GS Analyst: Daily Current Affairs

A recent incident of death of a construction-site labour has highlighted the severe risks faced by such workers.

Issues faced by construction labours:

• Daily Struggles on Construction Sites: Work on construction sites begins early and extends into the evening, even in extreme weather. Basic amenities like clean water, sanitation, and electricity are often missing. Falling ill means losing a day's wage, which can be a significant setback.
• Gender Disparities in Employment: Women face additional challenges. Unlike men, who can diversify into tasks like painting and carpentry, women often perform repetitive, lower-paid tasks like transporting materials.
• Housing and Wage Issues: Many workers live on-site while working on long-term projects. Wage disparities persist, with certain jobs, like Plaster of Paris (PoP) work, paying less despite their importance.
• Deaths: The state's neglect of these workers by not providing basic safety facilities at construction sites and not enforcing safety equipment regulations leads to frequent deaths in the construction industry.
• Other issues: lack of paid leaves, bonded labour, delayed payments, poor working and living conditions, climate change (heatwaves) and others.

Significant Role of Construction Labourers in the Economy

• Construction labourers are part of the unorganized sector, lacking formal job offers, gratuity, and other benefits that organized sector employees receive.
• More than 70 million individuals are engaged in India’s construction sector
• The construction industry is crucial to the Indian economy, expected to employ over 100 million people by 2030, with 80% being unskilled labourers.
• The industry contributes to 5% of GDP and 8% of capital formation.

As the backbone of urban development, these workers deserve significant interventions and robust protections to ensure their health, dignity, and financial well-being.

The Supreme Court of India has asked the Election Commission of India (ECI) to respond to an application demanding the disclosure of the absolute number of votes polled in the ongoing elections. The application seeks timely transparency in voter turnout data to maintain public confidence in the election process.

Key Issues Raised:

• Delayed Release of Voter Turnout Data: The ECI delayed releasing voter turnout data for the first two phases of the 2024 Lok Sabha elections. The final data released showed a significant increase compared to initial data, raising concerns about data integrity.
• Discrepancy in Data: The application highlighted a 5-6% increase in voter turnout. This discrepancy has caused public suspicion regarding the accuracy of the election data.
• Need for Timely Disclosure: It suggests uploading scanned copies of Form 17C, which records votes polled at each booth, to the ECI website immediately after elections.

Legal and Procedural Aspects:

• Form 17C Data: The ECI provides Form 17C data to every candidate, and any candidate can raise objections through an election petition.
• The Voter Turnout App provides real-time tentative voter turnout figures, which can later differ from the actual figures recorded in Form 17C.

Transparency in Elections:

• Timely and accurate disclosure of voter turnout data is crucial for maintaining public trust in the electoral process.
• Ensuring that discrepancies are minimized and explained can help mitigate suspicions and enhance the credibility of election results.

Integrity of Elections and Public Trust

• Impact of Discrepancies: The application argues that delays and discrepancies in data release undermine public confidence in the electoral process.
• Need for Verification: Without absolute numbers, the public cannot verify the accuracy of the votes polled against the votes counted.
• Historical Comparison: In the 2019 Lok Sabha Elections, the ECI released total votes polled data comparing it with 2014 data, providing transparency and trust.

Finance Minister Nirmala Sitharaman said that India needs to ramp up its manufacturing sector to increase its share in the global value chain and become 'Atmanirbhar'.

Current Status of India's Manufacturing Landscape

• India’s manufacturing sector contributes 17% to GDP and employs 27.3 million workers.
• Government aims to raise manufacturing's share to 25% by 2025.
• India's emergence as a manufacturing powerhouse presents long-term investment opportunities.
• Strengths:
  • Dominant sectors: textiles, automotive components, pharmaceuticals, and generic drugs.
  • Recently emphasized sectors: electronics, aerospace, defence, and renewable energy.

Challenges for India:

• Industrial Infrastructure: Improvements seen in industrial parks and economic zones. However, challenges remain in logistics and power supply.
• Skill Development and Talent Shortage: Skilled workers available, particularly in IT and engineering. There is need for continuous investment in advanced manufacturing skills. Labour laws and vocational schools also need reform.
• Manufacturing Diversification: Traditionally strong in certain sectors. However, push for diversification into newer sectors is crucial for balanced growth.
• Labour-intensive rather than capital-intensive: Manufacturers often use low cost of labour to offset the significant initial investment required for automation. It leads to a multitude of issues (labour-related problems, increased non-value-added time, heightened health, safety, and environmental concerns, and ultimately, a decline in product quality levels)
• Ease of Doing Business: Progress made but room for improvement in labour laws, land acquisition, and bureaucracy.
• Global Competitiveness: India faces stiff competition from countries with established manufacturing sectors like China, South Korea, and Taiwan.

Conclusion:

Despite challenges, India's manufacturing sector holds promise, especially with emphasis on diversification and skill development. Addressing infrastructure gaps and improving ease of doing business are crucial for sustained growth and global competitiveness.

A recent study based on satellite observations sheds light on a concerning trend in India's agricultural landscape. Between 2018 and 2022, over five million large farmland trees, vital for agroforestry, were felled to make way for farming.

Key Findings:

• The study revealed a significant loss of mature trees within a decade. It highlights the disappearance of around 11 percent of India’s large trees, particularly in states like Telangana and Maharashtra.
• Agricultural expansion: Several states pointed to agricultural expansion, notably for paddy fields, as the primary reason for tree felling.
• Human-induced factors like changing agricultural practices and infrastructure development were identified as major contributors to this alarming trend.

Concerns and Implications:

• The depletion of large farmland trees poses ecological and socio-economic challenges, including loss of biodiversity, carbon release, and erosion of indigenous knowledge.
• These trees play a crucial role in agroforestry, offering benefits like soil fertilization, crop protection, and provision of fruits and medicine.
• The decline in such trees may exacerbate climate change and threaten the sustainability of agricultural practices.
• India historically practices traditional agroforestry, integrating beneficial trees like neem, coconut, and jackfruit into agricultural areas.
• The loss of these trees signifies a shift in farming practices and land use patterns, with potential repercussions on environmental sustainability and livelihoods.

May 17 marked the 26th anniversary of Kudumbashree, a significant example of social progress in Kerala.

About Kudumbashree programme

• Launched in 1997, the Kudumbashree programme aimed to empower women and eradicate poverty.
• It has since grown into the largest women’s network in the world, boasting 46.16 lakh members across three lakh neighbourhood groups (NHGs).
• Kudumbashree primarily focuses on
• It started as a cluster of microcredit neighbourhood groups engaged in thrift and credit activities. Over the years, it has created many crisis managers and entrepreneurs from humble beginnings.

The Tejas Mk1A, an advanced version of India's indigenous supersonic fighter aircraft, is poised to bolster the Indian Air Force's capabilities. This upgraded variant builds upon the success of the Tejas programme initiated in the late 1980s.

Features of Tejas Mk1A:

• It incorporates almost 50% more indigenous content compared to its predecessor.
• With 40 enhancements, it promises advanced capabilities.
• Equipped with the Israel EL/M-2025 AESA Radar, soon to be replaced by the indigenous Uttam AESA Radar.
• It offers improved situational awareness with a larger canopy and enhanced aerodynamics.
• Capable of carrying various weaponry, including Beyond Visual Range (BVR) missiles and Advanced Short Range Air-to-Air missiles (ASRAAM).
• Features an indigenously developed digital fly-by-wire flight control system.

Significance of Tejas:

• The Tejas programme was conceived to replace aging MiG-21 and Su-7 aircraft.
• Tejas is the lightest and smallest aircraft in its class, with a composite structure contributing to its lightness.
• It boasts versatile capabilities for ground attack, interception, air-to-air combat, and air defense.
• The Mk1, Mk1A, and Mk2 variants are slated to replace aging MiG-21, MiG-29, and SEPECAT Jaguar aircraft in the Indian Air Force.

Recent incidents involving orcas, also known as killer whales, targeting boats in the Strait of Gibraltar have sparked concern. These interactions, which have led to damaged boats and risky situations for sailors, highlight a growing issue that requires attention.

Possible Explanations:

• Scientists are puzzled by the behavior, considering orcas are not typically aggressive towards humans.
• Theories suggest the behavior could be playful or a reaction to traumatic experiences, such as getting tangled in fishing lines.
• Some scientists believe targeting boats could be a form of play or a fad among young orcas, similar to toddlers mimicking behavior.
• Traumatic experiences, like getting tangled in fishing lines, may have triggered aggressive behavior in certain orcas, influencing others.

India has signed a 10-year agreement with Iran to develop and operate the Chabahar port, signaling a significant step in infrastructure and trade partnerships despite ongoing geopolitical tensions and potential U.S. sanctions.

India's Strategic Investment in Chabahar

• Financial Commitment: India will invest USD 120 million and offer a USD 250 million credit facility to develop the Shahid Beheshti terminal and related projects in
• Project Delays: The Chabahar project, conceived in 2003, faced significant delays due to U.S. and UN sanctions on Iran, but progressed after a 2015 MoU and 2016 contract execution following eased sanctions.
• Sanctions Carve-out: Despite the U.S. reimposing sanctions in 2018, India secured ad hoc measures to continue operating the port, emphasizing its importance for India's strategic interests.

Importance of Chabahar Port for India

• Alternative Trade Route: Chabahar provides an alternative route to Afghanistan and Central Asia, bypassing Pakistan, enhancing trade with these regions.
• Connectivity to NSTC: The port is expected to link with the International North-South Transport Corridor, reducing trade time and costs between India and Europe through Iran, Azerbaijan, and Russia.
• Geopolitical Influence: Located near Pakistan's Gwadar port, where China is expanding its influence through the Belt and Road Initiative (BRI), Chabahar helps India bolster its presence in Central Asia.

Challenges and Policy Considerations

• S. Opposition: The U.S. has warned of potential sanctions for entities doing business with Iran, complicating India's engagement with Tehran.
• Changing U.S. Interests: Shifts in U.S. regional policies, particularly post-2018, have influenced India's approach to Chabahar, but India's strategic interests in Central Asia necessitate sustained investment.
• Stability and Consistency: India must avoid previous policy reversals influenced by U.S. positions and maintain consistent support for Chabahar to secure its trade and connectivity goals.

Mains Question:

Discuss the strategic significance of the Chabahar port for India in the context of regional connectivity and geopolitical influence.

The recent heatwave and confirmation from the World Meteorological Organisation that 2023 was the warmest year on record underscore the urgent need to address climate change. This has intensified focus on reducing carbon emissions in major sectors like power and industry, particularly in high-emitting countries like India.

India's Green Energy Initiatives

• Government Support: The Indian government is promoting green energy through initiatives such as the Production Linked Incentive (PLI) scheme for solar modules, viability gap funding for offshore wind and battery storage projects, and the Faster Adoption & Manufacturing of Electric Vehicles (FAME) scheme.
• National Green Hydrogen Mission: This mission, along with amendments to the Energy Conservation Bill and the launch of green bonds, highlights India’s commitment to reducing carbon emissions.
• Voluntary Steps and Risks: While the shift to green technology isn't mandatory yet, many entities are voluntarily transitioning, facing transition risks such as technological, policy, regulatory, market, reputation, and legal challenges.

Investment and Infrastructure Needs

• Renewable Energy Investments: To meet the target of 50% non-fossil power by 2030, India needs an estimated Rs 11-12 lakh crore investment in renewable energy (RE) and Rs 5-6 lakh crore in transmission and storage infrastructure.
• Round-the-Clock Supply: Achieving a reliable supply from RE sources requires hybrid projects (wind and solar) and energy storage systems to mitigate intermittent generation issues.
• Hard-to-Abate Sectors: For sectors like steel and cement, carbon capture utilization and storage (CCUS) is essential to significantly reduce emissions, necessitating substantial investments and technological advancements.

Sector-Specific Challenges and Solutions

• Cement Industry: Cement production is highly carbon-intensive, with clinker production being the major emission source. CCUS can reduce emissions by 60-70%, with the cement sector needing a two million tonnes per annum CCUS capacity by 2030.
• Steel Industry: With domestic steel production heavily reliant on coal, reducing the carbon footprint by 25-30% by 2030 through technological interventions is critical, aligned with India’s 2070 net-zero target.
• Green Hydrogen: The National Green Hydrogen Mission aims to integrate green hydrogen into refining, chemical, and fertilizer sectors, requiring Rs 8-9 lakh crore in capital expenditure. Indian companies are initiating pilots and plans for green hydrogen and ammonia production facilities.

Mains Question:

Discuss the significance of India's green energy initiatives in the context of global climate change.

The monthly collection of GST reached an all-time high, crossing the Rs 2 lakh crore mark for the first time. Despite this achievement, there are ongoing issues with the implementation of GST laws, particularly the complications related to the time limits for availing input tax credit (ITC).

Input Tax Credit Challenges

• Core Philosophy of GST: The GST system aims to merge multiple central and state taxes, allowing seamless credit for tax paid on inputs. This prevents the cascading effect of taxes.
• Illustrative Example: A manufacturer with tax liabilities may face issues if unable to fully pay taxes, losing ITC on inputs already paid for, exacerbating financial strain.
• Practical Solution: The GST portal should accept returns even if the full tax is unpaid, recording arrears and charging interest, enabling businesses to claim ITC and maintain cash flow.

Impact on Small and Medium Enterprises

• Cash Flow Issues: Many SMEs struggle with delayed payments from clients, including government agencies, complicating timely tax payments despite input taxes already paid.
• Legal Recourse: The MSME Development Act imposes a 45-day payment limit, often ignored, leaving SMEs without effective legal solutions.
• Comparative Injustice: Similar to income tax laws, where tax is on net income, GST should not penalize businesses by disallowing ITC due to cash shortfalls, but rather impose interest on unpaid taxes.

Proposed Adjustments and Urgent Action

• GST Portal Modification: Allow acceptance of monthly returns with tax shortfalls recorded, charging interest until dues are cleared, thus permitting ITC claims.
• Practical Redress: The GST Council should address this issue to support SMEs, considering the non-deliberate nature of most defaults due to adverse business conditions.
• Extended Deadlines: Until the GST Portal is updated, the November 30 deadline for availing ITC should be flexible to prevent undue hardship on taxpayers.

Mains Question:                                                                                                              

Discuss the implications of the GST input tax credit time limit on small and medium enterprises (SMEs) in India.