📰 Govt. moots plan to link digital IDs
Idea is to create a single unique identity for digital transactions, eKYC services
•The government has invited stakeholder comments on a proposal that seeks to establish ‘Federated Digital Identities’ to optimise the number of digital identities that a citizen needs to have, by linking various consumer identification data into a single unique ID for digital transactions such as authentication and eKYC services.
•The proposal is part of the Electronics and IT Ministry’s India Enterprise Architecture 2.0 (IndEA 2.0) framework that aims to enable the governments and the private sector enterprises to design IT architectures that can span beyond organisational boundaries for delivery of integrated services.
•“As various government platforms across domains are being digitised, there is a tendency to create more IDs each with its own ID card, ID management, and effort to make it unique, etc,” the Ministry has said in the draft, on which stakeholder comments have been invited till February 27.
Cumbersome process
•“Having a multitude [of] IDs, especially to interact with the government, makes it harder for common man for whom these are created! Especially given the diversity in education, awareness and capabilities, this also has a potential to further create exclusion scenarios,” it said.
•Noting that digital identity is fundamental to enabling the citizen to answer the first question asked in any interaction with a public or private organisation, ‘who I am’, it pointed out that Aadhaar seems to have answered this question at population scale in respect of all publicly funded schemes.
•However, the Ministries and the States are required to create several identities for the same citizen acting in different capacities like student, teacher, farmer, land owner, entrepreneur, customer of a bank, driver, owner of a vehicle, pensioner and so on.
Optimising identities
•“InDEA 2.0 proposes a model of Federated Digital Identities that seeks to optimise the number of digital identities that a citizen needs to have. The model empowers the citizen by putting her in control of these identities and providing her the option of choosing which one to use for what purpose. It gives the agency to the citizens and protects privacy-by-design,” it said.
•It explained that electronic registries can be linked via the IDs to allow easy, paperless onboarding of citizens and also avoid repeated data verification needs.
•For example, when a beneficiary is registered for the PDS scheme, that record will be linked to Aadhaar by the PDS system storing the Aadhaar number (or a tokenised version of it).
•Similarly, when someone obtains a PAN, that record gets linked to Aadhaar where the Aadhaar number becomes the linking ID.
•Then when that person obtains a mutual fund account, the PAN, in turn, gets linked to the mutual fund record.
The Government needs to stop India’s avalanching slide into a grossly divided society, made worse by the pandemic
•On January 17, 2022, Oxfam International presented its annual global “Inequality Report”. Titled Inequality Kills, the report calculated and presented the quantum growth in wealth of a minuscule few, and the simultaneous impoverishment of millions of working people. During the novel coronavirus pandemic, the report reveals, more than half the world’s new poor are from India; 84% Indian households have suffered a loss of income, with 4.6 crore people falling into extreme poverty. In this period, the richest 142 people have more than doubled their wealth to more than ₹53 lakh-crore. This is clearly happening by design, and can only be corrected if our policymakers reverse their framework of paying lip service to the poor while making policies that support the rich. One of the most important places to show commitment to equity, is the Union Budget; and inequality should perhaps be discussed threadbare in India before, and after every Union and State Budget.
This is the guiding light
•There is also a constitutional mandate to reduce inequality. In India today, some of the most basic human rights that allow people to stay alive are under threat. It is the sacred responsibility of the Government to follow the Constitution, and ensure delivery of these rights. The policymaking “duty” of all governments is to follow Part IV of the Constitution — the Directive Principles of State Policy. The Budget is one of the most important annual exercises in state policy, and it is the Directive Principles that should be a guiding light. In terms of inequality, Articles 38 and 39 mandate a policy path. Among other important principles, Article 38(1) states: “The State shall strive to promote the welfare of the people by securing and protecting as effectively as it may a social order in which justice, social, economic and political, shall inform all the institutions of the national life.” Article 39 (c) states: The State shall, in particular, direct its policy towards securing — (c) that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment.
‘Duties’ talk
•A rights-based policy framework, should, therefore, be followed by the Indian state to protect the poor and the marginalised. But the Prime Minister advocates that people concentrate on their duties and stop demanding their rights. On January 20, 2022, at the launch of the Brahma Kumaris’ year-long programme of events (as part of the Government’s celebration of 75 years of Independence) the Prime Minister declared, “In the last 75 years, we only kept talking about rights, fighting for rights and wasting our time. The talk of rights, to some extent, for some time, may be right in particular circumstances, but forgetting one’s duties completely has played a huge role in keeping India weak.” Ironically, the Prime Minister did not seem to be referring to his own duties.
•In a country like India, reducing inequality should be a high priority. Today, this principle is being inverted. The Oxfam report does not exclusively examine the multiplying wealth of India’s billionaires. Let us look outside this 0.00001% of our population, and for the purposes of the Budget, look at their analysis of basic social services — particularly those that affect the survival of the poor.
•India must be one of the only countries in the world where during the COVID-19 pandemic the health Budget has declined — and that too by a huge 10% in the last year. Social security expenditure has declined from an already pathetically low 1.5% in 2020-21 to 0.6% of the Union Budget in 2022. It is at this end of Budget allocations where people are deprived of the most basic services and entitlements and are unable to survive. Social security pensions, for the elderly, for the disabled, and widows have been frozen at ₹200-₹300 a month for almost 15 years. The Government says there is not enough money to even index these to inflation. In contrast, policymakers have just in the last year increased their own salaries and pensions through a DA increase to 28%, and given themselves a bonus of 3% — with just the increase for one crore central government employees and pensioners costing the exchequer more than the total social security pension budget for 3.3 crore beneficiaries.
•The Prime Minister’s outburst against “rights” perhaps explains his lack of support for the implementation of rights-based laws. Nevertheless, during the pandemic, even his government had to turn to the National Food Security Act (NFSA) and the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) to save millions of Indians from hunger and premature death. After increasing allocations in the first phase of the pandemic, allocations were frozen, and budgets were slashed in Budget 2021-22. The Government said it will supplement as and when needed. However, it is clear that supplements come in an extremely miserly fashion, causing extensive distress, and in MGNREGA, undermining the legal guarantee of work on demand.
•During a recent 18-day “Accountability Yatra” in the State of Rajasthan, we came across thousands of cases of needy people not receiving ₹2 per kilo wheat. The answer to grievances and appeals filed in writing is that the portal is closed and no more entries allowed. The priority list of households under the NFSA has been frozen in absolute numbers, based on a percentage determined from the 2011 Census. In the last 11 years, population increases amounting to approximately 10 crore eligible beneficiaries have been kept out. Therefore, approximately 12% legally entitled people — even children of existing “priority households” — cannot get subsidised foodgrain. To use digital codes to block even the appellate process mandated by law is a live example of callous multi-dimensional inequality, demonstrating why the “Inequality Kills” title of the Oxfam report is poignant and true.
Children and education
•The pandemic has also produced a generation of children who have forgotten what formal education is. Many teenagers from poor households have already joined the workforce. In this period, there has been a 6% cut in the education Budget. Relying on online teaching, accompanied by Budget cuts, amounts to the institutionalisation of endemic multidimensional poverty.
•The list can go on and on. As we await Union Budget 2022-23, will this trend be reversed? There will be much talk among affluent analysts cautioning against social sector expenditure, calling them “welfare and doles”. Programmes such as the food security Act will not receive the quantum of allocations needed, even though food grain stocks are more than 90 million tons. The People’s Action for Employment Guarantee (PAEG) has estimated that approximately ₹2,64,000 crore will be needed to guarantee 100 days work for currently active job cards. Even half that amount is unlikely to be allocated for MGNREGA. Social security pensioners will continue to face hunger, insult, sickness and death. One would expect that if nothing else, their millions of votes in crucial State elections would fetch these families some basic rights. But, in polarised elections, the basic needs of unorganised and voiceless people are easily ignored.
Time to generate data
•Policymakers will tell us that resources are scarce. Oxfam says the combined wealth of India’s 142 billionaires has increased by a massive ₹30 lakh-crore, in just the pandemic period. Jan Sarokar, a network of more than 30 social sector movements, has suggested that a 2% wealth tax, and a 33% inheritance tax on the top 1% of our population will fetch an estimated ₹11 lakh crore per annum, to support basic social sector entitlements. Suggestions such as this are already being ridiculed by market fundamentalists. Which way will the Government go?
•The Bharatiya Janata Party’s response to most international reports has been to claim flawed methodology and analysis. It is time to introspect, generate robust data, and face the truth. The Budget is a policy that matters to all. There is, unfortunately, little hope that this Government will stop this avalanching slide into a grossly divided society. It is perhaps up to society to stand up and make sure that we are true to our constitutional commitment of building a more just and equal society. That is our most fundamental duty.
📰 Mahatma Gandhi, the out-of-the-box thinker
Since Gandhiji does not fit into any hard and fast category, he continues to disturb us
•The 74th anniversary of Mahatma Gandhi’s death provides us an opportunity to think about his character and contributions as an important figure of world history. Usually, to praise a historical figure, one tries to enumerate on their qualities to show how marvellous they had been in all areas of life.
•But Mahatma Gandhi was both an enigmatic and disturbing figure. He used to think out of the box. He was an open-minded soft reader of concepts and categories. In this regard, he saw his place among the weakest and the poorest. His notion of a just and truthful politics was that in such an environment, the weakest should have the same opportunities as the strongest. It would, therefore, be suspect to see Gandhi being celebrated by the powerful and the victors and not by the weak and the defeated.
•If Gandhi continues to disturb the powerful and the victorious, it is because he does not fit in the victors’ histories and narratives.
•Why do we continue to read Gandhi and to admire him? Not because he is the Father of the Indian Nation, but because he disturbs us. He was a chief doubter of oppressive systems and a rebel against all forms of hidden and open authority.
An example of simplicity
•It is also because in an arrogant and unchecked civilisation like ours, Gandhi is a great example of simplicity and transparency. Gandhi’s simplicity was reflected in his deeds and acts, but mostly in his mode of life. Unlike most of us, not to say all of us, Gandhi had more joy and fulfilment in pursuing less in life than in pursuing more. The corporate mindset — that of being successful — which dominates all aspects of our lives, did not exist for him. And maybe, it is because of his pure simplicity that we continue to have so much trouble in understanding Gandhi. Naturally, corporates, even when they use him as a logo or an emblem, fear him. Maybe because Gandhi, like Sisyphus, continues to roll the rock up to the top of the mountain. With Gandhi we are never confronted with absolute Truth. Gandhi is a perpetual truth seeker. In fact, Gandhi is victorious through his effortful trials. His position remains ambiguous and disturbing.
•Assuredly, Gandhi was an ambiguous personality, but he never wore a mask. He neither masked himself nor put a mask on the face of Indian history.
•Rather, he challenged Indian history by asking lucid and limpid questions from it. As such, in practically all of Gandhi’s historical actions, there was moral or spiritual interrogation. He, therefore, led Indians to a historical and civilisational awareness that went as far as a spiritual conversion to non-violence. That is to say, the Gandhian maieutic completely reversed the relationship between a leader and his people.
•Like Socrates, Gandhi was a midwife of minds (Gandhi was very much influenced by Socrates and his method of thinking). He reversed the guiding values of Indian life. His philosophy was that of a spiritual exercise, accompanied by an active reflection on truth and a lively awareness of all walks of life. Gandhi believed that the true test of life for the individual can be summarised in two principles: self-discipline and self-restraint. In this relation, he observed: “A self-indulgent man lives to eat; a self-restrained man eats to live.” His vision of community goes in the same direction and Gandhi gives ethical and political primacy to the two concepts of self-realisation and self-rule. For Gandhi, a self-realised and self-conscious community is a society of citizens who reconcile the self-determination of the individual with the recognition of the shared values in the community.
Point of self-transformation
•Interestingly, in a very existential way, Gandhi believed in the interrelated nature of human existence. In the same manner, what interested him in a democracy was neither representation nor elections, but the self-transformative nature of the citizens.
•But we can go even further and say that for Gandhi, this process of self-transformation should influence not only the inner life of the individual but also public life. So, what seems important is the upholding of the ethic of human action. And of course, solidarity is the advancement of that very ethic. However, what Gandhi taught us is that solidarity is not just a promise of compassion; it is actually what we can call the wake of responsibility. Undoubtedly, Gandhi knew well that global responsibility is nothing but an overriding loyalty to mankind. It goes without saying that remembering Gandhi could be a way for us to be reminded of our global responsibilities and our loyalty to mankind. Without it there would be no solidarity and no universal harmony among the peoples of the world.
Need for moral leadership
•The pandemic shows us clearly that our world is in lack of a moral leadership which can evolve through experiments of empathy and by redress of the sufferings and grievances of humanity. Even if Gandhi is no more among us, his spirit has been with the great transformative leaders of the 20th and 21st centuries like Khan Abdul Ghaffar Khan, Martin Luther King, Jr., Nelson Mandela, the Dalai Lama, Archbishop Desmond Tutu, Václav Havel and Pope Francis. As a global thinker with a transhistorical and transgeographical influence, Gandhi was a moral and political leader who stayed out of the box. We continue to wrestle with the radical parts of his vision.
📰 For the Finance Minister to note
The Indian government has to prepare for the introduction of the global minimum tax on MNCs
•The World Inequality Report 2022 authored by Lucas Chancel, Thomas Pikketty, Emmanuel Saez and Gabriel Zucman says India is now among the most unequal countries in the world. The bottom 50% of the population earn ₹53,610, while the top 10% earn more than 20 times that. The top 10% and top 1% of the population hold 57% and 22% of the national income, respectively, while the bottom 50% hold just 13%. India stands out as a poor and unequal country with an affluent elite. Inequality today is as great as it was at the peak of western imperialism in the early 20th century. The pandemic has exacerbated it. Nations have become richer but governments have become poor, says the report. The totality of wealth is in private hands. Global multimillionaires have captured a disproportionate share of global wealth growth over the past several decades.
•The Finance Minister, Nirmala Sitharaman, will take the findings of the report while framing the Budget. The long-standing complaint about corporate houses abusing provisions for tax exemption and deductions was addressed in a unique way by Ms. Sitharaman when she brought in a twin system of tax rates for companies claiming deductions and not claiming deductions. Domestic companies are charged 25% when their turnover is less than ₹250 crore and 30% when their turnover is above ₹250 crore. Suitable surcharges are also levied. A glaring inequality arises in the case of partnership firms; they are taxed at 30%. The idea seems to be to encourage corporatisation of firms. But medium- and small-scale industries find it a pain to go through the legal processes of corporatisation. Promoters of companies devise novel ways to escape the rigour of taxation.
The revolt of the haves
•The decline in corporate tax rates reduced government revenue at a time of growing public deficit and declining public wealth. It erodes the progressive nature of the tax system. High-income individuals choose to incorporate their business so that they can shift income from personal income tax to corporate tax. There is also the recent phenomenon of wealthy families of promoters of big corporate houses creating a succession plan through private trusts. Assets are transferred to the trusts. India’s corporate houses are taking a cue from wealthy families in the West like the Waltons who run Walmart via private trusts. The time has come for the re-introduction of estate duty in India.
Global minimum tax
•The Government of India has to prepare for the introduction of the global minimum tax on MNCs, as agreed to by 130 countries in July 2021. The rate then fixed was 15%. This is lower than what working class and middle-class people in high-income countries pay. MNCs are always ahead of the governments. Mark Zuckerberg chose to change his company’s name from Facebook to Metaverse. Google, Apple and Intel are all working on devices to circumvent the minimum global tax. Metaverse will pervade daily life offering new avenues for buying goods and services, communicating with friends and collaborating with colleagues. Metaverse refers to a collection of shared online worlds in which physical augmented and virtual reality converge. The CEO of Microsoft, Satya Nadella, points out that people can now hangout with friends, work, visit places buy goods and services and attend events on Metaverse. Digital access has not been equitable. This provides a challenge to the implementation of the proposed global minimum tax. Augmented reality attempts to provide a new kind of computing platform so as to find a new source of revenue.
•The rate of global minimum tax at 15% on MNCs will mean a gain of $0.5 billion for India without deductions. The gain will be zero if deductions are allowed. The World Inequality Report suggested a minimum global tax on MNCs at 25%. This will yield $1.4 billion for India without deductions and $1.2 billion with deductions of 5%. MNCs and their shareholders have been the main winners from globalisation. Their profits have boomed due to the ever-closer integration of world markets.
•Inflation indexing has long been suggested as a way out to sort out the difficulties of the fixed income group.
•India is a poor country. Pericles said, “Poverty is no disgrace to acknowledge but it is real degradation not to attempt to overcome.” The Finance Minister will do well to remember Justice Chagla’s famous saying, “Equity and income tax law may be strangers to each other but they are not sworn enemies.” No doubt, our socially conscious Finance Minister will do everything to promote equity while presenting the Budget.
📰 A year on from Myanmar’s ‘annus horribilis’
The road ahead looks dark and New Delhi’s outreach needs to be guided by realism and pragmatism
•The coup in Myanmar will be a year old tomorrow. On February 1 last year, the military seized power, violating the Constitution. A decade-long experiment with hybrid democracy ended abruptly, paving the way for violence, oppression and instability. The road ahead looks dark, but diplomatic efforts are under way to bring amelioration.
Internal scene
•The Opposition camp has called for a nationwide silent strike that ends in mass clapping, an act representing the indignation and the frustration of the people. They are angry with the military that has oppressed them and imprisoned their elected leaders. They are also frustrated with the international community as it failed to show up with a magic wand to restore democracy. Some of their leaders are promising freedom from military rule by the end of 2022. But few believe them.
•The military leadership has persisted in marching on the dangerous path it chose last January. It convinced itself that the November 2020 elections were fraudulent, resulting in a landslide victory for the National League for Democracy (NLD) led by Daw Aung San Suu Kyi. It feared that, armed with a strong popular mandate, she would clip their wings and establish full democracy. President Win Myint and Daw Suu Kyi were arrested and there was a brutal clampdown. The result: 1,498 people have been killed and 11,787 imprisoned till January 27, 2022, according to the Assistance Association for Political Prisoners. Besides, a sizeable number of security officials have been killed. An exodus of people seeking refuge in neighbouring countries followed, which included over 15,000 people to Mizoram, India.
•After the coup, the Opposition was active in articulating people’s anger. A parallel government named the National Unity Government (NUG) was formed. Slowly it lost momentum as Naypyitaw denounced NUG as “terrorists”, and used its overwhelming power to subdue the resistance. The military now has an upper hand although normalcy still eludes the nation. Instability has ruined the economy, with the World Bank terming it as “critically weak”. The crisis also weakened the Government’s efforts to manage the pandemic. In short, Myanmar has just gone through its annus horribilis.
ASEAN’s role
•Attention has now been focused on mediation by the Association of South East Asian Nations (ASEAN). It began well by persuading Senior General Min Aung Hlaing, the regime’s supremo, to accept the ‘Five-Point Consensus’ comprising, inter alia, the cessation of violence, national dialogue and mediatory efforts by ASEAN. Insiders recall that Min Aung Hlaing’s consent was implicit. This became explicit when Foreign Minister Wunna Maung Lwin formally conveyed Myanmar’s “commitment” to the plan last August. But the military resiled from its implementation. With uncharacteristic firmness, ASEAN barred the Senior General’s participation in its summits. It offered representation at the non-political level which Myanmar turned down.
•In this impasse, Cambodia’s Prime Minister Hun Sen, the current ASEAN Chair, has adopted a softer approach which is backed by Thailand and Laos. It aims at adjusting to the military’s refusal to compromise on its key requirements such as denial of access to Daw Suu Kyi for ASEAN mediators, and little dilution of the 2008 Constitution. Other ASEAN States led by Indonesia are opposed to Cambodia’s diplomacy. But long-time ASEAN watchers believe that through further consultations, the grouping will craft internal consensus and re-adapt its negotiating mandate.
•Whether this happens on Cambodia’s watch, or later under the Indonesian leadership, remains to be seen. A key person to watch is Noeleen Heyzer, the United Nations Secretary General António Guterres’s special envoy, who could help both the UN and ASEAN to craft a modus vivendi for Myanmar.
Other players
•The West exerts influence in Myanmar, but it has been unable to comprehend the dynamics of power. The United States and the European Union have not accurately assessed the military’s resolve and core conviction that without its driving role, national unity and integrity would disappear. The western policy to promote democracy and impose sanctions against the military have produced minimal results.
•The media paid huge attention to Russia’s endeavours to woo Myanmar by increasing its defence cooperation since the coup. But the principal player is China, not Russia, despite evident coordination between the two. Beijing enjoys enormous leverage in the ‘Golden Land’ through its control over several ethnic armed organisations, projects covered by the Belt and Road Initiative (BRI), the regime’s protection via veto in the Security Council, and a thick cheque book. Whoever wields power in Naypyitaw develops stakes in close partnership with China. But Myanmar’s rulers also desire independence and balance in their external policy, provided the international community gives them the means for it. Japan understands this geopolitical reality, but acting by itself, Tokyo cannot make a difference. It should act in coordination with ASEAN and India.
India’s policy
•As the world’s largest democracy, India is always happy to work with fellow democracies, but it has never been in the business of exporting democracy. Nevertheless, it has done much to shape and to strengthen diplomatic efforts at the UN and through its support to ASEAN for putting Myanmar’s transition to democracy back on the rails. This line was reiterated by India’s Foreign Secretary Harsh Vardhan Shringla in his interactions with the top military leadership in December 2021. He was given a patient hearing even though his request to meet Daw Suu Kyi was denied, as was expected. Besides, New Delhi provided one million doses of “Made in India” vaccines, and humanitarian assistance to the people of Myanmar.
•For India, the well-established two-track policy of supporting democracy and maintaining cordial relations with the Government remains in operation. South Block has to protect the state’s interests, guided by realism and pragmatism. It has to discourage a mass influx of refugees; cut the capability of insurgent groups to endanger security in the Northeast from Myanmar soil; safeguard the ongoing projects and investments; and, above all, counter China’s growing influence.
•Finally, what future awaits Daw Suu Kyi who no longer dominates the political narrative as she did before the coup? Sadly, she faces three choices, all difficult: long imprisonment, foreign exile, or imposed retirement from politics. The last option seems the most likely at present.
