IASCLUB Daily Current Affairs : 28 May 2019

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BIMSTEC heads invited to PM’s swearing-in

Topic: GS –II: International relations

India has invited several heads of state, including those from the Bay of Bengal community (BIMSTEC) and the Shanghai Cooperation Organisation (SCO), for Prime Minister Narendra Modi’s swearing-in ceremony on May 30.

More in news:

  • This is in line with the government’s focus on its ‘Neighbourhood First’ policy.
  • The Bay of Bengal Initiative for Multi Sectoral Technical and Economic Cooperation includes Bangladesh, Myanmar, Nepal, Bhutan, India and Thailand and received sustained attention during Mr. Modi’s first term.
  • President of the Kyrgyz Republic Sooronbay Jeenbekov and Prime Minister of Mauritius Pravind Jugnauth were among the invitees. Kyrgyzstan is the current chair of the SCO, and will host the organisation’s summit in Bishkek next month.
  • Bangladesh President Abdul Hamid is expected to attend the ceremony, diplomatic sources said on Monday. Nepal Prime Minister K.P. Sharma Oli and Prime Minister of Bhutan Lotay Tsering are also expected to attend.
  • Unlike 2014, leaders of Afghanistan, Pakistan and Maldives are not among the invitees.
  • Pakistan Prime Minister Imran Khan had called up Mr. Modi during the weekend, and congratulated him on being re-elected.

The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) is an international organisation of seven nations of South Asia and South East Asia, housing 1.5 billion people and having a combined gross domestic product of $3.5 trillion (2018).

·         The BIMSTEC member states—Bangladesh, India, Myanmar, Sri Lanka, Thailand , Nepal and Bhutan—are among the countries dependent on the Bay of Bengal.

·         Fourteen priority sectors of cooperation have been identified and several BIMSTEC centres have been established to focus on those sectors.

·         A BIMSTEC free trade agreement is under negotiation.

·         Leadership is rotated in alphabetical order of country names.

·         The permanent secretariat is in Dhaka.


Shanghai Cooperation Organization (SCO):

·         It is a Eurasian political, economic, and security alliance, the creation of which was announced on 15 June 2001 in Shanghai, China by the leaders of China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan; the Shanghai Cooperation Organisation Charter, formally establishing the organisation, was signed in June 2002 and entered into force on 19 September 2003.

·         The original five nations, with the exclusion of Uzbekistan, were previously members of the Shanghai Five group, founded on 26 April 1996.

·         Since then, the organisation has expanded its membership to eight countries when India and Pakistan joined SCO as full members on 9 June 2017 at a summit in Astana, Kazakhstan.

·         The Heads of State Council (HSC) is the supreme decision-making body in the SCO, it meets once a year and adopts decisions and guidelines on all important matters of the organisation.

·         Military exercises are also regularly conducted among members to promote cooperation and coordination against terrorism and other external threats, and to maintain regional peace and stability.

·         The SCO is widely regarded as the “alliance of the East“, due to its growing centrality in Asia-Pacific, and has been the primary security pillar of the region.

·         It is the largest regional organisation in the world in terms of geographical coverage and population, covering three-fifths of the Eurasian continent and nearly half of the human population.

Inviting to BIMSTEC leaders sends important signals to India’s neighbours

Topic: GS –II: International relations

By inviting leaders from the BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) countries, Kyrgyz Republic and Mauritius at his swearing-in ceremony on May 30, Prime Minister Narendra Modi has made a carefully calibrated diplomatic move that signals a major outreach to India’s neighbourhood from the Bay of Bengal to Central Asia, as well as the Indian diaspora across the world.

More in news:

  • Last time, Modi had invited the SAARC leaders, and then Pakistan Prime Minister Nawaz Sharif’s attendance had raised hopes of a new beginning in the bilateral ties.
  • This time, SAARC’s exclusion is clearly aimed at keeping Pakistan out of New Delhi’s engagement with its neighbours.

Who are invited for PM Modi swearing-in, and why

  • By inviting the leader from Kyrgyz Republic, India is displaying an outreach to the Shanghai Cooperation Organisation (SCO), which is headed by the Kyrgyz leader, and which has China, Russia, Uzbekistan, Kazakhstan, Tajikistan and Pakistan as members. India, which became a member along with Pakistan in 2017, wants to leverage its membership to advance its strategic objectives — counter-terrorism and connectivity.
  • And Mauritius Prime Minister Pravind Jugnauth, who was also the chief guest at the Pravasi Bharatiya Divas in January this year, is one of the most well-placed People of Indian Origin in the world. Since Modi has invested diplomatic capital in outreach to the Indian diaspora since 2014, this invite is seen as a natural choice.
  • The key message, however, is the outreach to BIMSTEC, which includes Bangladesh, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan, besides India.

Moving to break new ground

  • This is another effort to reach out diplomatically to the neighbourhood, diaspora and the China-Russia-led regional grouping of Central Asian countries. While PM’s SAARC effort last time failed to take off owing to strained ties with Pakistan, much will depend on the progress Delhi makes with these groupings.


  • New Delhi’s engagement with BIMSTEC rose from the ashes of SAARC. In October 2016, following the Uri attack, India gave a renewed push for the grouping that had existed for almost two decades but been largely ignored. Alongside the BRICS summit in Goa, Modi hosted an outreach summit with BIMSTEC leaders.
  • That September, some of these BIMSTEC countries had supported New Delhi’s call for a boycott of the SAARC summit scheduled in Islamabad in November 2016. As the summit was postponed, India had claimed victory in isolating Pakistan, having accused that country of carrying out the Uri attack.
  • Suddenly, BIMSTEC had emerged as a regional platform where five SAARC countries could gather and discuss sub-regional cooperation. India had long felt that the vast potential of SAARC was being under-utilised and opportunities were being lost due to either a lack of response and/or an obstructionist approach from Pakistan.
  • The search for an alternative, in fact, had been evident at the 2014 SAARC summit in Kathmandu, where Modi had said opportunities must be realised “through SAARC or outside it” and “among us all or some of us.” That was an important signal to Pakistan, as well as to fellow SAARC members.
  • Two years after the BRICS-BIMSTEC outreach summit and the BIMSTEC leaders’ retreat, the fourth BIMSTEC summit was held in Kathmandu in September 2018. The outcome was considered quite comprehensive, spanning from blue economy to counter-terrorism, although it was only the fourth summit in 21 years.

Why the region matters

  • The Bay of Bengal is the largest bay in the world. Over one-fifth (22%) of the world’s population live in the seven countries around it, and they have a combined GDP close to $2.7 trillion.
  • Despite economic challenges, all these seven countries have been able to sustain average annual rates of economic growth between 3.4% and 7.5% from 2012 to 2016. The Bay also has vast untapped natural resources. One-fourth of the world’s traded goods cross the Bay every year.
  • In an effort to integrate the region, the grouping was formed in 1997, originally with Bangladesh, India, Sri Lanka and Thailand, and later included Myanmar, Nepal and Bhutan. BIMSTEC, which now includes five countries from South Asia and two from ASEAN, is a bridge between South Asia and Southeast Asia. It includes all the major countries of South Asia, except Maldives, Afghanistan and Pakistan.

India’s stake

  • As the region’s largest economy, India has a lot at stake. In the 20th anniversary speech in 2017, Modi said BIMSTEC connects not only South and Southeast Asia, but also the ecologies of the Great Himalayas and the Bay of Bengal. “For India, it is a natural platform to fulfil our key foreign policy priorities of ‘Neighborhood First’ and ‘Act East’,” he said.
  • For New Delhi, one key reason for engagement is in the vast potential that is unlocked with stronger connectivity. Almost 300 million people, or roughly one-quarter of India’s population, live in the four coastal states adjacent to the Bay of Bengal (Andhra Pradesh, Orissa, Tamil Nadu, and West Bengal). And, about 45 million people, who live in landlocked Northeastern states, will have the opportunity to connect via the Bay of Bengal to Bangladesh, Myanmar and Thailand, opening up possibilities in terms of development.
  • From the strategic perspective, the Bay of Bengal, a funnel to the Malacca straits, has emerged a key theatre for an increasingly assertive China in maintaining its access route to the Indian Ocean. Beijing has undertaken massive drive to finance and develop infrastructure in South and Southeast Asia through the Belt and Road Initiative in almost all BIMSTEC countries, except Bhutan and India.
  • As China mounts assertive activities in the Bay of Bengal region, with increased submarine movement and ship visits in the Indian Ocean, it is in India’s interest to consolidate its internal engagement among the BIMSTEC countries.

India among countries where women face most violence by partner

Topic: GS–II: Social Justice  

Global estimates published by the World Health Organization (WHO) indicate that about 1 in 3 (35%) women worldwide have experienced either physical and/or sexual intimate partner violence or non-partner sexual violence in their lifetime.

 Other findings of the report:

  • Worldwide as many as 38% of murders of women are committed by a male intimate partner. What make this worse for countries like India is the fact that intimate partner violence is the highest at 37.7% in the WHO South-East Asia region.
  • As per figures released by WHO, the violence ranges from 23.2% in high-income countries and 24.6% in the WHO Western Pacific region to 37% in the WHO Eastern Mediterranean region.
  • “Violence against women — particularly intimate partner violence and sexual violence — is a major public health problem and a violation of women’s human rights.
  • WHO together with UN Women and other partners has developed a framework for prevention of violence against women called Respect which can be used by governments to counter this menace.

Multiple ramifications

  • Meanwhile, healthcare professionals cautioned that violence can negatively affect a woman’s physical, mental, sexual, and reproductive health, and may increase the risk of acquiring HIV in some settings.
  • Explaining how gender-based violence is perpetrated, the global health organisation said that men are more likely to perpetrate violence if they have low education, a history of child maltreatment, exposure to domestic violence against their mothers, harmful use of alcohol, unequal gender norms, including attitudes accepting of violence, and a sense of entitlement over women.
  • Women are more likely to experience intimate partner violence if they have low education, exposure to mothers being abused by a partner, abuse during childhood, and attitudes accepting violence, male privilege and women’s subordinate status.
  • Warning that intimate partner violence cause serious short-and long-term problems for women and adversely affect their children besides leading to high social and economic costs for women, their families and societies, WHO said: “There is now evidence that advocacy and empowerment counselling interventions, as well as home visitation are promising in preventing or reducing intimate partner violence against women.’’

Draft export policy unveiled

Topic: GS -III: Economic Development

The Commerce Ministry has come out with a comprehensive draft of the export policy which includes product- specific rules with a view to provide a ready reckoner for exporters.

More in news:

  • Based on inputs received from various partner government agencies, it is proposed to bring out a comprehensive exports policy for all ITC (HS) tariff codes (including items which are ‘free’ for export and do not currently exist in the policy), covering conditions/restrictions imposed by partner government agencies on exports.
  • The draft policy aims at consolidating the export norms for each product as applicable at different government agencies.
  • ITC-HS Codes are Indian Trade Clarification based on Harmonised System of Coding. It was adopted by India for import-export operations.
  • Every product has been accorded eight digit HS codes. The compendium will help an exporter know all the applicable norms pertaining to a particular product, helping him/her understand policy conditions for that item.

Consolidating norms

  • This exercise is for consolidating the norms and not for making any changes in the existing export policy of the country.
  • The DGFT said that the updated draft had been prepared by including all existing policy conditions, all notifications and public notices issued after January 2018. Besides, it also includes non-tariff regulations imposed by different government agencies
  • Commenting on the move, exporters body Federation of Indian Export Organisations (FIEO) said that it would provide a “ready reckoner” for traders and help in digitisation.
  • A similar policy exists for import purposes also. While Schedule 1 deals with imports, Schedule 2 deals with export related matters.

‘H-1B curbs put pressure on IT firms’ margin’

Topic: GS -III: Economic Development

Indian IT revenue is expected to grow by 7-8% in dollar terms during fiscal 2020, helped by double digit growth in digital services. However, operating margin is forecast to decline 30-80 bps (basis points) for the sector this year as local hires increase for onsite jobs, said Crisil Research.

More in news:

  • Local talent comes at an additional cost of 25 to 30% compared with the salaries paid to H-1B holders deployed onsite.
  • Traditionally, the sector had relied on labour arbitrage for maintaining margins, but that gap had been narrowing owing to various market forces — mainly, changing U.S. policy stance towards H-1B visas.
  • Employee expenses, which account for nearly 60-65% of total operating costs and cost per employee for tier 1 players, rose faster at about 17% and about 9% on-year in fiscal 2019, respectively, compared with about 6% and about 3% a year before. For mid-tier players, the increase in employee expenses were about 13% on-year for nine months ended December of fiscal 2019 as many are yet to declare fourth quarter results.
  • Such a rise in staff costs can be attributed to tightening of visa norms for Indian players, resulting in higher onsite costs for them.
  • Ever since the U.S. government tightened its H-1B visa norms in 2017, challenges had mounted for the sector.
  • That year, Indian-origin employees were the largest consumers of H-1B visas at 63% of initial employment, so the sudden change meant fulfilling onsite client requirements became tough.

Editorial section:

How to rescue genuine secularism –The Hindu

Global implications of the mandate –The Hindu

It’s there –The Hindu




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