GS PAPER: III

Dissonance in consumption growth: GST revenues reveal

Why in the news?

• Amid worries about weak consumer spending trends, Goods and Services Tax (GST) revenues for the first nine months of 2023-24 reveal a dissonance in consumption growth across States, with Gujarat, West Bengal and Andhra Pradesh among a dozen-odd States that are seeing weaker growth.

About the report

• The National Statistical Office estimated private final consumption expenditure (PFCE) would grow just 4.4% this year, the slowest since 2002-03, barring the pandemic-affected year of 2020-21.
• After recovering to 6% in the April to June 2023 quarter from below 3% in the second half of 2022-23, the PFCE growth had slipped to 3.1% in the July-September quarter.
• While GST revenues have been robust through April to December 2023, growing at 11.7% and averaging Rs.1.66 lakh crore a month, State GST collections have grown at a sharper pace of 15.2%. 
• Among the 20 largest States that account for nearly 97% of State GST collections, two large States, Gujarat (9.5%) and West Bengal (9.8%) are the only ones to clock less than double-digit growth, while 10 others have grown at rates lower than the national average of 15.2%.
• On the other hand, eight States, led by Madhya Pradesh, Maharashtra, Karnataka, Haryana, Uttar Pradesh, Tamil Nadu and Telangana have seen State GST revenues rise in a range of 17% to 18.8%.
• Gujarat, West Bengal, Delhi and Odisha are among the top 10 GST contributors where growth was slower, while eight States have driven the overall collections with growth higher than the national average. This is indicative of consumption being uneven across geographies… and may explain why overall consumption in the country has not been growing at a higher pace.

Lack of wage growth

• India Ratings and Research economists flagged the lack of significant wage growth, which turned marginally negative for lower income households while rising 6.4% for their upper income counterparts in the second quarter of this year, as another critical factor for consumption growth.
• Ongoing consumption demand continues to be an area of worry as it is skewed in favour of goods and services consumed largely by households belonging to the upper income bracket. 

Condition of smaller states and UT’s

• Among the smaller States and union territories, most registered higher growth in State GST collections than the 15.2% national average.
• The erstwhile State of Jammu and Kashmir has clocked a 29.8% uptick, while all the north-eastern States, including strife-torn Manipur (17.5%), recorded robust growth.
• State GST revenues grew 49.6% in Mizoram, 35.8% in Nagaland, and 33.9% in Arunachal Pradesh.

 

GS PAPER – II

Justice Gavai nominated as SC Legal Services Committee Chairman

Why in the news?

• Supreme Court judge Justice BR Gavai has been nominated as the Chairman of the Supreme Court Legal Services Committee (SCLSC), replacing Justice Sanjiv Khanna – the seniormost judge of the top court after the Chief Justice of India (CJI).

About Supreme Court Legal Services Committee

• The Supreme Court Legal Services Committee was constituted under Section 3A of the Legal Services Authorities Act, 1987, to provide “free and competent legal services to the weaker sections of society”, in cases falling under the top court’s jurisdiction.
• Section 3A of the Act states that the Central Authority (the National Legal Services Authority or NALSA) shall constitute the committee.
  • • • It consists of a sitting SC judge, who is the chairman, along with other members possessing the experience and qualifications prescribed by the Centre.
      • Both the chairman and other members will be nominated by the CJI.
      • Further, the CJI can appoint the Secretary to the Committee.

Composition of SCLSC

• The SCLSC consists of Chairperson BR Gavai and nine members nominated by the CJI. The Committee, in turn, can appoint officers and other employees as prescribed by the Centre, in consultation with the CJI.
• Besides this, Rule 10 of the NALSA Rules, 1995, entails the numbers, experience, and qualifications of the SCLSC members.
• Under Section 27 of the 1987 Act, the Centre is empowered to make rules in consultation with the CJI, by notification, to carry out the provisions of the Act.

Need of SCLSC

The need for providing legal services has been underlined in many provisions of the Indian Constitution.

• Article 39A states, “The State shall secure that the operation of the legal system promotes justice, on a basis of equal opportunity, and shall, in particular, provide free legal aid, by suitable legislation or schemes or in any other way, to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disabilities.”
• Moreover, Articles 14 (right to equality) and 22(1) (rights to be informed of grounds for arrest) also make it obligatory for the State to ensure equality before the law and a legal system that promotes justice based on equal opportunity.
• Although the idea of a legal aid programme was earlier floated in the 1950s, it was in 1980 that a committee at the national level was established under the chairmanship of then SC judge Justice PN Bhagwati. The Committee for Implementing Legal Aid Schemes started monitoring legal aid activities throughout India.

About Legal Services Authorities Act

• In 1987, the Legal Services Authorities Act was enacted to give a statutory base to legal aid programmes.
• It aims to provide free and competent legal services to eligible groups, including women, children, SC/ST and EWS categories, industrial workers, disabled persons, and others.
• Under the Act, NALSA was constituted in 1995 to monitor and evaluate the implementation of legal aid programmes and to lay down policies for making legal services available.
• A nationwide network has been envisaged under the Act for providing legal aid and assistance. It also disburses funds and grants to State Legal Services Authorities and NGOs for implementing legal aid schemes and programmes.

 

GS PAPER – III

First Advance Estimates of India’s GDP

Why in news?

• According to the recently released the First Advance Estimates (FAEs) India’s GDP will grow by 7.3% in the current financial year (2023-24), slightly faster than the 7.2% growth in 2022-23.

GDP estimated before actual time

• The FAE are presented at the end of the first week of January every year. They are only the first estimates of growth for that financial year. By the end of February, the Ministry of Statistics and Programme Implementation (MoSPI) will release the Second Advance Estimates and, by the end of May, the Provisional Estimates.
• The GDP estimates continue to be revised as more and better data become available — and in the coming three years, MoSPI will release the First, Second, and Third Revised Estimates of this year’s GDP before settling on the final number, which is called the “Actuals”.
• The FAE are based on the performance of the economy over the first seven-odd months, and the data are extrapolated to arrive at an annual picture.
• The Advance Estimates of National Income are indicator-based and are compiled using the benchmark-indicator method, i.e. the estimates available for the previous year (2022-23) are extrapolated using the relevant indicators reflecting the performance of sectors.

About FAEs

• The crucial significance of the FAEs is that they are the last GDP data released before the Union Budget for the coming financial year (which is presented on February 1) is finalised. As such, the FAEs constitute the base for the Budget numbers.
• However, since Lok Sabha elections will be held in April-May, a full-fledged Union Budget will not be presented this year.
• This year’s FAEs draw some additional significance from the fact that they provide the first complete picture of economic growth in the 10 years of the.

FAE data

• According to FAE India’s real GDP (GDP after stripping away the effect of inflation), both in absolute terms (in Rs lakh crore) and in terms of growth rate.

• By the end of March 2024, India’s GDP is expected to rise to almost Rs 172 lakh crore. When Prime Minister Modi took charge for the first time, India’s GDP was Rs 98 lakh crore, and it had reached almost Rs 140 lakh crore when he began his second term.
• On an annual basis, the 7.3% growth rate estimated for 2023-24 presents a substantial and pleasant upside surprise. Most observers, including the Reserve Bank of India, had expected growth to decelerate in the current financial year to somewhere between 5.5% and 6.5%. That the GDP growth rate is now expected to beat even the higher estimate by almost a percentage point underscores the strength of India’s economic recovery.
• However, there is a clear deceleration of growth in the second term of the Modi government compared to the first. During 2014-15 to 2018-19, the Indian economy grew at a compounded annual growth rate (CAGR) of 7.4%; in the second term (2019-20 to 2023-24), it was just 4.1%.
• The big reason for this is the poor growth rate in the first two years of the current term of the government. The economy grew by less than 4% in 2019-20 (before the Covid-19 pandemic), and then contracted by 5.6% in 2020-21 (immediately after Covid struck).
• Overall, the 7.3% growth rate in the current year suggests an optimistic picture because most of this momentum has little to do with the low base effect that bumped up GDP growth rates in FY22 and FY23.

Factors contributing to India’s growth

• India’s GDP is calculated by adding up all kinds of spending in the economy — the demand side of the economy. As such, there are four main “engines” of GDP growth.
• Spending by people in their individual capacity: Technically this is called Private Final Consumption Expenditure (PFCE). It accounts for almost 60% of India’s GDP.
• Spending towards investments in boosting the productive capacity of the economy: This could be the building of a factory, companies buying computers for their offices, or governments building roads. This is called Gross Fixed Capital Formation (GFCF), and is the second-largest engine of growth that typically accounts for 30% of the GDP.
• Spending by governments to meet daily expenditures such as salaries: This is Government Final Consumption Expenditure (GFCE). It is the smallest engine, accounting for around 10% of GDP.
• Net exports or net spending as a result of Indians spending on imports and foreigners spending on Indian exports: Since India typically imports more than it exports, this engine drags down GDP calculations, and shows up with a minus sign.

Private consumption demand: 

• In the current year, the overall demand by people is expected to grow by 4.4%. This is similar to the CAGR (4.5%) in the second term of the Modi government but is substantially lower than the growth rate in the first term (7.1%).
• Muted private consumption is made worse by growing inequality — consumption in some parts of the economy (say, the urban rich) has grown quite fast while large sections of the economy (especially rural India) haven’t yet recovered enough. While people should not consume more than their income, the muted performance of the biggest engine of growth is a matter of concern.

Investment spending: 

• A high rate of investment spending is considered a salutary signal for the prospects of an economy because it shows businesses are optimistic about future consumption demand.
• On the face of it, investments have grown by 9.3% in the current financial year, thus helping to push up the CAGR in the second term (5.6%) closer to the CAGR in the first (7.3%).
• However, there are two lingering concerns: one, a large part of the investment spending is still coming from the government and, two, private consumption is still muted.

Government spending: 

• As weak as the growth in private demand has been in the current year, at 3.9%, government spending has grown even slower.
• Despite the Covid disruptions, government spending has barely grown in the second term.
• At a CAGR of 2.8%, it is far lower than the CAGR of 7.9% during the first term.

Net exports: 

• When data for any particular year shows up with a negative sign, it suggests Indians are importing more than they are exporting. As such, negative growth rates here are a good development.
• For the current year, this drag effect has grown by 144%. However, over the two terms, the growth rate has decelerated from 19.6% to 13.3% — which is a mild improvement.

 

GS PAPER – III

AI can help detect cancer: How

Why in news?

• As India sees an ever-rising tide of cancer cases, Mumbai’s Tata Memorial Hospital is turning to artificial intelligence for help.
• By established a ‘Bio-Imaging Bank’ for cancer, the hospital is utilising deep learning to craft a cancer-specific tailored algorithm that aids in early-stage cancer detection. It incorporated data from 60,000 patients into the biobank in the last year.

Bio-Imaging Bank and AI

• The project’s overarching goal is to create a robust repository encompassing radiology and pathology images, intricately linked with clinical information, outcome data, treatment specifics, and additional metadata. This comprehensive resource is strategically designed for the training, validation, and rigorous testing of AI algorithms.
• Initially focusing on head neck cancers and lung cancers, with a minimum of 1000 patients for each cancer type, the project aims to surpass the committed patient data for both cancer types by its completion date.
• Alongside database creation, the project involves training and testing multiple AI algorithms using the gathered data, addressing medically relevant tasks such as screening for lymph node metastases, nucleus segmentation and classification, biomarker prediction (for instance, HPV in oropharyngeal and EGFR in lung cancer), and therapy response prediction.

How does AI help in early cancer detection?

• AI contributes significantly to cancer detection by emulating the human brain’s information processing.
• In cancer diagnosis, AI analyses radiological and pathological images, learning from extensive datasets to recognise unique features associated with various cancers.
• This technology facilitates early detection by identifying tissue changes and potential malignancies.

Is this technology currently in use?

TMH has already added the data of 60,000 patients into the biobank over the previous year, started using AI to reduce radiation exposure for paediatric patients undergoing CT scans.

AI help reduce cancer fatalities in the future

• In the future, AI is poised to play a transformative role in cancer treatment, particularly in mitigating fatalities in rural India. AI’s potential lies in tailoring treatment approaches based on diverse patient profiles, and thus optimising therapy outcomes.
• AI enhances accuracy, ensuring timely cancer diagnoses, improving patient outcomes, and aiding healthcare professionals in decision-making processes.
• However, the use of AI tools raises debates about potential replacement of human radiologists, facing regulatory scrutiny and resistance from some doctors and health institutions.

 

GS PAPER – II

Jammu and Kashmir has no representation at grass root level

Why in news?

The people of Jammu and Kashmir who have not had any assembly representation since 2018 will cease to have any electoral representation at the grassroots level as well.

Why there is cease?

• The five year term of almost 30,000 local representatives is set to expire on 9^th January.
• Also there is no clarity on when the next election to municipal bodies and Panchayat will be held, as union government has decided to first conduct a delimitation exercise.
• The disbursal of the 25 lakh fund allocated to each panchayat will also cease as term of public representative also expires.

Last election in J&K

• Panchayat election was last held in erstwhile state of J&K in late 2018.
• A total of 27,281 panches and sarpanches were elected and took oath of office on January 10, 2019.
• There are 12,776 vacant sarpanch and panch seat in J&K.

Way ahead

• On December 28, 2023 the Panchayati Raj department sent letters to all block development officers in J&K, directing them to submit detailed proposals to redraw the boundaries of municipal wards and panch constituencies in such a way that each will have an equal number of electors.
• The letter added this as urgent matter.

 

GS PAPER – II

Maldives suspended three deputy ministers for remarks over PM Modi

Why in news?

• The Maldivian government suspended three Deputy Ministers who are at the centre of controversy.
• The Indian High commission in the Maldives strongly raised the issue of disrespectful remarks about Prime Minister Narendra Modi.

How problem arises?

• It started with Maryam shiuna a deputy minister in Ministry of youth affairs had posted on X and referred India tie with Israel and made comments about Mr modi.
• Her colleagues Malsha shareef and Mahzoom Majid added to her remarks and said that the visit by the Indian prime minister to Lakshdweep was aimed at challenging Maldivian tourism which prides itself on its famous beachside facilities.

Impact of the statement?

• Though, Muizzu government distanced itself from remarks and said they believe in freedom of expression but has to be exercised in responsible manner.
• These opinions are personal and do not represent the views of the government of Maldives.
• These comment amplified by their supporters soon triggered a war of words on social media that escalated with Indian tourist cancelling hotel booking in the Maldives.

Background

• India Maldives relation has majorly went through turmoil, Abdulla yameen who was the president of Maldives from 2013-18 was also china pro, he even signed FTA with china and gave ultimatum to India to withdraw two helicopters from lammu and Addu tools.
• India Maldives relation has been on upward trajectory ever since Ibrahim Solih Government in power.
• But the recent election and Victory of china pro Muizzu and his India out campaign had questioned the bilateral ties in defence and infrastructure investments. This move was supported by Abdulla yameen.
• The president after winning had told to fullfill his promise of removing Indian military platforms.

Importance of relation:

• Important for curbing china BRI initiative.
• Major projects like Greater male connectivity and major supplier of essential goods.
• Key maritime neighbour in Indian Ocean region.

 

GS PAPER – II

Alaska airlines and its global concern

Why in news?

• India’s aviation safety watchdog Directorate General of Civil avaiation on directed Akasa air, Air India express and spicejet to conduct a “one time inspection” of emergency exits on all their Boeing 737 MAX -8 Aicraft.

Why concern arises?

• A brand new Alaska airlines 737 MAX 9 aircraft operating flight 1282 between Portland, oregeon and Ontario ,California made an emergency landing soon after a mid air window blowout that also led part of the fuselage breaking away.
• It left a door size hole in the plane and causing decompression in the cabin at an altitude of around 16,000 feet.
• Though none of the 171 passengers and six crew on board suffered any serious injury.

What will happen after inspection?

• If the investigations and aircraft inspection currently underway in the US show that the problem was only with the plane involved in the accident then operation could normalise fairly soon.
• But if the broader issue with the manufacturing of these aircraft is revealed the rectification process could be long drawn out with serious ramification for number of carriers.

What is Akasa?

• There are 44 737 MAX 8 aircraft currently in operation in India.
• With 22 planes Akasa is the largest operator in India.
• It is followed by spice jet with 13 and air India express with nine.