29th September Editorial

Impact of Liquidity Crunch on Low-Income Countries

Introduction

Low-income countries (LICs) are grappling with a severe liquidity crunch that not only hampers their economic development but also exacerbates the global climate crisis.

This crisis is marked by dwindling net financial transfers to Africa, a region hit hardest, due to a reduction in loans from the private sector and China, coupled with diminishing access to bond markets.

Rising food and fuel costs, alongside declining export revenues, are compounding their economic woes.

Looming Development Crisis

While only a handful of LICs have defaulted on their external debts, many face an impending fiscal crisis.

Their debt-service obligations have ballooned, surpassing the official support they can secure.

This silent development crisis is exacerbated by the widening gap between the financing needs for global development and climate action, estimated at $1 trillion annually.

Inadequate Global Response

International efforts, including the recent G20 declaration, aimed to reform the global financial and development architecture, emphasizing increased support from multilateral development banks (MDBs).

However, the rush to boost MDB funding before addressing the ongoing debt crisis risks diverting funds away from LICs.

China’s Role

China, a major bilateral donor, has opposed comprehensive debt relief, arguing that LICs’ external debt remains relatively low compared to historical levels.

Instead, China advocates for debt rescheduling, as seen in the Zambia deal. This stance has contributed to the lack of consensus on resolving the debt crisis.

Private Lenders and Collective Action

Private lenders have also resisted deep debt relief while failing to provide liquidity.

Unlike the Latin American debt crisis of the 1980s, where coordinated rescheduling was feasible, the current bond market closure highlights a collective-action problem among fragmented bondholders.

A Path Forward: The Bridging Compact

To address the liquidity and insolvency dilemma faced by LICs, a proposed ‘bridging compact’ led by the UN, World Bank, and IMF would support both illiquid countries in need of debt rescheduling and insolvent nations requiring debt haircuts.

This initiative hinges on implementing reforms and fiscal constraints within a national renewal program.

Key Components of the Bridging Compact

Conditional Support: The IMF and World Bank would provide funding with extended conditionalities beyond the typical three-year IMF package.
Rescheduling: To prevent resources from leaking to other creditors, some debts would need to be rescheduled during the program. The interest rate applied should not exceed the projected growth rate under the renewal effort.
Enforcement: All creditor groups must agree to the approach, and the IMF would enforce debt rescheduling through the threat of lending into arrears.
Debt Reduction: If, at the program’s end, external debt remains unsustainable, a debt reduction scheme, akin to the HIPC initiative, would be implemented.

Conclusion

The proposed bridging compact offers a viable approach to bridge the vast disparity between global development aspirations and the harsh financial realities faced by LICs.

It provides a pathway for illiquid countries to reposition themselves for sustainable growth, thus enabling the mobilization of trillions of dollars required for climate-friendly development.

Without such innovative solutions, the goal remains a distant dream, and LICs continue to bear the brunt of a liquidity crunch that has far-reaching global consequences.

PRESS FREEDOM IN INDIA: NAVIGATING CHALLENGES AND SAFEGUARDING DEMOCRACY

Introduction

The freedom of the press in India is facing increasing threats, with state agencies targeting individual journalists and editors. The Rights and Risk Analysis Group (RRAG) reported that in 2022 alone, 194 journalists, including seven women, were targeted by both state and non-state actors across the country.

This alarming trend has resulted in India’s ranking plummeting to 161 out of 180 countries on the World Press Freedom Index in 2023, the lowest since its inception in 2002.

Chilling Effect on Freedom of Speech

The atmosphere of raids, arrests, and FIRs (First Information Reports), often making bail difficult, has created a chilling effect on freedom of speech and expression, a fundamental right protected under Article 19(1)(a) of the Indian Constitution.
While Article 19(2) allows for “reasonable restrictions,” journalists have no special privileges or protection as members of the press.

Legal Safeguards and Internal Checks

Unlike the U.S. First Amendment, which explicitly mentions freedom of speech and the press, India’s Article 19(1)(a) speaks of freedom of speech and expression without specific reference to “the press.”

Nevertheless, newspapers maintain internal checks and balances, offering remedies for errors through clarifications or corrigenda.

Complaints against publications can also be lodged with the Press Council of India.

For defamatory content, both civil and penal provisions are available, and peer group scrutiny has been strengthened through social media.

The Argument Against Coercive Means

The primary argument put forth is against the use of coercive means when legitimate channels for addressing grievances are available, as they act as barriers to the exercise of freedom of speech.

This viewpoint is rooted in the historical struggle to safeguard this fundamental right against attempts to expand restrictions under Article 19(2) and successive governments’ use of state agencies to curtail it.

Historical Opposition and Legal Amendments

From the early days of India’s independence, journalists from diverse ideological backgrounds opposed state control, as seen in cases like Brij Bhushan vs. State of Delhi and Romesh Thapar vs. State of Madras.

These cases challenged pre-censorship orders and bans on publications, highlighting the importance of free speech and the press in democratic societies.

Resistance to Curbs and Legal Interpretation

Journalists, with support from the Supreme Court, resisted government curbs.

However, the government, responding to these challenges, introduced the Constitution (First Amendment) Bill in 1950, amending Article 19(2) to include new restrictions on speech.

Over the years, the Supreme Court has defined these restrictions more specifically to prevent broader interpretations and misuse.

Recent Legal Precedents

Recent legal precedents, such as the 2015 Shreya Singhal case, which struck down Section 66A of the Information Technology Act, demonstrate the judiciary’s commitment to protecting free speech.

The court emphasized the need to evaluate the effect of words from the perspective of “reasonable, strong-minded, firm, and courageous men.”

Current Challenges

In 2023, India faces a new chapter in the discourse on freedom of speech as journalists seek the Supreme Court’s relief in the Editors Guild of India (EGI) case.

Senior editors have been charged under various sections of the Indian Penal Code (IPC) following the publication of a report on media coverage of the conflict in Manipur. This case underscores the ongoing challenges to free speech in India.

Conclusion

The state of press freedom in India is indeed under duress, with a decline in global rankings and increasing cases of state interference. The historical struggle to protect freedom of speech and expression is still relevant today, as journalists and the judiciary work to safeguard this fundamental right against coercive measures and undue restrictions.

Legal Evolution of Self-Respect Marriages

Introduction:

Nearly 56 years after the enactment of the Hindu Marriage (Tamil Nadu Amendment) Act 1967, a young man named Illavarasan from Tamil Nadu finds himself in a legal battle over the validity of his Suyamariyathai marriage, which had been performed and validated under this Act.

This situation has raised questions about the evolution of Hindu marriage laws and their impact on alternative marriage practices in the state.

Historical Background:

In 1953, the Madras High Court declared self-respect marriages among professed Hindus as invalid, citing non-compliance with traditional Hindu marriage rituals.

This judgment stigmatized reformed marriages, labeling women as concubines and their children as illegitimate.

The judiciary used hegemonic Hindu marriage ideals to counter Dravidian notions of alternative non-Brahminic marriage practices.

Basis of the Self-Respect Movement:

The self-respect movement aimed to challenge caste supremacy and patriarchal norms in Hindu marriages.

It advocated for dissoluble contracts between couples without religious practices, civil registration of all marriages, women’s rights to dissolve marriages, remarry, and claim property rights.

Struggle for Legal Recognition:

The Dravidian movement faced a protracted struggle in the Madras Presidency and at the national level when the Hindu Code Bill was drafted in 1944.

The Rau Committee’s report in 1947 did not acknowledge demands for legal recognition of non-religious marriages.

The Hindu Marriage Act of 1955 recognized only reformed marriages that adhered to customary rites and ceremonies.

Challenges and Amendments:

The judiciary and Parliament consistently suggested that self-respect marriages be registered under the Special Marriage Act, 1954, neglecting property rights and Hindu joint family issues.

In 1967, the Hindu Marriage (Tamil Nadu Amendment) Act was passed, validating non-ritual Hindu marriages and questioning Brahminic interpretations of Hindu marriage.

Contemporary Challenges:

In 2017, the Union Ministry for Social Justice and Empowerment refused to recognize inter-caste marriages under the Section 7 Act, demanding registration under the Hindu Marriage Act, 1955.

Recent disputes have emerged regarding the validity of Suyamariyathai marriages, despite the Supreme Court upholding their legality.

Conclusion:

The legal journey of self-respect marriages in Tamil Nadu reflects the complex interplay between social reform movements, legal changes, and persistent challenges.

Despite amendments and court rulings, the struggle for full recognition continues, highlighting the broader issues of caste, gender, and patriarchal norms within the Indian legal framework.