Daily Editorial Analysis for 26th August 2021

  1. Home
  2. »
  3. Editorial Analysis August 2021
  4. »
  5. Daily Editorial Analysis for 26th August 2021


Income and quotas

Why in News

  • The Supreme Court’s ruling that economic criterion alone cannot be used to classify a member of a Backward Class as belonging to the ‘creamy layer’ adds an interesting nuance to the jurisprudence of affirmative action.

Background of ‘Creamy Layer’

  • There was a time when backwardness was primarily related to the inadequate social and educational advancement of a group.
  • Ever since the Court, in Indra Sawhney (1992), introduced the concept of ‘creamy layer’, a term describing the well-off among the Backward Classes, and declared that this section should be denied reservation benefits, the original idea of including groups based on social backwardness was matched by a parallel exercise to exclude the more advanced among them.
  • This position has crystallized into law. Many supports the formulation that once caste is accepted as a basis for determining backwardness, there is nothing wrong in excluding the affluent among the eligible castes.
  • The Union government has unreservedly accepted the ‘creamy layer’ rule, and formulated criteria for identifying those who fall under the category.
  • The proponents of economic criteria feel that genuine social justice means reservation benefits should be restricted to the poorer among the backward; while sections championing Backward Class, assertion disfavor any dilution of the social basis for reservation.
  • The Court’s latest judgment in a Haryana case corrects a grave error by the State.
  • It has struck down a notification fixing an annual income of ₹6 lakh as the sole criterion to identify whether a family belongs to the creamy layer.
  • It was contrary to Indra Sawhney that had spoken of different criteria, including being the children of high-ranking constitutional functionaries, employees of a certain rank in the Union and State governments, those affluent enough to employ others, or with significant property and agricultural holdings and, of course, an identified annual income.
  • The Court has found that the Haryana criterion based on income alone was contrary to its own law that specifies that the creamy layer would be identified through social, economic and other factors.
  • The Constitution permitted special provisions in favor of ‘socially and educationally backward classes’ through the first Amendment, as well as reservation in government employment for ‘backward classes.’
  • Judicial discourse introduced a 50% ceiling and the creamy layer concept as constitutional limitations on reservation benefits.
  • However, the 103rd Constitution Amendment, by which 10% reservation for the ‘economically weaker sections’ (EWS) has been introduced, has significantly altered the affirmative action programme.
  • With the current income ceiling being ₹8 lakh per annum for availing of both OBC and EWS quotas, there is a strange and questionable balance between the OBC and EWS segments in terms of eligibility, even though the size of the respective quotas varies.


It’s time for Industry 4.0

Why in News

  • The term ‘Industry 4.0’ was coined by the German government in 2011.
  • Additive manufacturing, Internet of Things, Cyber Physical Systems, Augmented Reality/Virtual Reality and data analytics are some of the technologies associated with Industry 4.0.
  • With the help of these technologies, the manufacturing industry will be able to make data-driven decisions.
  • The reduced costs of electronics like sensors, transmitters, and cloud have allowed us to capture the data produced during operational activities.
  • With the availability of advanced algorithms, this captured data can be analyzed for decision-making in real time.
  • Thus, Industry 4.0 integrated ‘data’ with manufacturing and Information Technology.
  • To take advantage of data-driven decision-making, the governments of other countries also coined their own industrial initiatives like Industry 4.0.
  • For example, the U.S. calls it Smart Manufacturing, China calls it Made in China 2025, and India refers it to as Make in India or Digital India.

The potential of MSMEs

  • Micro, Small and Medium Enterprises (MSMEs) are expected to become the backbone of India as the economy grows larger.
  • MSMEs form more than 95% of the industries in India, produce more than 45% of the total manufacturing output and employ more than 40% of the workforce.
  • According to the Economic Survey 2020-21, over 6 crore MSMEs employ more than 11 crore people and contribute roughly 30% to the GDP and half of the country’s export.
  • MSMEs are also ancillaries to larger enterprises, leading to a seamless supply chain integration.
  • As a result, making MSMEs more efficient will be advantageous for the whole economy.
  • However, MSMEs face challenges when it comes to adopting new technologies such as Industry 4.0.:
  • Lack awareness regarding Industry 4.0 and its benefits:
  • They consider such technologies disruptive and having the potential to demolish their existing system.
  • However, Industry 4.0 believes in improving the existing system.
  • Scientific literature provides evidence of sensors and Wi-Fi networks being integrated with old machines like lathes and mills to improve their performance.
  • Major financial investments to adopt Industry 4:
  • MSMEs will need to make major financial investments to adopt Industry 4.0.
  • Investing in the right set of technologies will need experts and consultants as well.
  • Positive organizational culture and the support of people:
  • For any new technology to be adopted, an organization requires a positive organizational culture and the support of people.
  • MSMEs need to believe in the advantages that Industry 4.0 technologies can offer.
  • Frameworks and steps to assist MSMEs:
  • The frameworks and steps that can assist MSMEs in adopting Industry 4.0 technologies have been missing.
  • In this regard, MSMEs need to understand the data they are producing from all their operational activities.
  • Based on such data, their readiness can be evaluated.
  • Finally, MSMEs should develop their own vision of Industry 4.0 technologies that they want to adopt and identify the relevant tools and practices they need for such a tailored vision.

Transcending impediments

  • Though adoption of Industry 4.0 technologies by MSMEs requires transcending a labyrinth of impediments, it will make them more competitive as they will be able to offer world-class quality products to customers.
  • Additionally, delivery timings and the flexibility to meet different needs will improve.
  • As India joined the group of top 50 countries in the global innovation index for the first time in 2020, it is imperative for its MSMEs to embrace Industry 4.0 technologies without any hesitation.
  • Proper sensitization of the Government of India, higher education institutions, practitioners, entrepreneurs, industrial associations, trade unions, venture capitalists, consultants and research agencies would help to speed up this task.
  • This becomes imperative given the manufacturing challenges abruptly posed by the COVID-19 pandemic when most of the healthcare infrastructure in India is MSME-dependent.


Current Affairs

Recent Posts