Daily Editorial Analysis for 4th August 2021

DAILY EDITORIAL ANALYSIS (04^th August 2021)

(Source: The Hindu, Indian Express, The Economic Times, PIB, etc.)

GS PAPER II

Circumscription

Why in News

• Police verification and security clearances for passport or government job applicants are routine in most parts of the country.
• The exercise may not be out of the ordinary in Kashmir, where the police have issued a circular aimed at gathering information and denying security clearance to those who have thrown stones and participated in street protests in the past, but it could have serious consequences for the aspirations of many young men and women.
• The circular, which asked CID Special Branch field units to look into any subject’s involvement in law-and-order incidents and related crimes, as well as collect digital evidence from police and security force records, suggests that the administration is serious about preventing those with a possible link to previous protests from either entering or remaining in government.

Constitutional provision

• Under Section 6(2) of the Passports Act, 1967, passports can be denied to applicants for a variety of reasons, including their likelihood of engaging in activities that are harmful to the country’s sovereignty and integrity or security.
• Those who have been convicted in the previous five years, or against whom criminal proceedings are pending, are also candidates for refusal.
• There is a legal recourse for those who affected, as the Act allows them to apply to the trial court for a “No Objection” certificate in order to get a passport.

Impact of Government Decision

• According to the government, the alteration in the status of Jammu & Kashmir in August 2019 has ushered in a new era of development and prosperity, and it is now time to strengthen grassroots democracy.
• Prime Minister of India invited leaders of the Union Territory’s political parties to a meeting in June as part of this process.
• Despite their obvious disappointment that the restoration of statehood is unlikely to be considered until after the Legislative Assembly elections, the meeting did inspire cautious optimism about the start of a new political process.
• If the administration pursues this circular with zeal, it risks reigniting the kind of youth alienation that led to the stone-pelting incidents in 2008 and 2010, as well as the wave of discontent following the assassination of militant leader Burhan Wani.

Conclusion

• When all efforts should be directed towards building on current gains, nothing ought to be done to make those still harboring, for whatever reason, a sense of betrayal feel that some fresh collective punishment is in the offing.

GS PAPER III

Poverty in India is on the rise again

Why in News

• India has not released its Consumption Expenditure Survey (CES) data since 2011­12. Normally a CES is conducted by the National Sample Survey Office (NSO) every five years. But the CES of 2017­18 was not made public by the Government of India.
• A new CES is likely to be conducted in 2021­22, the data from which will probably not be available before end­2022.
• Meanwhile, the economy has been slowing for nine quarters prior to the outbreak of the novel coronavirus pandemic.
• Unemployment had reached a 45­year high in 2017­18, as revealed by NSO’s Periodic Labour Force Survey (PLFS).

Sufficient to estimate change

• India’s labour force surveys, including the five yearly Employment­Unemployment Rounds from 1973­4 to 2011­12, have also collected consumption expenditure of households.
• The PLFS has maintained that tradition. While the PLFS’s questions on consumption expenditure are not as detailed as those of the CES, they are sufficient to estimate changes in consumption on a consistent basis across time. It enables any careful researcher to estimate the incidence of poverty i.e., the share in the total population of those below the poverty line, as well as the total number of persons below poverty.
• There is a clear trajectory of the incidence of poverty falling from 1973 to 2012. In fact, since India began collecting data on poverty, the incidence of poverty has always fallen, consistently.
• It was 54.9% in 1973­4; 44.5% in 1983­84; 36% in 1993­94 and 27.5% in 2004­05. This was in accordance with the Lakdawala poverty line, which was lower than the Tendulkar poverty line, named after a distinguished economist, then a member of the Planning Commission.

Methodology

• In 2011, it was decided in the Planning Commission, that the national poverty line will be raised in accordance with the recommendations of an expert group chaired by the late Suresh Tendulkar.
• As it happens, this poverty line was comparable at the time to the international poverty line (estimated by the World Bank), of $1.09 (now raised to $1.90 to account for inflation) person per day.
• Based on the Tendulkar poverty line, the poverty estimates for 2004­05 and 2011­12 are to be found in the Planning Commission’s own estimates using the CES of those years. Hence, we have extended the 2011­12 poverty line for each State and used the consumption expenditure reported by the PLFS to estimate a consistent poverty head count ratio as well as the absolute number of the poor.
• In the absence of CES data, the PLFS can be used to estimate the incidence of poverty. It also collects the household monthly per capita consumption expenditure data based on the Mixed Recall Period methodology.
• Similar to the CES, the PLFS (PLFS annual report, 2019­20, page 6) also asks the household questions about expenses on health, clothing and bedding, education, footwear and consumer durables for a 365-day recall period — prior to the day of the survey; but for non­durable consumption goods/services — including expenses on food, housing and conveyance, etc., its question expects a recall period of 30 days prior to the day of survey.

An urban and rural rise

• For the first time in India’s history of estimating poverty, there is a rise in the incidence of poverty since 2011­12.
• The important point is that this is consistent with the NSO’s CES data for 2017­18 that was leaked data.
• The leaked data showed that rural consumption between 2012 and 2018 had fallen by 8%, while urban consumption had risen by barely 2%.
• Since the majority of India’s population (certainly over 65%) is rural, poverty in India is also predominantly rural.
• Remarkably, by 2019­20, poverty had increased significantly in both the rural and urban areas, but much more so in rural areas (from 25% to 30%).
• It is also for the first time since the estimation of poverty began in India on a consistent basis, that the absolute number of poor has risen: from 217 million in 2012 to 270 million in 2019­20 in rural areas; and from 53 million to 71 million in the urban areas; or a total increase of the absolute poor of about 70 million.
• It is important here to recall two facts: between 1973 and 1993, the absolute number of poor had remained constant (at about 320 million poor), despite a significant increase in India’s total population.
• Between 1993 and 2004, the absolute number of poor fell by a marginal number (18 million) from 320 million to 302 million, during a period when the GDP growth rate had picked up after the economic reforms.
• It is for the first time in India’s history since the CES began that we have seen an increase in the absolute numbers of the poor, between 2012­13 and 2019­20.
• The second fact is that for the first time ever, between 2004­05 and 2011­12, the number of the poor fell, and that too by a staggering 133 million, or by over 19 million per year. This was accounted for by what has come to be called India’s ‘dream run’ of growth: over 2004 and 2014, the GDP growth rate had averaged 8% per annum — a 10­year run that was not sustained thereafter.
• By contrast, not only has the incidence of poverty increased since then, but the absolute increase in poverty is totally unprecedented.

The contributory factors

• The reasons for increased poverty since 2013 are not far to seek. While the economy maintained some growth momentum till 2015, the monumental blunder of demonetization followed by a poorly planned and hurriedly introduced Goods and Services Tax, both delivered body blows to the unorganised sector and Micro, Small and Medium Enterprises.
• The economic slowdown followed. None of the four engines of growth was firing after that. Private investment fell from 31% inherited by the new government, to 28% of GDP by 2019­20.
• Public expenditure was constrained by a silent fiscal crisis. Exports, which had never fallen in absolute dollar terms for a quarter century since 1991, actually fell below the 2013­14 level ($315 billion) for five years.
• Consumption stagnated and household savings rates fell. Joblessness increased to a 45­year high by 2017­18 (by the usual status), and youth (15­29 years of age) saw unemployment triple from 6% to 18% between 2012 and 2018.
• Real wages did not increase for casual or regular workers over the same period, hardly surprising when job seekers were increasing but jobs were not at anywhere close to that rate.
• Hence, consumer expenditure fell, and poverty increased.
• Poverty is expected to rise further during the COVID­19 pandemic after the economy has contracted.