Daily Mains question – June 9/2020

1. Strategies in tackling the Covid-19 crisis must include local governments being equipped and fiscally empowered. Critically Analyse.

In the News:

• The pandemic has brought home the critical role of local governments and decentralised responses.
• While imposing restrictive conditionality’s on states availing themselves of the enhanced borrowing limits for 2020-21 is unwarranted, the recognition that local governments should be fiscally empowered immediately is a valid signal for the future of local governance.

Core Issues:

• There are four major challenges upfront – economy, health, livelihood and resource mobilization which are to be addressed by all tiers of the government in the federal polity. Own revenue is the critical lever of local government empowerment.
•  The new normal demands a paradigm shift in the delivery of healthcare at the cutting edge level.
• The parallel bodies that have come up after the 73rd/74th constitutional amendments have considerably distorted the functions – fund flow matrix at the lower level of governance.
• There is yet no clarity in the assignment of functions, functionaries and financial responsibilities to the local governments.
•  Critical role of local governments should be recognized by all.

Local finance:

• Property tax collection with appropriate exemptions should be a compulsory levy and preferably must cover land.
• The economic survey of 2017-18 pointed out that urban local governments generate about 44% of their revenue from own sources as against only 5% by rural local governments.
•  There is a yawning gap between tax potential and actual collection resulting in colossal underperformance. In states such as Uttar Pradesh, Bihar and Jharkhand, local tax collection at the Panchayati level is next to nil. All states should take steps to enhance and rationalise property tax regime.
•  Land monetization and betterment levy may be tried and land values have to unbundle for socially relevant purposes.

MP Fund scheme:

• The suspension of MPLADS for two years is a welcome measure. The government has appropriated the entire allocation along with huge non-lapsable arrears.
• MPLADS which was avowedly earmarked for local area development must be assigned to local governments, preferably to Panchayati on the basis of well-defined criteria.
•  In the context of crisis underway, all grants must be untied for freely evolving proper containment strategies locally.
•  The new pandemic is a public health challenge of unprecedented nature along with livelihood and welfare challenges. It has waked us up to the reality that local governments must be equipped and empowered.
•  Relevant action is the critical need.

2. Foregoing a third aircraft carrier due to budgetary constraints could be counter-productive. Explain

In the News:

• In a recent article, it was stated that “third aircraft carrier is not required as military’s focus is on land borders”. The need of aircraft carrier was questioned citing budgetary constraints.

Overall Scenario

• Indian Navy has seen action only twice 1965 and 1971 on the sidelines of the land operations and the aircraft carrier had minimum role. There was classic naval action only once in 1971 which was also a decisive victory.
• Notwithstanding the attacks on Karachi by small missile boats, the centre of gravity was on the eastern front, where the carrier was deployed. Terming carrier involvement as peripheral displays an incomplete understanding of military history.
• The official history of Pakistan Navy acknowledges that “the success of Pakistan’s counter plans hinged largely on reinforcements and resupply of the eastern theatre of war by sea by breaking India’s naval blockade.
•  If the Indian Navy had not efficiently stymied this plan, Pakistan was hopeful of a “stalemate” followed by international intervention.
•  The Indian Navy using its lone carrier ensured that no reinforcements or supplies were forthcoming and no escape route was possible.
• The contemporary argument that a carrier’s utility in future war scenarios will be short and swift and that needs discarding is the claimed ability of any air force providing effective air cover at sea.

Impact of Parochialism:

• China went in for a carrier only after building its army is a narrow interpretation. Aircraft carrier operations take years to master even if a ship is available. China’s 2015 defence white paper states that “the traditional mentality that land outweighs sea must be abandoned”.
•  Foregoing a carrier due to budgetary constraints is counterproductive. An indigenous constructed carrier can galvanise the economy given the large number of industries and MSMEs involved in the supply chain.
• Carriers’ being required for global powers only is debatable. India had initiated the procurement of INS Vikrant within a few years of independence.
•  Parochialism and Sea blindness in the era of Covid-19 budget cuts can have long term impact on comprehensive national power.