Daily CUrrent AFfairs 28.05.2021 (Uncertainty, risks cloud outlook: RBI, Centralise vaccine buys to minimise costs: EY, Gaza attack may constitute ‘war crimes’, SC had cautioned govt. on privacy)

Daily CUrrent AFfairs 28.05.2021 (Uncertainty, risks cloud outlook: RBI, Centralise vaccine buys to minimise costs: EY, Gaza attack may constitute ‘war crimes’, SC had cautioned govt. on privacy)


1. Uncertainty, risks cloud outlook: RBI

‘Demand-supply imbalances may exert pressure on food prices; banks must gird for higher provisions’

Embattled by new waves of COVID-19 infections and mutant strains of the virus, the slow pace of inoculation in several parts of the world and vaccine protectionism, the global and domestic outlook has once again turned grim and overcast with extreme uncertainty and downside risks, the Reserve Bank of India (RBI) said in its annual report for 2020-21.

“Country experiences underscore the paramount need for speedy and universal vaccination on a war footing — the virus will mutate as long as it stays with humans; nobody is safe until everyone is safe,” the RBI added.

Consumption revival key

A durable revival of private consumption and investment would be critical for sustaining economic growth post-pandemic, the RBI said.

“For a self-sustaining GDP growth trajectory post-COVID-19, a durable revival in private consumption and investment demand together would be critical as they account for around 85% of GDP,” it added.

Price pressures

The RBI also cautioned that demand-supply imbalances could continue to exert pressure on the prices of pulses and edible oils, even as prices of cereals could likely see softening on the back of bumper foodgrains production in 2020-21.

The RBI also expects global crude oil prices remaining volatile in the near term.

‘Monitor bad loans’

The regulator also asked banks to closely monitor bad loans and prepare for higher provisioning in the wake of the second COVID wave and the Supreme Court order lifting the ban on classification of non-performing assets.

The waiver of compound interest on all loan accounts that had opted for moratorium during March-August 2020 may put stress on banks’ financial health, the central bank said.

The apex bank, however, expressed confidence that banks were better positioned than before in managing stress in their balance sheets in view of higher capital buffers, improvement in recoveries and a return to profitability.

Stating that the gross non-performing assets ratio of scheduled commercial banks declined to 6.8% by end-December 2020, from 8.2% in March 2020, the Reserve Bank said prudent provisioning had resulted in an improvement in the provision coverage ratio to 75.5% from 66.6%.

“As growth revives and economy gets back on track, it is important for the government to adhere to a clear exit strategy and build fiscal buffers, which can be tapped into in events of future shocks to growth,” the central bank said.

2. Centralise vaccine buys to minimise costs: EY

Current tack risks a hopeless situation’

India can minimise the vaccination bill by following a fully centralised procurement model that would reduce prices rather than States pursuing purchases on their own, EY India said in a report on Thursday, calling for an urgent recast of the ‘current ad hoc and non-transparent vaccine distribution strategy’.

If the country maintained the vaccination rate of 2.31 million doses per day recorded over March and April, with the current interstate distribution pattern, it would result in ‘a hopeless situation’, the consulting firm noted, adding that the pace of vaccinations had already fallen further in May.

“At an all-India level, it would require 748 days to achieve full coverage of the population of 18 years and above (eligible population),” EY India said.

‘Too many days’

“But, in terms of coverage of individual States, some States would require far too many days. For example, Uttar Pradesh may require 1,553 days, while Bihar may require 1,351 days and Tamil Nadu may require 1,217 days,” it added.

Stressing that the Centre had a primary role in ensuring countrywide vaccine coverage, EY India’s chief policy advisor D.K. Srivastava, who was a member of the Advisory Council to the 15th Finance Commission, said that the ₹35,000 crore provided in the Union Budget for vaccination was meant to be transferred to the States.

“If Centre becomes the only governmental agency to procure vaccines, the average price per vaccine would be much lower than if individual States get involved in floating global tenders. For vaccinating India’s total population aged 12 years and above at 108.5 crore, total required doses would be 217 crore considering two doses per person,” EY India observed, adding that a single purchase agency would be able to reap economies of scale and have more bargaining power.

‘Clearly avertible’

“At an average price of ₹300 per dose, the total vaccination cost would be ₹65,108 crore. If States’ involvement pushes up the average price to say ₹500 per dose, total vaccination bill to the country would unnecessarily go up to ₹1.09 lakh crore. This cost enhancement, which may be higher if the average vaccine price increases even more, is clearly avertible apart from avoiding the confusion ensuing from States’ involvement in vaccine procurement and implementation,” Mr. Srivastava pointed out.

Observing that vaccination and extended lockdowns were the only policy instruments available to control the pandemic, he said, “There is clearly a trade-off between the duration and spread of the lockdowns… and the erosion of growth on the other [hand].

“The more extensive the lockdowns, the larger would be the loss in GDP growth,” Mr. Srivastava added.

3. Gaza attack may constitute ‘war crimes’

UN rights chief Bachelet raises concerns over ‘high level of civilian fatalities’

Israel’s recent deadly air strikes on Gaza may constitute war crimes, the UN rights chief said on Thursday, as countries discussed launching a broad, international investigation.

Addressing a special session of the United Nations Human Rights Council, Michelle Bachelet voiced deep concern about the “high level of civilian fatalities and injuries” from the attacks on Gaza.

“If found to be indiscriminate and disproportionate in their impact on civilians and civilian objects, such attacks may constitute war crimes,” she warned.

She also said her office had “not seen evidence” that the buildings targeted in Gaza, including residential homes, medical facilities and media offices, were “hosting armed groups or being used for military purposes”, as claimed by Israel.

Ms. Bachelet also stressed that rockets fired by Hamas were “indiscriminate and fail to distinguish between military and civilian objects,” and were thereby “a clear violation of international humanitarian law.”

The UN High Commissioner for Human Rights made her statement at the start of a special one-day council session focused on the recent flare-up of violence.

Before a truce took hold last Friday, Israeli air strikes and artillery fire on Gaza killed 254 Palestinians, including 66 children, and wounded more than 1,900 people in 11 days of conflict, the health ministry in Gaza says.

Rocket and other fire from Gaza claimed 12 lives in Israel, including one child and an Arab-Israeli teenager, medics say. Some 357 people in Israel were wounded.

OIC calls for inquiry

At the rights council, countries were debating a proposal to set up a broad, international investigation into violations surrounding the latest violence, but also into “systematic” abuses in the Palestinian territories and inside Israel.

The proposal calls for an unprecedented level of scrutiny on abuses and their “root causes” in the decades-long West Asia conflict.

The draft resolution presented by the Organization of Islamic Cooperation (OIC) calls for the council to “urgently establish an ongoing independent, international commission of inquiry… in the Occupied Palestinian Territory, including East Jerusalem and in Israel”.

Organisation of Islamic Cooperation

  • The Organisation of Islamic Cooperation (OIC) is the second largest intergovernmental organization after the United Nations with a membership of 57 states.
  • It is the collective voice of the Muslim world. It endeavors to safeguard and protect the interests of the Muslim world in the spirit of promoting international peace and harmony among various people of the world.
  • It was established upon a decision of the historical summit which took place in Rabat, Kingdom of Morocco on the 25th of September 1969.
  • Headquarters: Jeddah, Saudi Arabia.
  • India is not a member of the OIC. However, India was invited as a guest of honour at 46th Session of the Council of Foreign Minister in 2019. 2019 is the 50th anniversary of OIC.

4. SC had cautioned govt. on privacy

‘De-encryption, if easily available, could defeat the fundamental right to privacy’

A 2019 Supreme Court order used by the government to justify its new Information Technology (IT) Rules, which compel encrypted social media messaging platforms to disclose their users’ identity, also cautions the Centre from doing anything which amounts to invasion of individual privacy.

On September 24, 2019, hearing a petition filed by Facebook, the top court showed deep concern at the utilisation of social media for committing crime. It said the medium had become a source for pornography. Paedophiles used social media in a “big way”. Criminals exploited it to run weapons, drugs and contraband. Hate and violence were shared and spread through these virtual platforms. The court had even felt that some messages on social media may even threaten national sovereignty.

It was in this context the court had called for a “properly framed regime” to allow the government to get information about first originators of messages from “significant” social media intermediaries with end-to-end encryption technology. The court had exercised restraint, too. It warned that de-encryption, “if easily available, could defeat the fundamental right to privacy”.

The court had clarified that the government should “ensure that the privacy of the individual is not invaded”. The order had also underlined that traceability should be restricted to “specific circumstances”.

But WhatsApp finds traceability under the new rules “disproportionate”. The privacy of each one of its users would be compromised as there was no way to predict which message would be subject to a tracing order from the government.

‘Chilling effect’

In its petition before the Delhi High Court, the social media giant said that it would have to “build an ability to identify the first originator of every message, to be served up to the government forever”. This means even legal users and their messages would be under watch. The effect would be chilling on free speech.

“The essential role of the test of proportionality is to enable the court to determine whether a legislative measure is disproportionate in its interference with the fundamental right [of personal liberty/privacy] … In determining this, the court will have regard to whether a less intrusive measure could have been adopted consistent with the object of the law and whether the impact of the encroachment on a fundamental right is disproportionate to the benefit which is likely to ensue,” the Supreme Court had said in the Puttuswamy case. The principle was reiterated in the Anuradha Bhasin case on Internet freedom.

Besides, the 2021 Rules is a subordinate legislation under the Information Technology Act. Neither the Act nor any other law, for that matter, specifically requires a social media intermediary using end-to-end encryption to reveal the identity of the first originator of a message. However, in this case, the subordinate law has overshot the original intent and boundaries of the parent Act.

The Information Technology (Guidelines for Intermediaries and Digital Media Ethics Code) Rules, 2021

Overview of the new rules:

  1. It mandates a grievance redressal system for over the top (OTT) and digital portals in the country. This is necessary for the users of social media to raise their grievance against the misuse of social media.
  2. Significant social media firms have to appoint a chief compliance officer and have a nodal contact person who can be in touch with law enforcement agencies 24/7.
  3. A grievance officer: Social media platforms will also have to name a grievance officer who shall register the grievance within 24 hours and dispose of it in 15 days.
  4. Removal of content: If there are complaints against the dignity of users, particularly women – about exposed private parts of individuals or nudity or sexual act or impersonation etc – social media platforms will be required to remove that within 24 hours after a complaint is made.
  5. A monthly report: They also will have to publish a monthly report about the number of complaints received and the status of redressal.
  6. There will be three levels of regulation for news publishers — self-regulation, a self-regulatory body, headed by a retired judge or an eminent person, and oversight from the Information and Broadcasting Ministry, including codes of practices and a grievance committee.

What is a significant social media intermediary and benefits obtained under it?

Social media companies with more than 50 lakh registered users will be considered ‘significant social media intermediaries’, as per the new norms.

What happens in case of non compliance?

  1. Social media giants such as Facebook, Twitter, Instagram and WhatsApp messenger could face a ban if they do not comply with the new Information Technology rules.
  2. They also run the risk of losing their status as “intermediaries” and may become liable for criminal action if they do not comply with the revised regulations.

What are the Concerns being raised?

  1. Various industry bodies have written to the government for up to a one-year compliance window, particularly in view of the pandemic.
  2. Concerns have also been expressed over potential unavailability of ‘safe harbour’ protection given to intermediaries under Section 79 of the IT Act, under the new rules.
  3. They have requested a re-think over a clause in the new rules which can lead to imposition of criminal liability upon the employees for non-compliance by intermediaries, asking for it to be dropped in the interest of ease of doing business.
  4. Originator traceability mandate in end-to-end encrypted platforms could end up weakening the security architecture of the platform. This could render the entire citizenry susceptible to cyberattacks by hostile actors.
  5. Additionally, the extant data retention mandate entailed risking privacy of users in India and abroad in addition to security risks and technical complexities which requires a lot of time for development and testing before integration with the existing ecosystem.

5. IBF to cover streaming platforms

The Indian Broadcasting Foundation (IBF), the apex body of broadcasters, is expanding its purview to cover digital streaming platforms and will be renamed the Indian Broadcasting and Digital Foundation (IBDF).

The move would bring broadcasters and OTT (over-the-top) platforms, which have seen a substantial jump in their viewership base after the pandemic, under one roof.

For this, the IBDF was in the process of forming a new wholly-owned subsidiary to handle all matters of digital media, an official statement said.

The IBDF would also form a self-regulatory body, the Digital Media Content Regulatory Council (DMCRC), for digital OTT platforms.

6. Editorial-1: Nine-pin bowling aimed at free speech, privacy

By and large, the Information Technology Rules, 2021 go against landmark judicial precedents upholding key rights

The life of Indian Law rather than being shaped along mathematical exactitudes finds itself at the receiving end of an experiential tussle. This tussle has aimed at every stage to bargain for a Fundamental Right in return for some negotiation, sometimes with the desire of the coloniser and at others with the dominant ideology at the Centre.

There are ambiguities

The subject of concern now is the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 ( which threaten to deprive social media platforms of their safe harbour immunity in the event of non-compliance with the said rules. While there are positive aspects about the said guidelines, there are, equally, glaring ambiguities and stifling susceptibilities that should render these contrary to past Supreme Court of India precedents such as K.S. Puttaswamy.

The Rules must be credited for they mandate duties such as removal of non-consensual intimate pictures within 24 hours, publication of compliance reports to increase transparency, setting up of a dispute resolution mechanism for content removal and adding a label to information for users to know whether content is advertised, owned, sponsored or exclusively controlled.

Gagging a right

However, the Supreme Court, in the case of Life Insurance Corpn. Of India vs Prof. Manubhai D. Shah (1992) had elevated ‘the freedom to circulate one’s views as the lifeline of any democratic institution’. It went on to say that ‘any attempt to stifle, suffocate or gag this right would sound a death knell to democracy’ and would ‘help usher in autocracy or dictatorship’. And so, it becomes increasingly important to critically scrutinise the recent barriers being imposed via these Rules against our right to free speech and expression.

The problem started when these Rules came to life. They were framed by the Ministry of Electronics and Information Technology (MeiTY). The Second Schedule of the Business Rules, 1961 does not empower MeiTY to frame regulations for ‘digital media.’ This power belongs to the Ministry of Information and Broadcasting. In the given case although MeiTY has said that these rules shall be administered by the Ministry of Information and Broadcasting, however this action violates the legal principle of ‘colourable legislation’ where the legislature cannot do something indirectly if it is not possible to do so directly. To propound the problem at hand, the Information Technology Act, 2000, does not regulate digital media. Therefore, the new IT Rules which claim to be a piece of subordinate legislation of the IT Act, travel beyond the rule-making power conferred upon them by the IT Act. This makes the Rules ultra vires to the Act.

Fair recourse, privacy issues

An intermediary is now supposed to take down content within 36 hours upon receiving orders from the Government. This deprives the intermediary of a fair recourse in the event that it disagrees with the Government’s order due to a strict timeline. Additionally, it places fetters upon free speech by fixing the Government as the ultimate adjudicator of objectionable speech online.

The other infamous flaw is how these Rules undermine the right to privacy by imposing a traceability requirement. The immunity that users received from end-to-end encryption was that intermediaries did not have access to the contents of their messages. Imposing this mandatory requirement of traceability will break this immunity, thereby weakening the security of the privacy of these conversations. This will also render all the data from these conversations vulnerable to attack from ill-intentioned third parties. The threat here is not only one of privacy but to the extent of invasion and deprivation from a safe space. These regulations in the absence of a data protection law, coloured in the backdrop of recent data breach affecting a popular pizza delivery chain and also several airlines highlight a lesson left unlearnt.

On fake news

The problem here is that to eliminate fake news — rather than defining its ambit as a first step, the Rules proceed to hurriedly take down whatever an arbitrary, ill-decisioned, biased authority may deem as “fake news”.

Lastly, the Rules create futile additional operational costs for intermediaries by requiring them to have Indian resident nodal officers, compliance officers and grievance officers. Intermediaries are also required to have offices located in India. This makes profit making a far-fetched goal for multinational corporations and start-up intermediary enterprises. Therefore, not only do these Rules place a barrier on the “marketplace of ideas” but also on the economic market of intermediaries in general by adding redundant financial burdens.

Our concluding words on the rapidly diluting right to free speech are only those of caution — of a warning that democracy stands undermined in direct proportion to every attack made on the citizen’s right to have a private conversation, to engage in a transaction, to dissent, to have an opinion and to articulate the same without any fear of being imprisoned.

7. Editorial-3: Weathering storms

Cyclones are inevitable, but communities need fiscal rehabilitation for recovery

India’s capacity to withstand multiple, near-simultaneous shocks is being tested, with a Very Severe Cyclonic Storm, Yaas, striking Odisha, just a week after an even stronger Cyclone Tauktae wreaked havoc along the west coast. Yaas, which put up an unnerving display of tornadoes and rain, smothered the north Odisha coast as it made landfall, but the preparatory mass evacuation from habitations appears to have limited the loss of life. Yet, thousands have lost houses and property. West Bengal and Jharkhand also bore the brunt of the weather system’s force, as it punched its way inland from May 26, weakening into a deep depression. All coastal States facing the Bay of Bengal have always been in the path of severe cyclones, the majority following the withdrawal of the monsoon, but their vulnerability may be growing as pre-monsoon and post-monsoon storms increase in frequency and strength. Moreover, for the second year running, States have been hobbled by the COVID-19 pandemic. The 2021 season comes as another reminder that India will have to improve its resilience to cyclones. Governments are, no doubt, more sensitive to loss of life today and are raising the capacity of the disaster response forces, but much work needs to be done when it comes to protecting assets and creating fiscal instruments to help people rebuild their lives.

While the full extent of displacement and losses from Cyclone Yaas is yet unknown, past experience points to a growing threat to overall well-being from such catastrophes. The World Meteorological Organization in its State of the Global Climate 2020 report described Cyclone Amphan that hit Bengal in May last year as the costliest cyclone on record for the North Indian Ocean, with economic losses to India of the order of $14 billion. In human terms the extreme event displaced 2.4 million people. What stood out in its aftermath was corruption in the distribution of relief, putting West Bengal Chief Minister Mamata Banerjee in a spot. The Amphan experience should convince Chief Ministers that they must insure people against losses from catastrophes using a system of documentation that makes relief and rehabilitation funds non-discretionary. Half a century of economic wisdom postulates that governments are best placed to compensate people, since they can spread the cost of the risk of disasters across the population. But the challenge is to address the risk of cyclones and other extreme weather events using specific funds, making citizens members in a social insurance model. Moreover, considering the negative climate change impact on tropical cyclones, rebuilding should use a green, build back better approach. Cyclones will otherwise take the shine off economic progress.

8. Editorial-4: Addressing vaccine hesitancy

Those unwilling to take vaccines don’t just need more science but guidance

COVID-19 vaccines have been developed at a record pace thanks to the collaborative efforts of governments, industry, academia and other organisations. The primary purpose of vaccination is to protect individuals against severe infection. Vaccination also protects populations by providing ‘herd immunity’, if done on a large scale. Globally, vaccinations against polio, small pox, meningitis and so on have seen huge success.

But there seems to be problem in vaccinating people against COVID-19. The possibility of a significant number of people not getting vaccinated thwarts our collective ability to reach the herd immunity threshold of 70-85% against SARS-CoV-2. As we mitigate the problems surrounding vaccine shortage and logistics, the issue of vaccine hesitancy needs to be urgently addressed.

Vaccine hesitancy

The results of a 2020 Gallup poll, conducted before the vaccine roll-out, were published on May 3, 2021. In the poll, one in three adults worldwide (32%) said they would not take the COVID-19 vaccine. India performed better in this poll with only 18% stating that they won’t take the vaccine. But vaccine hesitancy has gone up in India since then, due in part to largely overblown reports of complications or even deaths.

Vaccine hesitancy is complex and context-specific, varying across time, place and vaccines. The influencing factors include a lack of awareness of the extent of benefits, fears based on inaccurate information, lack of access to vaccine, civil liberty concepts, cost, cultural issues, and various layers of confidence deficit (mistrust of intent, lack of confidence in the system) sown by conspiracy theories and disinformation. Disinformation is rife, especially on social media. Among those who are extremely hesitant are the ‘anti-vaxxers’. The rest comprise those who delay getting vaccinated, accept vaccines in principle but are sceptical of their use, accept certain vaccines but not others, etc. ‘Free riders’ are those who do not want vaccines, but wish to derive the benefits of herd immunity.

The consequences of vaccine hesitancy are disastrous. If herd immunity does not develop, disease outbreaks and pandemics will prevail. The slower the vaccination rate, the wider the spread of infection and the greater the chances of mutations and the emergence of new variants.

The right message

To allay vaccine fears, our messaging needs to focus on simple facts. Vaccines have been widely tested. The side-effects that may last a couple of days are a very small price to pay to vastly reduce getting seriously ill from disease. The less than one-in-a-million chance of getting serious side effects far outweighs the effect the disease is likely to have.

Addressing the strategies to blunt disinformation, especially on social media, Lisa Rosenblum says in an article in the New England Journal of Medicine that quashing rumours and conspiracies with truth and reliable information alone may not suffice. Before attempting to persuade people, we need to understand the basis of their fear, hesitancy and the anti-vax attitude. By challenging untruths, we inadvertently feed the perception that we are actively suppressing the “real” truth. She concludes that often, the most educated sceptics will be against explanations of scientific facts.

While not different from prior vaccine drives, the objective now is to reach more people faster with a message that doesn’t just provide more science but includes guidance. Providing practical information through social media, alternatives to apps for those lacking easy access to vaccines, and taking the help of well-informed frontline workers will all help.

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