GS3 Weekly

(19th 24th Jan 2015)

[The Undercover Group]

General Studies 3
Topic: Conservation, environmental pollution and degradation, environmental impact
assessment; Disaster & Disaster Management
Q. Modern India has a lot to learn from the traditional water management from the past.
Explain in what ways this can be done with special focus on water harvesting and disaster
management. (200 Words)
Business Standard
Reference
Ans: In ancient times Indian are known for having various water conservation and management
methods. These methods are so convenient that these are suited according to need of any kind
of ecosystem.
Various water harvesting methods that can be used are:
1)Tanks: We can have tanks for an area or in each house which can collect rainwater and which
can be used for several purposes.It can also be used to collect water when there is a situation of
flood.So will help in mitigating flood impact.
2)Johads:It is small earthen dams to collect rainwater and can be used to recharge groundwater.
3)Step wells:These are also knows water temple.Step wells can be used to collect rainwater and
it can be used for various purposes during dry seasons.So drought like situation can be mitigated
this way.
4)Kunds: another very efficient method to collect rainwater, which is built underground with
cement is used for drinking purposes.
5)kuls: It is a channel in the precipitous mountainous region where rainwater can be guided to
flow in this channel and can be used for irrigation purposes in downhill areas. It will help in
mitigating flood situation also.
Modern water related problem can be solved by traditional methods. These techniques are very
simple to use. They just require participation from communities. So govt can learn these
approaches and MNREGA scheme can be used to involve people to build traditional water
reservoirs.

Topic: Indian Economy and issues relating to planning, mobilization of resources, growth,
development and employment.
Q. The finance minister of India called GST as the biggest tax reform measure since
independence. Analyse the benefits that can incur to the Indian economy with its introduction.
(200 Words)
Business Standard Reference
The Hindu
Ans: Goods and services tax (GST) is an indirect tax which is based on the principle of VAT which
aims to replace all the indirect taxes on goods and services like state tax, entertainment tax etc.
The producers then have to pay tax according to its output but the tax on input will be
reimbursed to them.
The benefits that GST can have on our economy are:
a) Tax Reforms: It will broaden the tax bases along with increased compliance tax evasion will
be difficult in GST regime which allows cross checking. It eliminates cascading burden of multiple
taxation.
b) GDP Improvement: This will increase tax to GDP ratio of the government which dipped to as
low as 10 percent in the last fiscal year. It will raise more revenue for the government and
reduced fiscal deficit, more investment in social sector initiatives.
c) Uniformity: It will integrate indirect taxation system across the states and facilitate common
market across states. It will also do away with entry tax thereby giving boost to trade between
the states.
d) Transparency: GST is expected to build a transparent and corruption free tax administration.
It will give boost to entrepreneurship by reducing confusion regarding taxes enthuse the private
sector leading to more investment.
d) Push for Make in India: It will boost the initiative. Along with this it will also give boost to
exports. This will also lead to creation more employment opportunities.
e) Inflation Control: Further GST is also expected to bring down inflation in the economy as the
prices of the goods and services will be reduced because of a uniform tax rate.
f) Tax Terrorism Removal: Equitable division of tax burden between manufacturing and services
without giving any advantage to any sector. This will increase in efficiency in the respective
sectors ultimately benefiting the economy.

g) Quality Improvement: It will promote specialization because total tax liability remains same
irrespective of number of production-distribution stages. It will encourage firms to purchase
inputs from the firms who have paid their taxes in order to reduce their tax liability.
All these benefits of GST make it a more desirable reform needed by the country in immediate
future. Addressing the concerns and demands of states on merit basis will be an important
breakthrough in its success.
Topic: Indian Economy and issues relating to planning, mobilization of resources, growth,
development and employment
9) Reforms, economic growth, progress all are empty words if they do not translate into
jobs. Write a note on initiatives taken by the government to improve employment
opportunities in the country. (200 Words)
Business Standard
Ans: Recently government has taken many initiatives with the intent of creating more jobs and
meaningful utilization of the vast workforce available in India. Some of the major initiatives are:
1. Make in India - A flagship initiative to boost the manufacturing sector so as to create
ample job opportunities for youth.
2. Apprentice protsahan yojna - to provide assistance and guidance to industries to provide
training to new apprentices and they can later be absorbed easily in the industries.
3. Ustaad for encouraging traditional skills like Zardoshi, Fulkari, Embroidary and providing
a market to this art crafts.
4. Nai Manzil for skilling madressa pass-outs to join main-stream.
5. Skill Development programs Deen Dayal Upadhyay Antyodaya Yojana to develop 10 lakh
skilled youth in next 3 years
6. National Manufacturing Policy and Information Technology policy also envisages creation of
millions of jobs in these sectors.
The urgent need is to create more jobs for youth which necessitates skill development. With the
favourable condition of 3D Demographic dividend, Democracy and Demand, India cannot
afford to lose this golden opportunity in hand.

Topic: : Indian Economy and issues relating to planning, mobilization of resources, growth,
development and employment
Q. In what ways higher levels of economic inequality hinders economic growth and social
mobility in the long run ? Discuss this statement in the light of growing inequality in India. Make
a case for re-introduction of inheritance tax in India. (200 Words)
The Times of India
Business Standard
Ans: Inequality in income leads to demand side problems for an economy since people having
less disposable income do not generate demands for commodities other than the bare essential.
In Indian agriculture, the weak economic position of marginal and small farmers reduces the
economies of scale in farming, they are unable to use new technologies and thus leading to
lower output. We have seen how the land reforms, debt waiver schemes, low interest credit to
farmers have majorly helped the economical stronger farmers.
The wealthy increase their monopoly. Bigger companies can increase their market share and
small/ medium scale industries bear the brunt of high competition from them.
The deprivation of opportunities forces the marginalized to work in low paying jobs. Skill
development is sidelined which further reduces the efficiency.
The state has to increase its spending in Social Security Schemes to cater to the needs of
increasing number of lower income groups, which increases the fiscal deficit. Adding to the
problem is the high rate of tax evasion by corporates and individuals.
The social status of women, dalits etc is further reduced in case of lower income groups. The
bargaining power of people with economic power is very high. They are able to influence policy
decisions of the government more than those with lower income. The rise in income inequality
increases the level of poverty thereby starting a vicious cycle of illiteracy, high population, and
unemployment and so on. High crime rate is also attributed to the frustration that comes in
people due to accumulation of wealth in a few hands.
Money makes money
In recent times, economists have voiced for reintroduction of Inheritance Tax for lowering of
income inequality. According to some, the biggest source of economic inequality today is
inherited wealth. It discourages rentier income and encourages professionalism and enterprise.
It can help the govt to shore up tax revenues.

Topic: Indigenization of technology and developing new technology.

Q. DRDO has not lived upto its expectations in achieving indigenisation of defence equipment.
Critically examine the factors responsible for its sub-optimal performance and suggest measures
to improve the same. (200 Words)
Business Line
PIB
Ans: DRDO is responsible for the development of technology for use by the Indias defence
forces. With a network of 52 laboratories, which are engaged in developing defence
technologies covering various fields, like aeronautics, armaments, electronics, land combat
engineering, life sciences, materials, missiles, and naval systems, DRDO is India's largest and
most diverse research organisation.
Recently, Projects most criticized were Tejas, NAG, but are much depended on industrial cooperation also, which is not developed in India as per requirements. Without the support of
vibrant technological base it is difficult for any defence organization to complete such projects
on its own.
DRDO is also in need of structural review and internal audit. There is also a criticism that within
the organization the youngsters are not allowed to move up in the hierarchy. Projects runoffs
are cause due to such lethargy.
Indias defence procurement policy is also responsible to dysfunctional projects. Scientist in
DRDO need Official approval for buying or exploring many research related equipments and
tools from abroad or private sectors. Such Red Tapes are gone against this marvel institution.
It is marvel institution because during sanctions, India has nearly achieved Triad in Nuclear
Weapons delivery systems, an indigenous achievement.
Successive governments have not been keen to address the problems in internal functioning of
DRDO. There has not been discussion on floor of house as well as in Media importance of
healthy functioning of DRDO.
Revamp of DRDO important recommendations:
i) creation of Defence Technology Commission (DTC)
ii) creation of a Commercial Arm of DRDO
iii) creation of technology domain based clusters
iv) Appointment of a dedicated Chief Controller for Human Resources (HR).

Topic: Effects of liberalization on the economy, changes in industrial policy and their effects on
industrial growth
Q. Explain the rationale behind imposing restrictions on Indian pharmaceutical companies in
charging a free market price. What are the mechanisms used by the government and add a note
on recent controversy regarding drug pricing. (200 Words)
The Indian Express
Ans: Governments have to strike a balance between the conflicting interests of the industry and
consumers to ensure affordable medicine without dampening innovation and competitiveness
in the pharmaceutical industry. Following a Supreme Court order to regulate drug prices, the
Pranab Sen task force was constituted on the basis of whose recommendations the government
set up NPPA under the Essential Commodities Act.
Rationale
It is cleanly summed up in the motto of the NPPA- "Affordable medicine for all"
The availability of drugs at affordable prices is essential for the health and productivity of
Indians. Low purchasing power of a large population, high mortality and poor health scenario
further prompts the government to intervene.
Mechanism
NPPA sets a ceiling price of 348 essential medicines determined essential by averaging the MRP
of all products with >1% market share.
Controversy
NPPA tried to set price ceilings of 100 or so non essential drugs citing its mandate to control
prices of non-essential drugs during shortages or emergency. This caused several complaints
and litigations from the
pharma companies. India was put under a watch-list of regimes with market-unfriendly IPR and
price control bodies.
This hurts our image as a fair market, as well as the upcoming BIT with the USA. The government
revoked NPPA's authority to control prices for non essential drugs although efforts continue to
bring more drugs into the essentials list. Prices of certain drugs shot up exponentially causing
distress to several affected citizens.

Topic: Issues related to direct and indirect farm subsidies and minimum support prices; Public
Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and
food security;
Q. FCI is a lynch pin in the food security program of India, yet failure of successive governments
to reform the organization has resulted in huge losses to the exchequer. Highlight the
deficiencies in the running of Food Corporation of India and suggest measures to revamp it.
(200 Words)
Business Standard
Ans: Food Corporation of India, a nodal agency for procurement of food grain and its
distribution through public distribution, has not performed to it's expectations.
Deficiencies
-Regional Disparity-FCI storage canters have been concentrated only in green revolution
zone.Large part of the eastern India is devoid of FCI storage cneters and weakens the forward
and backward linkages
-Lack of Infrastructure-FCI procures more than what it can store.Extra food grain rot in the open
because of lack of storage capacities.
-Lack of Monitoring mechanisms-Inefficeint and ineffective monitoring mechanisms have
encouraged corruption,pilferage, inefficiency to creep into the administration
-Functional Autonomy-Over centralization curtails the autonomy of FCI and reduces it's
efficiency
Measures
-Decentralization in East- Expanding the network of FCI in remote areas of the east
-Institutional reforms-Coupling FCI storage centers with food processing centers, better
transport facilities can help it reach big and small farmers alike
-Capacity building-Training it's professionals, corporatizing the FCI management can bring in
more efficiency
-Storage only to a predetermined level beyond that food grains should be released in the
market thereby helping in taming food inflation

Topic: Conservation, environmental pollution and degradation, environmental impact

assessment
Q. Though the tiger census has brought the good news of increase in the number of tigers by
thirty percent, the survey methodology has drawn criticism from some quarters. Discuss. Give
your suggestions to further improve tiger conservation efforts in the country. (200 Words)
The Indian Express

Ans: The recent Tiger census reports cites nearly 30 percent increase in Tiger population which
is a welcome change from the past trends and a much awaited positive development.
However the methodology employed for the census is a point of discussion. The government
has used the "refined methodology of double-sampling using camera traps" of 1938 for the big
cat population estimation.
But this is not the best available methodology for this task and superior alternatives based on
occupancy modelling approaches have evolved that are more apt in present context and more
cost effective.
The present method faces criticism on:
a) "Double sampling approach" used by NTCA: In this method, two sets of data are collected
from photographing tigers through cameras and counting paw-marks or droppings. It is now
considered obsolete.
b) Statistical extrapolation: This method is weak and may yield flawed results. And given the
vast geography of the area, the method may not yield refined results.
c) Silence on Area: Tigers now occupy only half of the area, than originally occupied but the
report is silent on this aspect.
Some of the ways suggested for Tiger conservation are:
a) Regulation: Strict regulation of Indias Tiger tourism. Tiger corridors must be designated as
eco-sensitive areas.
b) Measures for Poaching and Trade: Making the punishment fit the crime and ramp antipoaching measures will help immensely. Maintain and enforce laws banning tiger products.
c) Habitat and Corridors: Protecting tiger habitats like parks and establish new protected areas
for tigers. Create corridors that connect forests and allow tigers to roam to find adequate prey
d) Check Inbreeding: Corridor creation and strictly management of buffer zones will increase
mates for breeding and gene pool to raise population.
e) Address Legal Loopholes: Address the environmental laws that bypass scrutiny and destroy
forests for commercial activities.
f) Human Animal Conflict: Reduce tiger-human conflict by educating people in the vicinity of
Tiger reserves .Joint forest management involving both the state forest departments and local
communities will increase their will and community progress.

g) Research and Awareness: Develop critical tiger wildlife research and monitoring techniques
and promote research. Cooperation with NGOs and civil society to raise awareness in this regard
is a must.
With strong cooperation and sustained efforts from the Centre and state governments, the nongovernmental sector and people should make it is possible to raise and conserve the big wild
cat, Tiger, our National Animal.

Topic: Indian Economy and issues relating to planning, mobilization of resources, growth,
development and employment.
Q. Rather than increasing tax rates, the government should initiate comprehensive tax reforms
and rationalization of subsidies and government expenditure to curb fiscal deficit. Explain the
statement along with the measures being taken by government in that direction. (200 Words)

http://www.business-standard.com/article/economy-policy/budget-may-announce-fuelsubsidy-reforms-115012300033_1.html
Ans: Economic utilization of available resources can be visualized only when the Govt. spending
is rational and the income is augmentative, as suggested by Kelkar committee on fiscal
consolidation. From that perception, the following initiatives have been by the Govt:
Expenditure:
1. Pahal Scheme Target based subsidies is essential to plug the loopholes in delivery
mechanism. This is also an indirect way of financial inclusion by which consumers are pumped
into the financial system through their bank accounts.
2. Liberation of diesel pricing and decision to do away with the supply of subsidized kerosene
minimizes the enormous subsidy burden which was hitherto held by the Govt.
3. PSU Disinvestments Freed the locked-in capital which had been a serious setback, for there
were shortage of funds to bridge the wider current account deficit, especially when the target
being 4.1%.
4. Tax holiday for power projects Addresses the burgeoning energy demand and encourages
the growth in power sector to move towards clean energy.
Income:
1. GST Bill To provide a simple and uniform taxation arrangement in which all the indirect
taxes will come under the single umbrella of GST

2. Increase in FDI cap Though there were constraints in implementing the Tarapore
Committees recommendations to adopt full convertibility, the Govt. seeks to bring in more
capital by opening up FDI in various sectors. Ex: Insurance bill, coal mining privatization,
Defense, etc.
3. Financial inclusion Tax evasion and avoidance can be considerably dealt with if a proper
financial inclusion is in place. Pradhan Mantri Jan Dhan Yojana has recently found its place in
Guinness book of world records for being the largest financial services scheme ever.
Topic: Conservation, environmental pollution and degradation
Q. Despite conservation efforts by the state the number of South African rhinos killed by
poachers has increased in the last decade. What efforts have been initiated in this regard and
how can the poaching menace tackled to achieve a positive conservation future? (200 Words)

http://www.thehindu.com/news/international/s-africa-record-number-of-rhinos-killed-in2014/article6812389.ece
Ans: The South African Rhino is facing existence problem as its horn is the most prized object
that people demand. The number of poaching in South African for Rhino is irrevocably increased
for horn which is a status symbol in Thailand and Vietnam, treated as symbol of luxury, and the
myth associated with it being a medicine. Since the demand is surging many are stockpiling it for
future returns.
The conservation projects taken up by the people and the government in this regard are:
a) Legislative Measures: The South African Department Environmental Affairs has made several
legislative changes in response to the threats to rhinos. From 2008, a National Moratorium was
placed on rhino horn sales to try and prevent domestic sales of rhino horn from entering the
illegal international market.
b) Regulation: Stricter regulations on marking of rhino horn and trophy hunting of white rhinos
were introduced in 2009 to try and clamp down on leakage of rhino horn from Africa.
c) DNA Index RhoDIS: Rhino DNA Indexing System in Kruger Park is being done so that Poachers
can be prosecuted on based on evidence. The use of Camera and RFID detectors for tracking
Rhinos is used.
d) The WWF:SA has launched a national program to strengthen conservation efforts by: Building
and protecting Rhino, developing buffers in local communities as first line of defense, tightening
proactive law to break the illegal trade and market study to check them.

e) Tourism: Promotion of wildlife based tourism to provide additional funding for conservational
efforts and to generating mutual beneficial incentives for the co-existence of man and animal.
Poaching can be possibly tackled by:
a) Safe Dehorning: By cutting the Rhino horn for which they are hunted with checking the
impact on the behavior and mating process is debatable die to the ethical aspect which does not
permit this.
b) Poisoning Horn: Making the Rhino horn trade will make it unpalatable for human
consumption which is the main cause for poaching.
c) Selling Natural horns: Selling off horns of Rhinos dead due to natural causes legally can fetch
the government money to put for Rhino conservation. The existing stock legalization is also
debated.
d) Awareness: Increased funding, educating people and harsher prison sentence can bring
results for Rhino conservation.
Thus the initiatives taken by the South African government and other NGOs are tremendous
but the key message here lies with the individuals to stop buying rhino horn product.
Reference Links:http://www.expressoshow.com/articles/10-Realistic-Ways-To-Save-TheRhino?articleID=4090

Topic: Issues related to direct and indirect farm subsidies and minimum support prices; Public
Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and
food security;
Q. According to the latest NSSO survey data, about 52% of the agricultural households are in
debt, which has increased over the past decade. What are the major reasons for the high
indebtedness of the Indian Farmers? What initiatives are required to be taken in order to
improve the situation at ground level? (200 Words)

http://www.downtoearth.org.in/content/abyss
http://www.frontline.in/columns/C_P_Chandrasekhar/revisiting-ruralindebtedness/article6756887.ece
Ans: Inspite of the involvement of 58% of population in agriculture, its contribution to the
economy is meagre resulting in prevailing poverty condition in the country, especially among
the farmers and also slow growth conditions.

Reason for high indebtedness of the farmers:

1. Problems with agriculture
i) Highly affected by the vagaries of nature
ii) Low agricultural productivity due to inadequate institutional and infrastructural requirements
like inadequate irrigation, power supply, small land holdings, inadequate access to good quality
seeds, fertilizers, technology etc.
Initiatives requiredProviding required institutional and infrastructural requirements to the farmers by involvement
of modern technology and insurance for unforeseen calamities
2. Problems with financial institutions
i) Disproportionate rise in the ratio of capital formation in agriculture compared to the ratio of
agricultural credit to agricultural GDP indicates that a sizable part of the additional bank
credit may be going to the better-off farmers than the needy ones.
ii) Banks may not be willing to give loans to the poor farmers due to small holdings making them
indebted perennially, thus diverting the credit under the head of indirect finance to agriculture
just to meet the priority sector lending target
Initiatives requiredRevisiting the priority sector lending by diverting the credit flow to the needy farmers.
3. Problems with Government
i) Benefits of high prices of farm commodities are not reaching the growers in adequate
measure because to the lack of marketing reforms
ii) There are several flaws in the implementation of the government's agricultural development
and social welfare programmes like significant errors of inclusion and exclusion, providing
benefits to those who are not eligible and bypassing some who should be benefited
iii) Intervention of Government to waive farm debt results in restriction of credit flow to
agriculture by the banks
Initiatives requiredIncreasing the efficiency and eliminating the loopholes of agricultural welfare programmes by
introducing required marketing reforms
4. Access to financial institutions
i) Majority of rural households obtained credit from non-institutional sources as it is difficult to
get institutional credit due to complex procedures and documentation.
ii) Also there is inadequate awareness and knowledge of farmers about the schemes
Initiatives requiredIntroducing attractive schemes and increasing awareness of farmers to restrict them from noninstitutional lending

Thus, a coordinated effort by the Government and financial institutions can help improving the
condition of farmers and elevating agriculture as a forerunner contributor to the economy

Topic: Food processing and related industries in India- scope and significance, location,
upstream and downstream requirements, supply chain management.
Q. Market reform, investment subsidies, and better overall public service provision and good
governance are the key to tap the huge potential of the Food processing industry in India. In
light of statement discuss the problems faced by the industry. Also suggest ways to address
them. (200 Words)

http://www.epw.in/system/files/pdf/2014_49/52/The_New_and_Changing_Roles_o
Ans: India has a huge potential with regard to food processing industries because of its huge
raw material base, geographical advantage and large market. Its role in curbing inflation and
along with improving efficiency of the agricultural sector among others is immense. However
the industry is dealing with many problems and not been able to tap its true potential.
a) Market Problems: Poor supply chain management, middleman dominated linkages, small
sized industries problems are compounded by loopholes in laws such APMC act.
Solving basic Infrastructural problems of warehousing and stocking facilities, sorting and grading
by including private sector in storage area is must for growth.
b) Subsidies: Back ended subsidies paid only after completion of whole project discourages
involvement of low budget entrepreneurs. To avail benefits of MSME's tax benefits,
entrepreneurs keep plant size small thus R&Ds is hampered.
Proper Investment subsidies, tax reforms to reduce input costs and reducing the complexity in
the industry will encourage growth and investment.
c) Services: Government starts many schemes which are overlapping, vague and there is laxity in
implementation. Adoption of good manufacturing practices to qualify international standards of
CODEX, HACPP etc. Complete absence of vertical integration thus rising cost makes it
uncompetitive in international market.
Improved use of technology along with trained manpower, skill development, raising efficiency
of TAC and PRI will raise the service standards.

d) Governance and Coordination: Poor center state cooperation and agriculture being state
subject harmony is must to its success. Multiple overlapping policies and institutions are unable
to coordinate among themselves besides no accountability and transparency in functioning.
Policy on contract farming pan India, organized food retail in major scale with uniform policy
guidelines regarding all sector will raise governance standards.
Efforts for improvement have been envisioned such as national mission on food processing in
12th FYP, recent Make in India for food processing needs to be implemented on priority basis.
Lastly economies of scale need to be improved to make the industry more competitive in the
market.
Links- Mrunal.org:http://mrunal.org/2013/08/food-processing-introduction-scope-significanceawesomeness-hardly-obstacles-truckload-of-for-gs-mains.html