Indo-French harmony (The Hindu)

Not by fear alone (The Hindu)

 

Indo-French harmony

(The Hindu)

Synoptic line: It throws light on issue of recent visit of France president to India.

(GS paper II)

Overview

 

  • President Emmanuel Macron’s March 2018 visit to India was much awaited precisely because there is so much for him to do. More like the pioneering India-France strategic partnership of 1998, the agreements signed during President Emmanuel Macron’s visit are set to strengthen bilateral cooperation at a time of global flux.

 

Assessment

 

  • The Joint Vision Statement on the Indian Ocean Region is clearly aimed at countering China’s growing presence in the region and the International Solar Alliance, recommitment to starting the Jaitapur nuclear power plant, and joint ventures on climate change cooperation are reactions to the U.S. abdicating its role by announcing its pullout from the Paris accord.

 

  • The “reciprocal logistics support” agreement, which Prime Minister of India called a “golden step” in defence cooperation, is a signal to Russia and to the U.S.-led alliance that partnered in the “Quadrilateral”, that both New Delhi and Paris feel the need to diversify strategic postures beyond their current choices.

 

  • Finally, by bringing 61 countries into the ISA, India and France are proposing an alternative leadership model for the less developed world, challenging the geopolitical power structure configured around fossil-fuel energy resources. Notably, both the leaders declared they would ensure cheaper solar energy and increase avenues for financing, something that has created heat at the WTO.

 

 

  • The daunting task ahead is made clear by Mr. Macron’s assertion that $1 trillion is needed to reach the ISA goals by 2030: India and France have so far committed $1.4 billion and $1.3 billion, respectively.

 

 

  • However, there are other contradictions that New Delhi and Paris must contend with. For example, India’s solar power tariffs stand at about ₹2.40 a unit and there is little scope to make the domestic industry profitable, unless the cost of solar panels and other components are brought down drastically.

 

  • At the same time, more thermal power, for which tariffs are higher but which is less fickle than solar or wind power, is being produced than the demand. France’s nuclear power story is a success, but negotiations between EDF and NPCIL for the Jaitapur plant, billed as the world’s biggest, have made very slow progress. While the two countries have committed to start construction by end-2018, they have missed deadlines multiple times.

 

Way ahead

 

  • Bilateral cooperation in the Indian Ocean Region too is more symbolic than substantive today, and much will depend on how closely the Indian and French navies and intelligence work together in the future. The presumed joint message to Beijing may also be blurred by Mr. Macron’s parallel commitment to help “lead” the Belt and Road Initiative with China.

 

Question- As two pluralistic democracies with a firm belief in a multipolar world order and in the future of Eurasia, India and France have numerous strategic convergences. Analyse.

 

Not by fear alone

(The Hindu)

Synoptic line: It throws light on the issue of rollout of the e-way bills system.

(GS paper III)

Overview

 

  • In the recent GST (goods and services tax) Council chaired by Finance Minister, it has been decided to stick to the prescriptions of the group of ministers on the rollout of the e-way bills system. The introduction of an electronic way bill will alter dramatically the economics of moving goods within the country.

 

Assessment

 

 

  • Starting April 1, all inter-State movement of goods above the value of ₹50,000 will require the generation of an e-way bill to help track their movement. The original rollout plan for February 1 had to be aborted as the IT system couldn’t handle the lakhs of e-way bills being generated by consignors and transporters.

 

 

 

  • As proposed by the ministerial group, the e-way bill system for tracking intra-State movement will be launched in a phased manner, with all States to be on board by June 1. From April 1 onwards, every week a few States will start the system for internal trade.

 

 

 

  • While such an approach may give the government an opportunity to fix the chinks in the system, this is a compliance nightmare in the making for taxpayers with operations in multiple locations. The government is keen to use the system to foil tax evasion or non-filing of returns.

 

 

 

  • The Central Board of Excise and Customs, together with the GST Network, has begun deploying data analytics on the vast repository of information collected from taxpayers since July. Action is likely to begin soon on taxpayers, based on variances and data gaps that have been found in returns.

 

 

 

  • However, some industries remains edgy about the capacity of the IT system to cope with e-way bills from April 1, new rules and forms for the generation of these transit challans have been issued. Tax experts have voiced concern about some of these rules, including one that empowers commissioners to notify those officers who can intercept any mode of conveyance to carry out physical verification of e-way bills while goods are in transit, akin to the old physical check-post system.

 

 

 

  • The most disappointment for business is the failure of the GST Council to finalise a simplified tax form for assesses. Infosys co-founder has also made a pitch to help formulate a simpler return that involves just one monthly filing. Finance minister has said that there is scope for further simplification in the options available with the Council without rendering such a form ‘evasion-prone’.

 

 

Way forward

 

  • For now, taxpayers will have to stick to the current compliance system till June 2018. Similarly, the plan to pay GST under the reverse charge mechanism has been deferred till the end of June, to avoid ‘inconvenience’ to trade and industry.
  • The e-wallet scheme proposed for exporters whose cash flows have been affected by delays in refunds on GST paid on domestic inputs has been deferred till October 1. For GST to become truly simple for taxpayers, certainty of timelines is as critical as the fear of the taxman.

 

Question What is E-way bill system? Explain how it can overhaul transport economics?