DAILY QUESTIONS & MODEL ANSWERS
Q1. A data protection law needs to strike a balance between employee productivity and citizen privacy rights. Please remark in light of the Personal Data Protection Law of 2021. (250 words)
Paper & Topic: GS II – Government Policies and Interventions
Model Answer:
Introduction:
- Data protection, which encompasses the interplay of technology with data collection and distribution, is the process of securing data. By enabling the use of data for a variety of purposes while aiming to strike a balance between people’s rights to privacy. The sheer volume of personal information available online combined with the advancement of technologies like machine learning, artificial intelligence, and data mining increase the risk of data abuse.
Body:
Characteristics of a data protection bill:
- Non-personal data: The Bill’s title and scope have been modified. The Data Protection Bill 2021 has taken the place of the Personal Data Protection Bill. This suggests that non-personal information would be covered by the Bill as well.
- The Parliamentary Committee has also stated that this Bill should apply to both types of data until a distinct framework is devised to distinguish between personal and non-personal data.
- Collecting and storage: The regulation governs the handling, gathering, and keeping of personal data pertaining to individuals.
- Primary Data: A person whose personal information is treated in accordance with the bill is referred to as a data principle.
- Fiduciary of data: A person or organisation that chooses how and why to process data is known as a data fiduciary.
- The Law, which is applicable to both governmental organisations and companies with Indian incorporation, regulates the handling of data.
- Data localization: It also applies to foreign companies that deal with the private information of Indian citizens.
- All parties concur that the law grants data subjects a number of rights regarding their personal information. Any processing of personal data can only be done with the data subject’s consent.
- Authority for Information Protection The Bill creates a DPA to oversee compliance with its requirements and establish further guidelines for the handling of personal data pertaining to individuals.
- The Pegasus case demonstrates how inadequate the current regulations are at protecting civilians from arbitrary and intrusive State interference.
Concerns with legislation permitting surveillance include the following:
- Reasons of expediency: In order for the Government to rely on these justifications, a very low bar must be met.
- Absence of a need for an exemption order It is not necessary for an exemption order to be proportionate to performing a particular State responsibility.
- There is no way to monitor executive actions: No protections specified for this procedure or the executive’s choice to issue the order are subject to inspection.
- State-level monitoring When processing personal data for a criminal investigation, the Bill’s Section 36(a) allows for an exception. So, this provision may encourage vigilantism or permit private spying.
Challenges:
- The centralised Data Protection Authority, which has broad discretionary jurisdiction, is the cornerstone of the Bill’s regulatory framework.
- The Bill’s extensive limitations on international data transmission are likely to cut off our market from the digital economy as a whole.
- It seeks to enforce onerous compliance standards that have little to do with data security.
- It creates a strict framework without any formal rule-making processes involving formal consultation.
- A number of the Bill’s provisions do not adhere to international norms for data protection, which would reduce India’s competitive advantage in the digital market.
- Personal data that fits into a more narrow category and is judged “essential” won’t be permitted to leave India. The authority is in charge of establishing what “critical data” is because the Bill makes no attempt to define it. These restrictions negate the digital economy’s core benefit of connectedness across geographical boundaries.
- Established incumbents will bear the costs of onerous regulation, but the weight will be fatal to new entrants.
- If the Bill is approved, it will ensure that start-up ideas from today that might someday become unicorns never come to fruition.
Conclusion:
- Since that data privacy is a fundamental right of a citizen and that potential data breaches could cause economic downturns, the government needs to reassess the aforementioned open concerns. The need for a strict data protection law is imperative. Prioritization must be given to public education, better implementation and regulation, and efficient grievance redressal.
- The generation of value through technology requires a regulatory environment that is open and supportive of innovation. As a result, the government must carefully examine all of the policy suggestions made in the Bill, including the unanticipated but detrimental impacts of the recommended regulatory framework.
Q2. How does the fiscal deficit affect the Indian economy? Identify ways to address the financial void the pandemic’s consequences have created. (250 words)
Paper & Topic: GS II – Indian Economy
Model Answer:
Introduction:
- A fiscal year-long decrease in government revenue is referred to as a “fiscal deficit”. A fiscal imbalance exists when the government’s total spending exceeds its total revenue (excluding borrowed funds). The fiscal deficit is described as “reflective of the whole borrowing requirements of Government”.
- A fiscal consolidation strategy was included in the previous budget, with the goal of lowering the fiscal deficit from 9.5% of GDP in 2020–21 to 6.8% in 2021–22 and subsequently to less than 4.5% by 2025–26.
Body:
Financial Deficit:
- The difference between the entire revenue and total outlays of the government is referred to as a fiscal deficit.
- It acts as a barometer for how much money the government will ultimately need to borrow.
- A fiscal deficit typically happens as a result of either a decline in revenue or a big rise in capital expenditures.
- Capital investments are undertaken to create long-term assets like factories, buildings, and other constructions.
Fiscal deficit’s relevance:
- There is a limited supply of investable savings in the economy. Banks and other financial organisations lend money to governments and both small- and large-scale private enterprises using these savings (Centre and state).
- Less money is available on the market for private business owners and entrepreneurs to borrow if the fiscal deficit ratio is too high.
- Due to the fact that there is less of this money available, higher interest rates are imposed on such loans.
- The government borrows more as a result of a higher budget deficit, which, to put it simply, boosts interest rates for everyone in the economy.
- A significant fiscal deficit and higher interest rates would also undermine the Central Bank of India’s efforts to reduce interest rates.
Consequences of Fiscal Deficit:
- It may suggest that the government is squandering funds on projects that don’t increase economic productivity. (In MNREGA, for instance, the Sarpanch and local officers utilise the majority of the middle monies.)
- Government borrowing from the RBI increases the amount of money in circulation, and the RBI then prints more currency notes to meet this demand (a practise known as deficit financing). This can put pressure on inflation in the economy.
- If the government continues to borrow money to close the budget deficit gap, bond rates will increase. It’s terrible because fewer and fewer of the government’s incoming cash, or funds provided by taxpayers, will be used to pay for public services like healthcare and education.
- To cover even interest, the government might have to borrow money, which might lead to a vicious cycle and debt trap.
- The fiscal imbalance “crowds out” investment from the private sector because the government borrows the majority of the money.
- In actuality, borrowing slows economic development since future generations will have to pay back the loan plus interest.
Budget Deficit Reduction Techniques:
- A stable economy requires putting the NK Singh committee’s recommendations about the fiscal deficit into action.
- indicated a range of 5% for the fiscal deviation.
- This suggests that the government may deviate by 0.5% from the Budget Deficit objective if the economy is slowing down.
- The administration is free to create space for stimulus programmes to kick-start the economy.
- On the other hand, when the economy is doing well, the deficit can be decreased by 0.5%.
- Borrowing from the country’s central bank or raising money on the capital markets by issuing various securities like treasury bills and bonds are two common ways to finance a deficit.
- a substantial reduction in the price of key subsidies. reduction in the price of LTC, paid time off, bonuses, etc. austerity measures to cut non-plan spending.
- Limiting tax breaks and reductions should be done while broadening the tax base. It’s critical to effectively tackle tax evasion. Direct taxes should be prioritised more in order to increase revenue. selling shares of public sector units and restructuring.
- Famous economist John Maynard Keynes claimed that deficits aid nations in overcoming economic downturns.
- Conservatives on the budget, however, believe that the government should avoid deficits and instead opt for a balanced budget approach.
Conclusion:
- When considering various initiatives and challenges for better economic management and long-term economic growth, the fiscal imbalance should be taken into account. The most important element in the current scenario is
