Mitras Analysis of News : 13-03-2017

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1.Turning innovations into enterprises  (Mint)

2. Allowing for a sibling    (The Hindu)

3.New Rohingya insurgency in Myanmar

 

1.Turning innovations into enterprises  (Mint)

Synoptic line: It emphasizes and illustrates the need of innovation via start-ups for growth.(GS paper III)

Overview

  • Joseph Schumpeter was one of the earliest economists to advocate the relationship between innovation and economic growth. (can be used in essay)
  • New disruptive innovations are the buzzwords which are driving growth today. Innovation leads to growth in economic and socio economic indicators. Hence, government’s focus towards innovation is progressive.

Engines of innovation –  What are “start ups”?

  • As the fourth industrial revolution based on a knowledge economy starts taking shape, it is these technology-based innovative start-ups that have the ability to drive economic growth and generate large-scale employment opportunities.
  • A startup is a company in the early stages of business development. For some companies, the startup phase of a company may last years.
  • Start-ups are generally small and primarily financed and operated by a handful of founders or one individual. These companies offer a product or service that is not currently being offered elsewhere in the market, or that the founders believe is being offered in an inferior manner.
  • Start-ups typically face multiple risks at an early stage—concept risk, execution risk, technology risk, market risk and scaling-up risk—leading to a high mortality rate. It is estimated that 90% of all start-ups fail.

Startup according to Government of India

According to Startup India policy an entity will be called as start-up till:

  1. Till up to five years from the date of incorporation.
  1. If its turnover does not exceed 25 crores in the last five financial years.
  1. It is working towards innovation, development, deployment, and commercialisation of new products, processes, or services driven by technology or intellectual property.

 What is a Start-up Incubator?

  • startup incubator is a concerted program designed to help new start-ups succeed. Incubators help entrepreneurs solve some of the problems commonly associated with running a start-up by providing workspace, seed funding, mentoring, and training.
  • The sole purpose of a start-up incubator is to help entrepreneurs grow their business.
  • Start-up incubators are usually non-profit organizations, which are usually run by both public and private entities. Incubators are often associated with universities, and some business schools allow their students and alumni to take part in these programs.
  • There are several other incubators, however, that are formed by governments, civic groups, start-up organizations or successful entrepreneurs.

Innovation and growth

  • Numerous stories have linked innovation with economic prosperity.
  • The critical link between innovation and growth provides sufficient justification for the government to invest in innovation and entrepreneurship. Successful examples of public support to innovation and incubation exist around the world.
  • The Israeli government had made significant investments in developing technology incubators, resulting in its leadership generating hi-tech start-ups. The Singapore government rolled out multiple initiatives, including grants, equity financing schemes, incubator schemes, debt financing and tax incentives, to attract innovative start-ups.
  • In about five year’s time, the tech start-ups in Singapore have received record private equity and venture capital investments, totalling $3.5 billion in 2016.
  • According to a PricewaterhouseCoopers report, research and development (R&D) and innovation capital will be essential for India to grow its gross domestic product by 9% per annum to become a $10 trillion economy over the next two decades.
  • Innovations boost productivity through new technologies that reduce costs and/or increase output. The process of commercialization of the innovative technologies creates entrepreneurs.

Atal Innovation Mission (AIM) fostering start-ups

  • Atal innovation mission is step towards the promotion of innovative business ideas by young talent of the country.
  • Its objective is to serve as a platform for promotion of world-class Innovation Hubs, Grand Challenges, Start-up businesses and other self-employment activities, particularly in technology driven areas.
  • AIM is also helping to set up 100 new Atal Incubation Centres (AICs) and scaling up of Established Incubation Centres (EICs).
  • It is also providing comprehensive support for developing the incubation ecosystem in the form of grant-in-aid, seed-funding support, training for the incubator managers, incubation manuals, tech tools and platforms through industry partners and ecosystem partnerships.

Way ahead

  • Throughout the industrial revolutions, innovation has been critical, thus govt. needs to create more tinkering labs and should promote the innovation at the grassroots level. Scientific spirit should be inculcated at an early age in schools itself
  • Moreover, proper accountability and follow-up measures should be adopted to overlook the proper functioning of innovation missions.

2.Allowing for a sibling    (The Hindu)

Synoptic line: By ending China’s controversial ‘one child policy’, result can fall into either side of the spectrum. (GS II)

Overview

  • With concerns of ageing population and shrinking numbers of the working-age population, China has phased out its one child policy.
  • According to China’s national health and family planning commission it will result into “baby boom” with an estimate of annual birth 17-20 million by 2020.

China’s demographics

  • According to United Nations Department of Economic and Social Affairs, the number of Chinese citizens over the age of 65 will soar to 219 million in 2030, it will make up a quarter of China’s entire population by 2050, means a significant portion of citizens will age out of the labour force.

Background of the policy

  • People’s Republic of China established in 1949, there was no official policy, government propaganda condemned contraceptives and encouraged population to multiply for creating manpower. As a result, the population of China doubled over the next few years.
  • But the success was short lived. China’s food supply was strained and the government reversed the campaign against contraceptives. From 1959 to 1961, the Great Chinese Famine killed an estimated 15 to 30 million people.
  • In 1979, the government introduced the one-child policy, under which most couples are allowed to have only one child or with penalty of fines, sterilizations and abortions. With exception to ethnic minorities and for the parents who have first child as girl or disabled infant.
  • Under the 2000 relaxation some couples were allowed to have second child, only if both the parents had no siblings, In 2013 couple were allowed to have second child if either of parent was an only child.
  • With 2016 it has been finally come to end. But after decades of the one-child policy new economic and social pressures succeeded, many couples have decided to stop with one child or not to have any at all. So with a national birth rate well below replacement level China faces a new challenge.

Impact on China

  • According to the study, for the parents to have a second child or not depend upon some key factors like the quality of the public services, especially educational and medical services, affordability of two children, access to child care, Thus National health and family planning commission announced to give incentives to parents so that their economic burden can be lessen.
  • According to demographers and economists, policy reversal have come too late, the effect of two-child policy on China’s growth slowdown or its ageing population would be less than 0.5% a year of GDP growth and a reduction in aged dependency of 0.03% only.
  • Populous aging countries will reshape the global population to the point that almost a fourth of all people on Earth will be over 65 by 2100.

3. Explained

New Rohingya insurgency in Myanmar

  • A new Rohingya insurgent group in Myanmar is forming under the name – Harakah al Yaqin.
  • It is the first Rohingya Muslim insurgent group to organize in Myanmar in decades, signals a dangerous new phase in a crisis that is increasingly attracting the attention of extremists in Pakistan and the Middle East.

Who are the Rohingya?

  • The Rohingya are an ethnic Muslim minority group living primarily in Myanmar’s western Rakhine state; they practice a Sufi-inflected variation of Sunni Islam.
  • The estimated one million Rohingya in Myanmar account for nearly a third of Rakhine’s population. The Rohingya differ from Myanmar’s dominant Buddhist groups ethnically, linguistically, and religiously.
  • The Rohingya trace their origins in the region to the fifteenth century when thousands of Muslims came to the former Arakan Kingdom. Many others arrived during the nineteenth and early twentieth centuries when Bengal and the Rakhine territory were governed by colonial rule as part of British India. Since independence in 1948, successive governments in Burma, renamed Myanmar in 1989, have refuted the Rohingya’s historical claims and denied the group recognition as one of the country’s 135 ethnic groups.
  • The Rohingya are largely identified as illegal Bengali immigrants, despite the fact that many Rohingya have resided in Myanmar for centuries.
  • Government policies, including restrictions on marriage, family planning, employment, education, religious choice, and freedom of movement have institutionalized systemic discrimination against the ethnic group.

Attacks

  • In last Oct., Harakah al-Yaqin – Arabic for “Faith Movement” – launched three coordinated attacks on separate police border posts, killing nine officers.
  • The security operation launched by the military in response has been beset by allegations of mass killings and gang rapes that the United Nations says may constitute crimes against humanity and ethnic cleansing.
  • Myanmar’s government says the allegations of human rights abuses are “serious”, but that security forces are dealing with an insurgency that threatens the region’s stability and development.

Implications for India

  • India is constantly struggling the with the terror camps situated in Pakistan and Afghanistan. This renewed Insurgency in one more neighbour state may have security implications for India.
  • Manipur (which is already destabilized) shares land boundary with Myanmar, the insurgent Nagas may forge an alliance with Rohingyas to pursue their purpose of pressurising India to cede their demands.
  • Moreover, seeing rampant unemployment in the boundary area and hinterlands, the youth can fall to their recruitment propaganda.
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