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The Hindu Analysis Free PDF Download

Date: 07 June 2021

NEWS

  • PM lauds regional progress made by BIMSTEC countries, calls for united fight against COVID19 pandemic
  • Number of daily Covid cases declines to about 1.14 lakh; recovery rate further improves to 93.67%
  • Country crosses major landmark with administration of more than 23 crore Covid Vaccine doses so far
  • Covid-19 vaccine trial among children of 12 to 18 yrs of age group begins in Nagpur
  • SW Monsoon further advances into northeastern states
  • Railways creates record by delivering more than 26, 281 tonnes of Liquid Medical Oxygen to 15 states
  • EVMs are completely tamper-proof: CEC Sushil Chandra
  • Education Minister Ramesh Pokhriyal Nishank approves release of Performance Grading Index 2019-20 for states, UTs
  • Russia ready to transfer Covid-19 vaccine technology & to expand production abroad: Putin
  • Nepal: New Constitutional Bench formed to hear petitions against House of Representatives dissolution
  • Death toll in Burkina Faso militant attacks mounts to 132
  • Roadside bomb kills 11 civilians in Afghanistan
  • DGDA of Bangladesh approves 2nd Chinese COVID 19 vaccine ‘CoronaVac’

The red flags on the trail of the virus

  • The publication of science writer, editor, and author Nicholas Wade’s well-researched article in the Bulletin of the Atomic Scientists, “The origin of COVID: Did people or nature open Pandora’s box at Wuhan?”
  • Wuhan Institute of Virology (WIV)
  • China promoted the narrative that the virus spread from a wet market (seafood and animal market) in Wuhan to avoid any scrutiny of what was being done in the WIV.
  • With advances in biotechnology, it is now possible to genetically engineer existing pathogens to make them more lethal and difficult to treat.
  • Dr. Peter Daszak of the EcoHealth Alliance obtained grants from the U.S. National Institutes of Health and subcontracted research to a group headed by Dr. Shi Zhengli at the WIV.
  • Dr. Daszak claimed in a 2019 interview that after six or years of research, over 100 new SARS-related coronaviruses, some of which were introduced into human cells in the lab, caused SARS disease in humanised mice and were untreatable.
  • The research carried out involved the creation of novel, life-threatening and pandemic-creating viruses.
  • A former Israeli intelligence official and visiting fellow at the Institute for Defence Studies and Analyses, Dany Shoham, now with the Bar Ilan University, Israel, has linked the WIV to China’s biological weapons programme.
  • Admittedly, it is difficult to distinguish between a naturally occurring event, an accidental release of a genetically modified pathogen, or its deliberate use.
  • A 34-year-old doctor in Wuhan, Li Wenliang, tried to alert others on a social media platform from his hospital bed in Wuhan about a possible outbreak of a SARS-type virus.
  • Countries demanding greater transparency and accountability have been either denounced or ‘punished’ by China.
  • China’s vehement opposition to further investigations, actions to suppress facts from getting out, and reluctance to share data only fuel the suspicion that China has something to hide.
  • The 1972 Biological and Toxin Weapons Convention (BWC) — formerly known as the Convention on the Prohibition of the Development, Production and Stockpiling of Bacteriological (Biological) and Toxin Weapons and on their Destruction — has no systems to verify compliance with its prohibitions, nor any enforcement mechanisms to penalise infringement of its provisions.
  • These shortcomings have been repeatedly highlighted in the five-yearly Review Conferences of the BWC, but the state parties to the BWC have been unable to agree on any measures to address them, thus compromising on biosecurity and wilful breaches of the Convention.

How to be a wealthy nation?

  • Covid reminds us that the only sustainable solution for our healthcare, education, sanitation, and nutrition challenges is raising India’s per capita GDP via massive, non-farm, private, formal job creation.
  • Raising India’s wealth and power
    • 148th country ranking in hospital beds per capita
    • 142nd country ranking in per capita GDP
  • Economic development is what psychologist Robin Hogarth called a “wicked learning environment”
  • Change began in 1991 when China and India had the same GDP per capita; the average Chinese is now five times more prosperous.
  • Our reforms have been impactful but incomplete.
  • Raising per capita income needs higher productivity in our regions (Karnataka and UP have the same GDP though Karnataka has a fourth of the population)
  • Sectors: IT employs only 0.8% of the labour force but generates 8% of GDP while agriculture employs 42% of the labour force but only generates 15% of GDP
  • Firms: our largest and smallest manufacturing firms have a 24 times productivity difference
  • Individuals: sales is the fastest growth entry-level job with salaries varying four times based on skills
  • These structural transformations require bold reform in formalisation, urbanisation, industrialisation, financialisation and skilling.
  • Raise take-home Salaries
    • Our laws mandate the world’s highest mandatory payroll confiscation: 42% for low-wage employees (this deduction is only 9% for employees with salaries higher than Rs 25,000 per month).
    • Holding employer contribution mandatory, we should modify Clause 6 of the EPF Act and Clause 39 of the ESIS Act to make employee contribution voluntary.
    • Salary is individual property, payroll deductions cannot exceed savings, and PF loans solve a problem that should not exist.
    • Attack Regulatory Cholesterol
    • The employer regulatory compliance universe across state and central governments is 60,000+ compliances, 6000+ filings, and 6000+ annual changes.
    • Change has begun; Punjab recently abolished 479 compliances and central ministries are culling.
  • Massifying Employability:
    • Covid has hurt education but accelerated online learning, non-exam assessments, and made skills more valuable.
    • The National Education Policy, 2020, anticipated these changes but the proposed 15-year glide path should be reduced to three years.
    • And immediately license every university for online learning (currently only 32 of our 1,000 universities are), enable degree Apprentices (UGC Act 2F and Apprentices Act Rule 2), and legitimising Skill Universities (UGC Act Chapter 8 and Section 22).
  • Accelerate Civil Service Reform:
    • Civil service structures currently treat good and bad performers equally, promote too many to top ranks, front load training, sabotage urgency with too many ministries, and undervalue specialisation.
    • We should set a December 2021 deadline for differentiation (can’t rank 98% outstanding), delayering (retirement if not shortlisted for promotion beyond thresholds), and decluttering (cutting central ministries to 25).
  • Execute Privatisation:
    • Covid shreds public finances but there are limits to raising taxes or borrowing without breeding informality or stealing from our grandchildren.
    • Finishing the privatisation agenda this year will control government debt by taking advantage of strong investor and FDI attraction to India arising from unrealised growth potential, China fatigue, and a global capital glut.
    • More importantly privatisation is strategy signalling; the state will do less so it can do more.
  • To paraphrase Swami Vivekananda, the pain and helplessness of Covid is hopefully a fire that stirs up a fresh vigour in billions of veins; we are responsible for what we are, and we have the power to make ourselves whatever we wish ourselves to be.
  • India is poor but doesn’t have to be.

For better tax rules

  • G7 countries’ agreeing to a global minimum corporate tax rate of 15% and the rule that MNCs, irrespective of the nature of their business, have to pay taxes where they operate, are pathbreaking proposals.
  • They put on notice both tax havens, a list that includes countries like Ireland and China’s Hong Kong, as well as global technology behemoths like Google’s parent Alphabet, Facebook and Amazon.
  • These MNCs, in part taking advantage of businesses built on digital platforms, create a maze of subsidiaries and park most of their revenues in tax havens, denying governments of major markets taxes and putting companies which duly pay taxes at a great disadvantage.
  • G7’s agreement should be followed through quickly by, first, G20’s agreement and, second, framing the rules of the new system.
  • G20 members should persuade China, which may be concerned about Hong Kong, that it will gain far more than it will lose under the new system.
  • India, a G7 invitee and a G20 member, of course has much to gain.
  • As one of the world’s largest internet markets by size, and one in which the average  value of transactions will go up rapidly, India loses out badly when these technology MNCs escape the corporate tax net.
  • Taxes like the equalisation levy and the concept of ‘Significant Economic Presence’ introduced in IT rules are correct steps, but they don’t compensate for revenue lost under the current regime.
  • India should boldly undertake another corporate tax reform – lower domestic rates significantly.
  • In fact, India’s rate for taxing companies should be the global minimum – 15%.
  • In September 2019, GoI had slashed corporate taxes to 22% in general and to 15% for greenfield manufacturing companies.
  • With cess and surcharge, the effective tax rate for existing domestic corporates is roughly 25.17%.
  • But covid has radically changed ground realities.
  • Private investment, slowing down even before the pandemic, needs a huge incentive.
  • Any loss in revenue will be more than made up by taxes on activities generated by higher private investment.
  • A 15% corporate tax rate will make India the most attractive tax-wise in Asia.
  • Such a rate will also compensate for India’s  disadvantages vis-à-vis its peers – higher business compliance costs, poorer infrastructure, slower legal system.
  • Along with current incentives for manufacturing like the PLI scheme, a 15% rate has the potential to make this country a manufacturing giant.
  • Let’s remember, sustained private investment and industrial employment are the only sure shot means to make India richer.

Q.) According to the latest SDG India Index of NITI Aayog which state is at the top in CLIMATE ACTION category?

  • Tamil Nadu
  • Kerala
  • Odisha
  • Tripura

Q.) Who is the president of Nigeria?

  1. Muhammadu Buhari
  2. Goodluck Ebele Johathan
  3. Shehu Shagari
  4. Lai Mohammed