01.Jan.2024

#GS3: – 01. World Economy and Geopolitics

A flare-up in geo-political tensions can play spoilsport. The widening of the Israel-Palestinian crisis appears real with Houthi rebels attacking ships plying in the Red Sea. This could create a supply-chain disruption. If the conflict expands (US says Iran is behind the Red Sea attacks), prices of oil and other commodities will increase. This could fuel inflation, trigger another round of interest rate hikes, and smother economic revival.

– Commentary in News

Key Terms/Issues : Houthis, Red Sea

#GS3: –  02. India in 2023

Today every corner of India is brimming with self-confidence, imbued with the spirit of a developed India; the spirit of self-reliance. We have to maintain the same spirit and momentum in 2024 as well. The record business on Diwali proved that every Indian is giving importance to the mantra of ‘Vocal For Local’. Our players won 107 medals in Asian Games and 111 medals in Asian Para Games. Indian players won everyone’s heart with their performance in Cricket World Cup.The victory of our women’s cricket team in theUnder-19 T-20 World Cup is very inspiring.
-PM Modi
Key Terms/Issues : Vocal for Local

#GS3: – 03. Finance Commission

Besides deciding on what share of the centre’s tax receipts should be shared with states and how it is to be apportioned among them, a key task for the Finance Commission is to ensure that states have efficient systems and measures in place for financing local bodies as advised by the state finance commissions. The formula that applies till FY26 recommended by the Fifteenth Finance Commission led by NK Singh requires devolution of 41% of Centre’s net tax revenues to states. Among states, the share is decided by a formula designed to incentivize demographic performance and the state’s effort to mobilize own tax revenue and also takes into account the geographic area, forest cover and the state’s per capita income. – Commentary in News
One area of concern has been that very few states have regular state finance commissions to guide the state administrations on issues including local body fund requirements.Therefore,devolution of funds from unionand states to local bodies warrant greater attention.
-NR Bhanumurthy, vice chancellor of B.R. Ambedkar School of EconomicsUniversity

#GS2: –  04. World Geopolitics

My observation that “life is better now than at anytime in history” may have been true in 2013,but it probably is not today,even for the typical person. The question is whether this reversal will be temporary, or whether it is only the beginning of worse to come. Improvements in human well-being have repeatedly confronted reversals, many of them lengthy,and some characterized by unimaginable devastation. In the twentieth century alone,disastrous national and international politics caused tens of millions of deaths in two world wars, the Holocaust, and from the murderous policies of Stalin and Mao.The global influenza pandemic of1918-20 killed perhaps 50 million people out of a world population of less than two billion. The HIV/Aids epidemic has killed around 40 million people to date, and more than half a million continue to die each year from it, most of them in Sub-Saharan Africa. Recent events present a depressing catalogue: slow or negative growth; rising global temperatures; resurgent
infectious diseases;anti-democratic and right-wing populist politics; stalling globalization; stagnant life expectancy; and increased geopolitical tensions, particularly between the world’s two largest economies, the United States.

China. Are we returning to a pre-enlightenment world ruled by priests and warlords, or is today’s darker outlook just another temporary set-back that will be overcome in time? The single biggest threat to continued progress is climate change. Though we know what needs to be done,and though the required technologies are rapidly improving, national and international politics have not supported the necessary action. If there is one lesson to take from the pandemic, it is an old one: that hubris is the precursor to nemesis. Still, one promising change is the increased use of climate policies based on incentives rather than on penalties.This is crucial,because democracies will always struggle to implement policies that make substantial numbers of people worse off, even if only temporarily. Historically, plagues have spread along trade routes,and the situation today is no different. Since the 1990s, international trade has expanded at previously unseen rates, establishing not only global value chains but also global virus chains. During that period, there have been two other, much smaller pandemics involving novel respiratory diseases: Severe Acute Respiratory Syndrome (Sars) and Middle East Respiratory Syndrome (Mers). With a death toll below1,000 in each case, it was easy to see these episodes as a vindication of the global public-health system’s efficacy, and of the limited threat posed by novel pathogens in a richer, better-run world. Notwithstanding the cynical politics,we clearly cannot and should not seek a return to the era of hyper-globalization. We urgently need a new global economic order that can preserve and extend the great escape,but with greater care for domestic politics and for the well-being of non-wealthy, less-educated majorities in wealthy countries.To its credit, the current US administration’s policy agenda is directed toward this end, and much now depends on its long-term success. Populists and autocrats have little respect for institutions,including not only democratic processes and protections for minorities,but also the centers of scientific knowledge associated with educated elites. Finally, on an immediate and more parochial note, data collection is under threat as never before. While Chinese data have always required careful interpretation, the same is increasingly true for India, whose published growth rates are implausible and likely manipulated, and whose poverty-monitoring system has been
suppressed. In the US, political polarization has led to divergent measures of poverty, some of which come close to denying its existence.
– Economics Nobel laureate Angus Deaton Key Terms/Issues : Pre-enlightenment world, Global Value Chains, Global Virus Chains, SARS, MERS

#GS2: –  05. Multilateralism
The economic and climate-related disruptions that are falling hardest on non-Western countries can’t be disentangled from the declining influence of the post-World War II multilateral institutions, particularly the UN. The need for strong Western commitments to support global-governance reform is even more urgent now than it was at the beginning of 2023. To unite different parts of the world behind peaceful and equitable solutions and respect for international law, all major powers must commit in earnest to reforming multilateralism—both through the MDBs and at the UN. But since new conflicts will undermine any reform efforts, major powers must ensure that peace, human rights, and security prevail in Eastern Europe, the Levant,and elsewhere. A world of runaway wars—in which state and non-state actors conclude (with good reason) that they can impose their will through military force—is not conducive to progress on problems like unsustainable debt and climate change.
– Former deputy secretary-general, UN, MARKMALLOCH-BROWN

#GS2: – 06. Israel Hamas War

For Israelis and Palestinians, the harsh reality is that there are arounds even million Israeli Jews and seven million Palestinians living between the Jordan River and the Mediterranean Sea, with the latter on their way to gaining a demographic majority. Under these circumstances, there is no such thing as a one-state solution. Israelis will never allow their country to be governed by a Palestinian majority. At the same time,Israel can not rule indefinitely over millions of Palestinians living in a stateless limbo. The only path to peace is a two-state solution in which Israelis and Palestinians live securely alongside each other. The shock of this war might just make both sides recognize that reality.
-Former US National Security Council Member Charles A. Kupchan

#GS3: – 07. AI
AI is admittedly extraordinarily powerful, but it is hardly the first technology to alter the human condition. We need not assume the position of either a true believer or an unbending critic. Human progress emerges from collaboration between us and, beyond that,between us and our machines.In this sense, the role of artists, investors,and innovators in the AI revolution is the same: to combine openness toward the future with informed appreciation of the past.