Monday, August 25, 2014

Answer Writing Techniques for IAS Main Exam - 2

By Manoj K. Jha 

What is a good answer? Million dollar question! Especially in the given scenario when good marks in IAS Mains Exam is distant dream.  Mains examination questions of general studies unfolded many thing, about word limit, approach to the questions, analytical demand of the question, and many turns and twists attached to most of the question in the form of common instructions i.e. Analyse, Critically Analyse, Discuss, Evaluate, Explain etc.

Here I am presenting the meaning of the common instructions attached to the Questions in the Mains paper. And few question and there model hints about content, it is just an answer hint to get some overview about attempting answer in main exam. We have not attached the word limits. 

Here are some model questions:

Q 1. Central Vigilance Commission was set up by the Government to propagate the principle of zero tolerance on corruption. What steps it has taken to combat corruption? Analyse the outcomes of these steps and also assess the effectiveness of CVC.
Q 2. Critically examine the role played by Non Government Organisations (NGOs) in development process with special reference to India. Enumerate main problems facing the NGOs in India.
Q 3. “Democratic decentralization cannot be operationalised in real terms without proper fiscal decentralization”. Elaborate.
Q 4. What is micro finance? What role the self help groups play in financial intermediation?

In the IAS Mains exam there are various instructions attached to the question. Here is essence of those:-

 ANALYSE: Break up an issue/event into its component parts and explain how these relate to one another.

• ASSESS: consider the importance of something stress is given in the question.

• COMPARE: simply examine the similarities and differences.

• CONTRAST: concentrate on the differences.

• CRITIQUE: point out the limitations and usefulness of the subject in the question.

• DESCRIBE: give detailed account of a topic

• DISCUSS: explain various perspective and present a logical argument

• EVALUATE : weigh up the importance, success or value of something with evidence to support your view

• EXAMINE : give a detailed account, questioning and exploring the relevant issue

• EXPLAIN: give a precise account, with reasons for why or how it is as it is.

 ILLUSTRATE: use examples from a range of source to demonstrate your understanding of the subject.

• JUSTIFY: make a case for a particular perspective. Establish the truth through supporting evidence or logical reasoning

• REVIEW : examine how a topic has been studied and comment on value and limitations of its treatment

• To what extent... : explore the case for and against a claim

Here are solutions in the format of model hints to crack the essence of demand of such questions. You will also get an idea about the extent and dimension of content to write a good answer. Word limits are not attached to these questions.

Q. Central Vigilance Commission was set up by the Government to propagate the principle of zero tolerance on corruption. What steps it has taken to combat corruption? Analyse the outcomes of these steps and also assess the effectiveness of CVC.

Answer Hints 

The CVC has evolved over time as an institution to monitor corruption of government institutions and officials through initiating investigations since its creation in 1964.
The CVC Act 2003 conferred statutory status to the CVC and the powers to exercise superintendence over functioning of the Delhi Special Police Establishment, and also to review the progress of the investigations pertaining to alleged offences under the Prevention of Corruption Act, 1988.

The CVC publishes a list of cases where permissions are pending.  The commission, as a public authority provides information under the RTI act to the citizens as requested regarding vigilance of institutions and officials on alleged corruption cases.

It has taken some new initiatives including National Anticorruption Strategy, leveraging technology to prevent corruption, integrity in public procurement, awareness campaign, and provision for whistle blowers, improving the standard of vigilance work, computerization of commission’s work, Modern Preventive Vigilance Framework and international cooperation etc. All this has made some deterrence to corruption cases, but by and large its effect has been minimal because there are many limitations of the CVC.

Although CVC is relatively independent in its functioning, it has neither resources nor powers to inquire and take action on complaints of corruption that may act as an effective deterrence against corruption. The limitations include its advisory nature due to which government may accept or reject its advice, small size of sanctioned staff (299) as compared to large number of corruption cases pertaining to central government departments and ministries. 

Further, the CVC cannot direct CBI to initiate inquiries against any officer of the level of Joint Secretary and above on its own. Such permission has to be obtained from the concerned department.

It has no teeth as it does not have powers to register criminal case. It deals only with vigilance or disciplinary cases. Although the CVC has supervisory powers over CBI, it does not have the power to call for any file from CBI or to direct CBI to investigate any case in a particular manner.

And last but not the least, appointments to CVC are indirectly under the control of Govt of India, which has always raised suspicion that government prefers to appoint malleable officers.

Q. Critically examine the role played by Non Government Organisations (NGOs) in development process with special reference to India. Enumerate main problems facing the NGOs in India.

Answer Hints:

NGOs as a development alternative offer innovative and people-centred approaches to service delivery, advocacy and empowerment. NGOs fill the gaps in development activities of the government.

NGOs are grassroot organizations with better interface with people and their problems. By some estimates, India has 3.3 million NGOs or one NGO for every 400 individuals.

In India NGOs have carried on various initiatives for eradication of illiteracy, disease, exploitation of women and children and violence against them. They are also providing help in disaster management, support to street children, women involved in prostitution, pet care. In fact, these NGOs play a positive role in virtually every sector of the economy. NGOs have also acted against encroachment of human rights.
Main Problems

NGOs are, however, being set up and run by many vested interests. They become a means of money making, luxurious life for some and often alleged to be hand in glove to take funds and support from government organizations for personal benefits.  Some of the NGOs act as frontal face for organizations which have ulterior motives.

Main problems facing them are shortage of funds, absence of transparency, accountability and a regulatory mechanism. It is also not known whether they use the allocated funds for the stated purpose or misuse them.

A lot of NGOs setup in India are either dormant or fraudulent, used for a wide range of illegal activities such tax evasion and misappropriation of government funds.

Q. “Democratic decentralization cannot be operationalised in real terms without proper fiscal decentralization”. Elaborate.

Answer Hints: 

The Centre and states have a symbiotic relation, more so in financial arena. Although the rights of centre and states to mobilize resources through taxes and non tax sources have been clearly delineated in the constitution, the states allege that the buoyant and elastic sources are more under the control of the Centre.

The responsibilities of states to deliver welfare and development have increased overtime along with the Centre. It is important for democratic decentralization that the state governments are provided with sufficient opportunities to mobilize funds for these activities.

States carry on many of the vital development and welfare activities such as primary health care, primary education, supply of potable water and essential infrastructure including roads and electricity. Some of them have elaborate roadways services as well. All these programmes get financial support from the Centre and these programmes are also supplemented by Central programmes. In view of rising responsibility of the states it is important that they are allowed to mobilize resources for their financial needs.

The fundamental principles for devolution of funds from Centre to States are equity and efficiency. The states get funds from the Planning Commission for various development projects whereas they get their share from tax proceeds of the Centre through the Finance Commission. The transfer of resources from the Centre to the States is guided by certain principles, yet there is discontentment among states regarding inadequacy of funds.

It is also observed that the states which have developed their agriculture, industry, trade and commerce and services sector, their capacity to generate their own resources and spend on welfare and development is higher than those who have not been able to develop these sector.

In such a situation the need for financial decentralization is strongly felt. States want more transfers from Centre and they also want more powers to mobilize resources.

The finance commission has now changed its role from being a paternalistic institution to an institution that promotes fiscal discipline and reward states which focus on development, hence its criteria of financial devolution has also changed over time.

As regards vertical transfer from divisible pool of taxes, the 13th Finance Commission recommended that the share of states in the net proceeds of shareable central taxes be raised from 30.5 per cent to 32 per cent. According to the thirteenth Finance Commission’s criteria population has a weight of 25 per cent in horizontal devolution; area has 10 per cent, fiscal capacity 47.5 per cent and fiscal discipline 17.5 per cent.

The role of Planning Commission in devolving resources to the states is although formula based, political considerations lead to under financing and over financing. There is increase in recent times in non-formula based transfers, which has been criticized by the thirteenth finance commission.

If states are needed to maintain their expenditure on social sector and infrastructure it is important to give them power to mobilize additional funds from tax and non-tax sources.
The vertical and horizontal devolution still remains controversial, especially the developed states who mobilize more resources are critical of transferring more resources to backward states.

States demand expansion of the divisible pool from income tax and excise duty to other kinds of sources such as customs duty, service tax and corporate tax. They also insist that the large contributing states to the divisible pool of taxes should be rewarded for their revenue increase.

But the role of central government is to provide support to the lagging states so that they not only cover their revenue gap but also development gap. Besides excise duty and income tax, states want to include corporate tax, custom duty, corporate tax and services tax in the divisible pool of taxes.

The Centre is aware about the importance of financial decentralization, but it has its own compulsions. Its expenditure has also increased overtime, especially the non-plan expenditure. The Centre has revised its formula for the transfer of resources to states.

A number of states favour continuation of area as a criterion in the distribution formula, with some states suggesting an increase in the weightage and others suggesting a reduction. Continuation of tax effort and fiscal discipline as criteria for tax devolution has been suggested by the majority of states. Other criteria suggested by states include forest cover, length of international border, index of infrastructure, levels of backwardness, human development index, share of primary sector in Gross State Domestic Product (GSDP) of a state, contribution to central taxes and expenditure on social sectors and infrastructure.

Whatever be the criteria there is no doubt that democratic decentralization is possible only if the states have financial wherewithal for carrying out development and welfare activities and this needs financial decentralization.

Q. What is micro finance? What role the self help groups play in financial intermediation?

Answer Hints - 

Microfinance is a form of financial services for entrepreneurs and small businesses or farmers lacking access to banking and related services. The two main mechanisms for the delivery of financial services to such clients are:

(1) relationship-based banking for individual entrepreneurs and small businesses; and

(2) group-based models, where several entrepreneurs come together to apply for loans and other services as a group.

Micro finance also provides many poor and near-poor households access to an appropriate range of high quality financial services, including not just credit but also savings, insurance, and fund transfers.

Self help groups are group based models of micro finance. A self-help group (SHG) is a village-based financial intermediary usually composed of 10–20 local women or men. A mixed group is generally not preferred. Most self-help groups are located in India, though SHGs can also be found in other countries, especially in South Asia and Southeast Asia.

A  Self-Help Group may be registered or unregistered. It typically comprises a group of micro entrepreneurs having homogenous social and economic backgrounds; all voluntarily coming together to save regular small sums of money, mutually agreeing to contribute to a common fund and to meet their emergency needs on the basis of mutual help.

They pool their resources to become financially stable, taking loans from the money collected by that group and by making everybody in that group self-employed.

This system eliminates the need for collateral and is closely related to that of solidarity lending, widely used by micro finance institutions.

To make the book-keeping simple enough to be handled by the members, flat interest rates are used for most loan calculations.

The group members use collective wisdom and peer pressure to ensure proper end-use of credit and timely repayment.

NABARD estimates that there are 2.2 million SHGs in India, representing 33 million members, which have taken loans from banks under its linkage program to date. This does not include SHGs that have not borrowed.

Many self-help groups, especially in India, under NABARD's SHG-bank-linkage program, borrow from banks once they have accumulated a base of their own capital and have established a track record of regular repayments.

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