Editorial Notes

Editorial Notes 28th December 2016

Geopolitical Chessboards; India & NAM; India & SAARC; BIMSTEC, BCIM vs SAARC; Threat of automation; Universal Basic Income.
By IT's Editorial Notes Team
December 28, 2016


GS (M) Paper-2: “Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and bodies constituted for the protection and betterment of these vulnerable sections”
GS (M) Paper-2: “Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources, issues relating to poverty and hunger.”


What Can Governments Do When Jobs Run Out?

Threat of automation:


  • Around 47% of total employment in the US, around 64 million jobs, have the potential to be automated perhaps within a decade or two. Europe is already facing a crisis of jobs.
  • India’s pace of job creation pales in comparison with the millions entering the workforce each year and, according to the World Bank, 69% of jobs in India are threatened by automation.
  • If automation eliminates a substantial fraction of the jobs that consumers rely on, or if wages are driven so low that very few people have significant discretionary income, then it is difficult to see how a modern mass-market economy could continue to thrive.

What is a “Universal Basic Income”?

  • One way of managing social tensions is for governments to implement a guaranteed minimum income for all citizens.
  • Also known as universal basic income (UBI) or a guaranteed basic income, the idea of an income for all has been around for years.
  • It was backed by the Left and even libertarian thinkers and is beginning to gain traction again among economists.


  • Proponents feel that a cash boost – universal basic income mitigates the political problem of creating jobs and it provides disposable income that can be used to pay for goods and services.
  • The idea appeals to some conservatives because,
    1. It boosts the economy,
    2. It is easier to administer and
    3. It can potentially downsize the bureaucracy which currently manages a range of welfare programmes.


UBI has been criticised and reckoned as unfeasible on two grounds.

  • It reduces beneficiaries’ incentive to work and encourages delinquency.
  • It would be too expensive to implement in mass societies.


  • Studies have shown additional income does not really reduce the incentive to workResearch shows that people in the US used cash transfers for mostly housing and food costs and that less than 1% of the money was spent on alcohol or drugs.
  • Poor families that received up to $15,000 a yearatDauphin, Canada in 1970s, the hospitalisation rates fell, high-school completion rates increased.And those with full-time jobs did not reduce the number of hours they worked.
  • Implementing basic income is, of course, expensive. An unconditional $10,000 basic income for all adults in the USwould cost around $2 trillion.
  • This cost, can be offset to an extent by reducing or eliminating numerous federal and state anti-poverty programmes – but it would still require around $1 trillion in new revenue.
  • Governments will need to tax businesses a lot more, rather put this burden on workers and employees who already pay for existing welfare programs.

Is it feasible for India?

  • In India, the costs seem prohibitive and as the country grapples with more foundational issueslike ease of doing business, addressing education and skill deficits and kick-starting investments while banks are stuck with bad loans.
  • But given high poverty levels and the anger among youth that will inevitably rise, the policymakers will need to serious consider basic income, or at least some form of it.
  • A basic income of Rs. 10,000 per year – about three quarters of the official poverty line – would entail a cost equivalent to 10% of GDP, far more than the 4.2% that the government spends on explicit subsidies.
  • He writes that discontinuing some or all of the subsidies while retaining expenditures on health, education and rural and urban development programmes can secure a reasonable basic income for all.


  • Research shows poor families in Madhya Pradesh which received unconditional cash transfers ended doing more labour and work.
  • There was also a shift from casual wage labour to more self-employed farming and business activity and there was also reduction in migration caused by distress.
  • As developed countries increasingly warm to the idea (Finland to implement its version in 2017), policymakers may find it difficult to avoid discussing guaranteed minimum income.
[Ref: Hindustan Times]


GS (M) Paper-2: “Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests”


Playing On Geopolitical Chessboards



  • The BRICS-BIMSTEC meeting in Goa this month, that immediately followed the annual India-Russia Summit (also in Goa), during which India pursued a robust, even aggressive, foreign policy.
  • Given the several changes in direction — and departures from past policies and practices — taking place, there is perhaps scope to debate whether this amounts to a redefining of India’s foreign policy.
  • Hence, giving a new direction to the country’s foreign policy demands careful consideration and assessment of all relevant aspects.
  • Systemic, national and decision-making factors must determine foreign policy choices. Maintaining coherence and balance is also a vital aspect.
  •  It would seem, however, that this kind of exercise has yet to be undertaken, even as shifts in policy have been effected.
  • Multilateral fora have today become indispensable to the conduct of international diplomacy.

India & NAM

  • With non-alignment giving way to strategic alignment, organisations such as NAM may seem outdated. But  it still resonates with many Third World countries.
  • It also offers an alternative platform for putting forward a different viewpoint. It would, hence, be premature to pronounce the death of NAM.
  • The Indian Prime Minister’s decision to skip the NAM Summit in Venezuela may well hasten its end, but does not take away from the fact that NAM still has some relevance and India could still utilise NAM to counter newer challenges such as China’s not so ‘peaceful rise’.

India & SAARC

  • India is the most important country in South Asia, and India was the progenitor of the idea of a primarily economic grouping of countries of South Asia.
  • Admittedly, SAARC has been on ‘life-support’ for much of the period, but had begun to display a new vigour and dynamism recently.
  • India had also shown a willingness to adopt an asymmetrical and non-reciprocal approach towards other SAARC members which had gone down well with these countries.
  •  To undermine SAARC due to the ongoing conflict between India and Pakistan may well be an instance of ‘throwing the baby out with the bathwater’.


  • Propping up bodies such as BIMSTEC and BCIM in place of SAARC is hardly the answer, and could even prove counterproductive.
  • The China factor is all too predominant here, with almost every country (other than India) under China’s influence, having been wooed with financial and other inducements.
  • China is hoping to further consolidate its position through its One Belt, One Road initiative which has been warmly welcomed by all these countries, the sole exception again being India.

Changing ties:

  • Undoubtedly, India’s foreign policy has to evolve in keeping with the changes and shifts taking place across the globe. Permanence in relations, and consistency in alignments, is not a signal virtue in the world of the 21st century.
  • For instance, India-U.S. relations today are at an all-time high. This was hardly the case a decade and a half ago. On the other hand, the ‘all weather’ India-Russia relationship is today nowhere at the same level as it was even a few years back.
  • India may be only partly to blame for this, as Russia has been looking at diversifying its options for some time. It had moved closer to China and has achieved a degree of strategic congruence to counter U.S. moves in Asia.
  • The China, Russia and India triangle thus heralds a situation where two sides, China and Russia, have grown much closer to each other, with India in danger of losing out in this process.
  • The China-Russia Comprehensive Strategic Partnership of Coordination, as also the recent Russia-Pakistan military exercises, even though on a limited scale and a subtext of this, only demonstrate the growing strategic ambiguity in our neighbourhood and in Asia as a whole.

China’s March:

  • China’s ‘not so peaceful rise’, alongside its growing economic and military muscle, its growing strategic congruence with Russia, and a further tightening of its links with Pakistan pose a pre-eminent challenge for India in the competition of influence in the region and beyond.
  • It may have other graver implications as well. The One Belt, One Road initiative and the new Maritime Silk Route/Road also have the potential to negatively impact India and Indian initiatives in Asia.

Way Ahead:

  • As India aspires to become a leading power, these are real matters for contemplation and action.
  • It would be a mistake if India were to waste away its energies by viewing regional and world developments through a very narrow prism, viz., terrorism.
  • There are far bigger and larger issues at stake that demand attention. Most important would be highlighting India’s capabilities to accelerate economic growth during a period which marks the demise of globalisation.
  • India could also bring to the attention of the rest of the world its tremendous ‘human assets’ that can power the country as the world transits to an incredible future, viz., the era of the Fourth Industrial Revolution.

 [Ref: The Hindu]


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