Secure Q&A March 01, 2016

1. One of the major worries India grappling with is rural distress. How far has the 2016 budget addressed rural distress? Can it put agri-growth back on track, say, at 4 per cent per annum sustainably? Critically examine. (200 Words)

Broad Definition of Rural distress

Drought, Rainfed farming, Unpredictable monsoon, Lack of financial support, Failure of crop insurance schemes to protect farmers from uncertainties, Unsustainable agriculture on one side and unproductive, subsistence monsoon dependent agriculture on the other side, lack of cold storage, processing and transparent market (Failure of APMCs), lack of credit facilities to poor farmers, clutches of money lenders are causing Rural distress in General and Farmers suicides in particular

Budget 2016, Efforts to reduce rural distress

Allocation to agriculture is  Rs 35984 crores,

Safety net against uncertainties

1. Focus on Vulnerable sections through: Pradhan Mantri Fasal Bima Yojana – Provides assured income and attracts Youth to take up agriculture and Reduces Rural Urban Migration and
2. New health insurance scheme to protect against   hospitalisation expenditure – More disposable income in the hands of farmers, Increases investment in agriculture, increases productivity
3. Facility of cooking gas connection for BPL families – Reduces indoor air pollution, increases standard of living, Reduces physical burden (Collection of fuel and firewood)

Importance to Irrigation – Insurance against Monsoon uncertainties, increased profitability and productivity to farmers

Pradhan Mantri Krishi Sinchai Yojana’ , 28.5 lakh hectares will be brought under irrigation

Implementation of 89 irrigation projects under AIBP, which are languishing for a long time, will be fast tracked

A dedicated Long Term Irrigation Fund will be created in NABARD with an initial corpus of about ` 20,000 crore

Programme for sustainable management of ground water resources with an estimated cost of ` 6,000 crore will be implemented through 3 multilateral funding (Sustainable Agriculture)

5 lakh farm ponds and dug wells in rain fed areas and 10 lakh compost pits for production of organic manure will be taken up under MGNREGA

Sustainable agriculture – Evergreen revolution

1. Promote organic farming through ‘Parmparagat Krishi Vikas Yojana’ and ‘Organic Value Chain Development in North East Region’.

Agriculture marketing and infrastructure and Finance

Unified Agricultural Marketing ePlatform to provide a   common emarket platform for wholesale markets – Forces APMCs to upgrade to meet farmers marketing needs, Better price discovery

Pradhan Mantri Gram Sadak Yojana (increased to ` 19,000 crore). connect remaining 65,000 eligible habitations by 2019 – ( Better Transportation of Agriculture produce, better price discovery)

Interest subvention to reduce loan burden – 15000 crore

(850 crore) Four dairying projects – ‘Pashudhan Sanjivani’, ‘Nakul Swasthya Patra’, ‘E-Pashudhan Haat’ and National Genomic Centre for indigenous breeds – (Helps diversify Farming, assured income, increased sustainability – Reduce distress)

RURAL SECTOR

Allocation for rural sector – Rs 87,765 crore.

Every block under drought and rural distress will be taken up as an intensive Block under the Deen Dayal Antyodaya Mission –

A sum of ` 38,500 crore allocated for MGNREGS – Assured employment during lean season, insurance against uncertainties to landless laborers

300 Rurban Clusters will be developed under the Shyama Prasad Mukherjee Rurban Mission –Prevents distressed Urban migration, better facilities.

100% village electrification by 1 st May, 2018.

62 new Navodaya Vidyalayas will be opened

Education for talented rural children – Long term approach to fix problem of rural distress.

Krishi Kalyan Cess, @ 0.5% on all taxable services,. Proceeds would be exclusively used for financing initiatives for improvement of agriculture and welfare of farmers

Can it put agriculture growth at 4%

These are progressive step to reduce rural distress, but, these alone cannot put Growth at 4% sustainably,.

We also need,

1. Uniform APMC Reforms
2. Modernization of Agriculture – Mechanization, adoption of Modern technologies, Green house technology, etc.
3. Reforms in ICAR – KVK ———- Better extension, informed farmer – Sustainable agriculture
4. Processing industries, warehousing, Cold chain, Agri export zones, Attraction of rural youth, Star ups in Agriculture,
5. Easy credit (Present situation – Highly cumbersome procedure, no credit to non productive needs, mutual distrust between bankers and farmers)
6. Value addition and supply chain for Agriculture produce – More income, profitable

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2. Critically analyse the budgetary allocations for social sector in 2016 union budget.

Budgetary allocation for Social Sector in 2016.

New Conceptualization on social sectors – Shift of focus from Basic education, Basic health to Skills, employment and Entrepreneurship

Allocation for social sector including education and health care – `1,51,581 crore.

1. ` 2,000 crore allocated for initial cost of providing LPG connections to BPL families(Welcome step, improves standard of living, prevents indoor air pollution, reduces burden on women, saves time.

But, proper identification of beneficiaries is the key. No BPL family must be left out, and no APL family must be included through collusion, bribery or other means — Difficult till date

2. New health protection scheme will provide health cover up to ` One lakh per family.

(Finer details shows that old RSBY has been renamed and provided 153% increased allocation. But, insurance alone cannot become government’s major health policy component. Need to strengthen PHC, Government tertiary care, Mobile hospitals, Free ambulance, awareness against antibiotic resistance)

3. 3,000 Stores under Prime Minister’s Jan Aushadhi Yojana will be opened during 2016-17.

(Great step to provide affordable health care, along with new health insurance scheme, if properly implemented, could bring reforms in health sector)

4. ‘National Dialysis Services Programme’ to be started under National Health Mission through PPP mode

(PPP mode – Need to be cautious – Collusion between parties to siphon off fund, unimaginative MoUs.

Along with this, other critical health care services need to be provided – Blood test, Diabetes test, Urine test, TB detection centres, Centres to cater towards emergency situations like H1N1, Ebola, Zika virus etc

5. “Stand Up India Scheme” to facilitate at least two projects per bank branch. This will benefit at least 2.5 lakh entrepreneurs.

(Help to realize demographic dividend, problem of unemployment. But, Procedural hurdles must be removed to access funds)

6. National Scheduled Caste and Scheduled Tribe Hub to be set up in partnership with industry associations

7. 62 new Navodaya Vidyalayas will be opened

(Navodayas cater only to small section of rural population, It created a hierarchy within public education system – Contravention of 86^th Amendment act, We need all the schools on the model of Navodaya, not only few)

8. Sarva Shiksha Abhiyan to increasing focus on quality of education

(No plans on how to improve quality. Incremental budgetary rise (2%) do not help in improving quality – Need qualified teachers, Internet, E learning, Gadgets )

9. Higher Education Financing Agency to be set-up with initial capital base of ` 1000 Crores

SKILL DEVELOPMENT (Capitalization on Demographic dividend)

Allocation for skill development – ` 1804. crore

National Board for Skill Development Certification to be setup   in partnership with the industry and academia

Entrepreneurship Education and Training through Massive Open Online Courses

Minorities

Skill development by way of social development – But allocation reduced from 335 crore to 175 crores this year

Cleanliness

Swacch bharat mission – Allocation – 38% jump. Welcome step

Even though, Government announced major policies, none of these policies can be coherent “Social policy of India”.

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3. It is argued that subsidising crop insurance premium and running subsidised health insurance program are fraught with risks and are not sustainable in the long run. Critically examine why.

Subsidized crop insurance and Subsidized health insurance – Not sustainable in the long run

1. Unsustainable – Subsidy bill may grow further along with Fertilizers, fuel and food -=— CAD, Fiscal deficit (Both Farm and Health)

2. Trigger Irrational risk taking – Farmers may grow cash crops, crops with MSP even if conditions do not permit — Glut in market — Reduced price — Shifting away from traditional crops — Unscientific cropping system.

In Health insurance, People may become lethargic. May resort to curative treatment rather than preventive.

3. Collusion between bank officials, bureaucrats, Rich farmers to siphon off money with fake documents. Example, MH (Aurangabad, Jalagaon), Gujarat (Saurashtra), AP (Rayalaseema), Karnataka (Dharawad, Haveri), TN and Telangana —–In future it may spread nation wide since there is scope for that due to subsidy.

In Health – Collusion between Hospitals, Insurance companies —– Victims are patients —– Forced operations, Unnecessary diagnostics, Frequent resort to check ups and scannings….

4. We cannot insure farmers ignorance – First, Farmer education is must. Loss due to lack of knowledge, unscientific farm practices cannot be insured
5. Insurance work on 2 premises — 1. Low risk 2. Customers do not face high correlated risks. But, in farming both premises are high —— All the farmers in a region are affected at a time . Ex. Drought, disease epidemic, hailstorm — Hence, high risk —– Unsustainable in the long run.

IN Health – High Risk – Mal nourished children, Antibiotic resistance, TB, Dengue, Malaria,.

High correlation – Epidemics — Unsustainable in the long run

But, it can be turned sustainable in the long run also, (Farmers and Patients pay full premium in the long run)

1. More disposable income in the long run – Able to pay full premium
2. High reach and awareness about insurance due to initial subsidy
3. If proper regulatory measures and Technology (GPS Camera, Mobile app, computerization) are taken, Collusion/fake nexus can be eliminated
4. Higher loan recovery — Less NPA — Due to insurance

5. If Mechanization, new technology, Knowledge dissemination, E-mandi, APMC reforms, Reforms in MSP to Minor millets, Food processing carried out ——— Insurance risk reduces —- Full premium from farmers —

In Health – If disposable income increases, Swacch bharat, Less malnutrition, Cleanliness, Zero open defecation, Smart cities, Quality nutritious food —– Less disease burden ——- High resistance

But,The present situation demand safety net for farmers, which only provided thorugh insurance with subsidized premium. It must be a short term approach to reduce farmer distress. Long term approach is to empower financially to pay full insurance premium

6. Subsidies are inherently regressive – Only rich subscribe insurance policies ——— Subsidized insurance — Poor also get the service and protected from uncertainties

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4. It is said that the 2016 union budget has given big boost to strengthening e-governance in the country. Examine. (150 Words)

Robust Budget allocation –

The government has set aside Rs 2,059 crore for Digital India Programme – e-learning, e-panchayat and land records modernisation.

allocated Rs 24,543.48 crore to ministry of telecommunication and information technology.

Schemes for E- Governance                                                          

1. The National Land Record Modernisation Programme has been revamped under the Digital India initiative

(Reduces civil land disputes, Helps track agricultural loans and subsidies, Reduces land disputes, Fake records etc.,)

2. Introduction of Bill for targeted-delivery of financial and other subsidies, benefits and services by using the Adhaar framework.

(Legitimacy to Adhaar, Certainty in administration, Leveraging JAM trinity – Jandhan, Adhaar, Mobile technology to deliver services to citizens efficiently and effectively.

Reduces Subsidy leakages in LPG, Fertilizers, Kerosene, Student scholarships, Helps in paper less transactions — Reduces fake currency menace, Helps tracking funds, prevents black money, Reduces bureaucratic and citizen interface thereby reducing Coercive corruption which is common in middle level bureaucracy)

3. A social security platform will be developed using Aadhaar to accurately target beneficiaries.

(Diversion of public funds from Poor to rich will be prevented, Documentation and record keeping and tracking progress made easy)

4. Planning to extending Direct Benefit Transfer (DBT) to liquefied petroleum gas (LPG) and from LPG to fertiliser

(Opportunity to use JAM trinity here too…. Prevents diversion to commercial purposes)

5. Automation of 300,000 public distribution system (PDS) outlets using Adhaar cards

(Help to prevent diversion of foodgrains to open market)

6. Digital literacy campaign – Present 2 schemes 1. National Digital Literacy Mission; and Digital Saksharta Abhiyan (DISHA).

Plan to launch a new Digital Literacy Mission Scheme for rural India to cover around 60 million additional households within the next three years

(Back bone to all digital India scheme —— Digitally literate citizen + Digital India = E- governance at the door step with reduced corruption and inefficiency)

7. ‘e-Sahyog’ pilot project to provide an online mechanism to resolve mismatches in income tax returns, without requiring taxpayers to attend the income tax office.

(Ease of Doing business and helps widening the tax base by providing quality services)

8.To set up a Digital Depository for academic certificates on the pattern of Securities Depository.

(Prevents fake degree certificate rackets, Easy record keeping, Certified authentication, Paper less governance)

Hence, E governance encompassing

1. Public service delivery
2. Tax administration
3. Agriculture record keeping
4. Digital literacy
5. Direct benefit tranfe,   received big push and go a long way in ensuring citizen centric administration if properly and honestly implemented without vested interests

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5. Analyse the significance of some of the announcements made in recent budget to local self governments and governance mechanism at local level. (200 Words)

Budgetary allocations

Rs.3 trillion to gram panchayaths – 2.5 lakh gram panchayaths receive more than 1 crore every year,. Ie., Devolution of almost 15% budgeted money to panchayats

Fund, Functions and functionaries which were lacking for Local bodies – Now available

Fund – Can be used for Public services, Health, Sanitation, awareness, Eduacation and governance

Functionaries – Local bodies with decent funds now could recruit qualified functionaries, if supplemented with other financial sources like user fee, local taxes etc

This is democratization of Public expenditure ——– Later, leads to democratization of public service delivery —— Moving from Representative democracy to Popular democracy can be achieved

Good governance and service delivery

1. Revamped The National Land Record Modernisation Programme (Reduces civil land disputes, Helps track agricultural loans and subsidies, Reduces land disputes, Fake records etc.,)

2. Statutory status to Adhaar —— Service delivery through JAM trinity —- Subsidies, Services —–Increases financial inclusion — Reduces vulnerabilities with use of mutual funds, insurance, bank loans against Money lenders

(Legitimacy to Adhaar, Certainty in administration, Leveraging JAM trinity – Jandhan, Adhaar, Mobile technology to deliver services to citizens efficiently and effectively.

3. Reduces Subsidy leakages in LPG, Fertilizers, Kerosene, Student scholarships, Helps in paper less transactions — Helps better targeting poor for providing subsidies) 

4. A social security platform will be developed using Aadhaar to accurately target beneficiaries.

(SC, ST and other weaker sections including Manual scavengers, Bonded laborers, Victims of Human trafficking can be targeted without leakages ——– Good governance)

5. Digital literacy campaign – To reduce Digital Divide and to extend E-governance and benefits of ICT to Rural areas, Digital literacy is a must.
6. Present 2 schemes 1. National Digital Literacy Mission; and Digital Saksharta Abhiyan (DISHA).

Plan to launch a new Digital Literacy Mission Scheme for rural India to cover around 60 million additional households within the next three years

It helps in Creating quality functionaries equipped with latest technologies for Panchayat governance and helps in better service delivery using IT technologies.

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6. The union government has announced that it would introduce a Bill in the current budget session for targeted delivery of financial and other subsidies, benefits and services by using the Aadhaar framework. Discuss the significance of this move. (200 Words)

Significance of Adhaar number in service delivery and e Governance

1. Important component of JAM trinity – Service delivery, subsidies made possible efficiently – Direct benefit transfer for Kerosene (Checks air pollution), PDS, Scholarships, Subsidies — Diversion, Coercive corruption due to citizen- Official interface could be curtailed
2. Financial inclusion, Easy procedure to open banks accounts, KYC, Useful for migrant laborers,
3. MGNREGA wage transfer to bank accounts, IGOAPS, pension scheme and other social security scheme transfer to beneficiary bank accounts etc
4. DBT, Adhaar integration with bank account + Subsidies ———– Removes Ghost Beneficiaries, Coercive corruption
5. Weeding out of Ghost voters —— Linking with Adhaar card
6. E – Health – Centralized documentation of patients records
7. Digital locker – linked with Adhaar
8. Passport in 10 days – Easy service delivery – Police verification done at a later date
9. “Jeevan Praman for Pensioners”,– Removes procedure hurdles — Eliminate the need for the physical presence of pensioners at office
10. Use of multiple ID cards will be eliminated – Adhaar for all identification purposes – Removes ambiguity – Integration of work and services

Significance of the move to accord statutory status to Adhaar

1. Legal foundation to Adhaar – Expansion of its uses for wider range of service delivery
2. Accountability – Legislative accountability for Executive actions
3. Established hierarchy and Policy certainty – Proper grievance redressal mechanism,
4. Insurance against Change in government and their policies – Previous UPA govt, promoted…..But, opposed by NDA……….. But, now NDA is promoting ———- More certainty if there is statutory status
5. Well established guidelines to channelize the procedures in preventing the misuse of Adhaar card for Personal, political gains and vested interests
6. Judicial interferences will be curtailed and certainty in implementation will be established
7. Protection of privacy rights and establishment legalized channel to secure the private data

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7) Define conflict of interest. Discuss the OECD guidelines for managing conflict of interest in public service. 

OECD Definition – A ‘conflict of interest’ involves a conflict between the public duty and private interests of a public official, in which the public official has private-capacity interests which could improperly influence the performance of their official duties and responsibilities.

OECD guidelines for managing conflict of interest

Managing COI at Personal capacity

1. Public officials should avoid private action which derive improper advantage form insider information obtained in official duties which is not generally available to public.
2. Not to misuse Government position and resources for private gains
3. Not to accept any form of improper benefit to in office
4. Not to take improper advantage of a public office and privileged information to seek employment after leaving office

Supporting transparency and scrutiny

1. Public officials should subject themselves to closest public scrutiny. Must follow broader public service values such as Disinterestedness, impartiality and integrity
2. Private interests and affiliations that could compromise the public duties must be disclosed
3. Must ensure consistency and an appropriate degree of openness in resolving or managing conflict of interest

Promoting individual responsibility and personal example

1. Act at all times that their integrity serves an example to other officials and public
2. Accept responsibility for arranging their private capacity affairs to others, to prevent conflict of interest later
3. Must demonstrate commitment and integrity and professionalism though COI management policies

Engendering an organizational culture which is intolerant of COI

1. Organization must provide and implement adequate policies, practices in the working environment to encourage management of COI
2. must encourage officials to discuss COI matters and provide reasonable measures to protect disclosures from misuse by others