17 July 2023 : The Hindu Editorial Notes PDF
The Hindu Editorial
17-July-2023
Daily Current Affairs For UPSC ,The Hindu Editorial Summary
1. India’s conglomerates are getting too big for comfort.
Topic: GS3 – Indian industry
Context:
- Indian big businesses like the Adani Group and Reliance Industries Limited continue to make acquisitions and secure financial support despite concerns about debt dependency.
- Reliance Industries Limited has announced the demerger of its financial services arm to establish a new entity, seen as an attempt to establish a dominant presence in the financial services industry.
Why in the news?
- This demerger strategy from big businesses is viewed as a repeat of the group’s approach in other sectors such as telecommunications, retail trade, media, and entertainment.
- Other business groups like the Tatas and the Aditya Birla empire are also performing well.
- However, this positive assessment of big businesses does not apply to all sectors in India.
- Small- and medium-scale firms, as well as informal enterprises, have struggled to recover from the losses inflicted by the COVID-19 pandemic.
- A former Reserve Bank of India Deputy Governor and his co-author have reported an increase in the concentration of assets in non-financial sectors among the top five business groups, while the share of the next five has declined.
- Although their claim that increased concentration contributes to inflation has been challenged, the evidence they present regarding significant concentration remains unchallenged.
Implications of rapid industrial concentration:
- Rapid industrial concentration poses dangers by stifling competition and using market power to manipulate costs and prices.
- It results in profit inflation, leading to extreme asset and income inequality.
- Concentration of economic power triggers efforts to influence democratic institutions and can dilute the role of civil society.
- Over time, it can lead to undue corporate influence over political processes and policy formulation, bordering on state capture.
- These tendencies are not resolved by market competition; they are inherent to the functioning of markets.
- Asset and income inequality, along with differential power among economic agents, favor the asset-rich and contribute to concentration and centralization.
- Recognizing these issues, it becomes necessary to regulate markets and physically prevent the growth of dominant businesses or break up excessively large conglomerates.
Narrowing of political distance between the state and big businesses:
- Democracies have historically aimed to maintain some distance between the government and private capital, including big businesses.
- Efforts to maintain this distance have been partially successful, leading to actions against monopoly and trustification.
- After Independence, India initially emphasized maintaining a distance between the state and private capital.
- However, over time, the gap between the state and big business has significantly narrowed.
- The current situation is characterized by the state promoting big business rather than regulating or curbing it.
- The decisions about which business groups to promote and to what extent are often arbitrary.
- Three trends have contributed to this narrowing of political distance between the state and big business.
- The first trend is the embrace of neoliberalism, which views the state’s role as facilitating the growth of private capital for overall economic progress.
- Neoliberalism argues that liberalization and increased competition will counter concentration, but the reverse has happened, leading to concentration and collusive behavior in sectors like telecommunications and civil aviation.
- The second trend is the belief that the state should support domestic big businesses to compete globally, leading to state intervention through policies, diplomacy, and public resources.
- State intervention often involves protecting and promoting specific sections of big business through subsidies and transfers.
Issues withclose relationship between political parties and businesses:
- The influence of money in politics has not been reduced, leading to a close relationship between political parties and big business.
- Political parties require resources from big business to manage elections and gain electoral support.
- Policies have been changed to legitimize corporate donations to political parties, including through the electoral bonds scheme.
- In the current situation, these tendencies have converged into a strategy where a few favored business groups are actively supported by the state under the guise of promoting national interest.
- Normally, such favoritism would lead to widespread resentment and dissent, including among powerful sections closer to the top who feel ignored.
- However, dissent and corrective measures have been suppressed by the state in the name of national interest, preventing widespread unrest.
- As a result, there is an alarming march towards extreme concentration of wealth and economic power in India.
2. States must coordinate to evolve a joint strategy to combat floods.
Topic: GS3 – Disaster management
Context:
- Recent devastating floods in North India have highlighted the relationship between climate change, urbanization, and infrastructure gaps in Indian cities.
- Heavy monsoon rains have led to landslides, landslips, and threats to life and property in hill states like Himachal Pradesh, Punjab, Haryana, and Delhi.
- Delhi, a city not typically associated with heavy rains, has experienced excessive rainfall, leading to flooding and bringing attention to the potential disasters that lie ahead.
Significance of inter-state cooperation in Flood management:
- Integrated Approach: Floods do not adhere to state boundaries and often affect multiple states simultaneously. Inter-state cooperation allows for a more integrated and coordinated approach to flood management. By collaborating and sharing resources, states can collectively address the challenges posed by floods, including disaster response, mitigation, and preparedness.
- Efficient Resource Allocation: Flood management requires substantial resources, including personnel, equipment, and infrastructure. Through inter-state cooperation, resources can be allocated and utilized more efficiently. States can pool their resources, expertise, and funds to enhance flood forecasting, early warning systems, rescue operations, relief efforts, and infrastructure development.
- Information Sharing and Collaboration: Flood management heavily relies on accurate and timely information about rainfall, river levels, and hydrological data. Inter-state cooperation enables better sharing of information and data between states, allowing for improved flood forecasting, modeling, and risk assessment. Collaborative efforts can also include joint research and knowledge sharing on flood management strategies, best practices, and technological advancements.
- Transboundary Rivers and Watersheds: Many rivers and watersheds span across multiple states, making cooperation essential for effective flood management. States sharing these water bodies must work together to regulate water flow, manage reservoirs, coordinate dam operations, and implement measures to control flooding. Joint management approaches ensure that actions taken by one state do not adversely impact downstream areas.
- Enhanced Disaster Response: During severe floods, rapid and coordinated response is crucial to saving lives and minimizing damage. Inter-state cooperation allows for seamless coordination among various agencies, such as disaster management authorities, emergency services, and relief organizations. Joint training exercises, mutual aid agreements, and sharing of resources enable a more effective and timely response to flood emergencies.
3. India’s relationship with France is unique and multidimensional.
Topic: GS2 – International relations.
Context:
- Prime Minister Narendra Modi’s visit to France focused on celebrating 25 years of the India-France strategic partnership.
- The visit included meetings with French President Emmanuel Macron, agreements, and defense deals.
- The strategic road map for the next 25 years, called “Horizon 2047,” was a key agreement, covering areas such as defense, space, nuclear energy, climate change, education, and people-to-people ties.
- Another road map was released to enhance cooperation in the Indo-Pacific region, including military and naval exchanges and a trilateral development fund.
Importance India – France relations:
- Strategic Partnership: The strategic partnership between India and France strengthens bilateral ties in various domains, including defense, security, space cooperation, counter-terrorism, and intelligence sharing. It contributes to regional stability and enhances the security interests of both nations.
- Economic Cooperation: India and France have extensive economic cooperation, with bilateral trade and investment growing steadily. France is among India’s major trading partners in Europe. Collaborations in sectors such as aerospace, defense, renewable energy, smart cities, and technology create avenues for economic growth and innovation.
- Defense and Security Cooperation: Defense collaboration plays a crucial role in India-France relations. The countries engage in joint military exercises, defense equipment procurement, technology transfers, and defense industry partnerships. France’s supply of Rafale fighter jets to India and joint naval exercises reinforce defense ties and capability-building efforts.
- Science, Technology, and Space: India and France cooperate in scientific research, space exploration, and technology development. Collaborative projects in areas like space research, satellite technology, climate change studies, and nuclear energy promote scientific advancements and mutual benefits.
- Climate Change and Sustainable Development: Both countries actively cooperate on climate change mitigation, clean energy, and sustainable development initiatives. The Paris Agreement on climate change, negotiated under French leadership, further strengthens their collaboration in addressing global environmental challenges.
- Cultural and Academic Exchanges: Cultural and academic exchanges foster people-to-people connections and mutual understanding. The Alliance Française network in India promotes French language learning, cultural activities, and artistic exchanges. Educational collaborations and student exchanges contribute to academic growth and cultural diversity.
- Global Diplomacy and Multilateral Forums: India and France work closely in multilateral forums such as the United Nations, G20, and International Solar Alliance. Their shared values of democracy, human rights, and multilateralism enable joint efforts to address global challenges, promote peace, and advocate for a rules-based international order.
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