IAS UPSC Prelims and Mains Exam – 7th June 2019

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NATIONAL

TOPIC: General Studies 2:

• Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
• Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and bodies constituted for the protection and betterment of these vulnerable sections
• Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources.

The draft National Education Policy, 2019

In news:

The draft National Education Policy, 2019 is out in the public domain, with comments sought from all stakeholders. Drawing inputs from the T.S.R. Subramanian Committee report and the Ministry of Human Resource Development (MHRD), the K. Kasturirangan Committee has produced a document that is comprehensive, far-sighted and grounded in realities.

Unique features of the policy:

The draft policy seeks to revamp all aspects of the sector and suggests brave new ideas. The idea that lifelong education is based on four pillars — learning to know, learning to do, learning to live together and learning to be — has inspired the committee to cover every aspect of the education sector: school, higher, vocational and adult education.
It also includes the whole gamut of professional education — engineering, medicine, agriculture, law, etc.

• Early childhood education:
  In school education, the idea is to cover children of 3-18 years [instead of the present 6-14 years under the Right to Education (RTE) Act], three years under early childhood care and education (ECCE) and four years under secondary education.
• Restructuring the 10+2 education structure into a 5+3+3+4 structure so that the five years from ages three to seven or till the end of Std 2 are seen as one “foundational stage”.
  The next two stages, of three years each, are “preparatory” and “upper primary”, first ensure the acquisition of foundational skills and then their development.
  These stages are not only consistent with the development of children, but they are also useful to meet the overall goal of ensuring basic learning outcomes stage-by-stage.
• Higher education:
  The aim is to double the Gross Enrolment Ratio from 25% to 50% by 2035 and make universities the hubs of research.
  – Tier I universities/institutions devoted primarily to research and some teaching.
  – Tier 2 universities devoted to teaching and some research,.
  – Tier 3 institutions comprising mainly colleges that are to be converted gradually into degree-giving autonomous institutions.
• Achieve ‘universal foundational literacy and numeracy’ through initiatives like the National Tutors Programme and the Remedial Instructional Aides Programme.
• Introduction of school complexes, a system of modular Board Examinations to allow flexibility, setting up Special Education Zones in disadvantaged regions, recognising teachers at the heart of the system, moving teacher education into the university system, and stressing the importance of learning new languages are among the key recommendations.
• The policy recommends community and volunteer participation in collaboration with schools to overcome the current crisis. Schools generally work in isolation from the community they serve.
• The policy recognises the crucial importance of liberal arts (it recommends setting up five Indian Institutes of Liberal Arts offering four-year courses) and the study of modern and classical languages (it recommends setting up National Institutions for Pali, Prakrit and Persian).
• It proposes separate institutions for regulation, funding, standard setting and accreditation, a National Research Foundation, and a Rashtriya Shiksha Aayog/ National Education Commission.
• Vocational education, meant for 50% of the students, is sought to be integrated with school and higher education.

Challenges in implementation:

• Doubling of public funding to 6% of the GDP and increasing overall public expenditure on education to 20% from the current 10%.
  This is desirable but does not appear to be feasible in the near future given that most of the additional funding has to come from the States.
  Though innovative financing schemes have been proposed, involving the private sector, how those schemes will shape up remains to be seen.
• Expanding coverage under the RTE Act is extremely important, but should be introduced gradually, keeping in mind the quality of infrastructure and teacher vacancies.
• The idea of regulation being brought under the National Higher Education Regulatory Authority, standard setting under the General Education Council and funding under the Higher Education Grants Council may require a revisit so that there is synchronisation with the current Bill for the Higher Education Commission of India.
• Language issues have to be handled sensitively in view of their emotional overtones, as witnessed recently.

Conclusion:

The “learning crisis” is very deep. The education system — public and private — has been deteriorating rapidly and has affected the quality of our human resources.
If this trend is not reversed, the dysfunctional system will become more and more expensive but will not deliver the goods. It will require a huge commitment and conviction to make it happen.

Connecting the dots:

• Discuss unique features of the draft National Education Policy, 2019. Also comment on the challenges in implementation of suggested recommendations.

ECONOMY

TOPIC: General Studies 3:

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

The Nandan Nilekani panel on deepening digital payments

In news:

The RBI constituted the five-member committee in January to review the status of digitization of payments, identify gaps in the ecosystem, and suggest ways of plugging them.
It was tasked to suggest a medium-term strategy for deepening digital payments and measures to strengthen safety and security. The high-level committee on deepening of digital payments, led by Infosys co-founder Nandan Nilekani, has recommended a reduction in costs to widen the acceptance infrastructure and improve digital financial inclusion.
The report noted that while the digital payments ecosystem has made substantial progress on the issuance side, there needs to be an improvement on the demand or acceptance side of the ecosystem.

Background:

Per capita digital transactions stand at 22 in March 2019 and are expected to increase to 220 by March 2022, according to the committee. This will lead to an increase in the number of users of digital transactions from 100 million to 300 million. At present, India has a large currency in circulation to GDP ratio, when compared with other countries.

Recommendations:

Reduction in Fees & Taxes:

• 15-basis-point cut in the interchange fee for use of banks’ ATM networks by customers of other banks make sense.
• A major suggestion to increase both digital acceptance and tax compliance is that businesses be provided with tax incentives calibrated on the proportion of digital payments in their receipts.
• Removal of all charges on digital payment transactions for the convenience of customers.
• The government should continue the current scheme to refund the merchant discount rate for small value transactions (under₹2,000) beyond December 2019 for another two years.

Improving ease of usage:

• To move away from plastic, and let the merchant use only the phone and a QR code. This will make digital payments seamless and convenient for customers. Merchants can generate their own code that will be interoperable with banks, doing away with card-swipe terminals.
• The panel also recommended the creation of a No-KYC wallet with a maximum value of ₹2,000 in the wallet and maximum spending capped at ₹10,000 per month, with the aim of boosting digital payments.

Expanding the horizon:

• To expand the UPI payments platform to foreign currency remittances by the NRIs and to settle residents’ payments when they travel overseas — just as Chinese users can use WeChat — makes eminent sense.
• Another is that the Reserve Bank of India (RBI) consider setting up an acceptance development fund, which is used to develop new merchants in poorly served areas.
• Creation of a digital financial inclusion index so that progress in an area can be measured along a common scale, indicating the evolution of the users and steps taken for correcting the imbalance.
• The government, being the single-largest participant in payments, take the lead on all aspects of digitisation of payments. Need to provide citizens with the option to pay digitally for all payments to government and public sector agencies.

Improving security:

• The RBI and the Centre to put in place a mechanism to monitor digital payment systems and make aggregated information based on blocks and PIN codes, available to all players on a monthly basis.

Conclusion:

The Reserve Bank of India (RBI) and the government must target growth in the volume of digital payments by a factor of 10 in three years, leading to doubling in value relative to gross domestic product (GDP), as per the committee.
This growth will be driven by a shift from high-value, low-volume, high-cost transactions to low-value, high-volume, low-cost transactions.

Connecting the dots:

• The digital payments ecosystem has made substantial progress in India. In this light discuss the recommendation of the Nandan Nilekani panel on deepening digital payments.