Why is it in the News?

The current government policy, skewed towards consumers, unfavourably impacts farmers, necessitating a shift to enhance farmers' incomes.

Current State of India‘s Agricultural Exports:

• The current status of India's agri exports highlights a notable shortfall in achieving government targets.
• Despite aiming for $60 billion in 2022, actual exports in 2023-24 amounted to $48.9 billion, showing an 8% decrease from the previous year's $53.2 billion.
• Between 2004-05 and 2013-14, agricultural exports witnessed remarkable growth, expanding nearly fivefold from $8.7 billion to $43.3 billion.
• However, this growth trajectory slowed significantly in the period from 2014-15 to 2023-24, with an annual growth rate of merely 1.9%.
• Key exports include rice ($10.4 billion), marine products ($7.3 billion), spices ($4.25 billion), bovine meat ($3.7 billion), and sugar ($2.8 billion).

What is Agricultural Export Policy?

• The Agricultural Export Policy, commonly known as an agri-export policy, encompasses a range of governmental regulations, strategies, and incentives aimed at facilitating and encouraging the export of agricultural commodities from a specific nation.
• It encompasses diverse measures such as export subsidies, tariff adjustments, quality benchmarks, market access arrangements, financial support, and promotional efforts to assist agricultural producers and exporters in accessing global markets, enhancing their competitiveness, and broadening their export horizons.
• The Government of India introduced a comprehensive Agriculture Export Policy in December 2018, with the following objectives:
  • To diversify our export basket, and destinations and boost high-value and value-added agricultural exports, including focus on perishables.
  • To promote novel, indigenous, organic, ethnic, traditional and non-traditional Agri products exports.
  • To provide an institutional mechanism for pursuing market access, tackling barriers and dealing with sanitary and phytosanitary issues.
  • To strive to double India’s share in world agri exports by integrating with global value chains.
  • Enable farmers to get the benefit of export opportunities in overseas markets.

What is the Need for an Agri-Export Policy?

• Economic Contribution: India's agricultural exports, totalling around USD 53 billion in the fiscal year 2022-2023, constitute a significant portion of overall exports, yet the country's global share in agricultural exports remains low at 2.2% as of 2016.
• Food Security Enhancement: Despite catering to a substantial portion of the world's population with limited resources, a well-designed export policy can generate additional revenue to invest in bolstering food security and augmenting farmers' incomes.
• Inflation Control: Agricultural exports have the potential to stabilize domestic prices, benefiting consumers and producers, particularly during periods of abundant harvests.
• Job Creation: With approximately 45% of the workforce engaged in agriculture, promoting agricultural exports can foster employment opportunities, particularly in rural areas where agriculture is predominant.
• Balance of Payments Support: Agricultural exports significantly contribute to India's foreign exchange reserves, helping to offset trade deficits and maintain currency stability.
• Crop Diversity Utilization: India's diverse agricultural production offers substantial export potential, which can be tapped into through a well-structured export policy.
• Trade Relations Strengthening: Agricultural exports are pivotal in fostering and reinforcing trade ties with countries like the United States, Saudi Arabia, and the United Arab Emirates.
• Addressing Structural Challenges: The policy framework can effectively tackle obstacles such as low farm productivity, inadequate infrastructure, global price fluctuations, and limited market access.

What are the Challenges in India's Agri-Export Policy?

Several challenges hamper the effectiveness of India's agricultural export policy, requiring strategic interventions to unleash the sector's full potential:

• Restrictive Export Policies: Favoring domestic consumers over farmers often impedes the achievement of export targets.
  • Restrictions on commodities like Basmati rice, such as the Minimum Export Price (MEP) of USD 1,200, can limit export volumes.
• Subsidy-Centric Schemes: Increased subsidies during election periods, including food and fertilizer subsidies, strain fiscal discipline.
  • Populist measures like loan waivers and free power for farmers impact the financial health of the agricultural sector.
• Insufficient R&D Investment: Low investment in agricultural R&D, approximately 0.5% of agricultural GDP, hinders growth prospects.
  • Doubling or tripling R&D investments is essential for India to excel in agricultural production and exports.
• Quality and Standards: Maintaining consistent quality and meeting international standards is challenging.
  • Variability in quality, compliance issues, and difficulties in meeting Sanitary and Phytosanitary (SPS) Measures due to pests and diseases impede exports.
• Infrastructure: Inadequate infrastructure for storage, transportation, and processing results in post-harvest losses, reducing export competitiveness.
• Environmental and Sustainability Concerns: Balancing the growth of agricultural exports with environmental sustainability is crucial.
  • Over-exploitation of resources may have long-term consequences, necessitating careful resource management and sustainable practices.

Government Initiatives Promoting Agri-Export in India:

To unlock the full potential of India's agricultural exports, the government has launched several initiatives to enhance productivity, modernise infrastructure, and promote sustainable practices. Key schemes include:

• E-NAM (National Agriculture Market): A pan-India electronic trading portal, E-NAM enables farmers to sell directly to buyers, reducing intermediaries and ensuring fair prices.
  • E-NAM has integrated 1,000 wholesale markets and 585 mandis across 18 states and 3 Union Territories.
• National Horticulture Mission (NHM): Promoting sustainable horticulture practices, including organic farming and precision farming, NHM supports the establishment of over 100 Farmer Producer Organizations (FPOs) for horticultural products.
  • The mission also backs the production of high-value horticultural products for export.
• Market Access Initiative (MAI): Supporting export promotion activities, such as participation in trade fairs, capacity building, and market research, MAI has facilitated Indian exporters' participation in over 100 international trade fairs annually.
• Operation Greens: With an allocation of INR 500 crores in the Union Budget 2023-2024, Operation Greens stabilizes the supply and prices of essential agricultural commodities like fruits and vegetables.
  • The scheme reduces price volatility, ensures fair prices for farmers, and fosters sustainable agri-exports.
• Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters (SAMPADA): With a budgetary allocation of INR 6,000 crores for the period 2020-2021 to 2024-2025, SAMPADA modernizes infrastructure for agro-processing clusters.
  • This reduces post-harvest losses and increases shelf life, improving the overall export potential.
• APEDA: Promoting the export of scheduled products, APEDA provides guidelines for sustainability and quality.
  • APEDA facilitated exports of agricultural products worth USD 22.17 billion during the financial year 2022-2023.
• Agri Export Zones (AEZs): AEZs provide infrastructure development and technology adoption for sustainable agri-exports.
  • Established for commodities like mangoes, grapes, and spices, AEZs have contributed to increased export volumes.
• Promotion of Organic Farming: Initiatives promoting organic farming for environmental sustainability and the export potential of organic products have resulted in increased organic farming area, reaching 3.90 million hectares in 2022-2023, with exports of organic products totalling USD 1.04 billion.

Way Forward for a Stable Agricultural Export Policy in India:

To establish a stable and prosperous agri-export policy in India, several strategic actions and considerations must be taken into account. These include:

• Prioritizing Farmer Welfare: Ensuring that farmers receive fair prices for their produce is crucial for the success of agricultural exports and the well-being of the farming community.
• Supporting Domestic Consumers: Implementing targeted income policies to support vulnerable populations and maintain food security for domestic consumers.
• Enhancing Productivity: Increasing agricultural productivity through investments in R&D, seeds, irrigation, fertilizers, and improved farming practices to bolster global competitiveness.
• Diversifying Export Basket: Expanding the range of agricultural exports, focusing on value-added products, and targeting a wide array of international markets to minimize reliance on a select few commodities.
• Quality Assurance: Implementing strict quality standards and certification mechanisms to ensure that exported agricultural products meet international norms.
  • Establishing uniform quality and standardization protocols is vital, particularly for horticultural items.
• Infrastructure Development: Investing in modern infrastructure, such as cold storage, processing facilities, transportation, and logistics, to reduce post-harvest losses and enhance export competitiveness.
  • Offering financial incentives, subsidies, and credit facilities can encourage investments in agriculture, infrastructure, and processing facilities.
• Technology Adoption: Promoting the use of advanced agricultural technologies, precision farming, and efficient irrigation techniques to boost productivity.
  • Encouraging the growth of agri-startups and fostering innovative solutions can enhance agricultural production and export efficiency.
• Environmentally Sustainable Practices: Encouraging sustainable farming practices, including organic farming, to ensure environmental sustainability in agriculture.
• Learning from Global Best Practices: Gaining insights from successful agricultural export policies and best practices in other countries can inform India's approach.
  • Strengthening diplomatic efforts to negotiate favourable trade agreements and reduce trade barriers will provide better access to international markets.

Conclusion

To ensure India's continued growth in global agricultural trade, a stable export policy is crucial, embodying dynamism, responsiveness, and adaptability. It must prioritize agricultural sustainability, environmental responsibility, and farmer welfare, securing India's position in international trade. Balancing economic growth with farmer well-being and environmental concerns is key to unleashing India's agricultural potential. Forward-looking policies and innovative solutions will strengthen the agri-export sector, fostering a prosperous and sustainable future for all.

Why is it in the News?

The European Court of Human Rights found Switzerland guilty of violating the rights of women from KlimaSeniorinnen, stating that the government's emission control efforts were insufficient, failing to protect women from climate change impacts.

Context:

• Courts worldwide are increasingly tasked with addressing the nexus between climate change and human rights, as evidenced by significant rulings such as those from the European Court of Human Rights in Switzerland and the Supreme Court of India.
• These landmark decisions highlight the imperative of acknowledging climate change as a human rights issue and establishing crucial benchmarks for legal and policy responses to mitigate its detrimental effects on people and societies.

Legal Acknowledgment of Climate Change's Human Rights Impacts:

• Recent rulings by the European Court of Human Rights against the Government of Switzerland and the Supreme Court of India have underscored the failure to safeguard vulnerable populations from the effects of climate change.
• The European Court's decision highlighted the government's neglect in protecting elderly women from climate-related harm, while the Indian Supreme Court affirmed citizens' entitlement to freedom from adverse climate effects under constitutional guarantees.
• Citing Articles 14 (equality before the law) and 21 (right to life and personal liberty) of the Indian Constitution, the Supreme Court emphasized individuals' right 'to be free from the adverse impacts of climate change.'
• These legal judgments signify a significant step towards acknowledging climate change as a pivotal human rights concern.

The Escalating Human Rights Risks of the Global Climate Crisis:

• The global climate crisis presents an imminent threat to human rights, imperiling individuals and communities worldwide.
• The latest State of the Global Climate Report from the World Meteorological Organization presents compelling evidence of the intensifying impacts of climate change.
• In 2023, numerous climate indicators soared to unprecedented levels, marking it as the hottest year on record.
• This unparalleled warmth coincided with concerning trends such as heightened ocean heat accumulation, rising sea levels, diminishing Antarctic sea ice, and accelerated glacier retreat.
• These indicators underscore the severe strain on our planet, with profound implications for human welfare.

India's Climate Action and Vulnerability:

• Progress Amid Persistent Vulnerability: Despite notable advancements in climate action, India, among the world's fastest-growing economies, continues to confront significant vulnerability to climate change.
  • Having met two of its Nationally Determined Contribution (NDC) targets—reducing emissions intensity by 33% to 35% and achieving 40% cumulative non-fossil fuel electricity capacity—well ahead of schedule, India demonstrates proactive measures.
  • Nevertheless, the nation remains highly susceptible to climate-related adversities.
• Population Concentration in Disaster-Prone Areas: A primary concern is India's demographic distribution, with over 80% of its populace residing in regions prone to climate-induced calamities like floods, cyclones, droughts, and heatwaves.
  • These events not only disrupt lives but also exacerbate existing socio-economic disparities, disproportionately impacting vulnerable groups such as small-scale farmers, rural communities, and marginalized populations.
• Intersecting Challenges of Climate Change: Climate change intersects with broader socio-economic and environmental issues, compounding their repercussions.
  • Rapid urbanization and haphazard development intensify urban vulnerability to climate-driven disasters like flooding and landslides.

Frameworks to Strengthen India's Climate Action:

• Embracing Comprehensive Legislation: India's climate governance could benefit from the adoption of a comprehensive regulatory framework dedicated to climate change.
  • This legislation would offer a unified structure for addressing diverse climate-related aspects, spanning mitigation, adaptation, finance, and capacity-building.
  • By enshrining climate objectives, targets, and strategies in law, such a framework can furnish legal clarity and consistency, guiding sustained planning and investment.
• Insights from Global Climate Laws: Research from the London School of Economics and Political Science examined climate framework laws in 60 nations, spotlighting their pivotal role in shaping national climate agendas.
  • Countries like Germany, Ireland, New Zealand, Finland, South Korea, South Africa, and the Philippines have instituted robust climate legislation surpassing mere compliance with international obligations.
  • These laws have facilitated public resource mobilization, bolstered climate action capabilities, and fostered inter-sectoral cooperation.

Additional Measures for Enhanced Climate Governance in India:

• Integrated Climate Policies: India's climate strategies should embrace an integrated approach, embedding climate considerations into broader development frameworks and decision-making processes.
  • This entails weaving climate adaptation and mitigation efforts throughout key sectors like agriculture, water management, energy, transportation, and urban development to foster a cohesive response to climate challenges.
• Localized Solutions and Cross-Sector Collaboration: Tailored, localized climate actions, coupled with collaborative efforts across sectors, are vital for addressing the diverse and context-specific impacts of climate change.
  • Governments can craft targeted strategies to bolster resilience, mitigate risks, and advance sustainable development goals by engaging local stakeholders and fostering partnerships across sectors.
• Harmonizing Climate and Sustainable Development Goals: Localized climate initiatives often align with broader Sustainable Development Goals (SDGs), such as poverty eradication, food security, access to clean water, and gender equity.
  • Integrating climate considerations into local SDG agendas enables governments to leverage synergies, optimize resource use, and fortify community resilience and sustainability.
• Empowerment of Civil Society: Civil society organizations (CSOs) play a pivotal role in advocating for climate action, environmental equity, and governmental accountability.
  • Empowering CSOs and fostering rights-based discourse on climate change are vital for fostering inclusive decision-making, transparency, and environmental justice.
• Fostering Inclusivity and Representation: Promoting diversity and inclusivity within civil society is imperative to ensure the voices and perspectives of marginalized communities are heard and heeded in climate policymaking.
  • CSOs should aim to represent the interests of various stakeholders, including women, indigenous populations, youth, persons with disabilities, and other marginalized groups, in climate governance.
• Advancing Rights-Centric Discourse: A rights-based approach to climate action acknowledges that climate change disproportionately impacts vulnerable communities, infringing upon their basic human rights to life, health, food, water, and livelihoods.
  • By framing climate change as a human rights issue, CSOs can advocate for policies that prioritize the needs of affected communities and champion environmental justice.

Conclusion

The alignment of legal rulings, scientific findings, and policy mandates emphasizes the pressing imperative to confront climate change as a human rights emergency.

By acknowledging the inseparable link between environmental health and human welfare, nations can pave the way toward climate resilience and equity.

Empowering communities, fortifying legal structures, and promoting cross-sectoral cooperation stand as pivotal measures in realizing a future liberated from the detrimental effects of climate change.

Why is it in the News?

Financial inclusion awareness programmes must give special attention to women in households not headed by women.

Context:

• Financial inclusion is a key driver for realizing a more sustainable and inclusive future, as it directly influences the achievement of eight out of the 17 United Nations' Sustainable Development Goals (SDGs).
• Despite its importance, inequalities continue to exist, with India's subpar performance in the Global Gender Gap Report 2023 underscoring significant gaps in the economic realm.
• To address these disparities, particularly for women in India, it is vital to conduct a comprehensive evaluation of the complex aspects of financial inclusion.
• Insights can be drawn from multiple sources such as the World Bank's Global Findex Database and the National Family Health Survey (NFHS), ultimately paving the way for targeted interventions and improved financial access for all.

What is Financial Inclusion?

• Financial inclusion is a method of offering banking and financial services to individuals.
• It aims to include everybody in society by giving them basic financial services regardless of their income or savings.
• It focuses on providing financial solutions to the economically underprivileged.
• The term is broadly used to describe the provision of savings and loan services to the poor in an inexpensive and easy-to-use form.
• It aims to ensure that the poor and marginalized make the best use of their money and attain financial education.
• With advances in financial technology and digital transactions, more and more startups are now making financial inclusion simpler to achieve.

The Role of Financial Inclusion in Advancing Women's Empowerment:

• Financial inclusion not only facilitates women's access to bank accounts but also drives broader economic participation and empowerment.
• By offering women avenues for savings, credit, and investment, financial inclusion empowers them to manage risks, build assets, and seize socio-economic opportunities.
• In doing so, it bolsters women's resilience to economic uncertainties, fosters greater household welfare, and promotes economic stability, thereby illustrating its pivotal role in driving gender equity and sustainable development.

Insights from NFHS Data on Women's Financial Inclusion Progress:

• The NFHS data offers a comprehensive understanding of the multi-faceted dimensions of financial inclusion among women in India.
• Over the past two decades, several indicators point towards a significant improvement in women's economic empowerment and access to financial services including:

Financial Autonomy and Decision-making:

• A notable aspect highlighted by the NFHS surveys is the increasing financial autonomy among women.
• There has been a marked shift towards greater control over financial resources, with more women possessing self-operated bank accounts and playing an active role in financial decision-making within their households.
• This trend signifies a positive step towards women's economic independence, contributing to their overall empowerment and well-being.

Awareness and Utilization of Micro-Credit Programs:

• Micro-credit schemes have emerged as a key facilitator of financial assistance for women entrepreneurs and small business owners in rural India.
• The NFHS data indicates a growing awareness of these programs among women, with an increasing number utilizing micro-credit facilities to support their economic activities.
• This underscores the importance of targeted interventions and support mechanisms in promoting women's access to formal credit sources, fostering entrepreneurship, and generating income at the grassroots level.

Access and Utilization of Formal Banking Services:

• An analysis of factors such as education, occupation, and household characteristics reveals key determinants of women's financial inclusion.
• The NFHS data emphasizes the pivotal role of education in enabling women's awareness and utilization of financial services.
• Similarly, occupation and access to electronic media also significantly influence women's access to formal banking channels and digital financial tools.
• These insights underscore the need for targeted interventions and policy measures to address disparities and barriers, ensuring inclusive financial access, particularly among marginalized and vulnerable groups of women.

Advances in Global Financial Inclusion and India:

• Financial inclusion has become a key enabler of economic growth and development worldwide, with India demonstrating substantial progress in this arena.
• According to the World Bank's Global Findex Database, there has been a significant increase in adult ownership of bank accounts globally between 2011 and 2020.
• India's commendable growth of 42 percentage points during this period exemplifies the success of targeted interventions promoting financial access, particularly for marginalized communities such as women.
• This upward trend emphasizes the importance of continued efforts in fostering inclusive financial systems to ensure sustainable development and shared prosperity.

The Influence of Government Initiatives on Financial Inclusion:

• India's commitment to advancing financial inclusion has resulted in substantial progress, particularly in reducing the gender gap in account ownership.
  • The introduction of the Pradhan Mantri Jan Dhan Yojana (PMJDY) in 2014 played a pivotal role in this achievement, offering universal access to banking services, including savings accounts, remittances, and overdrafts to underserved communities such as women in rural and urban areas.
  • By January 2024, PMJDY had facilitated the opening over 28 crore accounts for women, significantly contributing to bridging the gender gap in financial access.
• Furthermore, government initiatives like the Deendayal Antyodaya Yojana and the National Rural Livelihood Mission (DAY-NRLM) have been instrumental in fostering women's economic empowerment and participation in the formal financial sector.
  • These schemes provide opportunities for skill development, entrepreneurship training, and access to credit, enabling women to establish and sustain livelihoods.
• In addition, social protection programs such as the Pradhan Mantri Awas Yojana and Pradhan Mantri Matru Vandana Yojana offer financial assistance and support during critical life stages such as pregnancy and homeownership.
  • Collectively, these initiatives have played a vital role in promoting women's economic independence and overall well-being, underscoring the importance of continued efforts towards inclusive financial systems.

Challenges and Way Forward:

• While significant progress has been made in advancing financial inclusion, several challenges remain, requiring concerted efforts and multi-stakeholder collaboration to address. Key areas of focus include:
• Enhancing Financial Literacy: Despite the expansion of banking services, a significant proportion of the population, particularly in rural and marginalized communities, lack adequate knowledge and understanding of financial products and services.
  • By promoting targeted education and awareness campaigns, we can empower individuals to make informed financial decisions and fully utilize available resources.
• Bridging the Digital Divide: The potential of digital financial services to enhance access and convenience is immense.
  • However, disparities in internet connectivity, smartphone ownership, and digital literacy create barriers to their effectiveness.
  • Expanding digital infrastructure and promoting digital literacy initiatives are critical to ensuring equitable access to digital financial services for all segments of society.
• Promoting Inclusivity of Marginalized Communities: Systemic barriers continue to hinder the meaningful participation of marginalized communities, including women, minorities, and persons with disabilities in the financial ecosystem.
  • These barriers are multifaceted, encompassing social, cultural, and economic factors.
  • To overcome these challenges, tailored interventions and affirmative action programs are necessary, fostering an enabling environment that promotes their inclusion and empowerment.
• Advancing through Collaboration: A collaborative approach involving multiple stakeholders, including government agencies, financial institutions, civil society organizations, and grassroots initiatives, is indispensable in advancing financial inclusion.
  • By coordinating efforts, leveraging resources, and implementing holistic solutions, we can collectively navigate the path ahead, overcoming challenges, and ensuring inclusive and sustainable financial systems for all.

Conclusion

Advancing financial inclusion for women in India is essential for fostering inclusive growth and sustainable development. While initiatives like PMJDY and DAY-NRLM have made significant strides, concerted action is necessary to tackle remaining disparities and fully leverage women's economic potential. By emphasizing education, digital literacy, and tailored awareness initiatives, India can unlock fresh opportunities for women's economic empowerment, thereby advancing the agenda of inclusive growth and prosperity.

Why is it in the News?

• While India has experienced positive outcomes from liberalization efforts, it is important to acknowledge a significant shortcoming—the country did not successfully establish a robust manufacturing foundation and underwent premature de-industrialization.
• It's crucial to recognize that no nation has achieved industrialization solely through deregulation.
• To facilitate the structural transformation of the economy, the implementation of a well-crafted industrial policy becomes imperative, with thoughtfully selected import restrictions serving as a key component of this policy mechanism.

The Make in India (MII) Initiative and Its Goals:

• Make in India Campaign: Officially inaugurated by Prime Minister Modi in September 2014, the Make in India campaign is a strategic effort aimed at advancing manufacturing, attracting foreign direct investment (FDI), fostering innovation, and generating employment opportunities within the nation.

Objectives of the Make in India:

• Advancing Manufacturing: The initiative strives to elevate India's status to a global manufacturing hub by encouraging both domestic and international companies to establish manufacturing units within the country.
• Attracting Foreign Investment: Make in India seeks to allure foreign direct investment by streamlining the business environment, simplifying regulatory norms, and providing incentives to foreign companies for investing in India's manufacturing sector.
• Infrastructure Enhancement: Emphasizing infrastructure development, the campaign focuses on improving key elements such as roads, ports, and logistics to ensure the seamless operation of manufacturing units.
• Skill Development: Recognizing the pivotal role of a skilled workforce in a thriving manufacturing sector, Make in India incorporates initiatives to enhance the skill sets of the Indian workforce, aligning them with the requirements of modern manufacturing.
• Innovation and Technology: The campaign places a significant emphasis on fostering innovation and integrating modern technology into manufacturing processes.
  • This strategic approach aims to enhance efficiency and competitiveness in the manufacturing sector.

Differentiating Made in India (MII) from Previous Policies:

• The Make in India campaign, launched in 2014, represents a departure from the self-sufficiency doctrine that India adopted in the 1970s.
  • It does not bring back memories of the licensing raj or import-substituting industries of the past.
• While concerns have been expressed about the implementation of Make in India, particularly in certain sectors where tariff duties are raised to provide protection and incentivize the establishment of domestic industries, it is crucial to note that the campaign is fundamentally different.
  • Worries about a potential spread of protectionist tendencies to other sectors, though possibly overstated, are not entirely unfounded, especially for those who experienced the challenges of the 1970s and 1980s.
• During those years, indiscriminate protectionism led to shortages, black markets, and widespread rent-seeking, all ostensibly in the name of the poor and distributive justice.
  • Producers who benefited from such protection actively advocated for its continuation.
  • Importantly, considering that an average mobile phone manufactured in India consists of 80-85 percent imported content (India Cellular and Electronics Association, 2022), it is empirically evident that Make in India significantly differs from the concept of self-sufficiency.
• Given these empirical distinctions, it is imperative to move beyond baseless comparisons and recognize the unique nature of the Make in India initiative.

Evaluation of Commitments and Performance of Make in India:

• A Sizeable Domestic Market Falls Short of Competitiveness in Exports: Make in India (MII) encompasses two related concepts, namely Made in India and Make for India, with MII serving as the foundational and overarching policy.
  • While Made for India focuses on manufacturing for the domestic market, it is essential to recognize that a substantial domestic market alone does not substitute for the crucial aspect of export competitiveness.
    • Historical examples, such as Japan, Korea, and China, underscore that export competitiveness has been a common feature of nations that have experienced significant economic growth.
• The necessity of an Effective Make in India Operation: Made in India functions as a branding strategy, promoting manufacturers rooted in Indian factors of production—land, labor, capital, entrepreneurship, technology, etc.
  • However, the success of Made in India hinges on the effectiveness of the broader Make in India operation.
• Alignment with National Manufacturing Policy (NMP 2011): Make in India was launched as a follow-up to prior initiatives, particularly the National Manufacturing Policy (NMP) of 2011, which aimed to cultivate a robust and competitive manufacturing sector.
  • The NMP 2011 identified challenges such as inadequate physical infrastructure, a complex regulatory environment, and insufficient availability of skilled manpower hindering manufacturing growth.
  • The policy set ambitious targets, including raising the manufacturing contribution to GDP from a stagnant 15 percent since the 1980s to at least 25 percent and generating 100 million additional jobs.
• Dynamic Objectives of Make in India: Beyond the objectives outlined in the NMP 2011, Make in India aspires to elevate India into a global design and manufacturing export hub.
  • In essence, Make in India envisions a transformation where India becomes a manufacturing powerhouse catering to the global market.

Requirement for Supplementary Industrial Policy Measures During Ongoing PLI Implementation:

• Diversified Articulation Beyond Production Linked Incentive (PLI): Beyond the current implementation of the Production Linked Incentive (PLI) scheme, there is a crucial need for an additional industrial policy tailored to sectors such as toys, readymade garments, and footwear.
  • A more nuanced and sector-specific articulation of industrial policies is essential to meet the unique requirements of diverse sectors.
• Emphasis on Job Creation: Industrial policy must prioritize job creation, especially in a country abundant in labour but with average educational attainments and skills.
  • Policies should be designed to create productive job opportunities, particularly focusing on labour-intensive manufacturing and opening avenues for women in the workforce.
• Addressing the Jobless Growth Critique: Acknowledging the criticism of jobless growth, the absence of quality jobs with social protection has contributed to this narrative.
  • Industrial policies should explicitly target mass job creation, considering both job quality and the provision of social protection.
• Navigating the Challenges of Inclusive Policy Formulation: The government should confront the complexities of formulating industrial policies that foster mass job creation, especially in comparison to policies solely focused on exports.
  • Inclusive policies that align with the overarching goal of creating high-quality jobs and ensuring social protection are essential.
• Treating Job Creation as the Benchmark: The effectiveness of industrial policies should be assessed based on their impact on mass job creation in India.
  • This underscores the significance of addressing concerns related to jobless growth and prioritizing policies that generate inclusive and high-quality employment opportunities.
• Confronting Labor Market Challenges: India's labour market research indicates the prevalence of low-paying, low-productivity, and largely informal jobs in the unorganized sector.
  • With more than 99 percent of India's 63 million micro, small, and medium enterprises (MSMEs) in the unorganized sector, there is limited flexibility for creating productive jobs.
• The assessment of how Make in India, complemented by other policies, has addressed these challenges is crucial.
  • However, the lack of frequent and short-interval official data poses a significant hurdle, necessitating attention to enhance policy efficacy through more regular and timely data collection.

Conclusion

A thorough examination of the nation's circumstances and capabilities is imperative for effective government decision-making.

• India must formulate an industrial policy that extends the advantages of technological advancements beyond just the privileged laptop class.
• However, it is essential to exercise caution in steering discussions on industrial policy, avoiding the pitfalls of showmanship, theoretical oversimplification, or misleading historical comparisons.
• The global landscape demands that India adopt a substantive industrial policy, placing a genuine emphasis on the significance of manufacturing.
• In this context, it is evident that there is no substitute for a well-considered and serious industrial policy.

Why is it in the News?

The government recently announced that it had approved a new policy allowing its advertising wing, the Central Bureau of Communication (CBC), to undertake advertisement campaigns on social media, OTT platforms, and other digital media.

News Summary:

• The government has introduced a digital advertising policy, facilitating websites with a minimum of 2.5 lakh unique users per month, OTT platforms, and podcasts to participate in publicity campaigns.
• Released by the Ministry of Information and Broadcasting, the policy empowers the Central Bureau of Communication (CBC) to conduct digital media campaigns.
• The policy incorporates competitive bidding for rate discovery, ensuring transparency for three years.

Key Provisions of the Digital Advertisement Policy, 2023:

• Empowerment for Digital Campaigns: The Ministry of Information and Broadcasting has formally sanctioned the implementation of the "Digital Advertisement Policy, 2023." This landmark decision aims to empower the Central Bureau of Communication, facilitating the execution of comprehensive campaigns within the Digital Media Space.
• Mission Alignment with Evolving Media Landscape: In response to the dynamic changes in the media landscape, this policy marks a significant milestone in CBC's mission.
• It focuses on disseminating information and raising awareness about various government schemes, programs, and policies.
• Expansion into Digital Platforms: The policy extends CBC's reach into the realm of digital advertising by allowing the empanelment of agencies and organizations in the Over-The-Top (OTT) and Video on Demand Space.
• Leveraging Podcasts and Digital Audio: CBC can now capitalize on the growing number of listeners on Podcasts and Digital Audio platforms.
• Empanelment of Digital Audio platforms facilitates the dissemination of government messages to a broader audience.
• Mobile Application Outreach: For the first time, CBC has the capability to channelize public service campaign messages through Mobile Applications.
• This diversifies the channels through which government communication can reach the public.
• Streamlined Advertisement on Social Media: Recognizing the popularity of Social Media Platforms as channels for public conversations, the policy simplifies the process for CBC to place advertisements for government clients on these platforms.
• Enhanced Outreach with Digital Media Agencies: The policy empowers CBC to panel Digital Media Agencies, further expanding its outreach through various digital platforms.
• This enhances the ability to effectively communicate government initiatives.
• Embracing Innovation and Transparency: The policy acknowledges the dynamic nature of the digital landscape and allows CBC to onboard New and Innovative Communication Platforms within the Digital Space.
• The approval process involves a duly constituted committee.
• Competitive Bidding and Rate Discovery: An important aspect of the policy is the introduction of competitive bidding for rate discovery, ensuring transparency and efficiency in the selection of advertising rates.
• Rates discovered through this process remain valid for three years and are applicable to all eligible agencies.

Why is there a need for the Digital Advertisement Policy?

Digital advertising is the promotion of products and services via online platforms like streaming media, websites, and more. Digital advertisements are available in text, image, audio, and video formats.

• Impact of Digital India Initiative: The government's Digital India initiative has significantly increased the country's internet connectivity, leading to a substantial rise in the number of people engaged with online and social media platforms.
• Substantial Internet Penetration: Telecom Regulatory Authority of India (TRAI) reports internet penetration in India surpassing 880 million as of March 2023, highlighting the extensive reach and potential of digital media.
• Consultative Policy Formation: The Digital Advertisement Policy 2023 has been formulated after extensive discussions involving various stakeholders, ensuring a comprehensive and inclusive approach to its design.
• Enhancing Citizen Outreach: This policy serves as a roadmap for amplifying the Government of India's digital outreach efforts, aiming to enhance information dissemination to its citizens, aligning with the evolving digital landscape.

About Central Bureau of Communication:

• Central Bureau of Communication (CBC) is a unit of the Ministry of Information and Broadcasting.
• It has the mandate of providing 360 degrees communication solutions to Ministries, Departments, Public Sector Undertakings (PSUs), and autonomous bodies.
• It was set up in December 2017 by the integration of the erstwhile Directorate of Advertising and Visual Publicity (DAVP), Directorate of Field Publicity (DFP), and Song & Drama Division (S&DD).
• With 23 Regional Offices (ROs) and 148 Field Offices (FOs), CBC is engaged in the process of educating people, both rural and urban, about the Government’s policies and programmes to evoke their participation in developmental activities.
• As an advisory body to the government on media strategy, CBC aims to elevate the government's image as the key enabler of public empowerment, adapting policies to match the evolving media landscape.
• CBC comprises divisions such as the Advertising and Visual Communication Division, Folk Communication Division, and Field Communication Division, each employing different forms of communication—ranging from traditional media to live performances—to maximize outreach and understanding of government schemes among the populace.
• CBC orchestrates comprehensive and integrated communication campaigns that transcend singular advertising efforts, employing a diverse range of communication channels to disseminate information and engage with the public extensively.

Why is it in the News?

• The Reserve Bank of India's Monetary Policy Committee (MPC) is going to meet from October 4 to 6.
• During this meeting, it is expected that the MPC will not change the repo rate, which is currently at 6.5 percent.
• This will be the fourth time in a row that they keep it the same.
• The reason for this decision is that inflation, which is measured using the consumer price index (CPI), is staying high.
• Additionally, it's likely that the central bank will stick to its plan of reducing the amount of money in the economy, which is known as a 'withdrawal of accommodation' stance.
• This is done to control inflation and prevent it from getting worse.
• On the other hand, if they were to take an 'accommodative stance,' it would mean that the central bank is willing to increase the money supply in order to boost economic growth.

Why is RBI likely to keep things the same in its policy?

Domestic Challenges:

• Consumption Concerns: There are worries about people buying less due to high food prices.
• Monsoon Trouble: The monsoon season hasn't been consistent, which is affecting crops like kharif.
• Higher Interest Rates: Interest rates are up, which can impact borrowing and spending.
• Inflation is still high, at 6.8 percent. While it's expected to drop, there's some concern about the kharif crop, especially pulses, which could make prices go up.
• The RBI Governor has also pointed out that frequent food price increases can make it harder to control inflation.

External Challenges:

• Rising Oil Prices: Oil prices worldwide have gone up, averaging nearly $89 per barrel. This is a 12.6 percent increase since the last policy.
• Russia-Ukraine War: The conflict between Russia and Ukraine is causing problems in the supply chains for many goods.

Is there going to be a revision in the GDP growth prediction?

• According to experts, it's unlikely that the RBI will alter its GDP forecast in the upcoming monetary policy announcement.
• The basic factors supporting growth still look positive, but there's a significant question mark regarding how a poor monsoon might affect agricultural production.
• Additionally, there's anticipation of an ongoing economic slowdown in Europe and China, which could lead to reduced exports and potential challenges for rural demand due to this year's weak monsoon.

Will there be any announcements regarding liquidity measures?

• According to experts, it's unlikely that the RBI will introduce any specific liquidity measures at this time, as the current liquidity situation is already tight.
• Furthermore, the RBI is in the process of reversing the incremental cash reserve ratio (I-CRR), which was introduced in the August policy.
• I-CRR is an extra cash reserve that banks have to maintain on top of the standard cash reserve ratio (CRR), which is the portion of deposits that banks must keep with the RBI.
• The RBI declared the discontinuation of I-CRR on September 8.
• However, despite the gradual withdrawal of I-CRR, there has been a liquidity deficit in the system since mid-September due to quarterly tax outflows and GST payments.
• Additionally, interventions in the foreign exchange market aimed at supporting the rupee may have slightly absorbed some rupee liquidity.

What is the Monetary Policy Committee (MPC)?

• According to Section 45ZB of the revised RBI Act of 1934, the central government has the authority to establish a six-member Monetary Policy Committee (MPC).
• The MPC's main responsibility is to decide the policy interest rate necessary to achieve the inflation target. The first MPC was formed in September 2016.
• Members of MPC
• As per the amended RBI act, the MPC is composed of the following members:
• The RBI Governor, who serves as its ex officio chairperson.
• The Deputy Governor responsible for monetary policy.
• An officer from the Bank nominated by the Central Board.
• Three individuals appointed by the central government.

Functions of MPC:

• Setting Policy Interest Rates: The primary role of the MPC is to determine policy interest rates, specifically the repo rate.
• Inflation Targeting: The government has set a current inflation target, which is a Consumer Price Index (CPI) inflation goal of 4% with a tolerance range of +/- 2%.
• Economic Analysis and Forecasting: The MPC conducts comprehensive analysis and forecasting of various economic indicators, including inflation, GDP growth, employment, fiscal conditions, and global economic trends.
• Decision-Making: The MPC convenes at least four times a year to assess the direction of monetary policy.

Why is it in the News?

The Education Committee of the Parliament has just presented a report about how the National Education Policy (NEP) from 2020 is being put into action in higher education.

Assessment in the report:

• The report checks how well the National Education Policy (NEP) from 2020 is being used in higher education and what progress has been made.
• In India, there are currently 1043 universities.
• Most of them, around 70%, are run by state laws, while about 18% are managed by the Central Government.
• When it comes to students, 94% of them study at state or private institutions, and only 6% are in central institutions.
• The report says that more students are going to college now compared to a few years ago. This is measured using something called Gross Enrollment Ratio (GER), which has gone up from 24.1% in 2016-17 to 27.3% in 2020-21. It's also improved for ST and SC students during this time.
• GER is like a way to see how many students in the right age group (18-23 years) are in higher education compared to the total population.

Report's Status of Implementation:

• Things are going well with the implementation of NEP 2020, thanks to different initiatives like PM Schools for Rising India (PM SHRI), e-VIDHYA, and NIPUN Bharat. The goal is to change higher education to be more inclusive, flexible, and meet global standards.
• Jammu and Kashmir is leading the way by being one of the first places in India to start using NEP 2020 in all Higher Education Institutions starting from 2022.
• NEP 2020 wants students to become more creative and innovative. It encourages connections between colleges and industries and works on joint programs.
• Indian universities will get more freedom to set up campuses in other countries and welcome top 100 universities from around the world to work in India.
• NEP 2020 also allows students more flexibility with something called "Multi Entry and Multiple Exit (MEME)" options, which gives them more choices in their education.

Issues Related to NEP:

• Accessibility: Some students in economically disadvantaged areas can't easily access higher education because of money problems, where they live, and because they might feel like they don't belong due to stereotypes.
• Multiple Entry And Multiple Exit (MEME)System: Even though the MEME system seemed flexible, the report suggests it might not work as well in India as it does in Western countries.
• Language Barrier: Most higher education institutions use English to teach, but not many teach in local languages. This can be a problem for students who are more comfortable in their local language.
• Lack of Funding: India needs to spend more on education. Right now, it's only about 2.9% of the country's total income (GDP), but experts say it should be 6%. This means there's not enough funding for education.

Way Forward

• By 2030, the goal is to have at least one multi-purpose higher education institution in every district in India. And by 2035, they want 50% of students to be in higher education, including vocational training.
• They want to focus more on research and innovation to help India file more patents and improve its global ranking.
• To get more money for education, Higher Education Financing Agency (HEFA) should look for funds from sources other than the government, like private companies, foundations, and international banks.
• They plan to make better use of technology in education. Creating a National Educational Technology Forum (NETF) will help expand digital resources and make India a top place for knowledge.
• They also want to make it easier for students who study different subjects to get credit for their work. This will help them move between schools and colleges more smoothly.

National Education Policy (NEP) 2020:

• The National Education Policy, created in July 2020, shows what India's new education system will look like.
• A group led by Shri K. Kasturirangan made this policy.
• NEP 2020 has five important ideas: making education affordable, easy to access, high-quality, fair for everyone, and making sure everyone is responsible for learning.
• It's like a big plan to change both basic and higher education in India by 2040.
• This is the third big education plan since India became independent. The earlier ones were made in 1968 and 1986.
• The new policy focuses on things like studying different subjects, using technology, writing well, solving problems, thinking logically, and getting experience in different jobs.

Why it is in News?

• While India is currently the world's fastest-growing major economy, it is also grappling with a rapid increase in food-price inflation.
• The surge in food prices began to intensify notably in 2019 and has continued to rise in most subsequent years.
• In July of this year, annual inflation surpassed 11%, reaching its highest level in the past decade.
• One consequence of this sustained high food-price inflation is the possibility that a portion of the population may encounter difficulties in accessing food with sufficient nutritional value.

Key Findings of Concern:

• The 'State of Food Security and Nutrition in the World' report by the Food and Agriculture Organization (FAO) assesses the percentage of people in different countries who cannot afford a nutritious diet.
• Approximately 74% of the population is unable to afford a healthy diet.
• This likely results in decreased food consumption due to reduced purchasing power.
• Food prices in India have been on a consistent upward trend since 2019, with annual inflation exceeding 11% in July 2023, the highest rate in a decade.
• There has been a notable increase in the prevalence of anaemia, with over 50% of adult women estimated to be affected according to the latest National Family Health Survey conducted between 2019 and 2021.
• Critics argue that macroeconomic policies, including the Reserve Bank of India's focus on inflation control through measures like inflation targeting, are ineffective in addressing food inflation, which is primarily driven by supply-side factors.

Importance of Food Security:

• Enhanced Health and Nutrition: Food security plays a crucial role in improving the health and well-being of individuals by preventing malnutrition and its associated health issues, including stunted growth, cognitive impairment, and increased susceptibility to diseases.
• It's worth noting that malnutrition is responsible for the deaths of approximately 3.1 million children each year, accounting for nearly half of all child deaths under the age of 5.
• Economic and Social Stability: Food security contributes to the economic and social stability of individuals and nations by enabling increased productivity, income generation, and participation in trade.
• According to a World Bank study, the global cost of undernutrition, in terms of lost productivity and human capital, amounts to USD 3.5 trillion per year.
• Additionally, a United Nations report highlighted that food insecurity played a pivotal role in 58% of conflicts between 2017 and 2019.
• Poverty Alleviation: Food security is instrumental in reducing poverty as it enables people to afford and access nutritious food while also investing in other essential needs such as education and healthcare.
• These factors help break the cycle of poverty.
• National Security: Food security bolsters national security by ensuring a reliable food supply that is not vulnerable to external factors like global food prices or supply chain disruptions.
• Food insecurity can make nations susceptible to such factors, compromising their sovereignty.
• Sustainable Development: Food security aligns with sustainable development goals, particularly Goal 2: Zero Hunger.
• It also supports related goals such as poverty reduction, improved health, gender equality, and environmental sustainability, contributing to a holistic approach to sustainable development.

Causes of Food Insecurity:

• Impact of Russia-Ukraine Conflict: The Russia-Ukraine conflict has disrupted the global supply chain due to trade-related policies imposed by countries, exacerbating the global food crisis.
• Several nations have implemented food trade restrictions to bolster domestic supply and reduce prices.
• Rising Domestic Inflation: Many countries are grappling with domestic food inflation, which has intensified the issue of food insecurity.
• For instance, India has imposed bans on wheat and rice exports to support its domestic population.
• Climate Variability and Extremes: Climate change has significantly affected the availability and quality of critical resources like water, land, and biodiversity essential for food production.
• It has also led to shifts in the patterns and severity of pests, diseases, and natural disasters, resulting in reduced crop yields and livestock productivity.
• The Global Report on Food Crises highlights that weather and climate extremes were the primary drivers of acute food insecurity in 12 countries in 2021, impacting nearly 57 million people.
• Economic Slowdowns and Downturns: Economic slowdowns have diminished the income and job prospects of vulnerable populations, who typically allocate a substantial portion of their income to food purchases.
• These economic shocks have disrupted both the supply and demand for food, leading to increased food prices and reduced food quality.

Learning from the Green Revolution:

• India boasts a rich historical backdrop of the Green Revolution, a transformative period during the 1960s.
• The government initiated a supply-side approach, providing farmers with high-yield seeds, accessible credit, and guaranteed prices through procurement.
• This initiative achieved remarkable success, swiftly liberating India from dependence on food imports and fulfilling its ambition of self-sufficiency.
• However, certain strategic errors were made during this period.
• Excessive use of chemical fertilizers resulted in soil degradation.
• An overemphasis on procurement prices, rather than prioritizing productivity to enhance farm incomes, contributed to inflation.
• The policy primarily focused on cereals, neglecting pulses, a vital source of protein for the majority of Indians.

The Path Ahead: Suggested Actions

• Enhanced Agricultural Investment: Evaluate and optimize public expenditure on irrigation to improve its efficiency.
• Revitalize Research Institutes: Revamp India's network of public agricultural research institutes to rekindle their pivotal role, reminiscent of their contributions during the 1960s.
• Reinvigorate the Role of Local Village Representatives (Gram Sevak): Empower and elevate the role of the gram sevak in villages, making them instrumental in disseminating best agricultural practices.
• Boost Protein-Based Crop Production: Implement a comprehensive program to significantly increase protein production by incorporating various initiatives.
• Foster Cooperative Federalism: Encourage states to actively contribute to enhancing agricultural productivity rather than relying solely on food allocations from the central pool for their Public Distribution System.
• Ensure Permanent Access to a Balanced Diet: Prioritize measures consistent with ecological sustainability to ensure that all Indians have continuous access to a nutritious diet.
• Supply-Side Interventions: Implement interventions on the supply side to stabilize food prices by improving land yield.
• Focus on Cost Reduction: Concentrate on the specific objective of reducing food production costs.
• Multifaceted Approach: Extend irrigation coverage to 100% of the net sown area, eliminate land leasing restrictions, accelerate agricultural research efforts, and reinstate agricultural extension services.

Mains Question:

• Examine the key agricultural issues in India today, encompassing food security, sustainability, and economic stability. Propose a holistic approach that integrates government funding, research, inter-state collaboration, and supply-side interventions to pave the way for a resilient and prosperous future in Indian agriculture. (15M)

Why in the News?

The Commerce and Industry Ministry is in the final stages of formulating the proposed national e-commerce policy, and at this point, no additional draft policy will be released to solicit input from stakeholders.

Context:

• Electronic commerce (e-commerce) is emerging as a pivotal driver of India's economic growth and development.
• Estimates indicate that, with grocery and fashion/apparel leading the way, the Indian e-commerce sector is poised to reach a valuation of $99 billion by 2024, with projections soaring to $300 billion by 2030.
• Recognizing this immense potential, the government is diligently monitoring the evolving landscape of electronic business, calling for a regulatory framework to safeguard the interests of buyers, sellers, marketers, and distributors.
• In 2019, a draft National E-Commerce policy was drafted and made available to the public for scrutiny.
• In response to this draft policy, numerous foreign governments, including the United States, have submitted comments, highlighting concerns affecting U.S. businesses.
• In August 2023, the Department for Promotion of Industry and Internal Trade (DPIIT) conducted extensive discussions with representatives from e-commerce companies and domestic trade associations concerning the proposed policy.
• A government official noted that a consensus has been reached among the involved stakeholders regarding the proposed policy.

Key Highlights of the National E-Commerce Policy:

• On February 23, 2019, the Ministry of Commerce and Industry unveiled the draft National E-Commerce Policy (DPIIT 2019).
• Aim:
• The national e-commerce policy seeks to establish a regulatory framework that simplifies business operations within the sector.
• Boosting Exports:
• This policy recognizes the substantial export potential within India's e-commerce sector.
• Projections indicate that by 2030, India's e-commerce exports could range from 200 billion USD to 300 billion USD annually.
• Given the anticipated growth in global cross-border e-commerce exports, expected to reach 2 trillion USD by 2025, India aims to harness this opportunity.
• Regulatory Body and FDI:
• The possibility of creating a regulatory authority for the e-commerce sector is under consideration, though its implementation may require time.
• Local trade associations have been advocating for an empowered regulatory body to enforce e-commerce regulations and address violations.
• While 100% foreign direct investment (FDI) is
• permissible in the marketplace model, the inventory-based model does not allow FDI.
• Addressing Trader Concerns:
• Traders have voiced concerns regarding e-commerce rule violations, such as steep discounts and preferential treatment for specific sellers.
• The policy aims to clarify these concerns and enhance transparency in FDI regulations for e-commerce.
• Furthermore, the Consumer Protection (e-commerce) Rules 2020 and proposed amendments will align with the e-commerce policy to maintain consistency.
• Comprehensive Framework:
• The e-commerce policy will function as a comprehensive framework for the sector, ensuring harmony among various governing statutes.
• The sector is presently regulated by the FDI policy, the Consumer Protection Act of 2019, the Information Technology Act of 2000, and the Competition Act of 2002.
• The policy intends to streamline these regulations, creating an environment conducive to the e-commerce industry's growth.

Advantages Highlighted in the Draft E-Commerce Policy:

• Enhanced Information Provision: One notable strength of the draft e-commerce policy lies in its emphasis on comprehensive information provision.
• It mandates that firms furnish clear details about product specifications, images, return and exchange policies, payment methods, and grievance redressal procedures.
• This ensures consumers have access to transparent information, fostering a healthy e-commerce market.
• Clear Grievance Redressal Mechanisms: The policy advocates for the establishment of transparent grievance redressal mechanisms, including the appointment of nodal officers, specified timeframes, and defined processes.
• These measures benefit consumers by facilitating seamless pre- and post-purchase processes.
• Seller Transparency: The policy requires platforms to disclose seller information, including names, locations, and contact details.
• This transparency empowers buyers to engage with sellers beyond the confines of a platform if they choose to do so.
• Fair Data Use: Platforms are prohibited from exploiting the vast data at their disposal to gain an unfair advantage over sellers or exhibit preferential treatment among sellers
• This regulation plays a crucial role in safeguarding the welfare of sellers.

Criticism of the Draft E-Commerce Policy:

• Infringement on Other Ministries' Mandates: The proposed rules appear to encroach upon the mandates of other ministries.
• For instance, the 'fallback-liability' provision holds platforms responsible for any mis-spelling by third-party sellers, contradicting the Finance Ministry's FDI rules that limit platform inventory management.
• Additionally, it removes the immunity granted specifically to marketplaces under the IT Act.
• Redundancy in Regulatory Oversight: The Ministry of Corporate Affairs argues that rules addressing the abuse of competitive positions are unnecessary since the Competition Commission of India already oversees such matters.
• Restrictive Measures on Related Parties: The policy restricts related parties from engaging in commercial activities on platforms, with related parties defined as entities with common shareholders owning more than 5% or over 10% ownership.
• While well-intentioned, this clause may not align with regulatory objectives.

Mains Question:

• Examine the objectives of India's National E-commerce Policy about consumer protection and seller support. Analyze the criticisms and challenges posed by its potential impact on other ministries and restrictions on related parties. (15M)

Why in the News?

• India's move to impose import limitations on personal computers, laptops, and a variety of commodities has sparked a discussion about the trajectory of the nation's industrial policy.
• Detractors view these restrictions as reminiscent of a bygone era when the Indian economy was constrained by the license permit regime.

The Government's Directive Regarding Laptop Import Ban:

• On August 3rd, the Union Government introduced measures to restrict the import of laptops, tablets, all-in-one personal computers, ultra-small computers, and servers, effective immediately.
• Entities or businesses intending to import laptops and computers for sale within India will now require government permission or a license for their importation.
• This directive was issued by the Directorate General of Foreign Trade (DGFT).
• The restrictions have been enacted under HSN Code 8471, affecting seven categories of electronic devices.
• The Harmonized System of Nomenclature (HSN) code is an organizational system utilized for tax-related product identification.
• HSN Code 8471 is employed to categorize devices specifically designed for data processing functions.
• However, due to issues arising at ports where customs officials were detaining shipments of the specified electronic goods, the DGFT opted to suspend the enforcement of this measure until November 1st, 2023."

Concerns Regarding the Laptop Import Restrictions:

• These limitations have raised concerns about a potential regression of the Indian economy into the period characterized by the license permit system, during which discretionary and authoritarian bureaucratic control prevailed, sometimes accompanied by corruption.
• During that era, citizens encountered scarcities, substandard products, or attempts to circumvent government regulations.
• The manner in which the government introduced the import ban on laptops, subsequently revising the deadlines, has evoked familiar concerns about bureaucrats who seem to "act first and inquire later."
• Nonetheless, proponents of the policy contend that its implementation was long overdue.

How these Restrictions are Different from Regulations in the 1960s-70s?

• Shift in Circumstances
• Indian industrial policy of the past yielded moderate outcomes, However, the historical context has undergone a transformation.
• Factors such as energy availability, logistics, human capital, and global geopolitical dynamics are no longer as constricting for India as they once were.
• The expanded market size, particularly in certain sectors, grants India greater negotiating power than in the past.
• Enhancement of Government Capacity:
• The current imposition of import restrictions is distinct due to the enhancement of government capacity, setting it apart from the circumstances of the 1960s.
• Those earlier restrictions were significantly more extensive, governing the entire import and production landscape in a way that hindered domestic productive and allocative efficiencies.
• Altered Objective:
• Today's objective diverges from simply reducing import reliance; it aims to reshape the import structure to support India's journey towards self-reliance (Aatma Bharat).
• If the government can effectively communicate and uphold this distinction, the nation may avoid reliving the challenges posed by prior industrial policies."

Importance of Instituting an Industrial Policy in India:

• While India has witnessed the fruits of liberalization, the reality persists that the country struggled to cultivate a robust manufacturing foundation and experienced premature de-industrialization.
• Across the globe, no nation has achieved industrialization solely through deregulation. An industrial policy is pivotal for orchestrating a fundamental reconfiguration of the economy's structure.
• Strategically devised import restrictions can constitute an integral element of such a policy framework.
• Given the contemporary global landscape, a robust industrial policy is imperative. Various countries are already adopting this approach, and considering the prevailing geopolitics and security concerns, it's crucial for India to formulate a comprehensive industrial policy and place a heightened emphasis on manufacturing."

Suggestions for Developing a Strong Industrial Policy:

• Balancing Competition and Collaboration:
• Advocates of an industrial policy assert that India should prioritize the fundamental attributes that enhance competitiveness within an economy.
• Such a policy can engender favorable external effects, address coordination hurdles, and stimulate agglomeration advantages.
• Shifting Away from Subsidies and Safeguards:
• Despite increased state capacity, the dynamics of bureaucratic discretion must not be underestimated, particularly within a context where certain companies receive disproportionate state favoritism.
• Furthermore, Indian states should progressively transition from reliance on subsidies and moderate safeguards.
• Embracing Export-Oriented Strategies Over Import Substitution:
• A noteworthy feature of successful Chinese and East Asian industrial policies was their emphasis on export-driven development.
• India faces a dual challenge in this regard. Achieving export orientation necessitates an open global trade framework. Yet, global support for this system is waning.
• India's effectiveness in advocating for an open trade system could be compromised if it resorts to protectionist measures.
• Thus, the design of India's industrial policy should promote exports rather than replicate import substitution tactics.
• Minimizing Spectacle

•  
• For instance, the current emphasis on the Micron deal, wherein the government contributes 70% of the investment, warrants consideration.
• Simultaneously, it's crucial for the government to recognize that chip companies are relocating manufacturing to more expensive locales with fewer subsidies.

Moving forward, the government must undertake a meticulous assessment of the nation's unique conditions and capacities. Crafting an effective industrial policy for India involves ensuring that the advantages of laptops extend beyond a specific class.

Nonetheless, it's essential to maintain a perspective that prevents the discourse on industrial policy from being swayed by ostentatious displays, oversimplified theories, or deceptive historical parallels.