in this section, we are presenting our readers/aspirants compilation of selected editorials of national daily viz. The Hindu, The livemint,The Times of India, Hindustan Times, The Economic Times, PIB etc. This section caters the requirement of Civil Services Mains (GS + Essay) , PCS, HAS Mains (GS + Essay) & others essay writing competition
1.Too much prudence with bad loans is bad
The reported proposal for banks to sell only bad loans that have been fully provided for to the bad bank proposed in the budget is, at one level, prudent, and, at another, too prudent. Any receipt against a loan that has been fully provided for will go straight to the bottomline. However, holding on to partially provided for bad loans will not serve the purpose of liberating the banks to start lending aggressively to fuel economic recovery.
Whatever kind of bad assets are transferred, two kinds of questions will remain, about the bad loan’s origination and pricing for transfer to the bad bank. Was there any mala-fide in the original sanctioning of the loan? This cannot be addressed by the choice of what types of assets are transferred to the bad bank. What is the fair price for the bad loan that the bad bank buys from the bank? The valuation problem can be addressed by letting a third party determine a value and having that reviewed by another set of eyes, as was successfully done in the first bad bank experiment in Pittsburg.
Mellon Bank of Pittsburgh set up Grant Street National Bank to buy its bad loans and resolve them. The unit was partially backed by junk bonds underwritten by an investment banking firm. The pricing of the loans for sale at a discount was done by accounting firm Arthur Andersen & Co, following which the price was reviewed by Kenneth Leventhal & Co. Similar arm’s-length pricing makes sense for India’s bad bank. An oversight committee will help protect the integrity of decisions taken by bankers. The bad bank must be run professionally and maintain an arm’s-length relationship with the bank. In tandem, the bankruptcy courts must do their job efficiently, and the market for corporate bonds must mature.
2.By diligence, not lockdowns
There is a pandemic resurgence in several parts of the country, particularly Maharashtra and Kerala. The official response must eschew either extreme: lockdown, or acceding to the public’s weariness with Covid protocols. Wearing a mask and avoiding close contact with others, particularly in closed spaces, besides getting vaccinated against the coronavirus at the first available opportunity are the key steps to prevent the spread of Covid — at the individual level. Enforcing these measures, with carrot, stick and innovative advertising, is only one part of the needed official response. Vigorous implementation of the vaccination drive and prolific genetic profiling of virus samples from fresh infections to spot any new mutant strains is another, vital part.
Sharad Pawar is a politician of national stature, but in Maharashtra, he wields special influence. He has done well to cancel all planned public engagements, in the light of a fresh wave of Covid infections. This sets the right example for a lot of people. Others who enjoy similar public esteem must be encouraged to come forward and champion Covid-responsible behaviour.
In the early years of trade union activism, unions played a vigorous role in responding to epidemics such as the plague and cholera, particularly in workers’ residential areas. Trade unions and other social organisations, temples, churches and mosques must be roped in to drive home the importance of maintaining Covid protocols till the disease is brought fully under control. This is more difficult than announcing a lockdown and, thus, appearing to be taking tough action to contain the pandemic. But such facile attempts at containing the virus would extract a huge cost that the nation can ill afford. Punjab is making it clear that health workers who refuse to get vaccinated would lose certain privileges. This is the right thing to do. Those who indulge their vaccine scepticism harm not just themselves but society at large. The message must be driven home, across states. Pandemics are overcome by action, not dither.
3.Trust private: Indications of a second Covid wave must trigger change in vaccination strategy
Five weeks after commencement of the vaccination drive, it has become fairly obvious that further delay in utilising private sector capacity can impose immense costs. India’s weekly average of cases is rising again after several weeks of steady decline. Maharashtra, perhaps India’s most economically crucial state, is threatening more stringent measures after imposing a lockdown on three districts. Fresh cases in Kerala, Punjab, Chhattisgarh and MP are also on the health ministry radar now. If this is the onset of a second wave, the best countermeasure available – vaccination – must be scaled up immediately.
The current vaccination strategy, despite best intentions, is inoculating less than 2 lakh persons on most days. At this pace, India’s hopes of vaccinating 30 crore persons in priority groups by July look impossible. However, leading lights of India’s private sector like Devi Shetty and Azim Premji have proposed a far more ambitious programme of vaccinating 50 crore people in 30 to 60 days. This will require unleashing India’s private sector energies to solve the problem of scale.
After the Union Budget pushed a strong privatisation agenda, Prime Minister Narendra Modi made spirited arguments indicating how the private sector can act as a force multiplier in solving national problems. He recalled private enterprise successes in telecom and pharma sectors that have improved quality of life for the poor, while pointing out the limitations of babudom. Trusting the private healthcare sector in boosting vaccination – to tackle the most critical problem facing India today – will translate such talk into practice instantly. Based on claimed capacity of 100 vaccinations per session, the 1.86 lakh inoculations on Saturday were achieved at just 26% capacity utilisation. A sense of urgency is clearly missing in these mediocre numbers.
Each day of low capacity utilisation equates to losing precious time against a second wave and complete economic unlocking. While government can continue its free vaccination drive for priority groups, the private sector must be freed from such bureaucratic exercises. Market dynamics and competition from government facilities will ensure that private hospitals and clinics price their offerings in a range that helps them tap the widest possible clientele. High vaccine stocks coupled with ample number of vaccination sites will rule out supply bottlenecks driving up prices, if that is what government fears. High vaccine hesitancy and complacency surrounding Covid are also reasons to take a war footing approach to vaccination. A high decibel campaign to promote vaccination and masking can no longer wait.
4.Crypto world: Cryptocurrencies pose unique challenges and need a judicious approach
In the flux after the 2008 financial crisis, an extraordinary instrument dubbed cryptocurrency was created. Bitcoin, the first cryptocurrency, was introduced by Satoshi Nakamoto, a pseudonym used by the mysterious originator. It turned our understanding of currency on its head. Inspired by the philosophy of “self-sovereign identity” cryptocurrencies are an asset which are not anyone’s liability; neither is there a single authority or institution to maintain records. What we have are digital currencies designed for decentralised operations, cutting out a regulated intermediary like a bank.
Conventional money, or fiat currency, is issued by the state. It is usually the liability of a central bank such as RBI, which also oversees the recordkeeping of transactions. Its essential features are the credibility that comes from being guaranteed by the state, which leads to a central record keeper like RBI. Cryptocurrencies such as Bitcoin and Ripple are just the opposite. They are underpinned by a network called blockchain, run by anonymous computers linked together by a ledger of anonymised transactions. There are two potential issues that arise from cryptocurrencies. Will they supplant conventional currency, a state monopoly? Highly unlikely because inherent limitations of cryptocurrencies limit scalability and mass use.
A cryptocurrency like Bitcoin is also traded on exchanges, including in India, taking on the role of an asset. Here many governments, including India’s, have taken a dim view. Cryptocurrencies thrive on anonymity. They open the door to peer-to-peer transactions that circumvent state controls. FATF, the inter-government body that sets standards to combat money laundering and terror financing, worries about this instrument becoming a safe haven for illegal deals. Will a ban on cryptocurrencies solve the problem? It won’t because not only do they already exist, they are designed to bypass normal filters. It is a tricky issue which needs a well-thought approach.
5. In Puducherry, a political crisis | HT Editorial
In Puducherry, on Monday, the Congress government, led by chief minister V Narayanasamy, lost power. Faced with desertions of four legislators — two resigned on Sunday — the government fell short of a majority, and the CM choose to resign instead of facing a floor test. The fall of the Congress government is significant, for it comes weeks before the Union Territory will hold elections. It has also happened days after the President of India, on the Centre’s recommendation, divested Lieutenant Governor Kiran Bedi of her charge and assigned it to Telangana’s governor Tamilisai Soundararajan, who asked the CM to prove his majority. The fall of the Congress government has led to a predictable exchange of accusations — with the CM accusing the Bharatiya Janata Party (BJP) of destabilising his government and the BJP accusing the Congress of misgoverning the UT.
Puducherry has confirmed, yet again, three broader trends in national politics. The first is the inability of the Congress to manage its internal affairs. Reports suggest that there had been brewing disenchantment with the CM’s style of functioning, and legislators were looking out for political opportunities. Despite being the only southern region where the party is in power, the Congress high command clearly did not pay enough attention to these rumblings and address the internal discord. The fact that internal discord cost the Congress power in Madhya Pradesh (MP) and Karnataka just recently — and the party was about to lose its government in Rajasthan — should have alerted it to the need to stem internal factional divisions.
Second, the developments confirm the BJP’s political aggression and willingness to deploy all means to weaken the Congress and ensure non-Congress governments, even if the BJP cannot, on its own, provide an alternative as is the case in Puducherry. But, most importantly, as analyst Chakshu Roy pointed out in this newspaper, the episode exposes the utter failure of the anti-defection law. It fails in stopping legislators from shifting allegiances and the ouster of governments due to these shifts, while stifling genuine voices from among legislators, beyond party lines, on issues of public importance. The practical realities of Indian politics — the ineptness of the Congress and the BJP’s quest for power — and the dysfunctionality of existing legal frameworks such as the anti-defection law has led to Puducherry’s pre-poll political shift.