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23rd December – Editorials/Opinions Analyses




Why in News?

Frequent Internet bans by governments and in the light of that it has become fashionable to call for “right to internet” as a fundamental human right.

Some cities and countries which are implementing “Right to Internet”

  • Finland legislated a right to broadband to provide all residents with a line of at least 1Mbps.
  • In 2017, the Kerala government announced that internet access was a basic right.
  • New Delhi became the latest city government to offer “free” Wi-Fi to its residents.

“Right to Internet”  as an intellectual wrapping

  •  Since the rights-based discourse is both fashionable and popular

Problems with “Right to Internet” as Fundamenta Right

  • First, they violate contracts and represent unjustified government intervention in competitive markets.
  • The second and deeper point is that free internet access cannot be a fundamental right, any more than food or education.
  • Anything that costs someone else something cannot be fundamental rights.
  • Fundamental rights are negative rights enforced against the state
  • If internet access were to be a fundamental right, the government would have to pay for internet connection, and that would come from the taxes.
  • With no end to human needs and wants, we can talk about anything to be included as FR

India and precedent of Internet shutdown:

  • Citizens should be protected from arbitrary disconnections by the state.
  • India as “the internet shutdown capital of the world”.
  • India accounted for more than two-thirds of the shutdowns in 2018.


  • Highly conservative estimate of the economic losses from 138 shutdowns between 2012-2017 comes up to around ₹22,000 crore.
  • Due to impact of penetration of internet over economy , the cost of any shutdown is huge.
  • Process followed for internet shutdown is arbitrary and lack effectiveness
  • Issue of individual liberty.
    • Instruments that abridge civil liberties must be used sparingly and in exceptional circumstances.


Why in News?

Recent calls from around the spectrum for Government intervention to revive Economy

  • Emerging Consensus that the economy needs government intervention to tide over the slowdown.
  • Low interest rates alone couldn’t hoist a $2-trillion economy out of an economic morass.
  • With this realization, there is a need to finalize the grand strategy or narrative for life after fiscal stimulus.

Some Ground Realities:

  • Government expenditure is responsible for whatever growth is witnessed during this economic slowdown.
  • Gross domestic product (GDP) data for the July-September 2019 quarter—which printed at 4.5%, the lowest in 25 quarters—shows that among all the engines of growth, government expenditure grew the fastest, thereby pulling up overall growth considerably.
  • The fact is this engine alone has been powering India’s growth story for the past few quarters. Some of the government’s expenditure compulsions can also be attributed to unending electoral cycles, which need to be lubricated through regular resource transfers.

Financing the fiscal stimulus

Couple of short-term and long-term solutions :

Government should re-allocate its budgeted spending:

  • First- between revenue and capital expenditures, and then even within the two heads to improve quality of spending.  For example, the government’s revenue expenditure strategy, especially for FY20, seems more focused on finessing the electoral cycle than rejuvenating and sustaining economic growth.
  • Second, the Centre should transfer states’ share of revenues without delay because it is affecting the states’ spending, which account for almost 50% of spending in the economy.
  • RBI GOVERNOR Shaktikanta Das said revenue accretion will be important for implementing a fiscal stimulus programme: primarily through disinvestment and through better tax collections, especially by plugging loopholes.

Fiscal Slippage and rating outlook

  • International credit rating agencies have already served notice on India, stating unequivocally they won’t take kindly to any fiscal slippage.
  • Moody’s has already changed India’s rating outlook to “negative”.
  • Standard and Poor’s has also issued dire warnings about lowering India’s credit rating if growth does not improve.
  • Unlikely that the rating agencies will concur with the necessity of a counter-cyclical fiscal stimulus.
  •  he leading western rating agencies display a home-country bias and seem hostage to outdated economic orthodoxies.
  • Credit rating agencies tend to display pro-cyclical behavior when rating sovereigns. “Rating agencies have tended to focus on the ‘wrong’ set of fundamentals. For instance, much weight is given to debt-to-exports ratios—yet these have tended to be poor predictors of financial stress,”

Why the government needs to think beyond Ratings?

  • The Indian political executive and economic administration have been extra sensitive about the ratings of these agencies.
  • Given the trade slowdown and the need for foreign investment to manage the current account deficit, concerns over India’s sovereign credit rating make sense.

However these are crunch times and require differentiated solutions.

  • Sorting out the crisis should take precedence over what rating agencies will do.
  • Sovereign ratings appeal largely to bond and equity portfolio investors, whose investment decisions currently seem to be driven more by different global risk-on considerations than sovereign ratings.
  • And so, even if rating agencies change India’s ratings outlook or the rating itself, it is unlikely that global investors will rush for the exit.

Thus India’s strategic moves should be:

Helping global investors keep their faith which can be achieved by re-building trust.

The government must clearly communicate its glide-path back to fiscal discipline. And, for this to be taken seriously, the government will also have to start improving the quality of data it releases.

February 2024