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China’s military began unprecedented live-firing drills in six regions surrounding Taiwan, firing missiles from its eastern coast into waters east of the island and putting in place an effective blockade that disrupted flights and shipping.
The drills, which will continue until Sunday, were part of Beijing’s response to visit by U.S. House Speaker Nancy Pelosi to Taiwan.
What we are taking and will be taking are a necessary and timely response and countermeasures which have been fully thought through and fully assessed, to protect sovereignty and territorial integrity, in line with international laws, and a warning to provocateurs.
Foreign Ministry spokesperson Hua Chunying said, announcing that Beijing had also called off a meeting set for Thursday between the Foreign Ministers of China and Japan to express its displeasure over a statement by the G7 group of nations that had defended Ms. Pelosi’s visit and criticised China’s actions.
They clearly believe they live in the time of 120 years ago,” she said, comparing the G7 to the eight-nation alliance that invaded China in 1900. “
The drills, carried out by the PLA Eastern Theater Command, were a show of force aimed as much at Taiwan as at the domestic audience in China, coming after Beijing’s public warnings failed to deter Ms. Pelosi’s visit.
Starting at mid-day, the long-range live-fire exercise carried out “precision strikes on specific areas in the eastern part of the Taiwan Strait,” Senior Colonel Shi Yi, spokesperson for the Eastern Theatre Command, said, adding that units of the rocket force conducted a “multi-zone fire assault drill”.
Editorial
Waiting for democracy in Jammu and Kashmir (Page no. 10)
(GS Paper 2, Polity and Governance)
It has been three years since then President Ram Nath Kovind issued the fateful orders that read down Article 370 of the Indian Constitution, allowing the Narendra Modi administration to divide the State of Jammu and Kashmir and demote its two new units to Union Territory status.
These measures, Prime Minister Modi said, would extend the rights and benefits of Indian democracy to the people of the State.
The irony of the fact that his administration felt compelled to simultaneously arrest more than 5,000 political leaders, activists and mediapersons in order to achieve this laudable goal appeared to escape him.
Three years later, the promise of democracy seems as far away as it was on August 5, 2019. Several hundred of those arrested in 2019 are still in jail without trial.
Fresh arrests of dissidents and human rights defenders have become routine. The media continues to be muzzled, and the few journalists who brave a silent censorship suffer from the ‘vicious circle’ of repeated arrests that the Supreme Court of India criticised in the case of Mohammed Zubair.
Despite the completion of the delimitation commission’s exercise, Legislative Assembly elections have still to be announced. Jammu and Kashmir has been under President’s rule and then Lieutenant-Governor’s rule for four years now.
The Modi administration’s initial rationale for the draconian actions of 2019 was that security would improve and militancy would be eradicated; that the former State would integrate with the Indian economy and its people would prosper; that Kashmiri Pandits who have been internal refugees for over three decades would be able to return; and that a new era of non-dynastic politics would emerge.
Security has clearly not improved. According to Home Ministry figures, the number of civilians killed between 2019 and 2021 was higher than in Mr. Modi’s first term (2014-19) — 87 in two years as against 177 in five years.
Civilian fatalities did decline between 2021 and 2022, as did the number of security personnel killed, partly because India and Pakistan agreed to a ceasefire in February 2021.
The numbers have, however, begun to rise again, and suggest a worrying pattern of targeting Kashmiri Pandits, elected officials of local government ( panches) and the Jammu and Kashmir police.
Sop or welfare debate (Page no. 10)
(GS Paper 2, Polity and Governance)
A general concern over ‘freebies’ pushing the economy to ruin or unviable pre-election promises adversely affecting informed decision-making by voters seems reasonable.
However, few will disagree that what constitutes ‘freebies’ and what are legitimate welfare measures to protect the vulnerable sections are essentially political questions for which a court of law may have no answer.
In this backdrop, the Supreme Court’s decision to form a body of stakeholders to examine the issue raises the question whether the legislature can be bypassed on such a far-reaching exercise.
The Chief Justice of India, N.V. Ramana, heading a Bench hearing a petition filed in public interest against the distribution or promise of ‘freebies’ ahead of elections, has made it clear that the Court is not going to issue guidelines, but only ensure that suggestions are taken from stakeholders such as the NITI Aayog, Finance Commission, Law Commission, RBI and political parties.
All these institutions, he has said, can submit a report to the Election Commission of India (ECI) and Government. A suggestion that Parliament could discuss this issue was met with scepticism by the Bench, which felt that no party would want a debate on this, as all of them support such sops.
The Bench also disfavoured the ECI preparing a ‘model manifesto’ as it would be an empty formality. The Court’s concern over populist measures seems to resonate with the Government too, as the Solicitor-General submitted that these distorted the voter’s informed decision-making; and that unregulated populism may lead to an economic disaster.
The Supreme Court, in S. Subramaniam Balaji vs Government of Tamil Nadu (2013) addressed these questions and took the position that these concerned law and policy.
Further, it upheld the distribution of television sets or consumer goods on the ground that schemes targeted at women, farmers and the poorer sections were in furtherance of Directive Principles; and as long as public funds were spent based on appropriations cleared by the legislature, they could neither be declared illegal, nor the promise of such items be termed a ‘corrupt practice’. It had, however, directed the ECI to frame guidelines to regulate the content of manifestos.
OPED
Is the declining rupee a crisis or an opportunity? (Page no. 11)
(GS Paper 3, Economy)
The rupee’s steep slide to the 79-to-a-dollar range is bound to impact importers, widen the current account deficit (CAD) and increase the value of India’s external debt burden.
But how much of a problem is this going to be for the Indian economy, given that the rest of the world is facing economic challenges as well? Zico Dasgupta and Indranil Pan discuss whether the declining rupee presents a crisis or an opportunity, in a conversation moderated by Bharat Kumar K. Edited excerpts:
Zico Dasgupta: This is a matter of concern because the question of opportunity arises when one talks about the positive impact of the declining rupee on trade balance and net exports.
That seems to be limited for two reasons. First, despite depreciation in the nominal exchange rate, the real exchange rate has not really depreciated in recent times and that is what matters for questions of trade balance and exports.
Second, in the last two-three decades, the sensitivity of exports has been weak as far as changes in the real exchange rate is concerned.
The depreciation is concerning — not exactly on the lines of the instability we have seen in Sri Lanka or other developing countries, but because it adds to the inflationary pressure and squeezes the purchasing power of those whose incomes are not linked to the crisis.
Some predict CAD could rise to 4% of the GDP in the first half of this fiscal. Is this unhealthy or can we live with it?
Indranil Pan: A broad indication that we are working with at this time is 3% CAD as a proportion of GDP with the assumption that oil is at about $110 per barrel.
If oil is at $120, the CAD goes up to 3.3%. From the RBI (Reserve Bank of India)’s perspective, the moment CAD crosses 2.5%, red flags come up.
More importantly, rather than only looking at the CAD, we need to find out whether we have adequate flows on the capital side to bridge the CAD.
And if we do, then even if the CAD is at 3%, it might not be very strenuous for the economy. Currently, because of the changing landscape in terms of the monetary policy cycle globally, emerging market inflows have dried up. There are more outflows from emerging markets.
So, the RBI has to sell dollars in the spot market to contain the depreciation. Depreciation pressures are relatively more contained than in 2013. I don’t mean it’s time to sleep over it; definitely, you need to see in what ways the capital flow can be improved — RBI has come out with certain policies on that — or determine how the current account gap can be closed by reducing imports.
There can be a natural adjustment: the higher inflation and tighter monetary policy domestically would dampen local demand. So, non-oil, non-gold imports are expected to be softer.
Fears of a global recession could also lead to a downward bias in crude oil prices; that could be positive for the current account. But global slowdown may also pull down exports and that is worrying from the CAD perspective.
News
CJI Ramana names Justice U.U. Lalit as successor (Page no. 15)
(GS Paper 2, Judiciary)
Chief Justice of India N.V. Ramana on August 4, 2022 recommended to the government the name of Justice Uday Umesh Lalit as his successor and the 49th Chief Justice of India.
Chief Justice Ramana personally handed over a copy of his letter of recommendation dated August 3 to Justice Lalit when they met for tea in the Supreme Court in the morning before court.
Chief Justice Ramana had received a communication from Law Minister Kiren Rijiju seeking his recommendation for appointment of the next top judge.
Sources said Chief Justice Ramana recommended Justice Lalit’s name in a matter of minutes after receiving Mr. Rijiju's letter.
Chief Justice Ramana is retiring on August 26, 2022. Justice Lalit is the senior most judge in the Supreme Court now.
The ‘Memorandum of Procedure of Appointment of Supreme Court Judges’ says “appointment to the office of the Chief Justice of India should be of the senior most Judge of the Supreme Court considered fit to hold the office”.
The process, according to the Memorandum, begins with the Union Law Minister seeking the recommendation of the outgoing CJI about the next appointment.
The Minister has to seek the CJI’s recommendation “at the appropriate time”. The Memorandum does not elaborate or specify a timeline.
The Memorandum says that “after receipt of the recommendation of the Chief Justice of India, the Union Minister of Law, Justice and Company Affairs will put up the recommendation to the Prime Minister who will advise the President in the matter of appointment”.
RS passes Family Courts Bill amid protests over ED actions (Page no. 15)
(GS Paper 2, Governance)
The Rajya Sabha passed the Family Courts (Amendment) Bill amid disruptions over the Enforcement Directorate’s “actions against Opposition MPs” when the House is in session.
The Bill validates family courts in Himachal Pradesh and Nagaland with retrospective effect. The amendment moved by CPI(M) MP V. Sivadasan to send the Bill to a select committee was defeated in a voice vote.
The debate took place amid disruptions as Opposition members stormed into the Well of the House demanding that the Centre rein in the ED and the CBI.
They shouted slogans against Prime Minister Narendra Modi, and said autocracy would not be tolerated. Law Minister Kiren Rijiju said there were at present 715 family courts in the country with over 11 lakh pending cases, and said the Bill would help set up at least one family court in each district so that there could be speedy disposal of the cases.
The Lok Sabha passed the Bill last week. The Bill clears family courts established in Himachal Pradesh with effect from February 15, 2019 and in Nagaland with effect from September 12, 2008.
The Bill also validates all actions under the Act taken by the governments of Himachal Pradesh and Nagaland and the family courts of these States.
World
Iran nuclear talks restart in Vienna with EU mediation (Page no. 17)
(GS Paper 2, International Relation)
Negotiators kicked off a fresh round of talks over Iran's nuclear programme in Vienna, seeking to salvage the agreement on Tehran's atomic ambitions.
Officials from world powers and Iran were meeting in the Austrian capital for the first time since March, when negotiations, which began in 2021 to reintegrate the United States into the agreement, stalled.
In late June, Qatar hosted indirect talks between Tehran and Washington in the hope of getting the process back on track -- but those talks failed to make a breakthrough.
In a last-ditch effort, EU foreign policy chief Josep Borrell submitted a compromise proposal last month and called on the parties to accept it to avoid a "dangerous nuclear crisis".
Mr. Borrell said the draft text includes "hard-won compromises by all sides" and "addresses, in precise detail, the sanctions lifting as well as the nuclear steps needed to restore" the 2015 pact.
Bilateral talks began on Thursday at Vienna's luxury Palais Coburg hotel under the auspices of the European Union's representative Enrique Mora.
The Iranian and Russian delegations, which have traditionally been close in the negotiations, held a separate meeting.
Britain, China, France, Germany, Iran, Russia and the United States signed the JCPOA in July 2015. Delegations from all will partake in Thursday's talks, but officials from the U.S. and Iran are not expected to meet face to face.
The Joint Comprehensive Plan of Action aims to guarantee the civilian nature of Iran's nuclear programme in exchange for a gradual lifting of sanctions.
But following the unilateral withdrawal of the United States in 2018 under former president Donald Trump and the re-imposition of U.S. sanctions, Tehran has backtracked on its obligations.
Iran subsequently exceeded the JCPOA's uranium enrichment rate of 3.67%, rising to 20% in early 2021. It then crossed an unprecedented 60% threshold, getting closer to the 90 percent needed to make a bomb.
The head of the UN nuclear watchdog, Rafael Grossi, on Tuesday warned Iran's programme was "moving ahead very, very fast" and "growing in ambition and capacity".
These include sanctions, Iranian demands for guarantees and the end of a probe by the UN nuclear watchdog, the International Atomic Energy Agency.