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1.Empowering women through job creation (Live Mint)

2.Bitcoin: fraud or future (Indian Express)

3.Childhood foregone (The Hindu)

1.Empowering women through job creation (Live Mint)

Synoptic line: It throws light on the issues associated with female Labour force participation rate. (GS paper III)

Overview

  • According to the World Economic Forum’s “Global Gender Gap Report 2017”, India’s ranking has fallen by 21 places from last year. Not only are we currently far below the global average but also behind our neighbours China and Bangladesh. One of the areas where we have fared poorly is in wages and participation of women in the economy where our rank is an abysmal 139.

Plight of women

  • This is not the first report to highlight the plight of our women. In fact, as per the World Bank report, we have one of the lowest workforce female participation rates, ranking 120th among 131.
  • Even in terms of contribution to gross domestic product (GDP), women are currently under-represented. At 17%, India has a lower share of women’s contribution to GDP than the global average of 37%. What is even more alarming is that the participation levels have been dropping in the last few years.
  • The National Sample Survey found that while in 1999-2000, 25.9% of all women worked; by 2011-12 this proportion had dropped to 21.9%.

Possible reasons for less participation of women

  • A possible and optimistic explanation could be that with rising household income, women now have the opportunity to choose leisure over work, especially in agricultural sectors and on construction sites, and focus on their families. However, research has shown that when women have access to more work opportunities, they gladly take them.
  • The India Human Development Survey highlighted that the provision of work under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) brought more rural women into wage labour. Among MGNREGA workers in 2011-12, a whopping 45% were not in wage labour before the scheme was initiated, which means that women do seek opportunities to earn a stable wage.
  • According to an International Labour Organization study, the participation of women in informal employment and non-standard forms of employment (for eg. part-time jobs or jobs in the informal sector) is higher than men. Jobs for Indian women, especially rural women, remain primarily in the agriculture sector. The share of women in services and industry is less than 20%.
  • Another point to note is that in India, nearly 100% of net job creation in the last two decades has happened in the informal sector in small and low-productivity enterprises. While pretty much every employee in the informal sector will have fewer skilling opportunities and lack of job security, the average Indian woman worker is at a dual disadvantage.
  • Not only is she less likely to find stable job opportunities within the informal sectors but she will also have to deal with poor quality and even unsafe working conditions, low wages and denial of statutory benefits like social security. She will also have to cope with higher risks of discrimination as compared to her male colleagues. Her wages will not only be below the statutory minimum wage but will be much less than her male counterparts’ and benefits like maternity leave or related facilities, which are meant to keep women in the workforce, will not be accessible to her in the informal sector.

Need of framework for women to enable them to work

  • The lack of safe working conditions, social security benefits, and a fair wage that can only be paid by formal sector employers with high productivity and output ratios, induces women to opt out of employment unless critical for their basic sustenance as the incremental economic and societal benefit for them to remain a part of the workforce is very suboptimal in most cases.
  • To take their rightful place within Indian workforce and society at large, our women need lot more formal sector employment opportunities with better wages. And this cannot happen till formal sector employment grows in its own right.
  • The existing complex and conflicting regulatory cholesterol and inconsistent legislation are currently impeding formal job creation. The last three years may have set the regulatory reform agenda in motion, but to accelerate the formal job creation, we will need to see a far more concerted effort. Raising the labour force participation in formal sector requires a total revamp of the regulatory ecosystem.
  • Large-scale job creation in the formal sector will need sustained reforms in labour laws and skilling ecosystems. It is estimated that India can potentially boost its GDP by $700 billion in 2025, translating to 1.4% per year of incremental GDP growth, by raising female labour-force participation rate by just 10 percentage points, from 31% to 41%. However, this requires us to bring in 68 million more women into the workforce.
  • Creating non-farm jobs to absorb this work force over the next decade will no doubt require a change in thought process about the role of women in society and the economy. Huge investments will be needed in upskilling and educating women and the girl child, financial inclusion of women, encouraging women entrepreneurs, strengthening legal provisions for safety and security of women.
  • But more than anything else it will require creating an abundance of new jobs within the formal sector and lowering barriers to job creation.

Way ahead

  • Increased availability of stable-wage jobs for women is critical to preventing their socio-economic exploitation, improving their quality of life, enhancing a woman’s control over household decision-making and enabling her to lead a life of dignity.
  • Formalization of India’s job market is one the biggest gifts our policy makers can possibly give to the Indian woman.

Question–  How does the formalization of workforce can help to increase the female labour force participation rate in India?

2.Bitcoin: fraud or future (Indian Express)

Synoptic line: It throws light on the Bitcoins and the possibilities associated with them. (GS paper III)

Overview

  • Today, with this strange digital currency at an all-time high, opinion is divided on whether its value is a sign of a growing rebellion against a monetary system controlled by corrupt, predatory governments, or, alternately, whether it is providing a haven for criminals.
  • There are also those who believe that Bitcoin and other digital currencies that have since emerged are simply a giant, collective delusion.

Bitcoins

  • Bitcoin’s emergence was organically linked to the implosion of the global financial system in 2007-08, which led some to lose faith in government-controlled currencies. Ideologically, Bitcoin appealed to a spectrum of libertarians and anarchists, who saw in it a kind of new gold a commodity whose value would be determined purely by demand and supply, not by the actions of central banks.
  • Like all crypto currencies, Bitcoin functions in the same way as cash or gold, but it can also serve as a certificate or bond, a clearing house, a settlement layer. To its proponents, the principles underlying Bitcoin make it a democratic alternative to the commercial banking network, and even central banks.
  • In essence, Bitcoin uses cryptography to securely conduct a transaction between a sender and a recipient. The cryptographic technology means you don’t have to trust others on the network, as you might a bank or a clearing house.
  • To get a sense of the technology, imagine having banknotes protected by combination locks with over 100 digits locks which, moreover, can’t be removed without destroying the note itself.
  • In addition, each confirmed transaction is recorded on a public ledger, called a block chain. The block chain is shared between all users of the Bitcoin network, and updated in real time. The underlying mathematics makes it impossible to make duplicate copies of Bitcoin, or use it for more than one transaction at a time. Each time a new block or set of transactions is consolidated into a block, it verifies all those before it. In general, six verifications mean a transaction is 99.99% likely to be genuine.
  • Like gold, Bitcoin is “mined”, though by giant, power-hungry computers, which are today thought to be collectively using more power than many European countries. In essence, Bitcoin miners solve the complex mathematical problems needed to verify transactions and thus build the block chain. In return, they are issued a certain number of Bitcoin.
  • Eventually, when 21 million Bitcoin are in use a target which experts estimate will be reached around 2040 no more will be created. Then, the verification of blocks will be rewarded by fees paid by users on the network.

Usage of Bitcoins

  • To use Bitcoin, users have to first get a digital wallet, which can be used on computers or mobile devices. Every wallet can contain one or more unique addresses, which are like account numbers. An address a string of characters which lets a user receive or buy Bitcoin. It is the only information you need to give out. In addition, every user has a private address, never shared with anyone else, which lets users send Bitcoin.
  • It is possible to send and receive any amount of money almost instantly anywhere in the world at any time no borders, no limits imposed by governments, no holidays. Though technologies do exist to help law enforcement organisations link individuals to Bitcoin transactions, it is relatively simple to ensure the defeat of such efforts.
  • For many users, Bitcoin’s attraction is that it frees their money from the actions of government. In countries where inflation is high as a consequence of government policies, for example, Bitcoin allows individuals to insulate themselves. Argentinians, for instance, invested in Bitcoin to avoid rampant inflation, as did Cypriots during the country’s 2011 financial crisis.
  • For the same reason though, it is a useful tool for money laundering and tax evasion. Bitcoin, after all, records transactions only between digital addresses, not explicitly identified individuals. Since 2011, law enforcement agencies across the world have been increasingly concerned over the use of Bitcoin, and other crypto currencies, for crime.
  • That year, the Federal Bureau of Investigation (FBI) shut down the notorious dark web marketplace Silk Road, where encryption and crypto currency allowed narcotics, stolen credit cards and hacked passwords to be sold anonymously. Ross Ulbricht, Silk Road’s founder, is now serving a prison sentence — but other digital marketplaces like it continue to pop up. The misuse of crypto currencies by criminals means some major financial institutions will not touch it. But others see it as the future of money, and some countries like Russia are working to create officially-backed versions.
  • Even as the price of Bitcoin and other crypto currencies rise ever-higher, opinion remains divided on Bitcoin’s underlying fundamentals. For Jamie Dimon, the head of financial giant JPMorgan Chase & Co., Bitcoin is simply “a fraud”. Eric Posner, professor of law at the University of Chicago, has described it, alternately, as relying on “collective delusion”.
  • The numbers, however, show these prognoses aren’t cutting much ice with investors, increasingly fearful of a global financial system that seems irrevocably broken.

Question– What do you mean by Bitcoins? In what way they can be called as the currency of the future?

3.Childhood foregone (The Hindu)

Synoptic line: It throws light on the the goal to eradicate child labour by 2025. (GS paper II)

Overview

  • Countries around the world having shared knowledge on policies and good practices, and have committed to eliminate child labour, but two years after governments set a 2025 target to end child labour, delegates from 100 nations at a recent conference in Buenos Aires were told that they will miss the deadline.

The IV Global Conference on the Sustained Eradication of Child Labour

  • Under the Sustainable Development Goals (SDG) of the 2030 Agenda, UN Member States, employers and worker’s organizations, as well as civil society organizations, are urged to eliminate child labour by 2025, and forced labour, modern slavery and human trafficking by 2030.
  • In order to contribute to this goal, the ILO launched a global partnership designed to align the efforts of those working towards the achievement of SDG Target 8.7.
  • In this framework, it was agreed that the IV Global Conference should cover both the sustained eradication of child labour and the elimination of forced labour and, in this context, it will also address the issue of the quality of youth employment.
  • SDG 8 aims to Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.
  • In Target 8.7 leaders committed to «take immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour, including recruitment and use of child soldiers, and by 2025 end child labour in all its forms.

Findings

  • The International Labour Organisation (ILO) estimates that eight years from now, around 121 million boys and girls would still be engaged in various occupations. The present figure is around 152 million children aged 5-17, only 31 million children are expected to be rescued between now and 2025 from conditions that deprive them for life of the fundamental ingredients of basic survival.
  • Around 71% of working children are concentrated in the agriculture sector, with 69% of them undertaking unpaid work in family units.
  • To resolve the issue countries, need to reinvigorate their efforts to reach the target, they would be looking at a reduction each year of 19 million. That is close to five times the prevalent pace of decline. That would be a stupendous record of eradicating a practice inconsistent with modern democratic norms.
  • Though there was a slowdown in the reduction of child labour, but just one percentage point, during the four years until 2016. In contrast was the fall of three percentage points in the corresponding period up to 2012. More worrisome is that there was almost no progress with respect to the rescue of children under 12 years in the four years since 2012. Equally, the decline in child labour among girls was only half the proportion of that of boys during this period.
  • The ILO points to four systemic failures that underpin the lack of progress. Most important is the absence of national legislation to give effect to global conventions on the employment of children in hazardous industries, as well as on the minimum age of work. There are also the legal inconsistencies is the lack of effective labour inspections in the informal economy.
  • The fact that the two instruments have received the largest number of ratifications brings into sharp focus the lack of harmony between global commitments and domestic priorities. Relevant here is the research on the incoherency between laws that prescribe a minimum age for employment and those for completion of compulsory school education. It also means that the expansion of quality universal basic education has to extend beyond the fulfilment of statutory provisions.

Way ahead

  • There is need for a strong legal framework that mandates punitive action against errant firms and recruitment of youth and adults are important tools to guarantee the protection of children.

Question– “The goal to eradicate child labour by 2025 seems elusive” critically examine the steps taken by the government.