2. About the Total Fertility Rate (TFR)

The Total Fertility Rate (TFR) is a key demographic indicator that helps us understand the average number of children a woman in a specific population will have during her lifetime, assuming current birth patterns persist. It's different from the crude birth rate, which simply measures the number of births per 1,000 people in a population in a given year. 

What it measures

• The average number of children a woman will have throughout her reproductive lifespan.
• It considers age-specific fertility rates, which means it takes into account the different birth rates at different ages within the population.
• Provides a longer-term perspective on population dynamics compared to the crude birth rate.

Significance

• Helps assess population growth trends and predict future population size.
• Informs policy decisions related to education, healthcare, social security, and economic development.
• Understanding TFR is crucial for analyzing the potential demographic dividend, which refers to the economic and social benefits that can arise from a large working-age population due to declining fertility rates.

Calculation

• Summing the age-specific fertility rates (ASFRs) for all fertile age groups (typically 15-49 years) and multiplying by five.
• ASFRs represent the average number of births per 1,000 women in a specific age group.

Key TFR levels

• Replacement fertility rate: Around 2.1 children per woman, ensures population stability without growth or decline due to births and deaths (excluding migration).
• TFR below replacement: Indicates a declining population, with potential implications for workforce size and economic growth.
• TFR above replacement: Leads to population growth, requiring investments in infrastructure and resources to support the growing population.

3. What does the Total Fertility Rate (TFR) of 2.0 mean?

A Total Fertility Rate (TFR) of 2.0 means that, on average, each woman in the population is expected to give birth to two children over her reproductive lifetime. This value represents the replacement level of fertility, where each generation replaces itself in the population. When the TFR is around 2.0, it indicates that the population is stable, with births balancing deaths over time.

A Total Fertility Rate (TFR) of 2.0 indicates several key things

• Average Children per Woman: In that specific population, on average, a woman will have two children during her lifetime, assuming current birth patterns remain unchanged. This means that each generation of women is replacing itself, without population growth or decline due solely to births and deaths (excluding migration).
• Replacement Fertility Rate: A TFR of 2.0 is often referred to as the replacement fertility rate. This is because it signifies the level of fertility needed to maintain a stable population size over time, considering only births and deaths. However, it's important to note that the exact replacement level can vary slightly depending on mortality rates, particularly child mortality.
• Demographic Transition: A TFR of 2.0 suggests that the population is likely in the later stages of the demographic transition. This transition involves a shift from high birth and death rates to low birth and death rates. In this stage, populations typically experience a decline in fertility, followed by a decline in mortality, leading to a stabilization of population size.
• Global Context: While 2.0 is the replacement fertility rate, the global average TFR is currently around 2.3, indicating slight population growth. However, many developed countries have TFRs below replacement level, which can lead to an ageing population and potential challenges for social security systems and workforce size.
• Policy Implications: Understanding the TFR is crucial for policymakers in various areas like education, healthcare, social security, and economic development. A TFR below replacement may necessitate policies encouraging childbirth or attracting immigration to address potential workforce shortages. Conversely, a high TFR might require investments in infrastructure and resources to support a growing population.

4. What is the Replacement Fertility Rate?

The Replacement Fertility Rate (RFR) is the level of fertility required to maintain a stable population size in a given area, considering only births and deaths (excluding migration). This means that each generation of women has just enough daughters to replace themselves and their mothers in the population.

Key Points about RFR

• Typically around 2.1 children per woman This number varies slightly depending on a country's mortality rates, especially child mortality rates. Higher child mortality necessitates slightly higher fertility to ensure replacement.
• When the TFR matches the RFR, the population neither grows nor declines due to births and deaths.
• Reaching RFR suggests a population in the later stages of the demographic transition, characterized by declining birth and death rates.
• Though the global average TFR is 2.3 (slightly above RFR), many developed countries have TFRs below RFR, leading to ageing populations.

Significance of RFR

• Understanding RFR helps policymakers formulate effective policies in areas like education, healthcare, social security, and economic development.
• TFR below RFR may require policies to encourage childbirth or attract immigration to address potential workforce shortages and support ageing populations. Conversely, a high TFR might necessitate investments in infrastructure and resources to sustain a growing population.
• Analyzing TFR about RFR offers insights into potential population growth or decline, aiding in planning and resource allocation.

5. How is the Total Fertility Rate calculated?

The Total Fertility Rate (TFR) is calculated by considering the age-specific fertility rates (ASFRs) of a population. 

1. Age-specific fertility Rates (ASFRs) represent the average number of births per 1,000 women within a specific age group. Typically, ASFRs are calculated for five-year age groups ranging from 15-49 years, covering the typical childbearing years for women. Data for calculating ASFRs usually comes from population censuses or demographic surveys.
2. Once you have the ASFRs for each age group, you need to sum them all up. This gives you the total number of births expected per 1,000 women across all fertile age groups.
3. Since age groups may have different sizes, simply summing ASFRs wouldn't be entirely accurate. To account for this, the sum is multiplied by the average number of women in each age group. This ensures the TFR reflects the fertility rates across all age groups proportionally.
4. Often, instead of using the actual number of women in each age group, a standard factor of "5" is used for convenience. This assumes that each age group has roughly the same number of women, which is a reasonable approximation for many populations.

Therefore, the TFR formula becomes: TFR = (Sum of ASFRs across all age groups) * 5

Example:

Imagine a hypothetical population with the following ASFRs:

• 15-19 years: 30 births per 1,000 women
• 20-24 years: 80 births per 1,000 women
• 25-29 years: 120 births per 1,000 women
• 30-34 years: 90 births per 1,000 women
• 35-39 years: 50 births per 1,000 women
• 40-44 years: 20 births per 1,000 women
• 45-49 years: 10 births per 1,000 women

Using the formula:

• TFR = (30 + 80 + 120 + 90 + 50 + 20 + 10) * 5
• TFR = 400 * 5
• TFR = 2000 births per 1,000 women

Therefore, in this example, the TFR is 2.0, indicating that on average, a woman in this population would have 2 children during her lifetime based on the current age-specific fertility rates.

6. The difference between birth rate and Total Fertility Rate (TFR)

While both birth rate and Total Fertility Rate (TFR) measure fertility within a population, they have key differences that offer distinct insights:

7. About demographic dividend

A demographic dividend refers to the potential economic and social benefits that can arise when a large share of the population is in the working-age (typically 15-64 years) compared to the dependent populations (children and elderly). This shift in population structure is often caused by a decline in fertility rates without a corresponding decline in mortality rates, leading to a "bulge" in the working-age population.

Key Features

• A larger working-age population translates to a larger pool of available labour, potentially boosting economic growth and productivity.
• The ratio of dependents (children and elderly) to the working-age population decreases, leading to increased savings and investment as fewer resources are needed to support dependents.
• The potential for increased investments in education and healthcare due to a smaller dependent population, leading to a more skilled and healthy workforce.

Conditions for a Dividend

• A significant and sustained decline in fertility rates is crucial for the demographic dividend to occur.
• The benefits of a demographic dividend can only be realized if the working-age population is adequately educated, skilled, and healthy.
• Expanding job opportunities is essential to absorb the growing workforce and prevent unemployment.

Challenges and Considerations

• The demographic dividend may not be evenly distributed across regions or social groups, potentially leading to inequalities.
• Governments and businesses need to adapt policies and infrastructure to accommodate the changing population structure.
• Ensuring social security and healthcare for the ageing population is crucial to sustain the benefits of the dividend.

Examples

• Several East Asian countries, like China and South Korea, experienced significant economic growth due to their demographic dividends in the latter half of the 20th century.
• India is currently experiencing a demographic transition with a declining fertility rate, creating the potential for a future dividend. However, realizing this potential requires investments in education, healthcare, and job creation.

 

 

Previous Year Questions   1. The total fertility rate is: (HPPSC GS 2018) (MPSC 2015)   A. The birth of women divided by the total female population B. The number of births divided by the total population C. The number of children a woman will likely bear in her lifetime D. The births to women of a given age divided by the total number of women at that age Answer: C   Mains   1. "Empowering women is the key to control the population growth.’’ Discuss. (UPSC 2019) 2. Critically examine the effect of globalization on the aged population in India. (UPSC 2013) 3. Discuss the main objectives of Population Education and point out the measures to achieve them in India in detail. (UPSC 2021) 4. Define potential GDP and explain its determinants. What are the factors that have been inhibiting India from realizing its potential GDP? (UPSC 2020)

 

 Source: The Indian Express

 

 

GLOBAL GENDER GAP

 

 

1. Context

 

India is now a global economic power, a digital innovator, and home to the world’s largest youth population. But the World Economic Forum’s Global Gender Gap Report (2025) is a sobering reminder that when it comes to gender equality, India remains far behind.

 

2. What is the Global Gender Gap?

 

The Global Gender Gap refers to the measurement of gender-based disparities across various aspects of life, including but not limited to economic participation and opportunity, educational attainment, political empowerment, and health and survival. It is commonly assessed and reported by the World Economic Forum (WEF) through its annual Global Gender Gap Report.

The Global Gender Gap Index ranks countries based on their progress towards gender parity. It measures the gap between women and men across four key areas:

• Economic Participation and Opportunity: This includes indicators such as labor force participation, wage equality for similar work, and the ratio of women to men in leadership positions and skilled roles.

• Educational Attainment: This assesses the gap in access to and completion of education between women and men at all levels, from primary to tertiary education.

• Health and Survival: This measures differences in life expectancy and sex ratio at birth, reflecting disparities in health outcomes between women and men.

• Political Empowerment: This evaluates the gap in political representation and participation between women and men, including the ratio of women to men in decision-making positions and parliamentary representation.

The Global Gender Gap Report serves as a tool to assess progress and identify areas where interventions are needed to address gender disparities. It highlights both achievements and challenges in achieving gender equality globally and provides policymakers, businesses, and civil society organizations with data-driven insights to inform their efforts toward gender equality and women's empowerment

3.What explains the gender pay gap?

 

The gender pay gap refers to the difference in average earnings between men and women in the workforce. Several factors contribute to the gender pay gap, including:

• Occupational Segregation: Women are often concentrated in lower-paying industries and occupations compared to men. This occupational segregation is influenced by various factors, including social norms, discrimination, and differences in educational and career choices.

• Unequal Pay for Equal Work: Even within the same occupation and industry, women may earn less than men for performing similar roles. This can be due to factors such as discrimination in hiring, promotion, and compensation decisions, as well as negotiation disparities.

• Motherhood Penalty: Women who become mothers often experience a reduction in earnings compared to women without children and men with children. This can be attributed to factors such as career interruptions, decreased work hours, and bias against working mothers in the workplace.

• Lack of Representation in Leadership Positions: Women are underrepresented in senior leadership roles and executive positions, which typically come with higher salaries and bonuses. This lack of representation contributes to the gender pay gap at the highest levels of organizations.

• Unpaid Care Work: Women are more likely to take on a disproportionate share of unpaid care work, such as childcare and eldercare responsibilities. This can limit their ability to work full-time or pursue higher-paying career opportunities.

• Gender Stereotypes and Bias: Societal stereotypes and biases about gender roles and capabilities can influence hiring, promotion, and compensation decisions, leading to disparities in pay between men and women

4. Global Gender Gap Report 2023-What are the Key Findings?

 

• The International Labour Organization (ILO) defines the gender pay gap as the disparity between the average wages of all women and all men in the labor market, regardless of whether they receive monthly salaries, hourly wages, or daily pay rates. It clarifies that this gap differs from the concept of "equal pay for equal work," which stipulates that individuals with the same qualifications and performing identical tasks should receive equivalent compensation.
• Moreover, there isn't a universally accepted method for calculating this discrepancy. For instance, while Pew Research found in 2012 that women earned 84% of men's earnings in the United States, the US Bureau of Labor Statistics reported a figure of 81 cents to the dollar shortly before that.
• Several factors contribute to this gap. Firstly, women's lower participation in paid employment compared to men, influenced by societal perceptions of gender roles, is a significant factor, as indicated by the labor force participation rate.
• The ILO states that globally, women's labor force participation rate stands at just under 47%, while for men, it is 72%. In India, according to the 2011 Census, only 25.51% of women participate in the workforce, compared to 53.26% of men.
• Secondly, the types of occupations women enter upon joining the workforce play a role. According to the ILO's Women in Business and Management report, women are underrepresented in managerial and leadership positions, especially at higher levels. Additionally, when women do hold managerial roles, they tend to be concentrated in support functions such as human resources and financial administration, which typically offer lower salaries compared to more strategic roles occupied by men.
• A survey conducted by Georgetown University in 2013 revealed that the top 10 highest-paying professions, predominantly in engineering and computer science, were dominated by men, whereas the 10 lowest-paying professions, primarily in fields like arts and education, were dominated by women.
• Furthermore, in 73 countries (based on 2018 data), women outnumber men as part-time workers. The ILO suggests that women's opportunities for full-time employment may be constrained compared to men's, leading them to opt for part-time work, which often comes with fewer benefits and lower remuneration over time.
• Institutional and socio-economic factors also contribute significantly to the gender pay gap, including the perception that men should be the primary breadwinners, unequal investments in women's education, and safety concerns during commute and in the workplace

5. How is the gender pay gap calculated?

 

The gender pay gap is typically calculated by comparing the average earnings of all women to the average earnings of all men within a specific workforce or labor market. Here's a basic outline of the calculation:

• Collect Data: Gather data on earnings for both men and women within the chosen population, whether it's a particular company, industry, region, or country. This data can be obtained from payroll records, government databases, surveys, or other sources.

• Calculate Average Earnings: Determine the average earnings for men and women separately by summing up the total earnings of each group and dividing by the number of individuals in that group.

• Calculate the Gap: Subtract the average earnings of women from the average earnings of men to find the absolute difference.

  Gap = Average Earnings of Men - Average Earnings of Women

• Express the Gap as a Percentage: To express the gap as a percentage, divide the absolute difference by the average earnings of men and then multiply by 100.

  Percentage Gap = (Gap / Average Earnings of Men) * 100

This percentage represents the gender pay gap, indicating the difference in average earnings between men and women as a proportion of men's average earnings

6.The Global Gender Gap Index and Gender Inequality Index (GII)

 

Subject	Global Gender Gap Index (GGGI)	Gender Inequality Index (GII)
Measurement	Measures gender-based disparities across four key areas: Economic participation and opportunity, Educational attainment, Health and survival, Political empowerment.	Measures gender inequality in three dimensions: Reproductive health, Empowerment, Labor market participation.
Focus	Focuses on gender disparities and gender parity in various aspects of life, including economic, educational, health, and political participation.	Focuses specifically on gender inequality, highlighting disparities in reproductive health, empowerment, and labor market participation.
Components	Includes economic participation and opportunity, educational attainment, health and survival, political empowerment.	Includes maternal mortality ratio, adolescent birth rate, women in parliament, educational attainment, labor force participation.
Data Sources	Relies on data collected by the World Economic Forum (WEF) through its annual Global Gender Gap Report.	Utilizes data from various sources, including United Nations agencies and other international organizations.
Ranking Method	Ranks countries based on their progress towards gender parity in each component and overall.	Ranks countries based on a composite index that combines indicators from the three dimensions of reproductive health, empowerment, and labor market participation.
Scope	Covers a broad range of gender disparities and focuses on the gender gap within each country.	Specifically targets gender inequality and highlights countries where women face significant barriers to equal rights and opportunities.
Policy Implications	Provides policymakers with insights into areas where interventions are needed to address gender disparities and promote gender equality.	Helps policymakers identify areas where targeted interventions are required to address gender inequality and improve women's rights and opportunities.
Global Rankings	Provides a global ranking of countries based on their performance in closing the gender gap.	Provides a global ranking of countries based on their level of gender inequality, highlighting countries with the highest levels of disparity.
Publication Frequency	Published annually by the World Economic Forum (WEF).	Published annually by the United Nations Development Programme (UNDP).

 

 

7. Way forward

 

One notable study conducted by the World Economic Forum (WEF) as part of its Global Gender Gap Report has consistently highlighted the gender wage disparity in India. The report typically provides an estimate of the gender wage gap based on the ratio of female to male earned income. In the most recent report available to me, India's gender wage gap was significant, with women earning substantially less than men. However, it's essential to note that this data may have changed since then, as gender wage gap figures can fluctuate over time due to various economic and social factors

 

For Prelims: Economic and Social Development-Sustainable Development, Poverty, Inclusion, Demographics, Social Sector Initiatives, etc For Mains:  General Studies I: Social empowerment • General Studies II: Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections. • General Studies II: Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources

 

 

Previous Year Questions   1.Which of the following gives 'Global Gender Gap Index' ranking to the countries of the world? (UPSC CSE 2017) A.World Economic Forum B.UN Human Rights Council C.UN Women D.World Health Organization Answer (A)

Source: Indianexpress

 

 

RIGHT TO VOTE

 

 

1. Context

 

On July 10, the Supreme Court directed the Election Commission (EC) to consider Aadhaar cards, voter ID cards, and ration cards as acceptable documents for the special intensive revision (SIR) of electoral rolls in Bihar. It has listed the batch of petitions challenging the EC’s decision for further hearing on July 28.

 

2. Background of the latest Controversy

 

• Electoral rolls in India are regularly updated by the Election Commission to ensure that all eligible citizens are included and ineligible names (such as those of deceased individuals or people who have moved away) are removed. Usually, this happens through Annual Summary Revisions.
• However, sometimes, a Special Intensive Revision (SIR) is conducted, particularly when there are reports of major discrepancies in the electoral rolls or if there have been significant demographic changes.
• In Bihar, the Election Commission of India (ECI) ordered a Special Intensive Revision of the voter list, which involved house-to-house verification by booth-level officers (BLOs). This revision began in June 2024 and was set to continue till August, with the final roll expected to be published later
• The revision has been ordered after the conclusion of the 2024 Lok Sabha elections and just months before the scheduled 2025 Bihar Assembly elections. Opposition parties, particularly the Rashtriya Janata Dal (RJD), have raised concerns that the exercise might be used to manipulate voter lists in a way that could favor the ruling party at the state or central level.
• Opposition leaders and civil society groups have warned that the SIR could result in mass deletion of voters, especially among marginalised communities like Dalits, minorities, and migrant labourers who might not be present at home during the verification period.
• These groups are often the most vulnerable during such exercises due to lack of documentation or frequent change of residence.

Supreme Court response

• On July 10, the Supreme Court instructed the Election Commission (EC) to accept Aadhaar cards, voter ID cards, and ration cards as valid identity documents for the ongoing Special Intensive Revision (SIR) of electoral rolls in Bihar.
• The Court also scheduled the next hearing on the group of petitions challenging the EC’s move for July 28. In doing so, the Court emphasized that the 'right to vote' lies at the heart of India’s democratic structure, drawing national attention to the core mechanisms behind the country’s electoral system and the origin of its policy of universal adult suffrage (UAS).
• India’s approach to the right to vote, as enshrined in its Constitution, stands in marked contrast to the historical trajectory seen in many Western nations. Influenced by thinkers such as J.S. Mill, who argued that voting should be reserved for the “educated” and denied to the “uninformed,” several countries began with a highly exclusive franchise.
• For instance, in the United Kingdom, voting was initially limited to male property holders. It wasn't until 1918 that all men gained voting rights, and women had to wait until 1928 to be included.
• Similarly, in the United States, while constitutional amendments—the 15th in 1870 and the 19th in 1920—technically extended voting rights to African Americans and women respectively, practical obstacles like poll taxes and literacy tests kept many citizens disenfranchised for decades

3. Universal Adult Suffrage in India

 

• Unlike many other countries that took a gradual approach to granting voting rights—often limiting them to elite sections and undergoing long, sometimes violent struggles—India adopted a bold and inclusive strategy from the very beginning.
• Instead of restricting suffrage, India chose universal adult franchise at the time of independence, embracing the principle of democratic equality from the outset. Article 326 of the Indian Constitution guaranteed every adult citizen the right to vote, regardless of their gender, caste, religion, education, or economic status.
• This was a progressive move, especially when compared to other nations that were still cautiously expanding voting rights. Initially, the voting age was set at 21, but it was later lowered to 18 by the 61st Constitutional Amendment in 1989.
• The nation’s strong commitment to inclusive democracy was further underlined by several landmark Supreme Court rulings, starting with the Kesavananda Bharati v. State of Kerala case in 1973, which declared democracy a core feature of the Constitution’s ‘basic structure’.
• For democracy to thrive, it is essential that citizens retain the unchallenged right to choose their government freely—an essential pillar that must remain inviolable.
• This vision of inclusivity was implemented through two foundational laws: the Representation of the People Act of 1950, which oversees the creation and updating of electoral rolls, and the 1951 Act, which deals with the conduct of elections, eligibility of candidates, and electoral offences.
• The Election Commission of India (ECI) has consistently worked to fulfil this constitutional promise by introducing several administrative reforms. A notable example is the innovation introduced by Sukumar Sen, India’s first Chief Election Commissioner.
• Faced with the enormous task of registering 173 million mostly illiterate voters, he introduced the use of visual symbols for political parties—transforming a logistical challenge into a democratic milestone.
• In India, the ECI bears the crucial responsibility of ensuring that every eligible citizen, no matter how remote their location, can exercise their right to vote. As Winston Churchill aptly put it, “At the bottom of all tributes paid to democracy is the little man, walking into a little booth, with a little pencil, making a little cross on a little bit of paper…” His words serve as a powerful reminder that the legitimacy of any democracy ultimately hinges on protecting and upholding the sanctity of the vote

 

4. Is Voting a Fundamental right in India?

 

 

• The nature of the ‘right to vote’ in India has been a topic of legal and constitutional debate for decades. During the framing of the Constitution, both Dr. B.R. Ambedkar and K.T. Shah had advocated for its inclusion as a fundamental right.
• However, the Constituent Assembly’s Advisory Committee ultimately decided against this proposal. This position was later affirmed by the Supreme Court in the Kuldip Nayar v. Union of India case (2006), where a Constitution Bench ruled that the ‘right to elect’ is not a fundamental or constitutional right, but rather a statutory one derived from Section 62 of the Representation of the People Act (RPA), 1951.
• Although a two-judge bench in Rajbala v. State of Haryana (2016) referred to voting as a constitutional right, the earlier and more authoritative decision in Kuldip Nayar remains the guiding precedent.
• Again, in the 2023 Anoop Baranwal v. Union of India case, the Supreme Court refrained from revisiting this issue, reaffirming that it had already been conclusively addressed in the Kuldip Nayar ruling.
• Justice Ajay Rastogi, however, in a dissenting opinion, argued that the right to vote stems from Article 19(1)(a) of the Constitution (freedom of expression) and embodies the spirit of Article 21 (right to life and personal liberty).
• Despite his reasoning, this remains a minority viewpoint, and under current jurisprudence, voting continues to be classified as a statutory entitlement.
• Still, courts have consistently emphasised that, even if not fundamental in a legal sense, the right to vote is deeply embedded in the democratic framework of the country.
• It serves as a vital mechanism through which citizens participate in governance and decision-making, making it essential to the functioning and legitimacy of the Indian Republic.
• As philosopher John Dewey aptly observed, democracy extends beyond a governmental system—it represents a broader social and ethical ideal

 

 

5. Significance of accuracy of electoral roll

 

 

• The foundation of free and fair elections lies in the accuracy of electoral rolls, as mandated by the Representation of the People Act, 1950. When these rolls contain significant flaws—such as widespread omissions, inclusion of ineligible individuals, duplicate entries, or factual errors—it threatens the principle of “one person, one vote.”
• Such discrepancies open the door to impersonation, voter exclusion, or vote dilution, ultimately skewing the democratic verdict.
• To maintain the credibility of the electoral process, Section 21 of the 1950 Act grants the Election Commission (EC) the authority to compile and update electoral rolls as necessary.
• Although errors in voter lists are sometimes inevitable, the judiciary has consistently maintained that only major, systematic flaws that have a tangible impact on election results can call the validity of an election into question.
• Minor irregularities or isolated cases of disenfranchisement are not sufficient grounds for overturning results. Allegations of errors, such as those recently reported in Bihar, merit investigation.
• At the same time, it's important to recognise that cleansing voter rolls is essential—excluding a rightful voter weakens democracy, but so does allowing someone who is ineligible to remain on the list.
• Therefore, rather than obstructing the process, attention should be directed toward strengthening and refining it. The Supreme Court’s recommendation to accept a broader range of identity documents helps ensure that all legitimate voters retain their right to participate in elections.
• While the legal right to challenge or seek inclusion in the electoral rolls rests with individual citizens rather than political parties, the Supreme Court in Lakshmi Charan Sen v. A.K.M. Hassan Uzzaman (1985) emphasised that in a society with widespread illiteracy and limited political awareness, political parties have a responsibility to assist in ensuring that eligible voters are registered and ineligible names are removed.
• In a party-driven parliamentary system like India’s, such proactive engagement is essential for maintaining the credibility and integrity of elections

 

Qualification for an Ordinary resident   Under Article 324 of the Constitution, the Election Commission (EC) acts as the constitutional authority responsible for overseeing and managing the electoral process. One of its fundamental responsibilities is the preparation of reliable electoral rolls. This task is carried out in accordance with Section 19 of the Representation of the People Act, 1950, which stipulates that every Indian citizen who is at least 18 years old, ordinarily resides in a particular constituency, and is not otherwise disqualified, is eligible for registration as a voter. The term “ordinarily resident” refers to someone who has a genuine and continuous presence in a location, rather than a brief or temporary stay. For instance, a student residing in a hostel may not meet the criteria if their permanent residence is elsewhere and they intend to return there. However, simply being away from one’s usual place of residence temporarily does not disqualify someone from being considered an ordinary resident of that place. This standard helps prevent fake or misleading entries in the voter list and ensures that electors have a meaningful connection to the constituency they vote in, thereby reinforcing the principle of accountable and representative democracy

 

 

6. Way forward

 

The controversy surrounding the Special Intensive Revision (SIR) in Bihar and the wider discussions on electoral reforms underscore a fundamental principle of democracy: the strength of India’s democratic system relies on electoral rolls that are precise, inclusive, and easy to access. As the Supreme Court prepares to continue hearings on July 28, it is essential for the Election Commission to carry out the revision exercise with both diligence and inclusivity, ensuring the process remains fair and credible.

At the same time, it is crucial for citizens to be made aware of their role in the process—by checking and correcting their voter information, they become active participants in safeguarding electoral accuracy. Protecting the right to vote goes beyond fulfilling a legal mandate; it is a collective democratic duty that demands alert institutions, engaged and informed citizens, and progressive legal frameworks

For Prelims: Election Commission of India (ECI), Representation of the People Act (RPA), 1951   For Mains: GS II - Polity and Governance

 

Previous Year Questions   1. The Voter Verifiable Paper Audit Trail (VVPAT) system was used for the first time by the Election Commission of India in (UPSC CAPF 2019)   North Paravur Assembly Constituency, Kerala B.Noksen Assembly Constituency, Nagaland C.Mapusa Assembly Constituency, Goa D.Nambol Assembly Constituency, Manipur Answer (B)

 

Source: The Hindu

 

ZONAL COUNCILS

 

 

1. Context

 

Union Home Minister Amit Shah chaired the 27th Eastern Zonal Council on Thursday (10th July) in Ranchi, Jharkhand. The Eastern Zonal Council consists of four eastern states — Jharkhand, Bihar, Odisha, and West Bengal.

 

2. What are Zonal Councils?

 

• The concept of Zonal Councils was first introduced by Prime Minister Jawaharlal Nehru in 1956. During discussions on the States Reorganisation Commission's report, he proposed grouping the newly reorganized states into four or five zones. These zones would each have an Advisory Council aimed at fostering a spirit of cooperative governance, as per records from the Ministry of Home Affairs (MHA).

• In alignment with Nehru’s vision, five Zonal Councils were established under Part III of the States Reorganisation Act, 1956. These councils function as statutory bodies.

• Currently, the Zonal Councils are structured as follows:

  • Eastern Zonal Council: Includes Bihar, Jharkhand, Odisha, and West Bengal.

  • Northern Zonal Council: Comprises Haryana, Himachal Pradesh, Punjab, Rajasthan, Delhi (NCT), and the Union Territories of Chandigarh, Jammu & Kashmir, and Ladakh.

  • Central Zonal Council: Consists of Chhattisgarh, Uttarakhand, Uttar Pradesh, and Madhya Pradesh.

  • Western Zonal Council: Encompasses Goa, Gujarat, Maharashtra, and the Union Territory of Dadra & Nagar Haveli and Daman & Diu.

  • Southern Zonal Council: Includes Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, and the Union Territory of Puducherry.

• Additionally, the North Eastern Council (NEC) was formed as a statutory advisory body through the NEC Act of 1971 and became operational on November 7, 1972, in Shillong. Its members are Assam, Arunachal Pradesh, Manipur, Tripura, Mizoram, Meghalaya, and Nagaland. Sikkim, initially part of the Eastern Zonal Council, was incorporated into the NEC in 2002

 

3. Composition of Zonal Councils

 

 

(a) The Union Home Minister serves as the Chairperson of each Zonal Council.

(b) The Chief Ministers of the states within a particular zone take turns serving as the Vice-Chairperson of that zone’s Zonal Council. Each holds this position for one year on a rotational basis.

(c) From each member state, the Chief Minister and two other ministers — appointed by the respective Governor — are part of the council. Additionally, two representatives from the Union Territories in that zone also participate.

(d) Each Zonal Council includes a nominee from the Planning Commission (now NITI Aayog), along with the Chief Secretaries and another senior official designated by each participating state.

In 2018, under the leadership of Prime Minister Narendra Modi, the Union Cabinet gave approval for the Union Home Minister to serve as the ex-officio Chairperson of the North Eastern Council. Meanwhile, the Minister for Development of the North Eastern Region (DoNER) was designated as the Council’s Vice-Chairperson.

The Ministry of Home Affairs (MHA) has emphasized that Zonal Councils play a crucial role in resolving intergovernmental issues. They offer a valuable platform for open and candid discussions between the Centre and the States, as well as among States themselves. These councils promote regional cooperation among states that are interlinked by shared economic, cultural, and political ties.

4. Organisational structure of Zonal Councils

 

The Zonal Councils are high-level advisory bodies established under the States Reorganisation Act, 1956. They are designed to promote cooperation and coordination among states and the Centre. Each Zonal Council is headed and represented by key political and administrative leaders

Organisation structure as follows:

• The Union Home Minister acts as the ex-officio Chairperson of all five Zonal Councils
• The Chief Ministers of the states in the zone serve as Vice-Chairperson on a rotational basis, each for a term of one year
• The Secretary of the Inter-State Council Secretariat (ISCS) serves as the Member Secretary of all the Zonal Councils

Members

• The Chief Minister of each member state.

• Two other ministers from each state, nominated by the Governor.

• Two representatives from the Union Territories (UTs) in the zone (if applicable)

 

5. Interstate Council

 

• The Inter-State Council was formed under Article 263 of the Indian Constitution, which empowers the President to establish such a body when deemed necessary. Its primary functions include:

(a) Examining and offering advice on disputes that may arise between different states;

(b) Studying and deliberating on topics that involve a shared interest among some or all states, or between the Union and one or more states;

(c) Providing recommendations on such issues, particularly with the aim of improving policy coordination and implementation.

This council acts as a platform for structured dialogue among various levels of government.

• Importantly, the Inter-State Council is not a permanent constitutional institution. In 1988, the Sarkaria Commission, headed by Justice R. S. Sarkaria, was formed to review Centre-State relations. The commission proposed:

(a) Establishing a permanent Inter-State Council, referred to as the Inter-Governmental Council (IGC), under Article 263;

(b) Assigning the IGC the responsibilities mentioned in clauses (b) and (c) of Article 263, excluding matters related to socio-economic planning and development.

• The Council is chaired by the Prime Minister and comprises the Chief Ministers of all states and Union Territories with legislatures, Administrators of other UTs, and six Union Cabinet Ministers nominated by the Prime Minister.

• Since its inception in 1990, the Inter-State Council has convened eleven times. Its most recent meeting occurred in 2016, where key topics such as the Punchhi Commission’s recommendations on Centre-State relations, the use of Aadhaar for identification, and Direct Benefit Transfer (DBT) in public service delivery were discussed.

• A Standing Committee supports the Council by facilitating continuous dialogue, reviewing matters for the Council’s consideration, and overseeing the implementation of its recommendations. The most recent formation of this committee took place in November 2024

 

For Prelims: Zonal Councils, Inter state Council, NITI Aayog, States Reorganisation Act, 1956   For Mains: GS II - Polity and Governance

 

Previous Year Questions    1.Which of the following bodies does not/do not find mention in the Constitution? (UPSC CSE 2013) National Development Council Planning Commission Zonal Councils Select the correct answer using the codes given below: (a) 1 and 2 only (b) 2 only (c) 1 and 3 only (d) 1, 2 and 3 Answer (d) Mains 1.What changes has the Union Government recently introduced in the domain of Centre-State relations? Suggest measures to be adopted to build the trust between the Centre and the States and for strengthening federalism. (2024)

Source: Indianexpress

 

CAT BONDS

 

 

1. Context

 

While life insurance is a ubiquitous term in India, disaster risk insurance is not. A low penetration of disaster risk insurance for individual property and livelihoods leaves much of the population exposed to irretrievable damage and loss. Most peoples’ assets and means of income remain largely uninsured. Globally, after the hurricanes of the late-1990s in the U.S., when even re-insurers suffered losses, catastrophe risk was farmed out to financial markets through catastrophe bonds (cat bonds).

 

2. What is a Cat band?

 

• Catastrophe bonds, or cat bonds, are specialized financial instruments that blend elements of insurance and debt. They convert insurance coverage into securities that can be traded in the financial markets.
• By doing so, these bonds shift the burden of disaster-related risks from vulnerable countries not only to traditional global re-insurers but also to the broader financial market, thereby significantly expanding the pool of funds available for post-disaster recovery and rebuilding efforts.
• These instruments are designed to transfer specified risks to investors, allowing for faster disbursement of funds and minimizing counterparty exposure.
• Typically, cat bonds are issued by sovereign governments that act as sponsors. They pay a premium for the coverage, and the insured amount becomes the bond’s principal.
• To mitigate counterparty risk, a third-party intermediary—such as the World Bank, Asian Development Bank, or a reinsurance firm—is involved in issuing the bond.
• In the event of a disaster, investors may lose part or all of their principal, which is why these bonds usually offer higher returns than standard debt securities.
• The interest rates on cat bonds vary depending on the type of risk; for instance, earthquake-related bonds often carry lower premiums (around 1–2%) compared to those linked to hurricanes or cyclones

 

3. Are Cat Bonds Profitable?

 

• Catastrophe bonds, or cat bonds, can be profitable, but they carry a unique set of risks that distinguish them from traditional financial instruments. These bonds are designed to provide high returns to investors in exchange for taking on the risk of a specific natural disaster occurring—such as a hurricane, earthquake, or flood.
• Because of the nature of this risk, the bonds offer higher coupon (interest) rates than standard corporate or government bonds. This makes them especially attractive in low-interest environments where investors are looking for higher yields.
• One of the reasons cat bonds are considered potentially profitable is their low correlation with the broader financial markets. Their performance is not directly influenced by market downturns, inflation, or changes in interest rates.
• Instead, their fate depends almost entirely on whether a predefined catastrophic event occurs within a certain timeframe and geographic area.
• This characteristic makes cat bonds valuable as a diversification tool in large investment portfolios, especially for institutional investors like pension funds or hedge funds.
• However, the potential for profit comes with significant risk. If the specified disaster does not occur, the investor receives attractive returns.
• But if the event does happen—and if it meets the criteria set in the bond agreement—the investor can lose part or even all of their principal. In this sense, cat bonds function somewhat like a bet: either the investor earns a high reward, or they face a considerable loss.
• Another important aspect is the reliance on catastrophe modeling. These models estimate the likelihood and impact of certain events, but if they are flawed or overly optimistic, investors may be exposed to more risk than they anticipated.
• Moreover, cat bonds are not as easily traded as mainstream securities, meaning they can sometimes be harder to sell quickly, which reduces their liquidity

 

4. India and Cat bonds

 

 

• In the era of climate change, the increasing intensity and frequency of natural disasters have made it difficult for insurers and reinsurers to manage risk profitably. This trend is already visible in the United States, where more powerful hurricanes and frequent wildfires are driving up insurance premiums.
• As a result, demand for insurance declines, and the burden of risk ultimately shifts back to disaster-affected individuals. This is where government intervention becomes crucial, especially through the use of financial instruments like catastrophe bonds (cat bonds).
• South Asia, and India in particular, is facing greater vulnerability to extreme weather events such as cyclones, floods, wildfires, and major earthquakes. To shield its public finances from the heavy cost of disaster recovery, India must consider structured approaches to risk transfer.
• Given India’s solid sovereign credit profile and the scale of its disaster exposure, issuing cat bonds through a credible intermediary like the World Bank—using its well-established bond curves—could prove to be a cost-efficient solution.
• Insurance companies often include requirements for disaster risk mitigation in their agreements, and failure to meet such standards can drive up the bond’s interest rates. In this regard, India has already made commendable progress.
• Since the financial year 2021–22, it has been allocating about $1.8 billion annually for disaster mitigation and capacity-building efforts, indicating a proactive approach to risk management.
• Considering India’s economic size and creditworthiness, it is well-positioned to take the lead in launching a regional cat bond for South Asia. Many of the region’s disaster risks remain uninsured, and a collaborative approach could help distribute these risks more evenly.
• The region also presents a diverse hazard landscape, with different countries facing distinct threats based on their geography and vulnerability. For instance, a regional cat bond could be tailored to cover high-impact events like earthquakes in Nepal, Bhutan, and India, or catastrophic cyclones and tsunamis affecting India, Bangladesh, Sri Lanka, the Maldives, and Myanmar.
• A shared financial instrument like this would help lower premium costs, enhance disaster preparedness, and strengthen the region’s collective financial resilience

 

5. Way forward

 

If not properly structured, a catastrophe bond may fail to trigger a payout even in the aftermath of a major disaster. For instance, an earthquake bond set to activate only when a quake of magnitude 6.6 or higher occurs in a specific area might not provide any funds if a 6.5 magnitude earthquake hits and still causes severe destruction. Moreover, in situations where no disaster occurs during the bond’s term, questions may arise about whether the expenditure was justified. Therefore, a more rational approach would be to transparently determine the premium through a formal government process and compare it against historical averages of annual post-disaster recovery costs. This could offer a more balanced assessment of the bond’s value and effectiveness

 

For Prelims: Cat bonds, Asian Development Bank, World Bank   For Mains: GS III - Disaster Management

 

 

Source: The Hindu

 

CAT BONDS

 

 

1. Context

 

While life insurance is a ubiquitous term in India, disaster risk insurance is not. A low penetration of disaster risk insurance for individual property and livelihoods leaves much of the population exposed to irretrievable damage and loss. Most peoples’ assets and means of income remain largely uninsured. Globally, after the hurricanes of the late-1990s in the U.S., when even re-insurers suffered losses, catastrophe risk was farmed out to financial markets through catastrophe bonds (cat bonds).

 

2. What is a Cat band?

 

• Catastrophe bonds, or cat bonds, are specialized financial instruments that blend elements of insurance and debt. They convert insurance coverage into securities that can be traded in the financial markets.
• By doing so, these bonds shift the burden of disaster-related risks from vulnerable countries not only to traditional global re-insurers but also to the broader financial market, thereby significantly expanding the pool of funds available for post-disaster recovery and rebuilding efforts.
• These instruments are designed to transfer specified risks to investors, allowing for faster disbursement of funds and minimizing counterparty exposure.
• Typically, cat bonds are issued by sovereign governments that act as sponsors. They pay a premium for the coverage, and the insured amount becomes the bond’s principal.
• To mitigate counterparty risk, a third-party intermediary—such as the World Bank, Asian Development Bank, or a reinsurance firm—is involved in issuing the bond.
• In the event of a disaster, investors may lose part or all of their principal, which is why these bonds usually offer higher returns than standard debt securities.
• The interest rates on cat bonds vary depending on the type of risk; for instance, earthquake-related bonds often carry lower premiums (around 1–2%) compared to those linked to hurricanes or cyclones

 

3. Are Cat Bonds Profitable?

 

• Catastrophe bonds, or cat bonds, can be profitable, but they carry a unique set of risks that distinguish them from traditional financial instruments. These bonds are designed to provide high returns to investors in exchange for taking on the risk of a specific natural disaster occurring—such as a hurricane, earthquake, or flood.
• Because of the nature of this risk, the bonds offer higher coupon (interest) rates than standard corporate or government bonds. This makes them especially attractive in low-interest environments where investors are looking for higher yields.
• One of the reasons cat bonds are considered potentially profitable is their low correlation with the broader financial markets. Their performance is not directly influenced by market downturns, inflation, or changes in interest rates.
• Instead, their fate depends almost entirely on whether a predefined catastrophic event occurs within a certain timeframe and geographic area.
• This characteristic makes cat bonds valuable as a diversification tool in large investment portfolios, especially for institutional investors like pension funds or hedge funds.
• However, the potential for profit comes with significant risk. If the specified disaster does not occur, the investor receives attractive returns.
• But if the event does happen—and if it meets the criteria set in the bond agreement—the investor can lose part or even all of their principal. In this sense, cat bonds function somewhat like a bet: either the investor earns a high reward, or they face a considerable loss.
• Another important aspect is the reliance on catastrophe modeling. These models estimate the likelihood and impact of certain events, but if they are flawed or overly optimistic, investors may be exposed to more risk than they anticipated.
• Moreover, cat bonds are not as easily traded as mainstream securities, meaning they can sometimes be harder to sell quickly, which reduces their liquidity

 

4. India and Cat bonds

 

 

• In the era of climate change, the increasing intensity and frequency of natural disasters have made it difficult for insurers and reinsurers to manage risk profitably. This trend is already visible in the United States, where more powerful hurricanes and frequent wildfires are driving up insurance premiums.
• As a result, demand for insurance declines, and the burden of risk ultimately shifts back to disaster-affected individuals. This is where government intervention becomes crucial, especially through the use of financial instruments like catastrophe bonds (cat bonds).
• South Asia, and India in particular, is facing greater vulnerability to extreme weather events such as cyclones, floods, wildfires, and major earthquakes. To shield its public finances from the heavy cost of disaster recovery, India must consider structured approaches to risk transfer.
• Given India’s solid sovereign credit profile and the scale of its disaster exposure, issuing cat bonds through a credible intermediary like the World Bank—using its well-established bond curves—could prove to be a cost-efficient solution.
• Insurance companies often include requirements for disaster risk mitigation in their agreements, and failure to meet such standards can drive up the bond’s interest rates. In this regard, India has already made commendable progress.
• Since the financial year 2021–22, it has been allocating about $1.8 billion annually for disaster mitigation and capacity-building efforts, indicating a proactive approach to risk management.
• Considering India’s economic size and creditworthiness, it is well-positioned to take the lead in launching a regional cat bond for South Asia. Many of the region’s disaster risks remain uninsured, and a collaborative approach could help distribute these risks more evenly.
• The region also presents a diverse hazard landscape, with different countries facing distinct threats based on their geography and vulnerability. For instance, a regional cat bond could be tailored to cover high-impact events like earthquakes in Nepal, Bhutan, and India, or catastrophic cyclones and tsunamis affecting India, Bangladesh, Sri Lanka, the Maldives, and Myanmar.
• A shared financial instrument like this would help lower premium costs, enhance disaster preparedness, and strengthen the region’s collective financial resilience

 

5. Way forward

 

If not properly structured, a catastrophe bond may fail to trigger a payout even in the aftermath of a major disaster. For instance, an earthquake bond set to activate only when a quake of magnitude 6.6 or higher occurs in a specific area might not provide any funds if a 6.5 magnitude earthquake hits and still causes severe destruction. Moreover, in situations where no disaster occurs during the bond’s term, questions may arise about whether the expenditure was justified. Therefore, a more rational approach would be to transparently determine the premium through a formal government process and compare it against historical averages of annual post-disaster recovery costs. This could offer a more balanced assessment of the bond’s value and effectiveness

 

For Prelims: Cat bonds, Asian Development Bank, World Bank   For Mains: GS III - Disaster Management

 

 

Source: The Hindu