6 April 2024 : Indian Express Editorial Analysis

Indian Express Editorial Analysis


1. Waiting for summer

Topic: GS3 – Indian Economy –

This topic is relevant for both Prelims and Mains in the context of understanding the RBI’s monetary policy decisions, factors influencing them, and their implications for the Indian economy.


  • The Reserve Bank of India (RBI) maintained a status quo on its policy rates on April 5, 2024, reflecting the prevailing economic landscape characterized by stronger-than-expected growth and inflation above target.
  • This decision aligns with market expectations considering various indicators suggesting continued economic momentum, particularly in non-farm sectors.

Economic Momentum and Growth Prospects:

  • The economy displayed resilience with the second advance GDP estimate indicating growth at over 8 percent in the first three quarters, propelling fiscal growth to 7.6 percent.
  • High-frequency data such as the Composite Purchasing Managers’ Index (PMI) for March, standing at 61.8, underscores robust expansion.
  • Tax collections exceeding targets, especially in sectors like construction, manufacturing, and financial services, further bolster the growth narrative.
  • However, agricultural growth remained subdued at 0.7 percent in 2023-24.

Investment-Driven Growth and Consumption Concerns:

  • GDP growth has been primarily investment-driven, with private consumption growth lagging behind.
  • Despite private consumption being vital for balanced growth, it has trailed GDP growth, necessitating close monitoring.
  • CRISIL expects GDP growth to moderate to 6.8 percent in the current year, influenced by the transmission of RBI’s rate hikes and regulatory actions aimed at controlling unsecured lending, which may dampen credit growth.
  • Additionally, a lower fiscal deficit could limit fiscal stimulus to growth.

Inflation Dynamics and Outlook:

  • Inflation, particularly food inflation, remains a concern.
  • While overall inflation is projected to drop to 4.5 percent assuming normal monsoon and stable crude oil prices, food inflation has been persistent.
  • Factors such as the impact of El Niño and La Niña conditions on food prices are crucial considerations.
  • Core inflation, excluding food and fuel, remains relatively benign but requires vigilance.

Impact of Food Inflation on Consumption and Policy:

  • High food inflation disproportionately affects lower-income segments, constraining discretionary spending and potentially weakening consumption demand.
  • While government interventions such as free food grain programs mitigate some impact, a reduction in overall food inflation is crucial for broader relief.
  • Expectations of normal monsoons and lower food inflation could bolster rural consumption.

External Factors and Monetary Policy:

  • Global factors, including geopolitical uncertainties and trends in central bank policies, influence India’s monetary policy decisions.
  • While domestic considerations primarily guide RBI actions, interconnectedness implies that rate cuts by major central banks may influence emerging markets.
  • Coordination between fiscal and monetary policy, alongside improved macroeconomic conditions, may pave the way for rate cuts in India, although external risks such as poor monsoons and volatile crude oil prices remain pertinent.


  • The RBI’s decision to maintain the status quo reflects a nuanced understanding of domestic and global economic dynamics.
  • While robust growth and inflationary pressures indicate a resilient economy, challenges such as consumption concerns and persistent food inflation necessitate careful policy calibration.
  • With a conducive macroeconomic environment and improved policy coordination, the outlook suggests potential rate cuts, contingent upon managing external risks effectively.
What is Monetary Policy?



  • It is the macroeconomic policy laid down by the central bank, involving management of money supply and interest rate.
  • It is the demand side economic policy used to achieve macroeconomic objectives like inflation, consumption, growth and liquidity.
  • Monetary policy in India:
  • In India, the monetary policy of the RBI is aimed at managing the quantity of money in order to meet the requirements of different sectors of the economy and to increase the pace of economic growth.
  • For example, liquidity is crucial to stimulate growth for an economy. The RBI depends on monetary policy to maintain liquidity.
  • The RBI implements the monetary policy through open market operations (OMOs), bank rate policy, reserve system, credit control policy, moral persuasion, etc.
  • For example, the RBI introduces the money in the economy and cuts the interest rate by buying bonds through OMOs.
  • The use of any of these tools will result in adjustments in interest rate or the money supply in the economy.
  • Classification of Monetary Policy:
  • Monetary policy can be classified as expansionary (or accommodative) and contractionary (or tight) in nature.
  • Accommodative monetary policy is triggered to encourage more spending from consumers and businesses by increasing money supply and reducing interest rates.
  • When firms can easily borrow money, they have more funds to expand operations and hire more workers, resulting in a lower unemployment rate.
  • On the other hand, if the money supply is loosened over an extended period of time, there will be too much money chasing too few goods and services, resulting in inflation.
  • To avoid inflation, most central banks rotate between accommodating and tight monetary policy (decreasing the money supply and raising interest rates) to varied degrees in order to promote growth while keeping inflation under control.



PYQ: If the RBI decides to adopt an expansionist monetary policy, which of the following would it not do (2020)

1) Cut and optimize the Statutory Liquidity Ratio

2) Increase the Marginal Standing Facility Rate

3) Cut the Bank Rate and Repo Rate

Select the correct answer using the code given below:

(a) 1 and 2 only

(b) 2 only

(c) 1 and 3 only

(d) 1, 2 and 3

Ans: (b)

Practice Question:  Discuss the factors influencing the Reserve Bank of India’s (RBI) decision to maintain its policy rates unchanged. How do domestic economic indicators, including GDP growth and inflation, shape the central bank’s policy stance? (250 words/15 m)

2. Copyright vs AI

Topic: GS3 – Science & Technology –

This topic is relevant for both Prelims and Mains as this article discusses a recent high-profile lawsuit filed by The New York Times against OpenAI and Microsoft, highlighting contemporary issues surrounding AI and intellectual property rights.


  • Artificial Intelligence (AI) is revolutionizing various industries, prompting a reevaluation of the capabilities of sophisticated intelligence beyond human capacity.
  • AI’s ability to pass professional tests and perform precise surgical procedures raises questions about the exclusivity of human intelligence.
  • However, challenges in the AI revolution arise, notably in the domain of copyright law.

The New York Times Lawsuit:

  • In late December 2023, The New York Times (NYT) filed a high-profile lawsuit against OpenAI and Microsoft for copyright infringement.
  • The NYT alleges that the defendants’ generative artificial intelligence (GenAI) tools utilized large-language models (LLMs) built by copying millions of copyrighted NYT articles.
  • The lawsuit emphasizes the critical importance of giving creators exclusive rights over their works, arguing that OpenAI and Microsoft exploited NYT’s labor and investment without proper compensation.

Arguments Against Fair Use:

  • To counter arguments of “fair use,” often cited as a defense against copyright infringement, the NYT asserts that there was nothing transformative about using NYT content without payment to create products that substitute for the newspaper and divert audiences away from it.
  • The NYT contends that defendants’ GenAI models directly compete with and closely mimic the inputs used to train them, undermining the notion of fair use.

Legal Petitions and Responses::

  • The legal petitions filed by the involved parties demonstrate rigorous and well-crafted arguments, serving as exemplars of good legal drafting.
  • OpenAI responds to the allegations by accusing the NYT of paying someone to hack its products, alleging deceptive prompts and violations of OpenAI’s terms of use.
  • Microsoft compares the NYT lawsuit to historical challenges against technological innovations like the Video Cassette Recorder (VCR), arguing for technological innovation and consumer choice.

Industry Responses and Future Challenges:

  • While some news conglomerates have chosen to challenge the use of their work by AI, others have embraced partnerships with AI companies to strengthen journalism in the age of AI.
  • As The New York Times Co v Microsoft Corp progresses through the court system, it signals emerging challenges for copyright law in the era of AI dominance.
  • The legal nuances surrounding the use of AI-generated content, particularly in the context of fair use, will continue to shape the future of copyright law and creative industries.


  • The intersection of AI and copyright law presents complex legal challenges, as demonstrated by The New York Times lawsuit against OpenAI and Microsoft.
  • As AI increasingly influences how humans access, process, and pay for news and creative work, legal frameworks will need to adapt to ensure fair compensation for creators while fostering innovation and consumer choice in the digital age.
Advantages of Intellectual Property Rights


  • The main advantage of intellectual property rights (IPRs) is to encourage and protect the creation, distribution, and offering of new goods and services that are based on the development and use of inventions, trademarks, designs, creative works, and other intangible assets.
  • Economic growth: Giving statutory expression to the creators’ economic rights and fostering fair trade, intellectual property rights can support economic growth by fostering economic development.
  • IPRs can generate income not only from direct marketing but also by licencing them to third parties.
  • Fostering of culture: Copyright allows authors, performers, producers, and other creators to receive an economic reward for their works that enrich cultural heritage, enhance cultural diversity, and benefit society as a whole. These creative industries include publishing, music, and film.
  • Technical information dissemination: Any member of the public, including researchers, can use patent information even when a company, university, or research institution does not intend to use its own patented inventions.
  • Impetus to fair competition: By allowing consumers to make informed decisions about various products and services, the protection of IPRs such as distinctive signs aims to encourage and ensure fair competition as well as to protect consumers.
  • Research and development: IPRs promote R and D activities due to the financial benefits indirectly provided to the creators. These R and D facilitate two things:
  • It facilitates the innovations and production of new technology, like a new formula of drugs against any life-threatening disease.
  • This new technology/formula, after the patent period, helps a large population (for , through the development of generics). Thus, it serves the social purpose of IPRs.
  • “Open source” is dependent on IPR: In industries like software, open source mechanisms like General Public Licences (GPLs) are common.
  • With no contractual obligation to use a single vendor, its benefits include reduced startup costs, quicker project launches, quicker iterations, more adaptable software development processes, strong community-driven support, and simpler licence management.
  • It’s important to note that a typical GPL actually depends on IPRs since it is generally a copyright licence that is only valid as long as certain requirements are met.
  • Collateral used to secure financing:  IPRs, which are intangible assets, frequently aid small and medium enterprises (including start-ups) in their efforts to persuade outside parties to provide them with financing (such as investing equity or granting loans).
  • The financial industry, particularly knowledge-intensive SMEs, depends heavily on the valuation of intangible assets, such as patents.
  • Disadvantages of Intellectual Property Rights
  • Here are a few disadvantages to intellectual property rights:
  • Extra Charges for Creators: It might be a bit costly to obtain protection for the first time, especially if the product is complex and includes methods, designs, and processes.
  • Piracy: Sometimes it becomes difficult to stop someone from copying the inventory work, even after obtaining IP protection. It becomes disadvantageous for the original creator of the patent.
  • Decreasing Quality: As time goes on, the quality of intellectual property degrades along with the rights to it.
  • Worldwide Inequities: The laws governing intellectual property are sometimes different. Different IP laws in different nations can result in unequal access to innovations and technologies, which disproportionately affects and impedes the development of developing nations.
  • Costly nature of patented products: Due to high prices for patent registration, research and development, and evergreening of patents, the price of patented products like pharmaceuticals has skyrocketed. It harms the interests of the general public, as they rely on these drugs.


PYQ: With reference to the ‘National Intellectual Property Rights Policy’, consider the following statements: (UPSC Prelims 2017)

1) It reiterates India’s commitment to the Doha Development Agenda and the TRIPS Agreement.

2) Department of Industrial Policy and Promotion of the nodal agency for regulating intellectual property rights in India.

Which of the above statements is/are correct?

a) 1 only

b) 2 only

c) Both 1 and 2

d) Neither 1 nor 2

Answer: (c)

Practice Question:  Discuss the legal and ethical implications of Artificial Intelligence (AI) on copyright law, with reference to The New York Times lawsuit against OpenAI and Microsoft. Analyze the challenges posed by AI-generated content to traditional copyright frameworks and assess potential policy responses to ensure fair compensation for creators while fostering innovation and consumer choice in the digital age. (250 words/15 m)

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