The Hindu Editorial Analysis | 18th April’20

Table of Contents

Helping a lending hand

Second set of measures announced on Friday by Governor Shatikanta Das
RBI has infused oxygen into the financial system.

Maintaining liquidity

Regulatory proposals aimed at making life easier for banks, NBFCs and borrowers
It is now clear the bank prefers to calibrate its moves based on constant feedback from the ground — the way it should be.
Mr. Das was categorical that the RBI would do what it takes to support the economy and also monitor the evolving situation.
RBI has been very generous in its liquidity maintenance measures in recent times and particularly so after the lockdown began in March.
The overarching objective now should be to keep the economy afloat by deploying all the instruments at the RBI’s command.
₹50,000 crore Targeted Long Term Repo Operations
Reduced REVERSE REPO RATE by another 25 basis points to 3.75%.
This is the time when banks will have to be liberal in extending help for working capital loans and overdrafts to their borrowers, including MSMEs.
Asset classification standstill during the moratorium period: relief for borrower
State finances have got some breathing space through the increase of WMA (Ways and Means Advances) limit to 60% over the level as on March 31.
The special refinance facility of ₹50,000 crore extended to NABARD, SIDBI and NHB will help these institutions to prop up their respective constituents.
The central bank has done what it can.
It is now over to the government for the fiscal support package.

A season of change

IMD: monsoon this year would likely be normal
‘Normal’ means India will get 100% of its long period average, with a potential 5% error margin.
The agency follows a two-stage forecast system:

Indicating in April whether there are chances of drought or any other anomaly
Second update, in late June, with a more granular look at how the monsoon will likely distribute over the country and whether danger signs are imminent.

The IMD’s April forecast, experience suggests, is not much to go by especially if the agency declares it ‘normal’.

The April forecast is a vestige of the agency’s reliance on the ‘statistical forecast system’ where values of selected meteorological parameters are recorded until March 31 and permutations of these are computed and compared to the IMD’s archive of weather data.
Climate, as well as technological change, allows new weather variables — such as surface temperatures from as remote as the southern Indian Ocean and regular updates from the Pacific Ocean — to be mapped.
Powerful computers mathematically simulate the weather based on these variables and extrapolate onto desired time frames.
Using these dynamical models is a change the IMD has incorporated and experimented with for years.
It made two key changes this year: reducing the definition of ‘normal’ rainfall by 1 cm, to 88 cm and, officially updating monsoon onset and arrival dates for many States.
This was long due and constituted acknowledgement of the accumulated impact that global warming has been having on monsoon patterns, particularly for cities and States.
India should move to a new monsoon-accounting calendar instead of the century-long tradition of June-September?
Institutional fixes and the need for ethical politics

BACKGROUND

Late night on March 23, while the nation was vexed with the coronavirus crisis, Shivraj Singh Chouhan of the Bharatiya Janata Party (BJP) was sworn in as the Chief Minister of Madhya Pradesh in a small ceremony at the Raj Bhavan.
The next morning, he won a trust vote in an Assembly session boycotted by the Congress legislators.
The Supreme Court had, on March 19, given an order directing the Speaker to conduct a floor test the next day.
Kamal Nath of the Congress party resigned as Chief Minister just hours before the scheduled time for the floor test.
With the resignation of the 22 Congress MLAs who subsequently joined the BJP, the halfway mark of the Assembly had reduced, allowing the BJP to stake claim to form the government.
Much of India was already in a lockdown when Mr. Chouhan took oath.
Since no other Minister was sworn in, Madhya Pradesh does not presently have a cabinet or a dedicated Health Minister at this time of a health emergency.
The political skulduggery in Madhya Pradesh represents a new method of bypassing the anti-defection law and toppling elected governments.
The H.D. Kumaraswamy-led Congress-JD(S) government was brought down in July last year in a similar manner with 17 MLAs of the ruling coalition resigning and joining the BJP.
Under this novel method, a set of legislators of the party in power is made to resign from the Assembly to reduce the total strength of the House enough for the BJP to cross the halfway mark to form government.
In the ensuing by-elections, the members who resigned were then fielded as BJP candidates (most of whom have been re-elected in the case of Karnataka).
The recurrence of this model of defection signals the exploitation of the inherent weaknesses of the antidefection law.
HORSE-TRADING seems to have gone from retail to wholesale.
It betrays the people’s mandate in a general election.
Rethinking the law: Tenth Schedule of the Constitution (better known as the anti-defection law)
It denies the legislator the right to take a principled position on a policy matter and reduces her to an involuntary supporter of the whims of party bosses.
Hence, the anti-defection law, on the one hand, severely restricts the freedom of a legislator and makes her a slave of party whips.
The constitutionality of the Tenth Schedule was challenged for violating the Basic Structure of Constitution with regard to parliamentary democracy and free speech, but the Supreme Court in Kihoto Hollohan v. Zachillhu (1992) in a 3-2 verdict upheld the law while reserving the right of judicial review of the Speaker’s decision.
On the other hand, it has not been able to meet its primary objective of preventing horse-trading and continues to be circumvented to bring down elected governments.
Dinesh Goswami Committee: the scope of the binding whip should be restricted to a vote of confidence.
It is best to institutionalise the Karnataka Speaker’s decision to bar the defected members from contesting in the ensuing by-poll, if not for a longer period, and thereby disincentivise MLAs from jumping ship.
These reforms would require a constitutional amendment to the Tenth Schedule.
A virus, social democracy, and dividends for Kerala
A number of States have been especially proactive, none more so than Kerala.
Though Kerala was the first State with a recorded case of coronavirus and once led the country in active cases, it now ranks 10th of all States and the total number of active cases (in a State that has done the most aggressive testing in India) has been declining for over a week and is now below the number of recovered cases.
Given Kerala’s population density, deep connections to the global economy and the high international mobility of its citizens, it was primed to be a hotspot.
Yet not only has the State flattened the curve but it also rolled out a comprehensive ₹20,000 crore economic package before the Centre even declared the lockdown.
Why does Kerala stand out in India and internationally?
Taming a pandemic and rapidly building out a massive and tailored safety net is fundamentally about the relation of the state to its citizens.
Cycles of social mobilisation and state responses have forged what is in effect a robust social democracy.
The current crisis underscores the comparative advantages of social democracy.
To begin with, social democracies are built on an encompassing social pact with a political commitment to providing basic welfare and broad-based opportunity to all citizens.
From the temple entry movement of the 1930s, to the peasant and workers’ movements in the 1950s and 1960s, a mass literacy movement in the 1980s, the Kerala Sasthra Sahithya Parishad (KSSP)-led movement for people’s decentralised planning in the 1990s, and, most recently, various gender and environmental movements.
These movements not only nurtured a strong sense of social citizenship but also drove reforms that have incrementally strengthened the legal and institutional capacity for public action.
Second, the emphasis on rights-based welfare has been driven by and in turn has reinforced a vibrant, organised civil society which demands continuous accountability from front-line state actors.
Third, this constant demand-side pressure of a highly mobilised civil society and a competitive party system has pressured all governments in Kerala, regardless of the party in power, to deliver public services and to constantly expand the social safety net, in particular a public health system that is the best in India.
Fourth, that pressure has also fuelled Kerala’s push over the last two decades to empower local government.
Nowhere in India are local governments as resourced and as capable as in Kerala.
Finally, all of this ties into the greatest asset of any deep democracy, that is the generalised trust that comes from a State that has a wide and deep institutional surface area, and that on balance treats people not as subjects or clients, but as rights-bearing citizens.
Chief Minister Pinarayi Vijayan convened a State response team that coordinated 18 different functional teams, held daily press conferences and communicated constantly with the public.
The government was able to leverage a broad and dense health-care system that despite the recent growth of private health services, has maintained a robust public presence.
As the cases multiplied, the government called on two lakh volunteers to go door to door, identifying those at risk and those in need.
Two decades of empowering local governments have clearly paid off.
The pandemic is a physical exam of the social body, and never has public trust been put to a greater test.

NEWS

Post-lockdown, India’s infection growth rate has slowed down
The Union Health Ministry on Friday said the doubling rate of positive COVID-19 cases was now down to 6.2 days, compared to 3 before the nationwide lockdown that began on March 25.
India reported 1,076 new cases and 32 deaths in the last 24 hours, taking the total number of cases to 13,835 and 452 deaths.
As many as 1,749 persons have been cured/discharged after recovery.
The active cases now are 11,616.

Wuhan admits to errors, hikes toll by 50%
China’s coronavirus ground-zero city of Wuhan on Friday admitted missteps in tallying its death toll as it abruptly raised the count by 50% following growing world doubts about Chinese transparency.
The U.S. has led the charge in questioning China’s handling of the pandemic and how much information it has really shared with the international community since the virus emerged late last year.
Authorities in Wuhan initially tried to cover up the outbreak, punishing doctors who raised the alarm online in December.
Wuhan’s epidemic control headquarters said in a social media posting on Friday that it had added 1,290 deaths to the tally in the city.
That brings the total deaths in the city to 3,869.
But the city government only added 325 cases, raising the city’s total number of cases to 50,333.
The change also pushes the nationwide death toll up by nearly 39% to 4,632.
The official toll in the country of 1.4 billion people, however, remains well below the number of fatalities in smaller nations such as Italy and Spain.
Salaried borrowers continue EMIs, ignore moratorium offer
The option of a moratorium on loan repayments announced by the Reserve Bank of India last month has mostly been availed of by micro, small and medium enterprises while salaried class borrowers have, till now, largely refrained from it, bankers have said.
Minor forest produce in exemption list
In the latest set of lockdown relaxations, the Ministry of Home Affairs (MHA) has added the collection, harvest and process of minor forest produce to the list of activities that will be permitted. The additional directives were issued on Thursday.
Minor forest produce include non-timber items such as bamboo, roots, seeds, fruits, flowers and plants.
Pakistan is exporting terror, says Army chief
Launch pads across LoC are active
Indore registers eight deaths in a day
Indore on Thursday registered eight deaths in the wake of the COVID-19 pandemic and 256 new cases, the most for the city in a day.
On Wednesday, the count in the city stood at 586. With reports from New Delhi detecting 218 new cases and from the Mahatma Gandhi Memorial Medical College, Indore, 26, the number of cases grew by 43% to 842.

Give ₹35,000 to PM-CARES for bail: HC

The Jharkhand High Court has granted bail to a former Member of Parliament and five others on condition of contributing ₹35,000 each to the PM-CARES Fund and downloading the Aarogya Setu mobile application.
More healthcare workers test positive in Mumbai
Maharashtra seeks ₹10,000 cr. for 5 months
Gujarat death toll touches 41; 170 new cases in a single day
Curfew clamped on Rajkot hotspot that reported 20 cases
Gujarat saw a sharp rise in the number of COVID-19 cases on Friday with 170 new cases and five deaths, taking the death toll to 41 and the total number of cases to 1,099.
Thirteen people were discharged after treatment and complete recovery from the infection.
After bringing major hotspots in Ahmedabad and Surat under curfew, the government also imposed curfew in a hotspot in Rajkot from where more than 20 cases have been reported. QUESTIONs
In the longer run, India should find new drivers for its relations with Gulf countries. Suggest some areas which India should explore.