Preparing for GS Paper III – Remaining Topics

Most of this paper deals with current affairs and thus the most important sources are the newspapers and magazines like frontline, downtoearth and selected and relevant issues of Yojana and Kurukshetra. Apart from this, I have also relied on the material of “the-most-famous-test-series-of-Delhi”, which I got from one of my friends for certain specific topics.

Before venturing into the details of various sources for various topics in this paper, here is a special word on “How to prepare for Science and Technology (S&T) part?”.

Science and Technology

I have observed that UPSC is not keen on asking questions which are purely research oriented, instead she is keen on asking questions which are general in nature. Thus, the key to this area would be to keep an eye on the S&T aspects of all the recent developments. To give you an idea, some of the S&T topics that I have prepared on were: The Ice Bucket Challenge, which went viral on social media, to promote the awareness and funding for the research of a disease called Amyotrophic Lateral Sclerosis (ALS), which I have studied from the internet; the e-Cigarettes as there was a debate on its safety on the downtoearth magazine;  3D Holographic Projection as Narendra Modi had used it for the first time for election campaigning and also because of the release of a 3D holographic projection video of Michael Jackson’s “Slave to the Rhythm” song; Ebola which broke out in West Africa last year. And within the S&T part, anything that deals with diseases and drugs are extremely important. Although I may not be able to measure the extent to which this strategy of mine had worked in the exam, as there were hardly any questions from this area last year, I feel this is an important basic strategy that an aspirant must adopt. This was something which Gaurav Agarwal had also proposed in his blog. On top of this, one may adopt a supplementary strategy, like referring to any S&T material of a coaching institute, if she feels the need for it.

Sources

Same as what I have mentioned in my interview on Mrunal.

Topic How Did You Prepare?
Indian economy, resource mobilization No special preparation apart from Newspapers
inclusive growth No special preparation apart from Newspapers
budgeting Covered the definitions of various terms in Economic Survey and Budget
major crops, irrigation NCERT and Internet
agro produce – storage, marketing Material of “the-most-famous-test-series-of-Delhi”
e-technology for famers No special preparation apart from Newspapers
farm subsidies, MSP No special preparation apart from Newspapers
PDS, buffer, food security Yojana
technology mission No special preparation apart from Newspapers
animal rearing economics Covered basics from Agriculture Annual Report
food processing Kurukshetra edition on Agri-Industries
land reforms Studied in History part + Newspapers (LARR Act)
liberalization No special preparation apart from Newspapers
infra No special preparation apart from Newspapers
investment models Material of “the-most-famous-test-series-of-Delhi”
science-tech day to day life Newspapers – special focus on diseases, drugs etc.
Indian achievements in sci-tech Newspapers
awareness in IT, space, biotech, nano, IPR IPR – Recent developments and contentious provisions of Patents Act
environmental impact assessment Shankar IAS Book
Disaster Management IGNOU Material + World Focus (edition on DM)
non state actors, internal security No special preparation apart from Newspapers
internal security – role of media, social networking site No special preparation apart from Newspapers
cyber security No special preparation apart from Newspapers
money laundering No special preparation apart from Newspapers
border  Management No special preparation apart from Newspapers
organized crime, terrorism No special preparation apart from Newspapers
security agencies- structure mandate Briefly covered from Wikipedia

With this post, I have covered all the topics related to the Civil Services Examination. In case you want me to write a post on any particular topic that I have not covered earlier, please mention it in the comments section.

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Preparing for GS Paper III – Economy

Many people have been asking me about how to prepare for Economics. So, here it goes.

For the GS Paper III, you don’t need to be an economist to answer the questions that are being asked. You need to be a generalist.

The ONLY book I’ve read for Economy part in GS Paper III is the Macroeconomics – NCERT. It helped me in getting the basics right. After that I DID NOT refer to any other book at all. I feel that Economy is all about understanding the meanings of various terms correctly. Once you understand what a term really means, the logic that goes around that term isn’t very difficult to understand. So for this purpose I’ve maintained a table of 2 columns, in my notes, consisting of various terms in one column and their definitions + relevant contemporary examples in the other column.

To get the list of different terms I did 2 things, but before I mention that I based my preparation on one basic assumption. That is, UPSC will not ask for an Economics concept which has not been in news/Union Budget/Economic Survey. I believed that it is rational for me to think that there is no reason why UPSC would ask a question on a topic which doesn’t fit into this criteria. Being an ardent follower of newspapers, I believed that I wouldn’t miss any important topic or issue that comes up in the newspapers. So with this as my base, I did the following 2 things:

  1. Whenever I see any new Economics related term in newspapers that I don’t know, I would first go and study the definition and try to understand the concept in the context of the newspaper article. This made it easy for me to remember the concept. For example, I read about “Sovereign Debt Crisis” in the context of Greek crisis. It serves me 2 purposes – understanding the concept well and also remembering that concept well because I have the context of some contemporary issue around that concept.
  2. Went through Economic Survey and Union Budget, not to get a hold of the numbers scattered in there, but to identify different terms (like ‘tax expenditure’) and then know their meanings (by looking it up in the internet). This year’s economic survey is quite good – especially the First Volume. Several concepts were well explained there and I strongly recommend the aspirants to go through it, from the mains point of view.

Apart from this, I’ve also read the Fourteenth Finance Commission Report and I’ve written an analysis on it earlier, which can be found here. In summary, the sources that I had followed:

  • Macroeconomics – NCERT
  • Newspapers
  • Economic Survey and Budget for identification of different terms

NO OTHER SOURCE WHATSOEVER!! 🙂

Opinion – Should the government have a say in the Monetary Policy?

Before answering this question, let us first take a quick look at the present formulation of the Monetary Policy.

Current Scenario: Monetary Policy of India is framed by the RBI headed by the Governor. He/She will be advised by the Deputy Governors and a Technical Advisory Committee for the Monetary Policy, but the advice rendered is not binding on the Governor.

Though the RBI doesn’t define the objectives of the monetary policy, some of them can be discerned as the following:

  • Price control – inflation targeting.
  • Ensuring adequate credit flow to sustain economic growth – growth targeting.

Problems with the present Monetary Policy:

  • The monetary policy must go hand in hand with the fiscal policy, but often we see dissent between the two, due to the lack of adequate coordination between the government (Ministry of Finance) and the RBI. As a result the Indian economy is not realising its full potential. For example, till December 2014, the RBI refused to accept the demand of the government to lower the interest rates to stimulate the economy. Keeping aside the merits and de-merits of this decision of the RBI, the dissent between the two is evident. The government which runs on the people’s mandate should definitely have a say in the monetary policy.
  • The present monetary policy holds an element of unpredictability as the guidelines of the monetary policy have not been specified. Having a predictable policy will ensure stability in the economy. Although some amount of unpredictability is required in the monetary policy, the present system swings far too much towards unpredictability. For example, the the RBI refused to lower the interest rates until Jan 2015 despite the industrial expectations of an early cut (as the inflation got tamed since June 2014).
  •  Also there is no adequate transparency and accountability in the formulation of the monetary policy. This needs to be addressed to improve the governance in the formulation of the monetary policy.
  • Recently, the RBI accepted Urjit Patel Committee’s recommendation of adopting CPI as the nominal anchor of the monetary policy. This makes sense at a time when India is fighting the inflation, but this doesn’t make sense in the long term.

It is in this regard, several committees like Financial Sector Legislative Reforms Committee (FSLRC) and Urjit Patel Committee, have recommended the establishment of a Monetary Policy Committee to formulate the monetary policy. The monetary policy shall be formulated by this committee on the basis of majority vote and they shall be held accountable.

Composition of Monetary Policy recommended by FSLRC:

  • Chairman (Governor)
  • Deputy Chairman (Dt. Governor)
  • 5 External full time members to be appointed by the RBI.
    • 2 of them must be appointed after seeking the opinion of RBI.
  • 1 representative from the government with no voting rights.

Composition of Monetary Policy recommended by Urjit Patel Committee:

  • Governor
  • Dt. Governor
  • Executive Director of the monetary policy
  • 2 External full time members appointed by the RBI

Since Urjit Patel Committee was constituted by the RBI, its recommendations ensure the domination of RBI in the monetary policy 😉

No doubt, there should be greater convergence between the monetary policy and the fiscal policy. For this it would be more appropriate to ensure that the government has a say in the formulation of the monetary policy as it will ensure that the concerns of the government backed by public mandate are addressed in the formulation of the monetary policy. In this regard, the recommendations of the FSLRC would be more appropriate to be implemented.

So, yes, the government should have a say in the formulation of the Monetary Policy.