Comprehensive News Analysis 24-01-2022

By Target IAS|Updated : January 24th, 2022

Comprehensive News Analysis covers all the important articles and editorials of 'The Hindu' from the UPSC/IAS examination point of view.

B. GS 2 Related

Nothing here for today!!!
Nothing here for today!!!

E. Editorials

Category: ECONOMY 

1. A chance to Support Growth, Fiscal consolidation

Syllabus: Indian Economy and Issues relating to planning

Prelims: – Basic determinants of  economic growth; 

Mains:- Need for Fiscal consolidation in India;

Context: –

This article examines the basic determinants of economic growth for 2022-2023 and stresses the need for Fiscal Consolidation.

National Statistical Office (NSO) Growth Estimates: –

  • The National Statistical Office (NSO) released the first advance national accounts estimates for 2021-22.

  • India’s real GDP growth in 2021-22 is estimated at 9.2%. It is 30 basis points lower than the projection by the Reserve Bank of India and the International Monetary Fund (IMF) projection of 9.5%.

Basic Determinants of Economic Growth for 2022-23:

Determinant of Growth

Analysis of 2021-22

Prospects for Economic Growth 2022-23



Capacity utilization

Capacity utilization ratio was only 61.7% in the preceding four quarters of 2021-22.

Capacity utilization in India continues to show considerable slack.

Gross Fixed capital formation (GFCF)

The gross fixed capital formation (GFCF) relative to GDP at current prices stands at 29.6% in 2021-22.

Meeting the GFCF target could be challenging given that private sector investment is still weak due to continued uncertainty over the pandemic.

Private final consumption expenditure (PFCE)

PFCE shows a low growth of 6.9% in 2021-22.

PFCE is estimated to drop by 2.9% from the pre-pandemic level, even though growth in FY22 had remained below par.

Real-GDP growth

India’s GDP will grow at 9.2 per cent in the financial year 2021-22 (FY22) as against a contraction of 7.3 per cent in the previous financial year.

Growth in 2022-23 could continue to be constrained by supply-side bottlenecks and high prices of global crude and primary products. It may thus be prudent to expect a real GDP growth in the range of 6%-7%.

Nominal GDP Growth

Implicit price deflator (IPD)-based inflation  was as high as 7.7% in 2021-22.

The nominal GDP is estimated to be higher by almost 4.2% from the budget estimate for FY22.

Fiscal Deficit

The annual growth in the Center’s GTR may be close to 35%, implying a buoyancy of nearly 2. With these buoyant tax revenues, the Government may be able to limit the 2021-22 fiscal deficit to its budgeted level of 6.8% of GDP.

ICRA estimates the GoI’s fiscal deficit at 5.8 percent of the GDP in FY23.

Other Determinants: –

  • Corporate income tax (CIT) reform: The major corporate income tax (CIT) reform undertaken in 2019-20 had provided a concessional CIT rate of 15% for fresh investment in manufacturing by domestic companies provided their production took off on or before March 31, 2023.

  • GST Compensation: – The GST compensation provision would also come to an end in June 2022. This would cause a major revenue shock at least for some States such as Tamil Nadu, Kerala and Andhra Pradesh.

Fiscal Consolidation: –

  1. What is Fiscal Consolidation?

  • Fiscal consolidation is a process in which the government’s fiscal health improves, as evidenced by a smaller fiscal deficit.

  • As the fiscal deficit falls below a tolerable level, improved tax revenue realization and better directed expenditure are key components of fiscal consolidation.

  • Know more About Fiscal Consolidation

  1. Finance Commission Recommendations on Fiscal Consolidation

  • The Fifteenth Finance Commission had suggested a fiscal consolidation path where the Center’s fiscal deficit was benchmarked at 5.5% of GDP for 2022-23. In their pessimistic scenario, it was kept at 6% of GDP.

  1. Why Fiscal Consolidation is important?

  • In India, the fiscal deficit is the most important indicator of the government’s financial health.

  • The Fiscal Responsibility and Budget Management (FRBM) Act gives the targets for fiscal consolidation in India.

  • It would be appropriate in current economic conditions to consider a graduated return to fiscal consolidation while using fiscal policy to lay the base for faster growth in the years to come.

  1. How Fiscal Consolidation can be achieved?

  • A high-powered inter-governmental group should be constituted to re-examine the sustainability parameters of debt and fiscal deficit of the central and State governments.

  • As per the FC 15, the 2022-23 fiscal deficit for the center was benchmarked at 5.5% of GDP. In their pessimistic scenario, it was kept at 6% of GDP.

  • A reduction in the fiscal deficit of about 1% point of GDP from its expected level at 6.8% of GDP in 2021-22 may be considered.

  • A stepwise reduction of 0.5% points per year would enable a level of about 4% of GDP by 2025-26.

byjusexamprepRecommendations: –

  • Expenditure prioritization in 2022-23 should focus on reviving both consumption and investment demand.

  • The National Infrastructure Pipeline (NIP) should be reassessed in order to make up for existing deficiencies in relation to the original targets.

  • Since consumption demand remains weak, some fiscal support in the form of an urban counterpart to Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) may be considered.

  • The GST compensation arrangement should be extended by two years in some modified form also considering its impact on the Center’s Budget.

  • With respect to non-tax receipts, the scope of the National Monetization Pipeline (NMP) may be extended to cover monetisation of government-owned land assets.

  • Disinvestment initiatives may have to be accelerated.

Nut Graf

Due to the three waves of COVID-19 that India has experienced, two years of real growth in economic activities have been wiped out. For revival of the economy in 2022-23, It would be prudent to support some of the sectors which have been most impacted by the pandemic while ensuring a graduated return to fiscal consolidation.


1. A stellar fallacy

Syllabus: Conservation, Environmental impact assessment.

Prelims: – Environmental impact assessment(EIA)

Mains: – Critical Analysis of Star Rating System.

Context: –

This article critically evaluates the concerns associated with the Star Rating System proposed by the Environment Ministry.

What is the Star Rating System proposed by the Environment Ministry?

  • The Union Environment Ministry proposed to “rank” and “incentivise” States on how quickly they could give environmental clearances to proposed infrastructure projects.

  • Under this scheme, State-level environment committees that appraise industrial projects on their potential environmental risk would be incentivised with points for “transparency, efficiency and accountability”.

How is the environment clearance (EC) accorded to Development Projects?

  • The environmental clearance process is warranted for projects listed in the Environmental Impact Assessment notification of 2006.

  • These projects are categorized based on the kind of environmental clearance they would require.

  • Category A projects require mandatory environmental clearance at the central level, and category B projects are reviewed at the state level by the SEIAAs.


  • The environmental clearance has four stages: screening, scoping, public consultation, and appraisal. Know more About Environmental Impact Assessment (EIA)

  • The project appraisal process is an online process where aspirant companies must upload documents on a portal called

What are the benefits of the Star Rating System?

What are the Concerns?

  • The proposal of star rating is contrary to the environmental rule of law, violates article 21 and is an arbitrary exercise of power.

  • The Star Rating System has been criticized for violation of The Environment (Protection) Act.

  • The task of the SEIAA is to undertake a ‘detailed scrutiny’ whereas this proposal makes them rubber stamp authorities.

  • State committees are hampered by having too few independent experts and decision-making being left to bureaucrats rather than to environment specialists.

  • Penalizing SEIAAs for seeking additional information more than once could lead to them granting clearances with inadequate data.

  • It also creates artificial competition between states, which may result in industries locating in states that offer environmental clearance quicker.

Way Forward: –

  • The Star Rating System proposed by the Environment Ministry will be a dynamic process based on performance of the states but the concerns such as a pressure of speed, efficiency and incentivisation can skew environmental governance and make it pro-business.

  • The way forward is to take steps to increase trust in the system and ensure that all States have competent experts who can conduct appraisals without fear or favor.

Nut Graf

The Star Rating System proposal aims to “incentivise states” by ranking them on the basis  of state environment impact assessment agencies (SEIAAs) clearances which contravene basic principles of environmental regulation. The proposal ignores sustainable development goals for monetary goals which in turn impacts the environment and rights of people.

F. Prelims Facts 

1. Gujarat to depict British massacre of tribals

  • In 1922 in Pal and Dadhvaav villages of North Gujarat’s Sabarkantha district, the Britishers massacred about 1,200 tribals who had assembled under the leadership of Motilal Tejawat, to protest against the land revenue system imposed by the British and the feudal lords.

  • Soldiers from Mewad Bhil Corps under direction from its officer, Major H.G. Saturn, indulged in unprovoked firing on the tribals.

  • This incident is considered worse than Jallianwala Bagh massacre of 1919.


  • The state of Gujarat will be highlighting a 1922 incident which had resulted in the massacre of about 1200 tribals on its Republic Day Parade tableau. The tableau aims to present the story of bravery and sacrifice of the tribals. 

2. ‘Statue of Equality’ gets final touches

Statue of Equality:

  • The Statue of Equality would be a 216-ft tall statue of the 11th century reformer and Vaishnavite saint, Sri Ramanuja.

  • The Statue is being installed to mark the 1,000th birth anniversary of Sri Ramanuja.

  • It would be installed in Muchintal on the outskirts of Hyderabad.

  • It is the second largest in the world in sitting position of the saint.


  • The ‘Statue of Equality’ will soon be unveiled by Prime Minister. 

G. Tidbits 

1. Elephant corridors to be restored in south Bengal

  • The forests of south Bengal have emerged as one of the hotspots of human-elephant conflict in the country, resulting in loss of lives of both humans and pachyderms.

    • Between 2014 and 2019, as many as 2,381 human deaths were recorded in elephant attacks across the country, of which 403 (over 16%) were reported from West Bengal. The State, however, is home to less than 3% of the elephant population and records a high death count of pachyderms in conflicts.

  • The degradation and fragmentation of forests have led to disruption in the traditional migration routes of the elephant herds in the region. This has resulted in elephants entering towns in Burdwan, Bankura and Medinpur of South West Bengal.

  • There is the need to create a balanced ecosystem so that humans and animals can coexist. Ecological restoration of elephant corridors in south Bengal can help minimize elephant-human conflict of the region. 

2. Framing policies is the domain of govt. and not courts: Delhi HC

  • The Delhi High Court while rejecting a public interest litigation (PIL) seeking to constitute a special commission on environment has noted that framing policies is the domain of the government and not the courts.

  • It stated that a court will not interfere in policy making as the policies are framed based on expert knowledge of the persons concerned in the respective fields and that courts are not equipped with the necessary expertise.

  • The Bench further stated that while courts can certainly examine a policy or an action of the Executive, if it is unreasonable, unfair, arbitrary or unlawful or if it is unconstitutional, but cannot issue directions to frame a policy in a particular manner owing to the principle of separation of power. 

3. Cost overruns

  • According to a report by the Ministry of Statistics and Programme Implementation, of the total 1,673 infrastructure projects, 445 projects have reported cost overruns and 557 projects have been delayed.

  • The cost overruns of 445 infrastructure projects stands at around 4 lakh crore.

  • The average time overrun in 557 delayed projects stood at around 45.69 months 

I. UPSC Mains Practice Questions 

  1. Examine the recommendations of the T.S.R Subramanian report on environment and evaluate the merits of the proposed Indian Environmental Service. (250 words; 15 marks)[GS-3, Environment and Ecology]

  2. Assessment of environmental costs and benefits of projects should not be done in haste. Comment. (250 words; 15 marks)[GS-3, Environment and Ecology]


write a comment
Khushbu Pandey
Thanx team byju's 🙏😊🍫

PrafulJan 26, 2022

Thank you sir
Sathish Murthy
Try to give this information in kannada
Laiba Parvez

Laiba ParvezJan 27, 2022

thank u sir/ma'am
Sunita Goswami

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