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IASbaba’s Daily Current Affairs – 7th December, 2016

  • December 7, 2016
  • 3
IASbaba's Daily Current Affairs Analysis, IASbaba's Daily Current Affairs Dec 2016, National, UPSC
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IASbaba’s Daily Current Affairs – 7th December, 2016

 

NATIONAL

 

TOPIC:

General Studies 2

  • Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources.

General Studies 1

  • Social empowerment
  • population and associated issues, poverty and developmental issues

 

Hospital over Home- Janani Suraksha Yojana

  • The government has aimed at increasing institutional deliveries over the last decade. This has changed the health-seeking behaviour of Indian women.
  • Various schemes have been introduced by government to support women during pregnancy and for some period thereafter. These include:
    • Janani Surakhsha Yojana
    • Janani Shishu Suraksha Karyakram
    • Mother and Child Tracking System (MCTS)
    • Matritva Sahyog Yojana
  • A study was conducted using data from two rounds of the India Human Development Survey (IHDS)- 2004-05 and 2011-12. This IHDS data served two advantages:
    • Round 1 of IHDS was conducted in 2004-05 when the JSY was not in place and round two was conducted six years after the launch, providing a before-after scenario for comparison.
    • IHDS is a longitudinal data set. It means that same households were interviewed in both rounds, which allows to examine changes in maternal care patterns.

 

Janani Suraksha Yojana

  • Janani Suraksha Yojana, a conditional cash transfer scheme- was launched in 2005 as part of the National Rural Health Mission (NRHM) to improve maternal and neonatal health by promotion of institutional deliveries (childbirth in hospitals).
  • The aim was to improve India’s infant and maternal mortality rates through institutional deliveries.
  • Under JSY, pregnant women choosing to deliver at the hospital and the health worker who motivated her to take the decision get cash incentives- Rs.1,400 for the woman and Rs.600 for the Accredited Social Health Activist in rural areas and Rs.1,000 and Rs.200 respectively in urban areas.
  • The motto of cash incentive was to reduce financial barriers to accessing institutional care for delivery.

Increased hospitalisation

  • The researchers of the study ‘Health and Morbidity in India: 2004-2014’, based on analysis of the 60th and 71st round of NSSO data, found a causal link between JSY and increase in hospitalisation, even for non-childbirth-related ailments.
  • While the fertility rates in Indian women have steadily declined from 2.88% in 2004 to 2.4% in 2014, JSY has impacted overall hospitalisation of women in India.
  • It has led to 15% increase in institutional childbirth with a commensurate decline in deliveries at home.
  • Also, there is tremendous increase of 22% in deliveries in government hospitals. This is due to 8% decline in childbirth at private hospitals and a 16% decline in childbirth at home.
  • The scheme has increased the probability of woman being hospitalised by 1.3% which has resulted in 2% overall increase in hospitalisation of women in India.
  • Though this increase might appear marginal but it is very significant as women in rural India are known to delay in seeking health interventions.

 

Positive changes

  • This scheme has led to enhancement in utilisation of health services among all groups especially among the poorer and underserved sections in the rural areas.
  • This has reduced prevalent disparities in maternal care.
  • Previous studies on JSY had shown reduction in maternal mortality rates. But there was no evidence if it had reduced socio-economic inequalities, i.e. difference in access to maternal care between individual people of higher or lower socioeconomic status.
  • In the IHDS study, three key services of maternal care were used for the analysis:
    1. Full antenatal care (full ANC)
    2. Safe delivery
    3. Postnatal care

Major findings

Services used

  • Increase in utilisation of all three maternal healthcare services between the two rounds was remarkably higher among illiterate or less educated and poor women.
  • This shows the effect of JSY scheme where women with little or no education were motivated to utilise maternal health care services.

 

Reduced disparities

  • The usage of all three maternal healthcare services by the OBC, Dalit, Adivasi and muslim women increased between the surveys.
  • There was narrowing of gap between the less educated and more educated women and between the poorer and richer women.
  • It was also found that women in their early twenties were more likely to avail of each of the three maternal health care services as compared to their older women.
  • Also, the incidence of women availing maternal healthcare services decreases with the increase in the number of children they have delivered.

Inequality persists

  • There still exists inequality in the access to maternal care.
  • Though there is gap in access to healthcare between the marginalised group of women and those who are financially better-off, it has declined since the advent of the JSY program.
  • There is still high incidence of maternal mortality rate in India. As per the latest series on maternal health, India accounted for 15% of the total maternal deaths in the world in 2015 — second only to Nigeria — with 45,000 women dying during pregnancy or childbirth.

Support of other schemes

  • Percentage of women reporting sick has also increased partially due to result of other health insurance schemes like Rashtriya Swasthya Bima Yojana.
  • Having insurance is associated with a 17% increase in probability of being hospitalized in a government facility and an 8% increase in the probability of hospitalization in a private hospital.

 

Challenge to tackle

  • Though the economic significance of 2% increase is little, it has to be understood that JSY was not to increase overall hospitalisation. It was only to reduce maternal and infant mortality. But now it is seen that women are going for childbirth and are also coming in for other ailments to the hospitals.
  • This has however raised concerns about quality of care with increasing number of caesarean sections and hospital-acquired infections.
  • Increased hospitalisation for deliveries in public sector is an achievement. But this has also increased the dangers of decreased health care quality. Here, the health outcomes are not aligned with public health goals.

Connecting the dots:

  • What is Janani Suraksha Yojana? Examine the impact of the scheme on maternal and neo-natal healthcare in India.
  • What is the current healthcare scenario in rural areas? Identify challenges faced by government and civil society in creating a healthy rural society.

 

ECONOMY/NATIONAL

 

TOPIC:

General Studies 3

  • Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

General Studies 2

  • Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

 

Will demonetisation pay off?

  • After a scheme or programme is launched, it is necessary to know whether it has been successful or not so as make decision to improve or eliminate it.
  • Thus, it is also necessary to know the success of demonetisation or rather re-monetisation programme of government.
  • The purpose of demonetisation is an attempt to eliminate black money besides countering the phenomenon of counterfeit currency.
  • As the time passed by, other objectives were also declared which included need of switching to digital transactions.
  • Hence, such schemes cannot be evaluated in the short term as some of the goals specified are transformational and will take time to materialise.

Measures to determine the success rate

  • Though demonetisation effect can’t be known in short term but its yardsticks can be decided beforehand for evaluation.

 

Disappearing cash

  • The first metric to evaluate the scheme can be how much money disappears from the system.
  • Though the finance secretary has expected that the entire scrapped money in circulation in the form of currency notes of Rs. 500 and Rs. 1,000 will come back to the banking system so that the tax authority can trace the transactions and tax black money hoarders.
  • But there is a projection that a large part of the currency in high denomination notes – around Rs. 14.25 lakh crore – would not enter the banking system, thus making it redundant.
  • At present, Rs. 8 lakh crore have been deposited in banks and a month is yet to go. Hence, whether 10% or 20% or 30% money will not be returning may determine the success rate.
  • A ratio of 20-30% will justify the quantum of vast exercise. The reason is that the cost of demonetisation for 50 days from November 8 to Dec 30 is expect to cost Rs 1,28,000 crore which includes loss of business or sales, cost to households, the expenses for printing fresh currency notes to the government and the RBI besides for banks.
  • Thus, the government will have to show gains in form of penalties and additional taxes from those who have been found violating the rules or have evaded taxes.

 

Taking refuge through Jan Dhan account

  • In respect to it, the second metric can be identification of people hoarding money. There have been reports of transactions converting cash to bank deposits through the Jan Dhan programme or any other means.
  • Identifying of such transactions will attract penalty cum fine which can vary across the spectrum. This will clearly bring in more revenue for the government.
  • Hence, it is expected that for every Rs. 1 lakh crore of identified black deposits could earn the Government a bonus of at least Rs. 50,000 crore revenue.
  • The success garnered here will reflect Government promptness in plugging loopholes that were being exploited by holders of black money.

Cash availability post 30th December

  • The third metric will be cash availability with banks and ATMs post 30th December when the window to deposit the scrapped notes and withdrawal limit will end. Currently, the cash crunch and long lines at banks and ATMs are signs of problems faced by citizens.
  • However, post 30th December, it needs to be seen how fast RVI revokes all the curbs on withdrawal of currency from banks and also sufficient cash in the economy.

 

GDP growth

  • The GDP growth is expected to retard in Q3 of the year and thereby affect the economic growth process and thus affecting overall growth in the fiscal.
  • Hence the fourth metric will be how fast the re-monetisation scheme will help the recovery of GDP growth and help economy move upwards.
  • If Q4 growth is lower than Q3, than the demonetisation plan will prove that it hampered the growth. But if it attains normalcy, then it should be considered turning point in economy post Q3.

Impact on real estate

  • The real estate hosts the maximum percentage of black money. Though there are varied views on how the sector will cope up post demonetisation, its litmus test will be on if the real estate prices come down or not.
  • The RBI or NHB price indices would provide some clue to whether there has been any moderation in the prices of property in the country.

Acceptance of digital transactions

  • Demonetisation has also the objective of promoting digital payments. Hence, the sixth metric will be if the volume of cash holdings will come down with the time.
  • Over a period of 6 to 12 months, the ratio of currency to GDP should come down from the present level of around 12%.
  • If the households and businesses go back to holding similar amounts of currency, then the transformational objective would get vitiated. It would also mean that Indians require currency for the three classical purposes put forward by monetarists — transactional, precautionary and speculative.

 

Creation of new black money

  • The main target of demonetisation has been targeting black money and eliminating it.
  • Till now, most of the black money has resided in cash and hence it needs to be seen if another platform for black economy will be created or not considering the fact that high denomination notes of Rs. 2,000 become easier to hold.
  • But it will probably take 5 to 10 years for such an economy to come up; however, it can be delayed by more stringent tax laws. This is where the tax system must be tightened so that slippages are eliminated.

Challenges

There are going to be considerable costs – some that can be measured and others that cannot.

  • The most tangible among it is loss of GDP and 50 bps cut in the GDP growth rate which would amount to around Rs. 70,000 crore. If the loss on an annual basis is higher, then the cost for the economy will increase proportionately.
  • There also are intangible costs such as time spent by households and businesspersons to deal with the new situation.
  • There will be distortion in market which includes stocks and GSecs in particular. The yields have become volatile as the RBI grapples with the excess liquidity problem in the system.
  • The banks have faced multiple challenges during the process such as late hours, reconciliation, overtime, recalibration of ATMs, security and so on, which would be considerable even as some cannot be quantified.

Conclusion

The success of demonetisation will largely be seen post 12 months when the economy will show changes that were projected. It is expected that benefits should outweigh the costs once the system starts cleaning up. However, the challenge would be to see that the new black economy doesn’t get generated again.

Connecting the dots:

  • What are the parameters to identify the success of demonetisation? Critically evaluate.
  • How is demonetisation disruptive to economy? Substantiate.

 

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