India- France: Expanding strategic partnership

The celebration by India and France of 25 years of their strategic partnership (January 26) presents an important opportunity for both to introspect on their relations. Signed in 1998, the time-tested strategic partnership has continued to gain momentum over shared values and aspirations of peace, stability and, most importantly, their desire for strategic autonomy. There are no real substantive disagreements between the two nations.

France a largest foreign investor in India

France has emerged as a key trading partner of India with annual trade of $12.42 billion in 2021-22.

It is the 11th largest foreign investor in India with a cumulative investment of $10.31 billion from April 2000 to June 2022, which represents 1.70% of the total foreign direct investment inflows into India.

France a key defence trading partner of India

Second largest defence supplier in 2017-2021: France has emerged as a key defence partner for India, becoming the second largest defence supplier in 2017- 2021. France has emerged as a major strategic partner for India with crucial defence deals and increased military to military engagement.

For example: A key example of this is the inducting of the French Scorpene conventional submarines, being built in India under technology transfer agreement of 2005, and the Indian Air Force having received 36 Rafale fighter jets.

Joint venture for aircraft manufacturing: The Tata group has also tied up with Airbus to manufacture C-295 tactical transport aircraft in Vadodara, Gujarat. This line is expected to be expanded into other civilian and military aircraft manufacturing in a joint venture with France.

Regular joint exercises: These relations are further fortified with the robust network of military dialogues and regularly held joint exercises Varuna (navy), Garuda (air force), and Shakti (army).

France is a willing partner for India: The importance of the defence partnership was further underscored in the recent statement by the French Ambassador to India, Emmanuel Lenain that France is a willing partner for India as it builds its national industrial base for the defence industry and for critical strategic defence projects.

Maritime ties

Joint Strategic Vision of India-France Cooperation in the Indian Ocean Region: India and France are resident powers of the Indian Ocean and in the Indo-Pacific. The importance of the Indian Ocean Region was visible during the visit of French President Emmanuel Macron’s visit to New Delhi in 2018 when the leadership of both countries welcomed the Joint Strategic Vision of India-France Cooperation in the Indian Ocean Region which presented a blueprint for a strengthening of ties.

Like-minded partners: In operational terms, Franco-Indian joint patrolling in the Indian Ocean signals New Delhi’s intent to engage with like-minded partners in expanding its footprint in the Indian Ocean.

Common vision for open Indo-Pacific: Maritime security has further gained momentum as both countries have articulated their common vision for a free, fair and open Indo-Pacific. Both countries seeks to provide comprehensive solutions for maritime security, regional cooperation, climate change adaptation.

Common concerns over China’s aggressive behaviour: Both countries share concerns over the rise of China and its aggressive behaviour, regionally and globally, and have committed to working together to ensure that there is no imbalance in the Indo-Pacific

Indo-Pacific Trilateral Development Cooperation Fund: India and France in September 2022 agreed to set up an Indo-Pacific Trilateral Development Cooperation Fund that will support sustainable innovative solutions for countries in the region. The two partners have formed a trilateral grouping with the United Arab Emirates to ensure maritime domain awareness and security from the east coast of Africa to the far Pacific.

Other areas of cooperation

Nuclear cooperation: France was among the first countries with which India signed a civil nuclear deal. Paris also played a critical role in limiting India’s isolation in the non-proliferation order after the 1998 nuclear tests.

Support for India’s bid for permanent membership of UNSC: In a sign of expanding cooperation, France supports India’s bid for permanent membership of the United Nations Security Council as well as its entry into the Nuclear Suppliers Group.

India supported France in the Paris Agreement: An area of importance for both is climate change, where India has supported France in the Paris Agreement expressing its strong commitment towards mitigating climate change impact. New Delhi and Paris, as part of their joint efforts on climate change, launched the International Solar Alliance in 2015.

No Rationalization of GST structure for now: Revenue Secretary

The long-awaited rationalization of the multiple rate structure of the Goods and Services Tax (GST) regime is off the table for now and unlikely to materialize in the near future.

What is GST?

GST launched in India on 1 July 2017 is a comprehensive indirect tax for the entire country.

It is charged at the time of supply and depends on the destination of consumption.

For instance, if a good is manufactured in state A but consumed in state B, then the revenue generated through GST collection is credited to the state of consumption (state B) and not to the state of production (state A).

GST, being a consumption-based tax, resulted in loss of revenue for manufacturing-heavy states.

What are GST Slabs?

In India, almost 500+ services and over 1300 products fall under the 4 major GST slabs.

There are five broad tax rates of zero, 5%, 12%, 18% and 28%, plus a cess levied over and above the 28% on some ‘sin’ goods.

The GST Council periodically revises the items under each slab rate to adjust them according to industry demands and market trends.

The updated structure ensures that the essential items fall under lower tax brackets, while luxury products and services entail higher GST rates.

The 28% rate is levied on demerit goods such as tobacco products, automobiles, and aerated drinks, along with an additional GST compensation cess.

Issues with GST structure

Complexity of the GST Structure: The GST structure is quite complex and difficult to understand, which has led to confusion among businesses and consumers alike. This has also led to an increase in the cost of compliance and administration for businesses.

Heterogeneity of Rates: One of the main issues with the GST structure is the heterogeneity of rates across different goods and services. This has led to an increase in the cost of compliance for businesses as they need to be aware of the applicable GST rate for each product and service.

Dual GST System: India has a dual GST system, which has led to confusion and complexity for businesses that have to deal with both the central GST (CGST) and the state GST (SGST). This has also led to an increased cost of compliance for businesses.

Cascading Taxation: The GST structure has led to the problem of cascading taxation, wherein taxes are levied at every stage of the supply chain, leading to an increase in the cost of goods and services.

Lack of Transparency: The GST structure has led to a lack of transparency in the pricing of goods and services, as the applicable taxes are not clearly indicated in the invoice.

Poor collection infrastructure: The GST system requires a strong infrastructure in order to function properly, which is not always present in India. This can lead to delays in filing and other issues.

Why rationalize GST slabs?

Complex duty structure: From businesses’ viewpoint, there are just too many tax rate slabs, compounded by aberrations in the duty structure through their supply chains with some inputs taxed more than the final product.

Multiple rate changes: This has been since the introduction of the GST regime in July 2017 have brought the effective GST rate to 11.6% from the original revenue-neutral rate of 15.5%.

Stipulated revenue losses: Merging the 12% and 18% GST rates into any tax rate lower than 18% may result in revenue loss.

Benefits of GST rationalization

Easier compliance: Rationalizing GST slabs helps simplify the tax structure and make it easier for businesses to comply with the law.

Fairness of taxation: It also helps to ensure that the tax burden is shared fairly and that the revenue generated is used efficiently.

Efficiency in tax collection: Finally, rationalizing GST slabs leads to more efficient collection of taxes, which helps to reduce the cost of compliance for businesses.

Article 356

Sitting PM recalled that governments at the Centre had dismissed 90 elected state governments by “misusing” Article 356 of the Constitution.

What is Article 356?

Article 356 of the Indian Constitution contains provisions for the imposition of “President’s Rule” in a state, removing an elected government.

While the Constitution intended Article 356 to be used only under extraordinary circumstances, central governments repeatedly used the provision to settle political scores.

What does it say?

Article 356 empowers the President to withdraw to the Union the executive and legislative powers of any state.

She/he has to be satisfied that a situation has arisen in which the government of the state cannot be carried on in accordance with the provisions of the Constitution.

Whether the constitutional machinery has broken down may be determined by the President at any time, either upon receipt of a report from the Governor, or suo motu.

Duration of Presidents Rule

According to the provisions of Article 356, President’s Rule in a state can be imposed for six months at a time for a maximum duration of three years.

Every six months, Parliamentary approval to impose President’s Rule will be required again.

However, in the past, President’s Rule has been extended for significantly longer periods under specific circumstances.

For instance, Punjab was under President’s Rule from 1987-1992 due to the growing militancy.

What are the origins of Article 356?

Article 356 was inspired by Section 93 of the Government of India Act, 1935.

This provided that if a Governor of a province was satisfied that a situation had arisen in which the government of the province cannot be carried on in accordance GOI Act, he could assume to himself all or any of the powers of the government and discharge those functions in his discretion.

The Governor, however, could not encroach upon the powers of the high court.

For the British, this provision allowed for a ‘controlled democracy’ – while providing some autonomy to provincial governments, Section 93 allowed the British authorities to exercise ultimate power when they deemed necessary.

How was the provision used as a political weapon in independent India?

During the decades of Congress’s dominance at the Centre, Article 356 was used against governments of the Left and regional parties in the states.

Until 1959, Jawaharlal Nehru’s government had used the article six times, including to dislodge the first-ever elected communist government in the world, in Kerala in 1959.

In the 1960s, it was used 11 times. After Indira came to power in 1966, Article 356 was used seven times between 1967 and 1969 alone.

The 1970s were more politically turbulent. Between 1970 and 1974, President’s Rule was imposed 19 times.

Post-emergency, the Janata Party government used it in 1977 to summarily dismiss nine Congress state governments.

When Indira returned to power in 1980, her government too imposed President’s Rule in nine states.

In 1992-93, PM Narasimha Rao dismissed three governments in the wake of the demolition of Babri Masjid, besides Kalyan Singh’s government in UP.

 Kalbeliya Dance

This newscard is an excerpt from an article detailing about well-known Kalbeliya dancer Suwa Devi from Rajasthan.

What is Kalbeliya Dance?

Kalbeliya Dance is a traditional Indian dance form that originated in the state of Rajasthan.

It is a vibrant, energetic dance that is performed by members of the Kalbeliya, a nomadic tribe of snake charmers in Rajasthan.

It is a highly sensuous dance, with the dancers performing intricate footwork and swaying movement of their arms and body.

In 2010, the Kalbelia folk songs and dances of Rajasthan were declared a part of its Intangible Heritage List by the UNESCO.

Performance details

The dancers are women in flowing black skirts who dance and twirl, replicating the movements of a serpent.

They wear an upper body cloth called an angrakhi and a headcloth known as the odhani; the lower body cloth is called a lehenga.

All these clothes are of mixed red and black hues and embroidered.

The male participants play musical instruments, such as the ‘pungi’, the dufli, been, the khanjari – a percussion instrument, morchang, khuralio and the dholak to create the rhythm on which the dancers perform.

The dancers are tattooed in traditional designs and wear jewelry and garments richly embroidered with small mirrors and silver threads.

As the performance progresses, the rhythm becomes faster and faster and so does the dance.

Features of the Kalbeliya Dance

Rapid footwork: The fast, intricate footwork of the Kalbeliya dance is the highlight of this folk dance. The dancers move their feet in quick, sharp movements that form intricate patterns on the floor.

Swirling skirts: The colorful skirts of the female dancers swirl gracefully as they move, adding to the beauty of the dance.

Hand and arm movements: The dancers use their hands and arms to create graceful, fluid movements that are integral to the dance.

Singing: Kalbeliya dancers often sing along to the music as they dance, adding to the atmosphere of the performance.

Cymbals and drums: Traditional Kalbeliya music is accompanied by drums and cymbals, which help to create a lively, energizing atmosphere.