• The consolidated fiscal deficit of the states as share in GDP has risen from 18%in FY12 to 44% in FY2018. The rise impacts macroeconomic stability of the nation.

  • Reasons
    1. The GST has reduced fiscal space for the states to consolidate their revenues.
    2. Lack of financial discipline on expenditure e.g. Loan waiver
    3. Populism in policy making such as rising subsidy burden
    4. Bureden of Central Govt. schemes such as UDAY.
    5. Non adherence to FRBM targets while policy making as state's consolidated expenditure has increased to 1.44 times of centre.

  • Impact
    1. Monetary policy transmission is reduced.
    2. Long term capital investment reduces such as infrastructure, telecom, roads etc.
    3. Exposes india to external vulnerabilitites such as decrease in sovereign rating by credit rating agencies thereby threatening current account deficit, balance of payment problem, external borrowing rates etc.
    4. Inflation targeting becomes difficult.

  • Way forward.
    N.K.SIngh committee has recommended for establishment of fiscal council to insulate populism in financial management.
    Decrease in debt to GDP ratio by 60% (curently at 68%)
    Instituting exception clause in case of extraordinary situation.

  • As per Yashpal report , India's higher education sector is largest in the world with 2nd highest enrolment of 3.5 crore students. To tap the demographic dividend a robust higher education sector is must.

  • Challenges
    1. Accessibililty - gross enrolment ration is 25% which is too less in comparison to countries like south korea (95%). Also, drop out rates are very high.
    2. Equity - female , minority, ST/SC, disabled participation is low.
    3. Quality - NITI action agenda says more focus is on outputs than outcomes as 80% engineers are unemployable
    4. Autonomy - lack of financial and academic autonomy to institutes such as IIM, IITs etc. over the years have curbed research potentials.
    5. Regulation - Over regulationregulatory bodies are involved in funding, policy making and regulation such as UGC which increase conflict of interest.
    6. Poor infrstruture such as VLSI labs, fabrication facilities etc.

  • Government initiatives
    1. Constitution of HEFA and RISE scheme
    2. Declaration of institute of eminence
    3. Scrapping UGC and giving autonomy to 60 institutes of higher education
    4. Vajra scheme to attract foreign faculty
    5. National Testing agency - to secure uniformity in exam and increase oportunities

  • Way forward (Gopalan committee)
    1. Social Impact assessment of all Research and Development
    2. Improve faculty teacher ratio
    3. Collaboration with foreign higher institutions
    4. Reputed colleges should be converted into deemed universities such as presidential college to improve brand value

  • Thus more need based approach than supply side approach can go a long way in overhauling higher education sector.

  • Data localization is the act of storing data on any device that is physically present within the borders of a specific country where the data was generated. Free flow of digital data, especially data which could impact government operations or operations in a region, is restricted by some governments. Many attempt to protect and promote security across borders, and therefore encourage data localization.

  • Policy goals: Goals set in the Draft National Digital Communications Policy 2018, along with various government notifications and guidelines such as Reserve Bank of India’s notification on Payment Data Storage 2018, and the Guidelines for Government Departments for Contractual Terms related to Cloud Storage 2017, show signs of data localisation.

  • The rationale behind such mandates has been attributed to various factors, such as: securing citizen’s data, data privacy, data sovereignty, national security, and economic development of the country. The extensive data collection by technology companies, due to their unfettered access and control of user data, has allowed them to freely process and monetise Indian users’ data outside the country.

  • Why technology firms are worried? Stricter localisation norms would help India get easier access to data when conducting investigations, but critics say it could lead to increased government demands for data access. Technology firms worry the mandate would hurt their planned investments by raising costs related to setting up new local data centres.

  • Why government is in favour of data localisation? Greater use of digital platforms in India for shopping or social networking have made it a lucrative market for technology companies, but a rising number of data breaches have pushed New Delhi to develop strong data protection rules.

  • Also, minimal or deregulated governance on critical data, due to absence of localisation requirements, could be detrimental to India’s national security as data would be outside the purview of existing data protection legislation. The ineffectiveness of Mutual Legal Assistance Treaties (MLATs) in this realm aggravates such government fears.

  • In addition to these, India also aspires to become a global hub for, among others, cloud computing, data hosting and international data centres, all of which are prompting the government to enact data localisation requirements for accelerating the nation’s economic growth, especially in the sphere of digital technologies.

  • Is data localisation the solution to physical data access and decryption of enciphered data? Can data localisation be conflated with access?

  • The proposed law by Srikrishna Committee cannot be a knee-jerk reaction to some events; it has to be in line with the SC judgement, which supports the march of technology, innovations, growth of knowledge, and big data analytics for the growth of economies, and for better services to citizens. It recognizes the role of data driven innovation (DDI) for the growth of economies, and for job creation. But it emphasises that the data so collected be utilised for legitimate purposes