Redistribution of wealth, 8th India Water Week 2024, UN Events

(General Studies II – Polity section – Indian Constitution—Historical Underpinnings, Evolution, Features, Amendments, Significant Provisions and Basic Structure. Governance section – 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.)

• With the Supreme Court has recently constituting a nine-judge Bench to interpret the Directive Principles of State Policy (DPSP) with respect to ownership and control of material resources and the debates surrounding wealth in the country, the understanding of ‘wealth’ and its redistribution has become important.
• Wealth, or net worth, refers to the total value of all assets owned by an individual or entity minus any liabilities (debts). E.g.- Real estate properties, Investments in stocks and bonds, etc.
• Income, on the other hand, is the flow of money received on a regular basis from work, business, investments, or transfers like pensions. E.g.- Salary from a job, Earnings from a business, Rental income, etc.

Constitutional Provisions –

• The Preamble to the Constitution of India aims to secure social and economic justice, liberty, and equality for all citizens.
• Directive Principles of State Policy (DPSP) (Part IV) guide the State in achieving social and economic justice, but they are non-enforceable in courts.
• Article 39(b) and (c) in DPSP emphasize the distribution of material resources to serve the common good and prevent the concentration of wealth.

Historical Amendments –

• Originally, the right to property was a fundamental right under Article 19(1)(f) and Article 31 mandated compensation for acquired private property.
• To facilitate land reforms and public asset construction, amendments like Articles 31A, 31B, and 31C were introduced to curtail property rights.
• In Golak Nath (1967) case, the Supreme Court ruled that fundamental rights cannot be abridged for DPSP implementation.
• Kesavananda Bharati (1973) upheld the validity of Article 31C but subjected it to judicial review.
• Minerva Mills (1980) emphasized a harmonious balance between fundamental rights and DPSP.
• The 44th Amendment (1978) downgraded the right to property from a fundamental right to a constitutional right under Article 300A.

Socialistic Model and Liberalization –

• Post-independence, India followed a socialistic model with high taxes, land reforms, and nationalization to reduce inequality and redistribute wealth.
• Economic liberalization in the 1990s shifted towards market-driven policies, reducing direct taxes, abolishing estate duty (1985), and wealth tax (2016).
• Despite liberalization, inequality has grown. According to the World Inequality Lab (2022-23), the top 10% hold 65% of the wealth and 57% of the income, while the bottom 50% hold only 6.5% of the wealth and 15% of the income.

Recently, a 9-judge Bench of the Supreme Court is set to interpret whether private property would fall within the definition of material resource of the community in Article 39(b) of the Constitution. The Article provided that the state should direct policy in such a way that the ownership and control of material resources of the community were distributed to best subserve the common good.

Way Forward –

• Governments need to protect the interests of poorer sections without stifling innovation and economic growth.
• Policies should be debated and framed in line with current economic models to achieve economic justice, ensuring the benefits of growth reach all sections, especially the marginalized.

• The 8th India Water Week 2024 focused on the theme ‘Partnerships and Cooperation for Inclusive Water Development and Management’.
• The event will feature around 4,000 delegates discussing issues like water security, flood management, drinking water, and sanitation.
• Experts from various countries, along with ministers and government officials, will attend.

Dig Deeper: Read about the National Water Policy.

• It is a Start-Up India Initiative under the Department for Promotion of Industry and Internal Trade.
• It is envisioned as a one-stop digital platform where diverse startup ecosystem stakeholders can seamlessly connect and collaborate.
• BHASKAR aspires to empower entrepreneurs and ecosystem stakeholders at every stage of their journey, driving forward a culture of innovation that propels India to the forefront of global entrepreneurship.
• It will be the largest digital registry of the startup ecosystem in the world in the coming times.

Dig Deeper: Read about investment facilitation and promotion agency Invest India.

• The United Nations will focus on urgent environmental issues through four major sessions over the coming months, addressing global warming, biodiversity loss, desertification, and plastic pollution.

Dig Deeper: Read about the various UN agencies concerned for upcoming UN events.

• DGGI has noticed entities like online casinos appear to intentionally avoid tax compliance by operating through off-shore VPNs and cloud-based platforms.
• GST investigation arm DGGI has suggested reciprocal arrangements with foreign governments to block websites to prevent tax evasion in OIDAR services like e-gaming and online education.
• Online Information and Database Access or Retrieval (OIDAR) services are those that are delivered over the Internet.
• Hundreds of off-shore entities providing OIDAR services have registered with the GST department so far. There is an 18% GST rate for OIDAR services.

Dig Deeper: Read about the GST Council of India.