.
‘Better position’
•The Forest Advisory Committee, the apex body of the Centre that deliberates on granting permission to industry to fell forests, at a meeting on September 26, said “... States, having well-established Forest Departments, are in a better position, rather than the [Union Environment Ministry], to understand their own forests and needs, and should frame criteria for their forests... criteria so finalised by a State need not be subject to approval by the Ministry”.
•The subject came up for discussion at the meeting because the Uttarakhand government had put forth a set of criteria defining forest land and asked the Ministry for its opinion, the minutes of the meeting had noted.
📰 The neglected foot soldiers of a liberalised economy
India’s contract workers need greater state protection
•Editorials and articles have been written on the proposed merger of BSNL and MTNL. Permanent employees of the two telecommunication companies are planning to opt for lucrative voluntary retirement schemes and a generous package also awaits the senior employees. But what about the thousands of contract labourers, contractual and temporary workers — who have served the two organisations for several years for far less wages and without any substantial social security benefits? It is not an exaggeration to say that these workers constituted the rudimentary service pool of these organisations. But now, after doing unpaid work for many months, many of the desperate employees are committing suicide.
•The BSNL-MTNL case is not an aberration. There are thousands of employees in the informal sector, a majority of them engaged through contractors, working in precarious service conditions. But, who will rehabilitate these victims of an emerging market economy where most graduates are not employable due to skill deficiency and there is an acute shortage of job opportunities?
Non-compliance
•The Contract Labour (Regulation and Abolition) Act, 1970 and the Inter State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979 have been in place for long; but non-compliance is the order of the day. Similarly, manual scavengers, most of them employed as contract labourers, are still forced to do cleaning jobs under the most inhumane conditions, despite this barbaric practice having been outlawed through successive pieces of legislation. The Supreme Court, in judgment after judgment, has ruled that contract workers should be paid the same wages as permanent employees for similar jobs, but these orders seem to exist only to be taught in law classes, not for compliance by employers.
•Similarly, Unorganised Workers’ Social Security Act, 2008, has largely been a cosmetic exercise. The second National Commission on Labour, in the year 2002, had strongly recommended abolition of the exploitative contract labour system in course of time and, in the meantime, suggested implementation of a comprehensive social security scheme. It had very rightly recommended that after two years of working for an organisation, a contract worker should be treated as a permanent worker. However, the apex court in SAIL vs. National Union of Water front Workers and others (2001) overruled some of its earlier judgments and decided that the law does not provide for automatic absorption of contract labourers upon its abolition and that the principal employer has no liability to regularise them.
Hire and fire the norm
•It is true that our labour laws are stringent and protective, but this statement applies only to the fortunate permanent employees, who constitute roughly 10% of the total workforce. Hire and fire is the rule for the contract labourers. Laissez faire is in full bloom. Paradoxically, a rigid labour law system has also contributed to greater contractualisation of the workforce. And, engaged in substantial numbers as contract labourers are people from vulnerable caste groups. The Contract Labour Act, 1970, is applicable only to organisations and contractors who are employing 20 or more workers. Hence, the number of such workers could be much more than what the numbers suggest.
•In the liberalised Indian economy of the 21st century, such labourers are treated as sacrificial goats. Pay Commissions are always very gracious to upgrade the salary structure of permanent employees on a periodical basis, but the genuine needs of contract workers are repeatedly ignored by the state. Unless our policymakers ensure strong enforcement of policies linked to such workers, suicides, as in the BSNL-MTNL case, will continue. Parliament has already enacted the Code on Wages, 2019. Indeed, we do need reform in our labour laws to enhance globalisation. But, at the same time, we also need a comprehensive umbrella of social security for these foot soldiers of growth and development.
📰 Climate-related disasters on the uptick
Japan worst-hit, India ranked fifth for water shortages, crop failures and flooding
•Worsening heatwaves are taking a heavier toll on rich as well as poor countries, according to an annual ranking that measures the damage done by extreme weather to human life and economies.
•The Global Climate Risk Index, published on Wednesday by environmental think-tank Germanwatch, rated Japan as the most-affected country in 2018, while Germany was in third position.
•Both of the industrialised nations were hit hard by heatwaves and drought that year, as was India — in fifth position — which suffered water shortages, crop failures and worst flooding, Germanwatch said in a report.
•“Recent science has confirmed the long-established link between climate change and the frequency and severity of extreme heat,” it added in a statement.
•In 2018, a severe summer heatwave in Japan killed 138 people and caused more than 70,000 people to be hospitalised with heat stroke and exhaustion, the report said.
•And in Germany, the period from April-July 2018 was the hottest ever recorded in the country, leading to the deaths of over 1,200 people.
•Across Europe, extreme heat spells are now up to 100 times more likely than a century ago, says the report. It noted that the impact of heatwaves on African countries may be under-represented due to a lack of data.
•Powerful storms also left a trail of destruction in 2018, with the Philippines second in the climate risk index due to large losses when it was battered by top-strength Typhoon Mangkhut.
‘Crisis can’t be ignored’
•Madagascar was the fourth most weather-affected country as two cyclones killed about 70 people and forced 70,000 to seek refuge.
•Laura Schaefer, a policy adviser with Germanwatch, told journalists at the UN climate talks in Madrid that the index results showed that the “signs of climate crisis”, on all continents, could no longer be ignored.
📰 Cabinet okays bond ETFs
Bharat Bond ETF would be India’s first corporate bond exchange traded fund
•The Union Cabinet on Wednesday approved the government’s plan to create and launch India’s first corporate bond exchange traded fund (ETF) — Bharat Bond ETF.
•“The Cabinet Committee on Economic Affairs has given its approval for creation and launch of Bharat Bond Exchange Traded Fund (ETF) to create an additional source of funding for Central Public Sector Undertakings (CPSUs), Central Public Sector Enterprises (CPSEs), Central Public Financial Institutions (CPFIs), and other government organisations,” the government said in a release.
•“Bharat Bond ETF would be the first corporate bond ETF in the country,” it added. The ETF will comprise a basket of bonds issued by the CPSEs, CPSUs, CPFIs, and other government organisations and all will be initially AAA-rated bonds.
•“The unit size of the bond has been kept at just ₹1,000 so that retail investors can invest and it’s not a matter of having crores to invest,” Finance Minister Nirmala Sitharaman said at a press conference following the Cabinet meeting.
•Each ETF will have a fixed maturity date and initially they will be issued in two series, of three years and 10 years.
•“Bond ETF will provide safety (underlying bonds are issued by CPSEs and other government-owned entities), liquidity (tradability on exchange) and predictable tax efficient returns,” the government release added.
•The low unit value of ₹1,000, it said, would help deepen India’s bond market as it will encourage the participation of those retail investors who are currently not participating in bond markets due to liquidity and accessibility constraints.
Additional source
•On the issuer side, the bond ETFs are expected to offer CPSEs, CPSUs, CPFIs and other government organisations an additional source of meeting their borrowing requirements, apart from bank financing.
•“It will expand their investor base through retail and HNI [high net worth individual] participation, which can increase demand for their bonds,” the government added. “With increase in demand for their bonds, these issuers may be able to borrow at reduced cost thereby reducing their cost of borrowing over a period of time.”
