Demographic dividend: How can India leverage its biggest strength?

Syllabus: Population related issues/ Development and management of social sectors or service

In News

The country has a unique opportunity to experience a “golden era” over the next 25 years, capitalizing on its favorable demographic composition.

Demographic Dividend:

The Demographic Dividend refers to the economic growth potential that arises from changes in a population’s age structure, particularly when the working-age population outweighs the non-working-age population. This phenomenon has been recognized by the United Nations Population Fund (UNFPA) as a significant driver of economic development.

India’s Demographic Dividend:

India stands at a unique advantage with its average age being 29 years, making it the youngest among the most populous countries in the world. In comparison, countries like the US, China, France, Germany, and Japan have relatively older populations, which places India in a favorable demographic position.

Implications:

With a rising working-age population and a decreasing old-age dependency ratio, India is poised to leverage its demographic dividend for economic growth. This demographic trend indicates that in the future, India will have a relatively larger proportion of its population contributing actively to the workforce, which can have positive implications for the economy.

Success Stories:

Several developed countries have successfully utilized their demographic dividends to achieve higher economic growth and improved living standards. Notable examples include China, which harnessed its demographic dividend from the early Eighties until 2008-2009, achieving impressive average annual growth rates. Japan, South Korea, Malaysia, and Singapore also capitalized on their demographic advantages during specific periods to fuel consistent growth through strategic structural transformations.

Opportunities for India:

As many countries face declining fertility rates and a shrinking labor force, India has an opportunity to become a global source of skilled labor. This could lead to increased economic activity and contribute to the country’s overall growth.

What Should India Do?

To make the most of its demographic dividend, India should focus on various key areas:

• Enhance the quality of education, healthcare, and skill development to improve the productivity and efficiency of its workforce.
• Create ample employment opportunities for both the existing labor force and the new entrants into the job market.
• Shift labor from low-productivity sectors like agriculture to more labor-intensive manufacturing industries, such as textiles, footwear, and automotive components.
• Identify and invest in sectors with substantial potential for growth, like healthcare, hospitality, construction, and agricultural processing.
• Develop and upgrade infrastructure, streamline trade facilitation, strengthen the intellectual property rights ecosystem, and improve ease of doing business to support manufacturing growth.
• Provide support and incentives to MSMEs to enhance their competitiveness and enable them to participate in global supply chains.

Steps Taken:

India has undertaken various initiatives to develop and upgrade the skills of its labor force. Skill development programs like Jan Shikshan Sansthan, Pradhan Mantri Kaushal Vikas Yojana, and National Apprenticeship Promotion Scheme have contributed to increasing the availability of skilled human resources in different sectors. Other programs, such as Ayushman Bharat, Swachh Bharat Mission, and PM Bhartiya Janaushadhi Pariyojana, have been instrumental in promoting health equity and improving access to quality education.

Challenges:

India faces challenges in its unorganized sector, where a significant percentage of the labor force is engaged in underpaid jobs. High out-of-pocket healthcare expenses and issues with the quality of education need to be addressed.

Way Ahead:

To maximize the benefits of the demographic dividend, India must focus on improving the employability of its labor force through large-scale skilling programs. Simultaneously, creating ample employment opportunities for the youth entering the job market will be crucial. Scaling up access to quality healthcare and education will also play a vital role in nurturing a productive labor force.

Conclusion:

India’s demographic dividend provides a tremendous opportunity for economic growth and development. By implementing strategic reforms and effectively utilizing flagship programs like Skill India, Make in India, and Start-up India, India can harness the potential of its young and dynamic workforce to become a significant global player in the years to come.

Sarpanch Pati

Syllabus: Governance

In News

The Supreme Court of India has asserted that the issue of men exerting power behind elected women in grassroots politics (referred to as “sarpanch Pati”) should be addressed by the government and not the judiciary. In response to this matter, the court advised an NGO to make a representation before the Ministry of Panchayati Raj to bring attention to the issue.

The NGO argued that the practice of unelected male relatives wielding political and decision-making influence behind elected women is a mockery of constitutional democracy, despite the existence of a one-third quota for women in panchayat governance introduced by the Seventy-Third Constitution Amendment Act in 1992.

About Sarpanch Pati:

The phenomenon of “sarpanch Pati” or husbands who control panchayats by making their wives contest elections is not new or uncommon. Even the Prime Minister has recognized this problem and identified it as an obstacle to women’s progress.

Examples:

• In a case in Ratlam, Madhya Pradesh, a man even possessed a ‘power of attorney’ document, granting him the right to make decisions on behalf of the elected woman sarpanch, whose election expenses he had allegedly funded.
• In another instance, a woman sarpanch from Odisha “authorized” her husband to carry out her duties, citing domestic responsibilities as the reason.

Reasons behind the Practice of Sarpanch Pati:

• Patriarchal Gender Norms: Traditional gender norms, where men are considered superior and decision-makers, contribute to the continuation of this practice.
• Lack of Capacity Building: Insufficient training and capacity-building programs for women to take on leadership roles in local government hinder their ability to assert authority independently.
• Social Status and Illiteracy: Women often face a lower social status and high levels of illiteracy, which may affect their confidence and competence in political matters.
• Weak Deterrence Laws: The absence of strong laws to deter men from controlling women in panchayats allows this practice to persist without significant consequences.
• Lack of Recognition: Women’s contributions and capabilities are not adequately recognized, further perpetuating the notion that men should be in charge.

Conclusion

In conclusion, the issue of “sarpanch Pati” poses a challenge to gender equality and democratic principles in grassroots politics. Addressing this problem requires efforts from the government to implement effective measures, including capacity building, stronger laws, and increased recognition of women’s contributions, to empower elected women and ensure genuine representation in local governance.

Internationalisation of rupee: Why and what are the benefits?

Syllabus: Economy

In News

According to the RBI, given India’s status as one of the fastest-growing countries and its impressive resilience in the face of major challenges, the rupee holds the potential to become an internationalized currency.

Internationalization of the Rupee:

Internationalization involves increasing the use of the rupee in cross-border transactions between residents in India and non-residents. The process includes promoting the rupee for import and export trade and gradually expanding its use in other current account transactions, followed by capital account transactions. The goal is to establish the rupee as a recognized currency in international trade and finance.

Prerequisites for Internationalization:

The successful internationalization of the currency is closely linked to the nation’s economic progress. It requires further opening up of currency settlement, a robust swap and forex market, full convertibility of the currency on the capital account (allowing free movement of local financial investment assets into foreign assets and vice versa), and unrestricted cross-border fund transfers.

Current Scenario:

As of now, India has allowed full convertibility only on the current account. The US dollar is considered to have an ‘Exorbitant Privilege’ due to various factors such as the size of the US economy, macroeconomic stability, and currency convertibility, making it the dominant reserve currency in the world. The Chinese renminbi is seen as a potential challenger to the US dollar’s dominance, but its success will depend on factors like the resilience, integrity, transparency, openness, and stability of the Chinese economy and financial system.

RBI Recommendations:

The RBI has put forth several short-term and long-term recommendations to foster the internationalization of the rupee:

• Adopting a standardized approach to examine proposals on bilateral and multilateral trade arrangements.
• Inclusion of the rupee in the IMF’s Special Drawing Rights (SDR), which is an international reserve asset created to supplement member countries’ official reserves.
• Encouraging the opening of rupee accounts for non-residents both in India and abroad.
• Integrating Indian payment systems with other countries for cross-border transactions.
• Strengthening the financial market by fostering a global 24×5 rupee market and recalibrating the Foreign Portfolio Investor (FPI) regime.
• Reviewing taxes on masala bonds (rupee-denominated bonds issued outside India) and promoting international use of Real Time Gross Settlement (RTGS) for cross-border trade transactions.
• Including Indian Government Bonds in global bond indices.

Advantages of Internationalization:

The internationalization of the rupee offers several benefits:

• Cross-border transactions in rupees protect Indian businesses from currency volatility, reducing the cost of doing business and enhancing global growth opportunities.
• It adds weight to the Indian economy, elevating India’s global stature and respect.
• Reduced dependence on foreign currency makes India less vulnerable to external shocks and reduces the need for holding significant foreign exchange reserves.

Challenges and Reforms:

• Despite the potential benefits, challenges to internationalizing the rupee persist, including limited international demand for the currency and restrictions on full capital account convertibility. 
• To address these issues, reforms are needed, such as making the rupee more freely convertible with a goal of full convertibility by 2060. The RBI should also promote a deeper and more liquid rupee bond market to attract foreign investors and facilitate invoicing of transactions in rupees by Indian exporters and importers. 
• Currency swap agreements with other countries and tax incentives for foreign businesses to utilize the rupee in Indian operations could further support its internationalization. 
• Additionally, pursuing the recommendations of the Tarapore Committees, including fiscal deficit reduction, controlling inflation, and addressing banking non-performing assets, would contribute to strengthening the rupee’s international standing.

Zo peoples of Manipur & Mizoram

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The recent clashes in Manipur have drawn the attention of numerous leaders, who are calling for a reunification of the Zo people. This comes in light of the ongoing ethnic violence between the dominant Meiteis and the Kuki-Zomi tribes in the neighboring state.

About Zo Tribes:

The Zo people comprise diverse tribes, such as Chin, Kuki, Mizo, Lushei, Zomi, and others, dispersed across Myanmar, India, and Bangladesh. These tribes share a common history, including migration and settlement in various regions, and are bound together by their Christian faith.

Challenges to Zo Reunification:

While the idea of Zo reunification holds strong emotional appeal to the people of Mizoram, it encounters significant political challenges. Integrating territories from Manipur, Tripura, and neighboring countries with Mizoram would require complex negotiations and potentially face opposition from concerned parties in those regions. The process of carving out and integrating areas poses intricate political and administrative hurdles.

Chatbot for people in mental distress

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Jammu and Kashmir (J&K) has witnessed the launch of India’s first Tele-MANAS chatbot, designed to engage with individuals in distress.

The primary goal of this initiative is to offer round-the-clock access to health counselors, clinical psychologists, and consultants. The launch event coincided with the J&K Health Conclave on Mental Health and Non-Communicable Diseases.

Operating under the Ministry of Health and Family Welfare, Tele-MANAS functions as a two-tier system:

• Tier 1 consists of State Tele MANAS cells, which house trained counselors and mental health specialists.
• Tier 2 involves specialists at District Mental Health Programme (DMHP)/Medical College resources, providing options for physical consultation and/or eSanjeevani for audio-visual consultation.

Farmers Distress Index

In News

In India, the Central Research Institute for Dryland Agriculture (CRIDA) has devised a unique early warning system named the “farmers’ distress index.”

The significance of this index lies in its aim to alleviate agrarian distress, encompassing issues like crop loss, failure, and income shocks, which have unfortunately contributed to a rise in farmer suicides.

The methodology employed by the index involves monitoring local newspapers, news platforms, and social media to identify reports of distress. Subsequently, telephonic interviews are conducted with small and marginal farmers, employing standardized questions to gauge early signs of distress.

By utilizing the farmers’ distress index, targeted interventions become possible. For instance, if the distress is found to be gender-based, efforts can be directed towards improving women’s incomes to address the specific challenges they face.

New methane source

In News

A study published in Nature Geoscience reveals that climate change is triggering the release of methane from groundwater springs in the Arctic as retreating glaciers expose these methane-rich springs.

The research focused on Svalbard, an archipelago in the Arctic, where the groundwater springs were found to be emitting more than 2,000 tonnes of methane annually. This amount is equivalent to 10% of Norway’s methane emissions from its oil and gas industry.

The presence of methane near shale rocks indicates that the gas likely originates from a geologic or thermogenic source, which moves upward through fractures in the rocks and accumulates beneath the glacier.

As global warming persists and glaciers continue to retreat, the release of methane from glacial groundwater springs is expected to increase. This emphasizes the importance of assessing the risk and impact of these emissions for the future.

Microplastics

In News

The Food and Agriculture Organization (FAO) has released a report highlighting the significant impact of microplastics and nano plastics on human and animal gut microbiomes, as well as the environment.

Key Findings:

• Exposure to plastic has been observed to lead to intestinal inflammation and gut dysbiosis, resulting in alterations to the gut microbiome and microbiota.
• Microplastics and nano plastics have been found to affect soil microorganisms and can enter the food chain. Evidence indicates that these particles have been discovered in human lung tissue, placenta, stool, blood, and meconium.
• The majority of studies in the report reveal various host alterations due to microplastic exposure, including changes in gene markers, biochemical markers, mucus layer, gut permeability, oxidative stress, immune response, and liver function.

About Microplastics:

Microplastics are plastic particles with a diameter of less than 5mm. They come in two types:

• Primary Microplastics: These are tiny particles intentionally produced for commercial purposes, as well as microfibers shed from clothing and other textiles. Examples include microbeads found in personal care products, plastic pellets, and plastic fibers.
• Secondary Microplastics: These particles are formed from the breakdown of larger plastics, such as water bottles.

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