Corporate Governance

Corporate Governance

This article deals with the topic titled ‘Corporate Governance.’ This is part of our series on ‘Ethics’. For more articles, you can click here.


Concept of Corporate Governance

What do we mean by Corporate?

The concept of Corporate Governance
Corporate Governance

Any Organization, whether public or private, which has a separate legal entity. For example

  • Reliance Jio, BSNL etc. are corporations => If a person registers a case against them, it will be against this organization only (like Name of Person vs BSNL).
  • But the Department of Communication or MEITY is not included in this because it has no separate legal entity. If a person registers a case against MEITY, the case will be against the Government of India.  

What do we mean by Corporate Governance?

  • Corporate Governance is the set of systems and processes to ensure that the company is governed in the best interests of all stakeholders (shareholders, employees, customers, society etc.)
  • The concept of Corporate Governance is associated with gains that can accrue from following a moral path. It means Ethical Governance. Every Corporation should function in such a way that along with its own development and growth, it should ensure the development of its employees, shareholders, customers, society, nation and world.

What do we mean by Corporate Social Responsibility? 

  • Corporate Social Responsibility (CSR) is the moral responsibility of any organization (whether private or public) to positively impact the society in which it exists.

The world started to become aware of Corporate Social Responsibility and Corporate Governance with the start of LPG in the 1980s (because a large number of private entities came into sectors where earlier only the government was involved, and obviously, their main aim was maximization of profits).  


Main thing through which Corporate Governance is ensured

  • The main principle on which Corporate Governance works is the SEPARATION OF OWNERSHIP AND CONTROL. If such a separation exists, both will have checks and balances on each other. Hence, to ensure Corporate Governance, the company is owned by the Shareholders but controlled by Directors. 
Corporate Governance
  • If those who own the company and those who manage them are the same, all their actions and decisions will likely be governed by the motive of maximizing their profits, even at the cost of other stakeholders.

Types of Corporate Governance

There are two Models

Anglo Saxon Type

  • It is found in those countries where the influence of the rule of law is strong. 
  • It only focuses on the interest of shareholders (only)
  • Its impact is mainly seen in countries like Britain and USA   

Continental Type

  • It is found in those countries where the influence of administrative law is more
  • E.g., France and Germany 
  • In this, more emphasis is laid on the interests of shareholders, customers and employees. 

Principles of Corporate Governance in India

 Corporate Governance includes the following principles:-

  1. Independence of the board of directors to take decisions in the best interest of Profits of the company, People of the society and the Planet (3Ps).
  2. Fairness in actions in the market
  3. The corporation shouldn’t indulge in excessive profit-seeking behaviour through fraud practices. 
  4. Business should be carried out in a socially responsible manner. Companies should invest in building social and human capital.

Example of Corporations indulging in Fraudulent Activities

Condition of Corporate Governance in India

1. Bhopal Gas Tragedy

  • The Bhopal Gas showed that India lacks a regulatory and legal framework even for dangerous industries. 

2. Satyam Computer

  • Satyam Computer owner Ramalingham Raju indulged in creative accounting to show higher profits. He transferred the company’s funds to an individual account.  

3. Sahara Fraud

Sahara gathered funds from the sharemarket and transferred the funds to a private account.  


4. Nirav Modi Scam and Punjab National Bank

  • Nirav Modi gathered Rs 14,000 crore of money from Punjab National Bank using fraudulent means by colluding with the bank officials.

5. Volkswagen

  • Volkswagen tweaked the vehicle software in such a way that they could dodge the Environmental Protection Agency about their emission standards.

Why do we need Corporate Governance in India?

  • Liberalization and de-regulation the world over have given greater freedom to management. The greater freedom demands even greater responsibilities.
  • Intense Competition: Players in the field are many. Competition brings in its wake weakness in standards of reporting and accountability.
  • Inadequate monitoring and response failure by regulatory authorities: The enforcement machinery has not been strengthened with the same speed with which regulatory changes have been brought in. As a result, the oversight by regulators remains weak.
  • Market conditions are increasingly becoming complex in light of global developments like WTO, the removal of barriers & reduction in duties. 
  • Failure of corporations due to lack of transparency & disclosures and instances of falsification of accounts (embezzlement). For example, it was witnessed in Satyam Computer, Franklin Templeton (India) and Sun Pharma Ltd. cases.
  • The absence of Corporate Governance leads to fraud, mismanagement, embezzlement and harm to society & environment.
  • Sustainable growth: Corporations following corporate governance witness sustainable growth. E.g. Tata Group of companies ​continues to be one of the biggest conglomerates even after 150 years of its ​existence as it followed the principles of corporate governance.
  • To improve the functioning of the boards: Good corporate Governance curtails nepotism and favouritism and thereby helps fill the capability gap in the organizations.

Issues with Corporate Governance in India

According to various committees such as Kotak Committee and Narayan Murthy Committee, Indian corporations face the following Corporate Governance issues.   

  • Creative Accounting: Indian corporations such as Satyam Computers indulged in Creative Accounting, leading to their eventual downfall.
  • Insider trading: For example, Aptech India ltd
  • Nepotism in board appointments: The board members are relatives or known ones.
  • Independent directors have either played a passive role or can be removed easily if they don’t side with promoters. Hence, Independent Directors aren’t independent enough. Moreover, recent experiences like ILF&S and DHFL showed that independent directors are not fulfilling their roles and responsibilities.
  • Executive Compensation policies are not transparent.  
  • Family-owned Indian companies have excessive controls and poor succession planning. 
  • Lack of serious efforts by the board toward Corporate Social Responsibility (CSR) projects. 
  • Corporate Fraud: Corporate frauds are happening as the main motive of the corporations is profit maximization.
  • Lack of Diversity: Corporate boards lack diversity. The representation of other genders on the boards is nominal.
  • Lack of transparency and disclosure.

Areas of Importance within Corporate Governance include

  • Independent Directors: Independent Directors are the directors who aren’t involved in day-to-day activities but primarily attend board meetings. They protect the interests of Minority Shareholders. The number of independent directors is set to a minimum of one-third of the board strength, and they are required to hold at least one separate meeting in a year without the participation of non-independent directors.
  • Remuneration Committee: Established to avoid directors setting their own remuneration levels high (a check on directors) 
  • Audit Committee: Acts as an interface between the Board of Directors and the External Auditors. It is made up of Independent Directors.
  • Public oversight: This gives the public an insight into the company (e.g. via Public open day). Since the public can be affected by the company’s decisions and are important stakeholders, hence they have the right to know what is happening inside the company.  
  • Other Areas of Importance
    • Code of Conduct and Code of Ethics should be inculcated in employees.
    • There should be a strong Whistleblowers Policy
    • There should be a Corporate Social Responsibility Policy. 


Steps taken till now to strengthen Corporate Governance

Timeline of Corporate Governance in India

Narayan Murthy Committee Recommendations 

  • 1/3rd to 1/2rd of the Total Directors of the Company should be Independent Directors.
  • Auditing the accounts of Big Corporations should be done under the vigil eye of CAG & Indian Auditing Services. 
  • Whistleblowers Protection Act should be applicable to both public and private sectors. 

The above recommendations have not been implemented in the true sense. Although Whistleblower’s Act has been formed, it has many lacunae.


Kotak Committee Recommendations

  • There should be at least 6 Independent Directors in the top 500 companies (earlier 3).
  • At least 50% of Directors should be  Independent Directors.
  • No board meeting can be conducted without the presence of an independent ​director.
  • At least 1 Independent Director should be a woman.
  • Board of Directors Meeting should be held 5 times (earlier 4) in which one meeting should be exclusively dedicated to Corporate Governance. 
  • All the Independent Directors in the Board of Directors should be compulsorily present in the meetings.
  • For government companies, it is recommended that the board have the final say on the ​appointment of independent directors and not the nodal ministry. 
  • Reporting System should be of ‘Matrix Type‘.
  • Permission of Minority shareholders should be necessary in case payments to related parties exceed 2% of revenue. 
  • Disclosures of Auditor Credentials and Audit Fees should be mandatory.
  • Market Regulator (SEBI) should be strengthened to improve corporate governance. ​SEBI should have the power to act against auditors if the need arises.


Benefits of Corporate Governance

  • Reduced risks of corporate scandals and frauds
  • Ensures adequate disclosure & transparency in business transactions
  • Leads to statutory & legal compliance
  • Protection of shareholder interests 
  • Improves strategic thinking at the top by inducting independent directors who bring a wealth of experience, and a host of new ideas


Corporate Social Responsibility

Corporate Social Responsibility can be explained as

  • Corporate: Meaning ‘Organized Business
  • Social: Meaning ‘Dealing with People’ 
  • Responsibility: Meaning ‘accountability between the two’

Corporate Social Responsibility is the moral responsibility of any corporation(whether public or private) to positively impact the society in which it exists.


Corporate Social Responsibility vs Corporate Governance

Corporate Governance Corporate Social Responsibility
Apart from Society, it also focuses on Customers, Employees and Shareholders. Hence, it has a relatively larger scope  It focuses on Social Interests only. Hence, it has a relatively narrow scope 
It is expected from all Corporations, whether small or large (size doesn’t matter) It is expected mainly from comparatively larger Corporations. (Although any company can do it, but it is expected from larger companies only).
More regulatory and legal efforts are required to implement it. Comparatively, fewer regulatory and legal efforts are required. It can also be implemented on a moral basis. 

Basis /Reason /Rationale for CSR

  • Corporations utilize the resources of society – both human & natural. So they have the responsibility to pay back to the community. 
  • Corporate plants create negative externalities in the form of pollution. To compensate for negative externalities, the government can force them to work in the interest of society. 
  • Triple Bottom Line Principle of CSR: ‘Triple Bottom Line’ (TBL, or 3BL) means that Corporations should work for the ‘people, planet and profit’. 
    1. Planet: The actions of corporations shouldn’t impact the planet negatively. 
    2. People: Corporations should work to improve the lives of local communities. 
    3. Profit: The corporations have the full right to increase their profit.
Profit 
Sustainability 
cople 
Planet
  • Creates a favourable image of the company, which attracts customers. The reputation & brand equity of companies demonstrating their social responsibilities is very high. E.g.: Tata Corporation. 

Case Study: Patagonia

  • Patagonia is a garment company based in California.
  • The company follows the triple Bottom Line Principle in letter and spirit.
    1. Planet: The company uses environment-friendly materials like organic cotton and recycled polyester.
    2. People: The company do a large charity and persuades its customers to donate their used products.
    3. Profit: The company is least interested in greater profits, and the owner donated his whole wealth to charity (around $ 3 billion) to fund the research to combat climate change.

The provision in the Companies Act regarding CSR

  • Companies will have to spend 2% of their last three years’ average profit on social development-related activities like education, health, slum development etc.
  • CSR rule applies only to companies having annual turnover above Rs 1000 crore and net profit of Rs 5 crore
  • Companies have to set up a CSR Committee of 3 Board Directors.

Issues with CSR in India

  • Less Importance to CSR: Most companies have not looked at their CSR strategies through the same lens as their core business functions.
  • Lack of clarity about regulations as government changes the provision each passing month.
  • Imbalance in CSR spending: Most of the CSR funds are spent on a handful of activities like education and health
  • Geographic equity: Five states, i.e. Maharashtra, Gujarat, Andhra Pradesh, Rajasthan, and Tamil Nadu, accounting for well over one-quarter of all CSR funding. Towards the bottom of the list are Nagaland, Mizoram, Tripura, Sikkim and Meghalaya-all from North-East. 
  • A large number of shell NGOs have come up which take up money from companies but don’t spend on targeted projects. 
  • Since there is no standardised way to measure the impact of CSR spending, companies can’t make informed choices.   

Administrative Reform Commission’s (ARC) Recommendation on CORPORATE PHILANTHROPY

  • When a corporate entity takes up a community benefit project, there should be some mutual consultation between the company and the local government so that there is no unnecessary overlap with other similar development programs in the area. 
  • The government should act as a facilitator and create an environment that encourages businesses and industry to take up projects and activities that are likely to impact the quality of life of the local community.

Ethical Issues in International Relations and Funding

Ethical Issues in International Relations and Funding

This article deals with ‘Ethical Issues in International Relations and Funding.’ This is part of our series on ‘Ethics’. For more articles, you can click here.


Introduction

  • International ethics is a set of universal values that governs the actions and behaviours of nation-states. These include protection of human rights, prohibition of genocide, prohibition of attack on civilians during the war etc.
  • In International Relations, the state is called an Actor. Hence, 
    • All decision should protect and further the national interests of the State (Machiavellian Ethics) but  
    • It should also be seen as ethical.  
  • Examples where International Ethics played a role. Eg 
    • Sri Lanka objected to Nuclear Plant at Kudankulam as it is situated very close to the coast. India took their concerns into notice. 
    • India and China were initially against any quota on them in Climate Change negotiations. But, later they accepted the quota for the sake of whole humanity and people living in Small Island nations.
  • However, world powers try to mould International Governance in a way that their interests are protected. For instance, the US at World Bank, World Trade Organisation etc. 


Three Perspectives of Ethics in International Relations

Ethical Issues in International Relations and Funding

Realistic Perspective

  • There is anarchy in International Relations with no world government. Hence, the state is the most important actor. 
  • Ethics is PROMOTION OF NATIONAL INTEREST. 
  • Peace is created by DETERRENCE. For instance, Proponents of the Realistic Perspective are of the view that the third world war hasn’t happened because of Nuclear Weapons).

Liberal Perspective

  • There is no world government.  
  • The state is an important actor but cooperation between states is possible. For instance, Mutual Cooperation in form of WTO, UN, IMF, World Bank, UNSC etc.
  • Peace & Stability is established via Cooperation.

Ideal/Cosmopolitan Perspective

  • They see the world as a single entity. 
  • Rather than citizens, all are humans. Hence, they are proponents of Universal Brotherhood.

Principles which should guide International Relations

In the international forums, countries negotiate based on their perception of what is good – economically or strategically. This approach ignores the larger ethical framework to make decisions that may be good in the long term for all and short term good for a few. A broad ethical framework that can ensure this includes:-

  • Equity, Justice and Human Dignity should form the bedrock of international negotiations.
  • Equally important is transparency, making decisions more acceptable. 
  • The international community is responsible for assisting the state to fulfil its primary responsibility of protecting its citizens (as envisaged in the Responsibility to Protect (R2P) in UN resolution).  

Ethical Guidance Principles in India’s Foreign Policy

  • Non-Violence i.e. solving International Issues peacefully. 
  • Mutual Respect for each other’s sovereignty. 
  • Non-interference in each other’s internal affairs.
  • Universal Brotherhood  
  • Protecting Human Rights (For Example: Helping Bangla, Baluch and Tibet Cause).
  • Equality at all International forums & break the hegemony of few. 


Some Ethical Issues at International Level

Human Rights Violations

  • Political interventions frequently lead to Human Rights Violations.
  • Terrorism: States use Terrorism as a tool of foreign policy and indulge in human rights violation. (eg: Pakistan (supporting LeT, JeM), Iran (supporting Hezbollah)). 
  • Refugee Issue: European nations are closing their borders to refugees fleeing war-torn areas.

Climate Change

  • International Equity Concerns: Countries that are least responsible for climate change and have the least economic capacity to fight the effects of climate change are the most affected ones. For example Marshall Islands.
  • Issue of Common but Differentiated Responsibilities: There are issues in defining and differentiating the responsibilities between present and future generations as well as developed and developing countries.
  • Climate Sceptics don’t consider climate change to be real.

Disarmament

  • Cause of disarmament at the international stage is being promoted by those states, which have massive reserves of nuclear armaments, missiles etc.
  • Countries like the USA impose economic and other sanctions on countries like Iran to prevent them from developing nuclear weapons. How it is ethical for a country to impose sanctions on others without discarding their own weapons.

IPRs

  • The developed countries are depriving the poor countries of accessing the new technologies (even life-saving drugs) by the restrictive clauses of IPRs. It is essential to determine whether it is justifiable for a country to defend its IPRs on commercial grounds, or it should share technology for the greater interest of humanity.

Global Commons

Global commons are defined as those parts of the planet that fall outside national jurisdictions and to which all nations have access. International law identifies four global commons, namely the High Seas, the Atmosphere, Antarctica and the Outer Space. Some of the issues wrt global commons are as follows:-

  1. Zoonotic diseases like Covid-19 
  2. Greenhouse gas emission
  3. Governance and conservation of Arctic 
  4. Overfishing  
  5. Accumulation of plastic waste
  6. Accumulation of Space debris

Global Poverty

  • Rise in insensitivity: Global poverty as Kaushik Basu argues largely remains out of sight for those who are not living it. This enhances insensitivity amongst the well off nations.  
  • Whom to prioritise?: The states being a stakeholder in the global fight against poverty, face an inherent dilemma, that whether they should prioritise citizens or non-citizens for the allocation of the resources.  

Power Asymmetry at United Nations

  • UN is not democratic with Veto power given to 5 Permanent members. The organisation which is formed to protect democracy and led by the US and UK which calls themselves the defenders of Democracy in the world are heading institution in an undemocratic way. 

Genocide

Genocide is a crime against humanity and the world has signed the ‘UN Convention on Genocide’ to end this. Even after that, Genocide does happen in the present world. Some of the notorious genocides include the Jewish Holocaust in Nazi Germany (1933 to 1945), Armenian Genocide by the Ottoman Empire (1915 to 1923) Rape of Nanking by the Japanese Empire (1937), Rwandan Genocide (1994), Tamil Genocide in Sri Lanka, Rohingya Genocide in Myanmar etc. Ethical aspects related to this include:-

  • Right to Protect is vague. As a result, either the international community acts very late or doesn’t at all against the genocides carried out by the states.
  • The international community also faces a dilemma that whether it should intervene on its own or arm the group so that persecuted section can protect itself.
  • The narrow definition of Genocide: The definition excludes targeted political and social groups. It also excludes indirect acts against an environment that sustains people and their cultural distinctiveness. 

Terrorism

Most of the countries of the world are affected by terrorism. But there are some ethical issues in this, such as

  • Good Terrorist vs Bad terrorist: States differentiate between Good Terrorists and Bad Terrorists based on their interests. This reveals selective and self-serving nature. For example, Pakistan differentiates between ‘Good Taliban’ and ‘Bad Taliban’. 
Good Taliban and Bad Taliban
  • Conduct of states during the anti-terrorist operations: States such as the USA and Australia, which present themselves as the ‘the saviours of the human rights are often alleged to violate human rights and mass killings. For examples, (in 2021) Australian soldiers were found guilty of killing innocent Afghans during their operations to eliminate the Taliban in Afghanistan. Apart from that, during Vietnam War, US soldiers were alleged to have committed war crimes epitomised by the My Lai Massacre (1968).

Issues with World Trade Organisation, IMF & World Bank

  • Western First World Countries have asymmetric voting rights in these bodies. 
Asymmetric voting rights in the World Bank

International Funding

  • Explained in detail below.

Ethics and International Funding

Foreign aid means the transfer of money, goods or technical knowledge, from the developed to the under-developed countries.


Why Funding of Countries is done

1. Philosophical Explanation

  • Humanitarian Concern: We might have drawn artificial boundaries to create a nation-state but we belong to the Human race.  
  • Historical Burden: Past Colonial nations like the UK, France etc. developed by exploitation of other nations in Asia, Africa, South America etc. To compensate for that, they give grants and soft loans to their earlier colonies 
  • Principle of Sacrifice: It is the duty of well off to sacrifice some of their wealth to protect those who can’t protect themselves. 

2. Economical Explanation

  • Export of Capital: Western Countries have an excess of capital that need investment in lucrative developing countries. 

Types of Aids

1 . Military Aid

  • It is the worst form of aid as it can destabilise the whole region.
  • The objective of this kind of aid is to garner new military allies or to strengthen the military capability of their respective allies. 
  • Eg: the US used to give huge Military Assistance to Pakistan.

2. Technical Assistance

  • It aims at providing technical know-how instead of equipment and helps in capacity building.
  • It is the least expensive with big benefits. 
  • Eg: Pan African e-Network Project by India in Africa.

3. Economic Aid

  • These are economic loans given at very nominal interest rates which are to be repaid over a long time. 
  • Such loans can help in the economic development of a nation by setting up the infrastructure.

4. Humanitarian Assistance

  • Humanitarian aids are the actions designed to save lives, alleviate suffering and maintain and protect human dignity during and in the aftermath of emergencies.

Issues in International Funding

State vs Non-State Actors

  • Through which actors Funding should be done? – State Actor or Non-State Actor. 
    • If funds are given to the Government of Donee Country, most of the times they are inefficient in spending them. 
    • NGO and UN organisations can utilise the funds effectively than Govt Organisations. 
  • But if rich countries give funds directly to Non-State actors, there is an issue that it erodes the sovereignty of the nation.  

Conditions on Funds

  • Most of the funds that developing nations receive have a large number of conditions attached to them. These include 
    • Receiving nations can’t use it for their most pressing needs but only on projects which donor country or agency allow. 
    • Highly-paid observers have to be hired which make the overall cost very expensive. 
  • World Bank and IMF Grants come with large conditions like Opening markets for the world. This can therefore be viewed as a continuation of colonialism by other means.

Other aspects

  • The proliferation of Monoculturalism: These programmes are often aimed at inculcating certain form of culture and have low regards for indigenous culture in the targeted nations.
  • Modern technologies are preserved for-profit motives and ‘Obsolete Technologies’ are transferred instead of advance, to the developing nations. 
  • Corruption: Only one per cent of humanitarian fund reach the affected population. For Example, It was seen in West Africa during Ebola Crisis.  
  • Dependency on foreign aid: The state starts to lose its independence and relies on foreign aid for socio-economic policies.
  • Indirect benefits to rebel groups: The rebel groups might derive considerable financial benefits from humanitarian operations by imposing charges on transports, levying taxes on imports and employees’ salaries, and collecting rent for warehouses, offices and residences.

Problems in Funding Institutions

The key problem of the major funding institutions of global governance is that of unilateralism of Economic powerhouses like the US, EU, Japan and lack of democracy in their working.  

Main Problems of Major Funding Institutions 

  • Democratic Deficits:  Voting shares are in favour of the US, EU and global north. Countries like China and India are showing discontent
  • Global Response to Regional Problems: Response concerning problems of developing nations are untimely.
  • Issues of Accountability and Transparency due to large back door diplomacy. 

Limit of Sovereignty

Responsibility to Protect

Important ethical concern in International Ethics includes what is the limit of Sovereignty? When large scale Ethnic cleansing & Genocide is taking place (eg in South Sudan or Myanmar), can a country protect its actions in the garb of sovereignty?

What is the limit of Non-Intervention by the International Community? 

  • For this, there is an initiative of the UN called the Responsibility to Protect (R2P) Initiative. 
  • It states that Nations have sovereignty but subject to Human Rights. If human rights are violated, then International Community can unilaterally act against that nation. 
  • The idea was invented in the aftermath of the Nazi execution of the Jews to protect such crimes from happening which ‘shocked the conscience of mankind’. 
  • But weaker and smaller states fear that the garb of Responsibility to protect developed nations will undermine their sovereignty.

Just War Theory

What is a valid justification to start the war, if war has started which type of actions are justified during the war and what are the steps that country should take after the war?

Just War Theory

Principles of Jus ad Bellum (Just Recourse to War)

  • Last resort: All non-violent options must have been exhausted  
  • Just cause: The purpose of war is to redress a wrong  
  • Legitimate authority: Lawfully constituted government of a sovereign state can declare war, rather than a private individual or group.
  • Right intention: War must be prosecuted on morally acceptable aims rather than revenge  
  • Reasonable prospect of success: War should not be fought in a hopeless cause 
  • Proportionality: Any response to an attack should be measured and proportionate.  

Principles of Jus in Bello (Just Conduct in War)

  • Discrimination: Force must be directed at military targets only because civilians or non-combatants are innocent.
  • Proportionality: Force should be proportional.
  • Humanity: Force must not be directed ever against enemy personnel if they are captured, wounded or under control (prisoners of war). 

Post War

  • Reconstruction: Postwar reconstruction should also be done.
  • Reconciliation: There should be efforts of reconciliation after the war is over.   

It should be noted that the theory is not intended to justify wars but to prevent them, by showing that going to war except in certain limited circumstances is wrong, and thus motivate states to find other ways of resolving conflicts.

Similarly, Mahabharata outlines the principles and contours in the conduct of a just war. Some rules propounded were armies were allowed to collect bodies, personnel could meet for negotiations etc.


Ethical Issues around Nuclear Weapons

Ethical Issues around Nuclear Weapons

Nuclear weapons have the potential to destroy the entire ecosystem of the planet. However, a handful of states insist that these weapons provide unique security benefits, but reserve the sole right to possess them. Hence, the possession of nuclear weapons leads to numerous moral and ethical dilemmas.

Benefits

  • The fact that there has not been a war between nuclear-armed states due to fear of mutually assured destruction implies that deterrence has prevented the aggravation of conflicts. Eg: USSR and the US didn’t fight during the period of the cold war.   
  • It has indirectly saved millions of lives as conventional wars have not happened. Pakistan and India are less likely to attack each other because both are nuclear states.
  • Nuclear statesmanship: Possession of nuclear weapons engenders a sense of responsibility and a strong bias against adventurism. 

Against

  • The first question is whether nuclear weapons are moral or immoral in themselves. According to ethical theories, since morality cannot be attributed to non-human things, hence nuclear weapons in themselves are neither evil nor good. The question of Morality comes when it goes in hands of the person who will use it. Till Nuclear Weapons are available, there is always a possibility that Terrorists can get hold of them and use them.
  • According to proponents of nuclear weapons, these weapons create deterrence and stabilize the world order
  • From the utilitarian perspective, while nuclear weapons give a sense of security to the nations, which possess them, but it instils fear of destruction in the mind of billions. Even the citizens of nuclear-armed states cannot be sure of their safety. Hence, on the touchstone of ‘maximum good to maximum people’ nuclear weapons falter. 
  • Similarly from a deontological perspective, which believes that means to achieve peace should also be pure. Means to avoid war should not be fear of destruction but values of humanity, peaceful co-existence etc
  • Another dimension could be whether the money used for the production of nuclear weapons can be put to better use. Spending on social upliftment is more moral than spending on weapons 
  • The possibility that nuclear-armed states may go rogue, collapse, or fail to prevent their arsenal from falling into the hands of terrorists, cannot be ignored.

Hence, it can be concluded that although the deterrent effect of nuclear weapons worked during the bipolar ‘first nuclear age’, it is far less reliable in the less stable, multi-polar circumstances of the ‘second nuclear age’.


Asylum

The response of countries to asylum seekers has been xenophobic

Afghanis

Against giving Asylum 

  • It leads to drain on the (scarce) economic resources of the country.
  • Giving asylum leads to fear of job loss.
  • It also leads to the entry of extremist elements into the country. For instance, the Indian government fears that a large number of Rohingya coming to India makes India prone to Islamic extremism and terrorism.
  • Rebirth of Extreme Right-Wingers playing on Xenophobia. For example, far-right political parties such as Alternative for Germany (AfD) in Germany and National Rally in France are gaining ground playing on this card.
Xenophobia in Europe

Favour of giving Asylum

  • Every human being has an equal right to the resources of the earth. 
  • The principle of non-refoulment (to which a large number of countries except India are signatory) states that no one should be returned to a country where they would face torture, cruelty or any other irreparable harm.

Sample Questions

Developing countries are often very vulnerable to exploitation by multinational corporations. They support industrialization but lack of infrastructure is a major limiting factor. Further, without suitable laws and regulations, developing nations are ill-prepared for such endeavours. In their efforts to attract business, these nations often overlook the health and safety violations by the corporations doing business within their borders. Drawn by low-cost labour, new markets, and lower operation costs, corporations have little incentive to address environmental and human risks once they are entrenched. In this situation, there is an imminent threat of disaster.

Discuss some feasible strategies to balance economic development and safety and security of people at large in developing countries with special emphasis on India

Governments of developing countries often compete fiercely for attracting Multinational Corporations (MNCs) in the expectation of the advantages they will bring to their economies, often prioritizing economic goals over fundamental human rights and environmental conservation. The fierce competition leads to defective policies by these governments, which are the reason for disasters in many countries. The Bhopal Gas tragedy of 1984 was a consequence of defective policies of the government and the exploitative character of the MNCs. To prevent a “second Bhopal” from happening, developing countries need to rethink their strategy & to balance the economic goals and their repercussions on the environment and human welfare. 

Strategies to control the exploitative character of MNCs can be classified under two broad categories namely at the National and Global level. 

National Level

  • Corporate Governance norms should be strengthened.
  • Regulatory institutions should be strengthened.  
  • Compliance towards Corporate social responsibility (CSR) should be ensured. 
  • Environment Impact Assessment & Social Impact Assessment
  • Mock drills – fast response in case of any industrial disaster. 

Global Level

  • A global industrial watchdog must be instituted. 
  • International best practices should be documented and widely disseminated.

Previous Year Questions

  1. At the international level,  bilateral relations between most nations are governed by the policy of promoting one’s own national interest without any regard for the interest of other nations.  This led to conflicts and tension between the nations.  How can ethical consideration help resolve such tensions?  Discuss with specific examples. (2015)
  2. Strength, peace and security are considered to be the pillars of international relations. Elucidate. (2017)

Women Movements

Women Movements 

In this article , we will  deal with topic titled ‘Women Movements’

 

Immediately after two decades of independence, the overall feelings with respect to women’s issues were concerned with required legislative reforms. Many acts were passed to translate namesake equality into true spirits, like special Marriage Act 1954, the Hindu Marriage Act (1956), Inter State Succession Act (1956) and Dowry Prohibition Act 1961 were enacted.

 

There were three prominent women organization, which were still working for the women’s cause

    • All India women’s conference (AIWC)
    • National Federation of Indian women (1954)
    • All India Democratic Women’s Association (AIDWA since 1981)

Neither of them had direct political affiliations, but AIWC is known to have close links with Congress, the NFIW with the CPI and AIDWA with CPM.

 

Mid 1970’s were watershed years in Indian Politics. Series of locally organised &  intense popular struggle broke out. Eg,

    • United women’s Anti Price Rise Front, which turned into a mass movement of women for consumer protection
    • Chipko Movement for environment protection
    • Bodhgaya movement for women’s land rights.
    • Nationwide protest were organised around specific incident like the Mathura Rape Case (1978), Jessica Lal Murder case, the latest ones were Nirbhaya Case Delhi (2012).
  • There is growing demand for women’s safety, dignity, employment, and reservation in Assemblies and Parliament
  • Various NGOs have also contributed a lot in women emancipation . Eg SEWA .
  • But there are many rape cases and violence against women happening in the country despite enormous laws.

New Farmers Movement

New Farmers Movement

In this article , we will  deal with topic titled ‘New Farmers Movement’

 

  • Farmer’s movements burst onto the National political stage in 1980 with the road and rail roko agitation in Nasik, Maharashtra led by the Shetkari Sangathana of Sharad Joshi. Sharad Joshi articulated the ideology of the movement in terms of India V/s Bharat, industrial V/s rural.

 

  • In 1986, in Muzaffarnagar, U.P. Mahendra Singh Tikait, presided over a gathering of lakhs of villagers before which the CM of UP had been forced to appear in person to announce his acceptance of their demand for reduction of electricity charges to the old level.

 

  • In the 1980’s emerged widespread grassroots mobilization of rural dwellers like in
    • Tamil Nadu led by Viva Sayigal Sangam
    • Karnataka led by Rajya Ryothu Sangha
    • Punjab and Haryana led by Bhartiya Kisan Union
    • Gujarat led by Kisan Sangh
    • Maharashtra led by Shetkari Sangathana

These above mentioned New Farmers Movements especially in 1980s have attracted much media and political attention and focused mainly on

  • demanding remunerative prices for agricultural produce
  • lowering or elimination of government dues such as canal water charges, electricity charges, interest rates and principal of loans, etc

Dalit Movements

Dalit Movements 

In this article , we will  deal with topic titled ‘Dalit Movements’

 

Based on Rajni Kothari’s studies , various phases in Dalit Movement in India are as follows :-

Pre-Independence

These can be divided into two parts

    • Reformative : They never questioned the Caste System. All they wanted was  , discriminatory aspects of Caste System should be reformed . Eg : Harijan Movement of Gandhi
    • Alternative : Create alternative socio-cultural system where there is no place for caste system . Eg : Religious Conversions etc

 

Post Independence

1950-60s
  • Congress was manipulating Dalits as vote bank but they were not given any leadership role. To challenge it ,
        • Republican party of India formed
        • Mass conversion of Dalits to Buddhism
  • But Republican Party wasn’t able to sustain itself due to Marxist vs Ambedkarite ideology . Ambedkarites were  in favour of gaining political power and use it for social upliftment of their community. But Marxist wanted to annihilate socio-political structure and create completely classless society.

 

1970s

Dalit Panther Movement

  • Inspired by Black Panthers Movement of USA
  • It was aimed at generating awareness among people regarding the plight of the dalits
  • It was carried out by educated students and methodology included public debates, pamphlets , plays etc . Students of other sections of society apart from Dalits were also participating
  • They defined Dalits in holistic way consisting of  “all those who are exploited politically, economically and in the name of religion.”

 

1980s Rise of Bahujan Samaj Party

  • In democracy , majority rules .
  • They wanted to take power out of the hands of elites especially Brahmins , Rajputs and Baniyas .

Environmental Movements

Environmental Movements 

In this article , we will  deal with topic titled ‘Environmental Movements’ which happened in India after independence.

 

 

Introduction

Ecological and environmental conflicts in India are claims over depleting resources of forests, land water, fisheries etc. These conflicts have been a challenge to the development of the country.

 

Chipko Movements

  • Location = Central Himalayas ( Uttaranchal)
  • Reason: forest department refused permission to villagers to fell ash trees for making agricultural tools and allotted the same patch of land to sports manufacturer for commercial use. The villagers demanded that local communities should have effective control over natural resources like land, water and forests.
  • Novel Aspect : Women’s active participation (Gaura Devi=Prominent figure) + Villagers in general, and women in particular thwarted commercial falling of trees by hugging the trees to prohibit their cutting
  • Movement achieved a victory when  government issued a ban on felling of trees in the Himalayan regions for fifteen years, until the green cover was fully restored.

 

 

Narmada Bachao Andolan

  • Ambitious developmental project was launched in the Narmada valley of central India in early 80’s consisting of 30 big dams, 135 medium sized and around 3000 small dams to be constructed on the Narmada and its tributaries . Sardar Sarovar Project in Gujarat and Narmada Sagar Project in MP were two most important
  • Project required relocation of about 2.5 lakh people and 245 villages were expected to get submerged.
  • Initially locals demanded proper relocation and proper rehabilitation. It was during late 80’s that the issue strengthened under the banner of Narmada Bachao Aandolan. NBA demanded
    • proper cost benefit analysis of the major developmental projects completed in the country so far.
    • social cost should be calculated too with respect to such projects. Social cost meant forced settlement of project affected people, serious loss of means of livelihood and culture, depletion of ecological resources.
  • Because of constant struggle, Right to rehabilitation has been recognized by the government and judiciary.
  • NBA used every available democratic strategy to put forward its demands like Pradarshan, Dharna, Gherao, Rasta Roko, Jail Bharo Aandolan, Bhook Hartal etc.
  • Prominent face of the movement was Medha Patkar, a social activist.

 

 

Silent Valley Movement

  • Aimed at the protection of silent valley an evergreen forest in the Palakkad district Kerala.
  • Reason : Announcement of  dam construction on Kuntipuzha river, in silent valley
  • Movement was started in 1973 and Kerala Sasthra Sahitya Parishad (K.S.S.P)  aroused the public opinion to save silent valley.
  • Protesters were successful in 1985, when the then PM Rajiv Gandhi inaugurated silent valley National Park and the park was designated as the core area of Nilgiri Biosphere Deserve.

 

 

Fisheries Movement

  • Livelihood of small fishermen worker was threatened, when the government permitted entry of mechanized trawlers and technologies like bottom trawling for large scale harvest of fish in the Indian seas. To protect their interests and livelihood, the fishermen came together on a national level platform as a National Fishworkers Forum (NFF).
  • NFF achieved their first success against Indian government’s move to open the entry of commercial vessels including of MNCs in deep sea. In July 2002, NFF called for a nationwide strike to oppose the move of government to issue licenses to foreign trawlers as well.

 

Point to Note : In India , Environmental Movements were bottom up movements started by common people whereas in Europe and western nations, Environmental Movements were basically Elitist / Intelligentsia / Top Down Movements

 

Coalition Politics

Coalition Politics 

In this article , we will  deal with topic titled ‘Coalition Politics’.

 

  • During 4th General Elections to Lok Sabha and State Assembly, Congress started to lose popularity . Challengers started to come from states and they lost mandate in many states . Reasons
    • People unhappy with corruption and lavish lifestyle of party members
    • Rapid erosion in party discipline
    • Power struggles within the party
    • Blow to Syndicate as large number of Congress Stalwarts lost
    • Coming together of opposition parties from 1967
    • Start of politics of defection (1967-1970 => 800 MLAs defected)

 

  • First Coalition Government at Centre came in 1977 of Morarji Desai heading four party Janata Government for about two years (1977–79). But due to aspiration of power and position the Janata Coalition collapsed like a house of cards in July 1979. After the collapse of Janata Government, India had another coalition government headed by Charan Singh. But this government too remained for a very short time. Later for almost a decade India had a stable one party government at the centre under Congress’s leadership. People were unhappy with earlier two coalition governments.

 

 

Era of Constant Coalition Governments

  • After a decade old stable government by the congress, there was a return of coalition politics. Elections in 1989 led to the defeat of the Congress Party but didn’t result in majority for any other party. This defeat of 1989 of the Congress Party marked the end of Congress dominance over the India Party System. Hence an era of multi-party system began. This new evolution in multi party system meant that no single party secured a clear majority of seats in any Lok Sabha elections held since 1989 until BJP got majority in 2014.  The nineties also saw the emergence of powerful parties and movements that represented the Dalit and backward castes. With the elections of 1989, a long phase of coalition politics began in India.
  • In this phase, any government could be formed only with the participation or support of many regional parties.

 

Land Reforms

Land Reforms

In this article , we will  deal with topic titled ‘Land Reforms’.

 

 

Introduction

Land reform was a Government program to promote socio-economic equality in the rural setup by dealing with the deficiencies of British Era land tenure system.

 

Objectives

  • Socio-Economic Development
  • Social Justice
  • Increasing agricultural productivity
  • Improving the standard of living

 

Colonial Legacy

The British rule had a devastating impact on Indian agriculture where despite of commercialisation and differentiation, it didn’t led to the emergence of Capitalist Agriculture. Reasons were

  • Extraction of Surplus from Peasantry
  • Transfer of Surplus from India to Britain
  • Creation of Rentier landlord class instead of class of rich peasants

 

 

Features of Indian Agriculture during Colonial Rule

  • Colonial State made a very high tax demand on agriculture . Eg : Permanent Settlement, Ryotwari System
  • Growth of Landlordism and rack renting .
  • In addition to the rent, landlords resorted to illegal exactions (bonded labour, begar etc) . Hence, land owners preffered to give their land on tenancy instead of going for capitalistic mode of agriculture
  • Hence, petty commodity production with traditional technology rather than large scale modern capitalist farming was the typical production pattern in colonial India .

 

At the time of Independence, Indian Agriculture due to long term stagnation was facing food shortages and famine conditions. Hence, multi-pronged approach was the need of the hour. Eg (based on recommendations of Kumarappa Committee , 1949 & Nagpur resolution, 1959)

  • Abolition of Zamindari
  • Land ceiling
  • Distribution of surplus land via cooperatives
  • Prevention of fragmentation of land holdings to make force labour illegal
  • Remunerative prices for agriculture produce

 

 

Questions : To what extent land reforms were able to alter the socio-political fabric of rural India ?

 

It can be broadly divided into two parts

Pre 1960s Institutional Reforms

  • Abolition of Zamindari
  • Tenancy Reforms
  • Land Ceiling
  • Bhoodan and Gramdan Movement
  • Cooperatives

 

Post 1960s Technological Reforms

  • Green Revolution

 

 

Abolition of Zamindari

  • It was the first provision to be launched
  • To ensure Judicial implementation of Zamindari abolition ,  Government of India passsed First Amendment Act

 

 

Issues wrt Zamindari Abolition Act’s implementation

  • Absence of adequate land records
  • Resentment by the Zamindars
  • Zamindars allowed to retain land which were declared to be under their personal cultivation. It was followed by large scale eviction of less secure small tenants.
  • Land is in State List , only the formulation of Policy was in hands of Union while implementation was in hands of state. Eg : In J&K , it was success because presence of Sheikh Abdullah
  • Filing petitions in the Judicial courts
  • Zamindars – Revenue Officials nexus

 

However, out of all the land reforms , abolition of Zamindari met with the maximum success .  Despite resistance by the landlords , the process was completed in democratic manner because Zamindar as a class became socially isolated during National Movement.

 

Outcome

  • Emergence of Dominant Caste (Superior Tenants who got land in lieu of Zamindari abolition)
  • Rise of Rural Middle Class
  • Agricultural productivity got enhanced
  • Common villagers got access to common village resources which was earlier under control of Zamindars

 

 

 

Tenancy Reforms

Issue of Oral and Unrecorded Tenancy continued even after abolition of Zamindari.

 

There were three aspects regarding Tenancy Reforms

  • Security of Tenure to tenants who have cultivated a piece of land continuously for a fixed number of years.
  • Reduction of rents paid by Tenants to a fair level
  • Tenant’s Right to acquire ownership of land subjected to certain restrictions

 

 

There were two fold purpose of the tenancy reforms

  • To improve the condition of tenants
  • To maintain the balance between the interest of the owner and tenant

As a result , Right of Resumption for the purpose of self cultivation was introduced. However, this provision led to large scale eviction of tenants.

 

 

Failure

  • Right of Voluntary Surrender was also given to the tenants . However, it was misused and led to largescale eviction
  • Issue of Farm Servant
  • Issue of Conversion to Share-Croppers : Sharecropper were not given protection under Tenancy Legislation as they didn’t pay a rent in cash but a fixed produce as rent.

 

 

Operation Barga

  • To address the concerns of Sharecroppers , Operation Barga was launched in 1977 in  West Bengal. The objective was time bound registration of Share croppers so as to ensure permanent occupancy and hereditary rights and the crop division in the ratio 1:3
  • Issues with Operation Barga
    • Lack of Political Will
    • Ethically indefensible in context of Landlords with very small land holdings
    • Due to skewed land-man ratio , landlords often rotated leased land among two or more sharecroppers . Hence, registering all of them was economically unviable

 

 

Limitation of Tenancy Reforms

  • Security of Tenure to all the tenants met with only limited success
  • Adverse  man-land ratio led to high rents
  • In most of the states where Green Revolution was success , rent was as high as 70% due to increase in land value.
  • Ownership Rights of Tenants were partially achieved
        • Right to Resumption by land owners
        • Legal or illegal eviction
        • Voluntry surrender
        • Shift to Oral or Concealled Tenancy

 

According to Daniel Thorner, despite the loopholes Land Reforms succeeded in creation of progressive cultivators making investment and improvement in productivity

 

Land Ceiling

  • Objective : making Land distribution more equitable

 

  • During the First Five Year Plan, the government accepted the Kumarappa Committee Report, which recommended the ceiling of 3 times the Size of Economic Land Holding but stated that exact upper limit would be fixed by respective states and redistribute the surplus land among the landless

 

  • However due to improper implementation , it was declared in 1959 that the ceiling should be fixed by all the states and the surplus land should be vested to Panchayats and managed through Cooperatives consisting of Landless Labourers.

 

 

Lacunae in Land Ceiling

  • The ceilings fixed by the states  were very high
  • Ceilings were imposed on the individuals and not on the family households
  • Large number of exemptions were given by many states to promote capitalist farming
  • Exemption to the lands held by Cooperatives was also misused by transferring lands to bogus Cooperatives
  • Long delays in the implementation of ceiling provisions defeated the purpose as it led to Benami Transfers .

 

 

It didn’t meet success but the laws definitely discouraged concentration of land ownership beyond ceiling levels

 

Bhoodan and Gramdan Movement

  • It was an attempt at land reform through a movement and not by Government Legislation.
  • Vinoba Bhave organised the Sarvodaya Samaj to take up the task of Social Transformation.
  • It  was based on idea that each family should give 1/6th of their land by accepting poor member as part of their family.
  • Although it wasn’t a political movement but it had the support of many mainstream politicians .
  • It started from Telegana and later spread to North India . However post 1956, the movement lost it’s momentum and the substantial part of land given was either unfit for cultivation or was under litigation.
  • Meanwhile , the movement took a new form of that of a Gramdan which was based on premise that land belongs to God and it is equally and collectively owned . The movement started in Orissa and was successful in villages where class differentiation was yet not emerged and there was little if any disparity in the ownership of land

 

 

Positives

  • It popularised the idea that land is a gift of nature and belongs to all
  • It was a voluntary movement
  • It created atmosphere for political propaganda and agitation for redistribution of land and development of Cooperatives

 

 

UPSC Question : Critically discuss the objectives of Bhoodan and Gramdan movement started by Vinoba Bhave and their success.

 

Kargil War

Kargil War

In this article , we will  deal with topic titled ‘Kargil War.’

 

Introduction

Line of Control (LoC) at Shimla Declaration was defined till NJ 9842 . Both India and Pakistan interpreted LoC beyond that point in their own way

  • India : LoC is along Saltoro Ridge (ie entire Siachen lies in India)
  • Pakistan : It is along line joining NJ 9842 to Karakoram Pass

 

 

Chronology

Operation Meghdoot(1984)
  • Siachen Glacier was occupied by India

 

Nuclear Test / Pokharan (1998)
  • India conducted Nuclear test
  • Weak later Pakistan also tested Nuclear Bomb

 

Lahore Declaration (1999)
  • As both countries were now nuclear powers, situation became tense .
  • Lahore Declaration was signed in Feb 1999 that conflict related to Kashmir will be peacefully resolved

 

Operation Badr (1999)
  • In April 1999, Pakistan occupied crucial positions on Siachen Glacier
  • The aim was to sever the link between Kashmir and Ladakh causing Indian forces to withdraw from Siachen and forcing India to negotiate a settlement on Kashmir Issue. Pakistan believed that any tension in the region would internationalize the Kashmir issue and help it to secure speedy solutions.

 

Operation Safed Sagar (1999)
  • Part of Operation Vijay to re-conquer Siachen Glacier

 

Operation Talwar (1999)
  • Part of Operation Vijay to re-conquer Siachen Glacier

 

Rajiv Gandhi Era

Rajiv Gandhi Era

In this article , we will  deal with topic titled ‘Rajiv Gandhi Era .’

 

Events during his tenure

  • Panchayati Raj
  • IT Revolution : Literacy Mission + White Revolution + Immunization + Drinking Water Mission + Edible Oil Mission + One telephone in each village
  • Computerization
  • Operation Blackboard (providing basic infrastructure to primary schools) + Navodaya Vidyalayas
  • Sri Lankan Crisis
  • Peace Accords : Assam Accord
  • Shah Bano Judgement
  • Women Perspective Plan for Woman: Dowry Prohibition Act, Health and education among women promoted & reservation in seats for women in Panchayats
  • Jawahar Rozgar Yojana (52 days job / predecessor of MGNREGA)
  • Protection of Environment : New ministry of environment was created + Mission to Clean Ganga launched + Proposal for Planet Protection Fund started
  • Cleaning Politics : Anti-Defection Law
  • Concept of Lok Adalats

 

 

Foreign Policy Initiatives

  • Action Plan for Nuclear Disarmament
  • AFRICA Fund (Action for Resisting Invasion, Colonialism & Aparthied)
  • Played important role in ensuring Namibian Independence
  • Relationship of India with Nepal deteriorated : Rajiv Gandhi’s Government shut the trade routes with Nepal which had a devastating impact on Nepal’s economy. Reason = Nepal’s growing bonhomie with China (China card)

 

 

Sri Lankan Crisis

Factors leading to Ethnic Crisis in Sri Lanka in 1980s

  • In 19th century,  Britishers had taken more than 10 lakh Tamil labourers from different parts of Madras to Sri Lanka in the lure of good employment opportunities in plantations. For over 100 years, these Tamils laboured for the prosperity of Sri Lanka . However, 1948 the government passed Ceylon Citizenship Act which deprived them of their Citizenship Rights.
  • In 1956, Sinhala was declared as the only Official Language which was considered as a delibrate attempt of cultural, linguistic and economic domination.
  • During 1960s, there was a pact which was signed between India and Sri Lanka known as Sirimavo – Shastri Pact. According to this pact, 5 lakh Tamils were to be brought back to India and remaining were to be conferred Citizenship in the span of 15 years. However, Government of SL kept on extending the time limit
  • In 1970s, policy of standardisation was introduced wrt admission in the educational institutions.
  • State sponsored colonialisation of traditional Tamil areas by Sinhalese peasants.
  • Preference given to Buddhism in the Sri Lankan Constitution.
  • Banning of import of Tamil literature

All these factors led to emergence of ethno-nationalism among the Tamilians in Sri Lanka . However, it was the Operation Liberation which Sri Lankan Government launched in 1978 to attack Jaffna which became the precipitating factor culminating in start of Civil War.

 

Under the pressure from South, Indian government was providing the necessities to the people in Jaffna.

 

 

Indo – Sri Lanka Accord

In the wake of continuing Tamil Insurgency, an accord was signed known as Indo-Sri Lanka Accord .

 

Features

  • Northern and Eastern Province of Sri Lanka would be merged into single province
  • Substantial devolution of power
  • LTTE would be dissolved and arms would be surrendered
  • Indian Army would come for the aid of Sri Lanka if required

Accord failed to materialise as LTTE refused to surrender and the Indian Government got involved in the messy situation as they faced ridicule from their people as well as Sri Lanka . It finally ended with murder of Rajiv Gandhi