Indian Statistical Service Indian Economic Service (ISS IES) 2021 General Studies-1, Question-3

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(a) Critically examine the Indian Agriculture Acts of 2020.

Answer- The Indian Agriculture Acts of 2020 are a set of three laws that were enacted in September 2020 by the Indian government, aimed at reforming the agriculture sector in the country. These acts are:

1. The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, 2020

2. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020

3. The Essential Commodities (Amendment) Act, 2020

These acts have been the subject of much debate and controversy since their passage, with some farmers and activists protesting against them.

One of the main criticisms of the acts is that they have been passed without proper consultation with the farmers and other stakeholders. Many farmers believe that the acts will lead to the dismantling of the Minimum Support Price (MSP) system, which guarantees them a minimum price for their crops. The government has denied this, but the lack of clarity in the acts has contributed to this perception.

Another major criticism is that the acts do not address the fundamental issues faced by farmers, such as lack of access to credit, water, and infrastructure. The acts focus mainly on facilitating private investment in the agriculture sector, which critics argue will benefit large corporations at the expense of small farmers.

Moreover, the acts also allow for contract farming, which farmers believe will leave them vulnerable to exploitation by large corporations. They fear that companies will force them to sell their crops at lower prices, without any guarantee of a minimum support price or protection from market fluctuations.

In conclusion, the Indian Agriculture Acts of 2020 have been a subject of controversy and protests by farmers, who believe that the acts do not address their concerns and will benefit large corporations at their expense. While the government has argued that the acts are necessary to modernize the agriculture sector and improve farmers' incomes, it is clear that more consultation with the farming community and other stakeholders is necessary to address their concerns and ensure that the reforms are beneficial to all parties involved.

(b) "Privatization of Public Sector Banks is fraught with huge risk." Elucidate.

Answer- The privatization of public sector banks refers to the process of transferring ownership and control of government-owned banks to private entities. While privatization has been touted as a way to improve efficiency and profitability, it is also fraught with significant risks.

One major risk of privatization is that it could lead to a concentration of wealth in the hands of a few individuals or entities. Private banks are typically owned by wealthy individuals or corporations, and if public sector banks are privatized, this could result in a transfer of wealth from the public to the private sector. This could have serious social and economic implications, particularly in a country like India, where income inequality is already a major issue.

Another risk is that privatization could result in a lack of access to banking services for certain sections of society. Private banks tend to focus on profitable segments of the market, such as high-income individuals and large corporations. This could leave low-income individuals and small businesses without access to banking services, which could have a negative impact on their ability to participate in the economy.

Furthermore, privatization could also lead to a decline in the quality of banking services, as private banks may prioritize profits over social objectives such as financial inclusion and supporting small businesses. In contrast, public sector banks have a mandate to serve the public interest and support the government's development objectives.

Privatization also poses a risk to financial stability. Public sector banks play a critical role in providing credit to key sectors of the economy, such as agriculture, small and medium-sized enterprises, and infrastructure. If these banks are privatized and their focus shifts to maximizing profits, it could lead to a reduction in lending to these sectors, which could have a negative impact on economic growth and stability.

In conclusion, while privatization of public sector banks may have some potential benefits, it is also fraught with significant risks. Before embarking on this path, it is essential to carefully consider the potential implications and ensure that steps are taken to mitigate the risks and protect the public interest.

(c) Do you believe that Aatmanirbhar Bharat Abhiyaan, 2020 will be able to combat the COVID-19 crisis of the Indian economy? Justify your answer.

Answer- The Aatmanirbhar Bharat Abhiyaan, launched by the Indian government in May 2020, aims to make India self-reliant in various sectors, including agriculture, defense, and health care, among others. The plan includes a range of measures to support businesses, such as tax breaks, loans, and other forms of financial assistance. It also focuses on promoting local manufacturing and production, reducing imports, and increasing exports.

While the Aatmanirbhar Bharat Abhiyaan has the potential to strengthen India's economy in the long term, its effectiveness in combating the immediate crisis caused by the COVID-19 pandemic is debatable. The pandemic has severely affected the Indian economy, with disruptions in supply chains, reduced demand, and decreased production capacity, among other challenges.

To combat the immediate impact of the pandemic, the Indian government has taken several steps, including providing financial assistance to businesses and individuals, implementing measures to ease the burden on the healthcare system, and launching vaccination drives. While these efforts have helped to mitigate some of the effects of the pandemic, the situation remains challenging.

In conclusion, while the Aatmanirbhar Bharat Abhiyaan has the potential to strengthen India's economy in the long run, its immediate impact on combating the COVID-19 crisis is limited. The government needs to continue to implement measures to support businesses and individuals affected by the pandemic and prioritize the health and safety of its citizens.

(d) Analyse the recommendations of the Narasimham Committee Report I and II in controlling Non-Performing Assets (NPAs) of the banking sector in India.

Answer- The Narasimham Committee Report I and II were instrumental in laying down the foundation for banking sector reforms in India. One of the key areas that these reports addressed was the problem of non-performing assets (NPAs) or bad loans in the banking sector. Here is an analysis of the recommendations of the Narasimham Committee Reports I and II in controlling NPAs in the banking sector:

Narasimham Committee Report I (1991):

1. Asset classification and provisioning: The Committee recommended the introduction of asset classification norms based on the repayment period and the creation of specific provisions for NPAs. The report also recommended the introduction of a provision coverage ratio (PCR) of 70% for NPAs.

2. Loan recovery: The Committee recommended the establishment of debt recovery tribunals (DRTs) to expedite the process of loan recovery. The report also recommended the securitization of loans to enable banks to dispose of their non-performing assets.

3. Prudential norms: The Committee recommended the adoption of prudential norms for credit appraisal, risk management, and exposure limits for various types of borrowers. The report also recommended the introduction of risk-based capital adequacy norms for banks.

Narasimham Committee Report II (1998):

1. Asset reconstruction companies (ARCs): The Committee recommended the establishment of ARCs to acquire and manage NPAs of banks. The report also recommended the creation of a secondary market for distressed debt.

2. Credit information bureau (CIB): The Committee recommended the establishment of a CIB to collect and disseminate credit information about borrowers. The report also recommended the introduction of credit ratings for borrowers.

3. Supervision and regulation: The Committee recommended the establishment of an independent banking regulator, the Reserve Bank of India (RBI) and the introduction of a system of consolidated supervision for banks and financial institutions.

Overall, the recommendations of the Narasimham Committee Reports I and II were instrumental in introducing prudential norms and regulatory mechanisms to control NPAs in the banking sector. The introduction of asset classification norms, provisioning norms, DRTs, and ARCs helped banks to manage their NPAs efficiently. The establishment of a credit information bureau and the introduction of credit ratings helped to improve credit appraisal and reduce the incidence of bad loans. The creation of an independent banking regulator, the RBI, helped to improve the overall supervision and regulation of banks and financial institutions in India.

(e) Discuss the roles and responsibilities of the Anganwadi workers and helpers under Integrated Child Development Services Scheme (ICDS).

Answer- The Integrated Child Development Services (ICDS) Scheme is a flagship program of the Government of India aimed at improving the health, nutrition, and development of children below six years of age, as well as pregnant and lactating mothers. Anganwadi workers and helpers play a critical role in the implementation of the ICDS scheme.

Here are the roles and responsibilities of Anganwadi workers and helpers under ICDS:

1. Identification of beneficiaries: Anganwadi workers are responsible for identifying pregnant women, lactating mothers, and children below six years of age in the community who require the services provided under ICDS.

2. Providing supplementary nutrition: Anganwadi workers are responsible for providing supplementary nutrition to children in the form of take-home rations, hot cooked meals, and fortified food. They also distribute food supplements to pregnant and lactating mothers.

3. Conducting health check-ups: Anganwadi workers conduct regular health check-ups of children and pregnant and lactating mothers to identify malnourished children and refer them for medical treatment.

4. Immunization: Anganwadi workers are responsible for ensuring that all children under six years of age are immunized against vaccine-preventable diseases. They also maintain records of immunization and provide information on the importance of immunization to parents.

5. Non-formal education: Anganwadi workers conduct non-formal education classes for children between the ages of 3 to 6 years. They teach them basic skills like counting, alphabets, and hygiene practices.

6. Health and nutrition education: Anganwadi workers provide health and nutrition education to parents and caregivers to raise awareness about the importance of a balanced diet, breastfeeding, hygiene, and sanitation.

7. Referral services: Anganwadi workers refer children and pregnant and lactating mothers who require medical attention to the nearest health center.

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