The Hindu Editorial Analysis- 28th April 2025 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Clean AI

Why is it News?

The IMF report indicates that the economic advantages of AI applications are likely to outweigh the environmental costs associated with the increased energy demand of AI data centers. Countries with strong renewable energy infrastructure will mitigate the social and environmental costs of AI growth. India’s strategy, backed by initiatives like IndiaAI, highlights the importance of sustainable energy integration in AI development.

Key Insights from the IMF Report

• AI's economic benefits are expected to surpass its environmental costs, despite the increased energy demand of AI data centers.
• AI is not fundamentally against global sustainable growth strategies.
• Countries with robust renewable energy infrastructure will experience lower environmental and social costs while advancing AI.
• India's AI infrastructure, supported by the IndiaAI Mission, currently does not significantly impact the nation's energy mix, but pursuing renewable energy for AI is crucial.
• The government’s strategy, as outlined at the AI Action Summit in Paris, highlights the importance of renewable energy and sustainable practices in AI development.

The Role of Renewable Energy in AI Development

• High Energy Consumption of AI: AI requires substantial energy, especially in the United States, the largest hub for AI computing.
• Impact on Electricity Prices: The IMF warns that the expansion of AI could lead to a rise in electricity prices by up to 9%, contributing to broader price pressures.
• Importance of Renewable Energy: Renewable energy is vital to offset the emissions associated with conventional energy sources used in AI data centers.

AI and Renewable Infrastructure

• Data centers, where AI operates, are well-suited for renewable energy integration due to their energy-intensive nature.
• Indian companies are already investing in renewable energy for their data centers, aligning with sustainable practices.
• Data centers occupy large spaces, making them ideal for solar energy integration.
• Role of Nuclear Energy: Nuclear energy, particularly small modular reactors, may complement renewable energy sources to reduce emissions at data center clusters.

Broader Environmental Impact of AI

• Additional Environmental Footprints: AI’s environmental impact goes beyond electricity use and includes factors such as:
• Large-scale mining of minerals.
• Water consumption.
• Effluents from electronics manufacturing.
• India’s Role in Electronics Manufacturing: India aims to expand its electronics manufacturing sector, which presents both opportunities and environmental challenges. Achieving India’s net zero target by 2070 will require reducing conventional emission sources while managing energy consumption from growing industries.

Conclusion

As AI continues to transform various industries, the challenge lies in managing its environmental impact, particularly regarding energy consumption. The adoption of renewable energy solutions for AI data centers is crucial to minimizing emissions. India’s approach of combining AI growth with sustainable practices and renewable energy sets a positive example, ensuring that technological advancements contribute to a greener and more sustainable future.

The Real Indian Arbitrator Needs to Stand Up

Why in News?

 There is a need to build a class of elite arbitrators in India to meet the growing demands of arbitration. 

Introduction

• With the rapid economic growth of India, there is an increasing focus on how Indian arbitration can contribute significantly to this expansion.
• As domestic and international trade rises, so do commercial disputes.
• The Indian court system, however, is already overburdened and not well-equipped to handle these disputes, which are often urgent, complex, and involve substantial amounts of money.
• This is why commercial arbitration, particularly through specialised arbitral institutions, is becoming a preferred option.

Rethinking Indian Arbitration: Are We Overlooking the Role of Arbitrators?

• A crucial question emerges: Is the Indian arbitration system truly capable of meeting the growing demands and expectations?
• Is India genuinely on the path to becoming a global hub for arbitration?
• While there is a lot of focus on improving laws and reducing interference from the judiciary, the most important players – the arbitrators – are often not given the attention they deserve.

The Subject of Human Capital

• The effectiveness of any legal system relies not only on its regulations and framework but also on the quality of its human resources. In the context of Indian arbitration, this human capital includes arbitration lawyers, but more importantly, the arbitrators who make the final decisions.
• The trustworthiness and authority of Indian arbitration depend largely on two key aspects:
  • Efficient Management: How well arbitration proceedings are managed.
  • Quality of Awards: The standard of the final decisions made by arbitrators.
• Arbitrators play a crucial role in both these areas. While lawyers provide assistance during the proceedings, it is the arbitrators who:
  • Determine the procedure
  • Set timelines
  • Resolve procedural disagreements
  • Impose penalties when required.
• Their decisions, known as arbitral awards, can be challenged in courts either in India or internationally, highlighting the importance of their role. Therefore, Indian arbitrators are at the heart of the country’s arbitration framework.

An Exclusion

Discussions about Indian arbitration rarely emphasise the importance of cultivating top-tier arbitrators. While there are numerous initiatives to strengthen the arbitration bar (the lawyers), there is insufficient focus on the arbitration bench (the arbitrators themselves). This oversight is regrettable and needs to be addressed.

Recent Concern Raised

Reasons for the Exclusion

• Traditional Thinking: In India, elite arbitrators are often thought to be retired judges from the Supreme Court or High Court. Appointment Practices: Courts, litigants, lawyers, and arbitral institutions tend to prefer former judges for high-value arbitration cases. 
• Assumption: There is an assumption that having judicial experience automatically leads to better outcomes in arbitration. 

Reality Check

Source: Ministry of Finance Guidelines (June 2024) Key Findings: Highlighted issues such as lengthy and costly arbitral proceedings that resemble court processes, and poorly reasoned awards that are frequently challenged and set aside.

What Needs to Change

1. Qualifications Beyond Judicial Experience: Emphasise that effective arbitrators need more than just judicial backgrounds. They should be: - Legally knowledgeable - Skilled in managing arbitration processes - Adaptable and innovative, moving away from strict court-like procedures - Proficient in applying international best practices 
2. Development of Soft Skills: Recognise the importance of soft skills for arbitrators, such as: - Working collaboratively with colleagues from diverse countries and cultures - Deliberating, negotiating, and persuading fellow arbitrators 
3. Specialized Training: Implement special training programs to develop these essential skills for arbitrators. 
4. Understanding Award Writing: Educate arbitrators on the differences between writing arbitral awards and court judgments, including the need for thorough reviews of documents, expert testimonies, and financial analyses to assess damages. 

The Improvements Needed

1. Diversification of Arbitrator Pool: Expand the pool of Indian arbitrators to include individuals with specialisation in arbitration. - Avoid limiting the pool to advocates and retired judicial officers. - Welcome trained experts from various fields who can offer diverse perspectives in decision-making. 
2. Rigorous Training and Accreditation: Ensure that every candidate, regardless of their background, undergoes a strict training and accreditation process. - This could involve specialised certificate courses, workshops organised by arbitral institutions, or membership in professional arbitration associations. 

Conclusion

The aim is not just to enhance skills but also to foster a culture where arbitration is regarded as an equal, if not superior, option to court litigation. This shift in perception is crucial for nurturing elite Indian arbitrators who can take their place among the best in the global arbitration community.