1-3 January 2015 Current Affairs niti aayog1) National Institution for Transforming India (NITI) Aayog replaced Planning Commission The Government of India has scrapped its 65-year-old Planning Commission, replacing it with the National Institution for Transforming India (NITI) Aayog. The new National Institution for Transforming India (NITI) will act more like a think tank or forum, say its supporters, in contrast with the Commission which imposed five-year-plans and allocated resources to hit set economic targets. One significant change of note is that one of the functions of the body will be to address the needs of national security in economic strategy. Nowhere is this more relevant than in the area of energy security where India, unlike China, has failed to evolve a coherent policy over the years. Similarly, networking with other national and international think-tanks and with experts and practitioners, as has been envisaged, will add heft to the advice that the NITI Aayog will provide. NITI will have a governing council, which will include leaders of India’s 29 states and seven union territories comprising all chief ministers and lieutenant governors – the PM will chair it – and will work towards fostering co-operative federalism for providing a national agenda to the Centre and states of India. The institution will create a knowledge, innovation and entrepreneurial support system through a collaborative community of national and international experts, practitioners and other partners. It will also offer a platform for resolution of inter-sectoral and inter-departmental issues to accelerate the implementation of the country’s development agenda. The new body will also focus on technology upgradation and capacity building for implementation of programmes and initiatives. The Aayog follows Modi’s announcement in his Independence Day speech that there was a need for replacing the Planning Commission with a new body in the changed economic scenario. The government has set up the Aayog through a Cabinet resolution. The Planning Commission was also set up through a government resolution, in 1950. Objectives of NITI Aayog: Key objective for establishing Niti Aayog was to separate as well as energize the distinct ‘process’ of governance from the ‘strategy’ of governance. Second objective is to provide governments at the central and state levels with relevant strategic and technical advice across the spectrum of key elements of policy. This includes matters of national and international import on the economic front, dissemination of best practices from within the country as well as from other nations, the infusion of new policy ideas and specific issue-based support. The institution has to be able to respond to the changing and more integrated world that India is part of. Third objective is to change from the past is replacing a centre-to-state one-way flow of policy by a continuing partnership with the states. The institution to have the necessary resources, knowledge, skills and, ability to act with speed to provide the strategic policy vision for the government as well as deal with contingent issues. Lastly the institution must adhere to the tenet that while incorporating positive influences from the world, it will find our own strategy for growth. The new institution has to zero in on what will work in and for India. It should be a Bharatiya approach to development. 2) A step towards Universal Health Coverage The Union government took a bold step by releasing the draft National Health Policy 2015. The policy is a first step in achieving universal health coverage by advocating health as a fundamental right. The key objective is to work towards universal access of affordable health-care services. The current government spending on health care is a dismal 1.04 per cent of gross domestic product (GDP), one of the lowest in the world; this translates to Rs.957 per capita in absolute terms. The draft policy has addressed this critical issue by championing an increase in government spending to 2.5 per cent of GDP (Rs.3,800 per capita) in the next five years. But even this increase in allocation falls short of the requirement to set right the dysfunctional health-care services in the country. Insufficient funding over the years combined with other faulty practices have led to a dysfunctional health-care system in the country. The failure of the public health-care system to provide affordable services has been the main reason that has led to increased out-of-pocket expenditure on health care. As a result, nearly 63 million people are driven into poverty every year. The Ebola crisis in Liberia, Guinea and Sierra Leone, which underlined the repercussions of a weak public health-care system, should serve as a grim reminder of this. Draft on National Health Policy 2015 The national programmes at present provide universal coverage only with respect to certain interventions such as maternal ailments that account for less than 10 per cent of all mortalities. Over 75 per cent of the communicable diseases are outside their purview and only a limited number of non-communicable diseases are covered. It is, therefore, crucial for the Union government to undertake proactive measures to upgrade the health-care services of poorly performing States such as Bihar and Uttar Pradesh. As it stands, health will be recognised as a fundamental right through a National Health Rights Act only when three or more States “request” it. Since health is at present State subject, adoption by the respective States will be voluntary. Though a different approach has been taken to improve adoption and implementation by States, the very objective of universal health coverage that hinges on portability will be defeated in the absence of uniform adoption across India. 3) A roadmap for reforming ailing state banks India’s top bankers have gathered in Pune in a one-of-a-kind “Retreat for Banks and Financial Institutions” called “ज्ञान संगम” “GyanSangam”to discuss long-pending reforms vital to improving the health of ailing public sector banks in Asia’s third-largest economy.The country’s more than two dozen inefficient state-run banks have been constrained by a pile of bad loans and corporate governance issues. They also lag their private sector rivals in profitability. For years, political interference and union opposition have thwarted major reforms. If reformed, however, the country’s mega state lenders offer investors the best exposure to any sustained upswing in India’s economy.Besides the heads of all public sector banks, the two-day meeting ending on Saturday will also be attended by Prime Minister NarendraModi, Finance Minister ArunJaitley and Reserve Bank of India Governor RaghuramRajan. The issues to be discussed include industry consolidation, restructuring of state banks for better efficiency and governance, as well as asset quality.State banks account for more than 70 percent of total outstanding loans in the sector.Public sector lenders are estimated to need as much as $60 billion in capital over the next four years to meet upcoming global regulations and to build a buffer against rising bad loans. The programme includes a separate session devoted to sharing of the best Practices followed by different Banks. ‘Learning from each other’. The following best practices would be shared: Axis Bank – the Mobile Youth account Retail banking Product design based on life insights. IDBI Bank – The Electronically secured bank and treasury receipts and Payments. State bank of India – A Specialized cadre of IT function. This has created a viable track for specialist talent in public sector banking.
Posted on: Sun, 04 Jan 2015 13:25:19 +0000
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