TOPIC: General Studies 2
- Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests
- Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.
BREXIT – Britain’s Exit from EU
The hover around Brexit referendum has come to an end with Britain voting to ‘leave’ EU.
In the article below, we shall cover the following:
Why Britain went for referendum? What Brexit means for Britain? for European Union? for rest of the world? More importantly, what it means for India?
Finding the roots of Brexit Referendum
- Many believed that EU threatens British Sovereignty.
- In 2008 financial crisis, EU central bank failed to respond effectively leading to recession – this increased worry among wealthy countries like UK that they might have to help bailout the less wealthy countries.
- Some Brits didn’t like that many foreigners (from other EU countries) were moving to Britain after EU was formed. During 2008 crisis, people from those countries who couldn’t find jobs at home, went to find in wealthier countries like UK. This put an extra burden on existing resources of UK- Immigration issue.
- Burdensome regulations of EU – It is argued that EU regulations cost the British economy 600 million euros every week.
- On security issues, Brexiteers think that they should have control over its borders in era of international terrorism at its peak.
- UK could keep the money it currently sends to the EU as a part of contribution to EU budget.
- Britain would be free to discuss bilateral trade pacts with other countries.
The possible outcome of ‘leave’ vote
- With 52% of British national voting to ‘leave’ EU, concerns and uncertainties raised across the world about the possible outcomes.
- Immediate reactions can be seen in markets which swiftly reacted. British Pound lost 9% of its value and reached its 30 Year low – reflects market worries about more severe consequences in the months ahead. And it is expected to fall by around 20% in future.
Consequences – For Britain
- In the short run, uncertainly about Britain’s future relationship with the EU, its largest trading partner, could push the UK into a recession.
- Falling value of currency has great implications on its imports and exports, it may increase no. of tourists, students etc (In the long time, the same could be reversed if new visa norms and immigration rules are put in place).
- Britain products could lose its easy entry into other European markets (currently about 45% of UKs trade is with EU)
- IMF forecasts UKs economy to be 5% smaller by 2019.
- It will become tougher for people to move across the borders. (Currently about 1.2 million Brits living in EU countries).
- It may trigger job crisis in UK (At present about 3 million jobs are tied to EU).
- Brexit could encourage disintegration of United Kingdom.
- UK is made up of 4 countries – England, Wales, Scotland and Northern Ireland.
- Scotland supported ‘Remain’ on Brexit referrundum – Scottish first minister threatens to block the legislation on Brexit.
- 44% Scottish people voted to make Scotland an Independent country in 2014. And now they are considering to revisit the issue of Independence.
Consequences – For EU
Britain’s departure could have ripple effects throughout the Europe too
- This might be the first of many political expressions of discontent among other EU countries, potentially causing the disintegration of EU.
- People from other EU countries may find it difficult to access UK’s jobs. Affects students who wish to pursue their studies in esteemed institutions of UK.
- There may be a large scale dislocation of people which may cause chaos.
Consequences – For the world
- EU made trade with European countries much easier for the world, and it also made it easier to negotiate with Europe for geopolitical help. Now Britain may not be a part of such negotiations and discussions.
- Its impact on Asian countries is less likely because exports to the UK is less than approximately 2% for most economies as a percentage of GDP, except India and Japan which trade more with UK.
- UK could have a more rational immigration system outside the EU, since Immigration was one of the most important issue (an emotional one too) – Which affects foreign nationals visiting UK (students, employees, tourists, visitors etc).
Effects on India
Some facts regarding India – UK
- Currently about 800 Indian owned companies are operating in UK (more than all combined together in EU) and generate 1 million jobs. (Jaguar, Bharti Airtel, HCL technologies, TATA, Pharmaceutical industries etc).
- UK has been an entry point for Indian business to the rest of the world.
- In the 2016 financial year,India-UK bilateral trade was worth $ 14.02 billion.
- India exported goods and services worth $ 8.83 billion while imports from the UK were at $ 5.19 billion. IT, Health care, food and agriculture technologies are the key sectors.
- UK is 3rd largest source of FDI to India.
- One of the key concerns is the three million strong diaspora of Indian origin.
- The other one being the interests of a large moving population of Indians who come to Britain ever year as tourists, business people, professionals, students, spouses, parents and relatives.
Positives form Brexit
- Some argue that EU is the biggest obstacle to India-UK trade. Hence many believe that it would boost trade.
- Weakening of Pound will give some advantage for Indian imports. Weaker pound will also benefit Indian tourists and students (however it is an advantage to other countries too, once the new immigration policies are framed, Indians will have an edge over others owing to intellectual traits – talented and English speaking population of India).
- At last India could escape from some of the rigorous regulations of EU which hampered trade in the past (For ex: Mango ban).
But whatever the advantages accrue to other nations including India, it will be at the cost of Britain Economy which the Brits wouldn’t let it happen for long time.
Negatives from Brexit
- If it change the rules of doing business, Visa norms or of access to higher education, it will create new barriers for work visas or the visitation rights of relatives who have families here.
- Falling sterling value have chain effects (But nothing can be predicted exactly. And these are likely to be short term effects).
- Since India has sufficient forex reserves, it is in a good position to withstand any short term shocks.
- However some of the negative effects may include, weakening of rupee, increased fuel prices and gold prices etc – which are already showing up.
- It may also effect IT sector, Indian exporters in UK, Indian Companies listed in London stock exchange etc.
Does Brexit intensify the referendum for Delhi statehood?
“After UK referendum, Delhi will soon have a referendum on full statehood.” – A.Kejriwal
Draft of the Full-Statehood Bill already in the public domain for suggestions.
- Important functions like policing and land are under the control of central govt.
- There are frequent clashes between CM and governor over the appointments.
Delhi is one of the prosperous and educated regions and it is a sign of mature democracy that it allows its people to decide on contentious issues.
India’s own history of supporting a referendum in Sikkim in 1975 on the question of its inclusion in the Indian Union and abolishing the monarchy provides us with precedence and a model for allowing a referendum in Delhi.
What is the message for India from Brexit?…… Sexit?
- Trade blocs make sense when the proportion of intra-union trade is significant – and rising.
- North America trades 63 percent within itself.
- The European Union’s intra-EU trading figure is 51 percent.
- ASEAN’s is 31 percent.
- The Economic Timesreports that intra-SAARC trade is all of 4.5 percent.
- SAARC is going nowhere, and this will continue as long as Pakistan is a member of the organisation. Currently, Pakistan plays the role of spoiler in SAARC, spiking any ideas for greater cooperation between India and other SAARC members.
- Since there is no chance of a Pexit – a Pakistani exit from SAARC – India should encourage a Sexit.
- SAARC needs to exit from the scene. It can be replaced by bilateral free trade agreements – exactly what Britain will do after Brexit.
However, even though SAARC is redundant, India should avoid opting out of it entirely. Staying in is important to keep China out. But we should let SAARC wither on the vine. Sexit should happen in spirit, not literally.
Connecting the dots
- What are the possible consequences of BREXIT on India? Analyse.
- “Creation of supra national trade bodies cannot work when the political and economic interests of member countries are in conflict.” Comment.
- General Studies 2– Governance Issues
- General Studies 3– Conservation, environmental pollution and degradation
Coastal Zone Management
- Coastal zones are defined by the extent of territorial waters up to the high water mark. Generally the world’s coastal zones are long narrow features of mainland, islands and seas, generally forming the outer boundary of the coastal domain (from 200m above sea level to 200 m below sea level)
- Coastal zones include the entire continental shelf and occupy about 18% of the surface of the globe, supplying about 90% of global fish catch and accounts for some 25% of global primary productivity while at the same time being some of the most endangered regions on the planet.
- India’s coastal zone is endowed with abundant coastal and marine ecosystems that include a wide range of mangroves, coral reefs, sea grasses, salt marshes, mud flats, estuaries, lagoons, and unique marine and coastal flora and fauna (Eg: The Sundarbans – shared between India and Bangladesh – are the largest contiguous mangroves in the world)
Integrated Coastal Zone Management
Integrated Coastal Management (ICM) is an interdisciplinary and inter-sectoral approach to problem definition and solutions in the coastal zone and includes a range of initiatives that promote environmentally sustainable development of coastal areas. It is a process of governance that consists of the legal and institutional framework necessary to ensure that development and management plans for coastal zones are integrated with environmental and social goals, and are developed with the participation of those affected.
Purpose of Coastal Zone Management
- Maximize the benefits provided by the coastal zone
- Minimize conflicts and harmful effects of activities upon each other, resources and the environment (oil spill contingency planning, and navigational risk assessment)
- Promote linkages between sectoral activities (pollution and erosion control, aquaculture, tourism and recreation)
- Guide coastal area development in an ecologically sustainable fashion (community based management of coastal resources)
Integrated planning ensures the following important outcomes in coastal zone management:
- Help avoid any activity that can threaten
- Ensures that adequate preventive measures are taken
- Lessens the negative consequences of economic development
- Supports initiatives that meet the chosen policy of coastal zone resource use
Challenges to ICZM
- Failure to appreciate the interconnections within coastal systems
- Inadequate legislation and lack of enforcement
- Limited understanding and experience in ICZM
- Limited understanding of coastal and marine processes
- Lack of trained personnel, relevant technologies and equipment
Shailesh Nayak Committee— Review of the Coastal Regulation Zone Notification, 2011
Need to demarcate precisely: There exists ambiguities in key baseline data, including the demarcation of high and low tide lines and the coastal zone boundary, which has affected the preparation of Coastal Zone Management Plans.
Shift in Governance: Transferring control of development in the CRZ-II zone, the existing built-up area close to the shoreline, from the Environment Department to State Town Planning authorities, as proposed, would mark a radical shift in governance.
Construction Activities: Proposed lightly regulated tourism in “no development zones”. Construction and other activities could be taken up in CRZ-III zones just 50 m from the high tide line in densely populated rural areas under State norms (with the responsibility to rescue and rehabilitate during natural calamities left to local authorities) could be based on an over-estimation of the capacity in such bodies.
Pollution Control: The plan should be to identify specific areas for such activity, assess its environmental impact, demarcate the area under the State’s management plans, and fix responsibility for enforcement, particularly for pollution control.
Make it participatory: Involving the local communities in the betterment of these areas have yet not been achieved and incorporating a community-based approach should be made a priority
- Despite the ecological richness and contribution to the national economy, India’s coastal and marine areas have not received adequate protection and are under stress and are reeling under rapid depletion and degradation, which unless arrested, will impact the livelihood, health and well-being of the coastal population, affecting in turn prospects for India’s sustained economic growth
- India needs to make sure that the coastal communities are equipped to better address continued economic development of the coastal zone while accounting for natural resource management. This will ensure the health and stability of the coast, both environmentally and economically, into the long-term future (marking the test of sustainability)
Connecting the Dots:
- Write a note on structure, functioning and performance of Coastal Zone Management Authorities (CZMAs).
- The security ecosystem for the coastal waters requires for multi-pronged approach that clubs preparedness to secure the coastline not only from tactical aggression by enemies but also from natural disasters and marine pollution. Discuss.
The rise of demotic democracy in Europe
Lessons to be learnt from Brexit
Reality check on India-U.S. ties
The writing on the great wall
Shrinking spaces at the nuclear high table
Banking on future
Breaking new frontiers
For a nuanced policy on bad debts
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