Food security in India

Food security in India

Source: by S. S. Johl: The Tribune

Food security does not necessarily need legislation to kickstart action in this direction. Executive action can provide for not only food security, but also nutritional security, especially for the vulnerable sections of society i.e. children, old persons and women, especially the pregnant and lactating mothers.

There is no dearth of availability of foodgrains and major protective foods in the country. Normally the foodgrain stocks are at the highest level in June and the lowest in April. Compared to the year 2004, when the foodgrain stocks at the highest level were 322.82 lakh tonnes on 1st June, the stocks on 1st June, 2013 were 777.40 lakh metric tonnes. The lowest high was on 1st June, 2006 at 222.98 lakh metric tonnes and from there on the highest level of stocks kept increasing year after year. The lowest level of foodgrain stocks too was on 1st April, 2006, at 166.20 lakh metric tonnes and this level too kept increasing continuously, touching 597. 58 lakh metric tonnes on 1st April, 2013.

The per capita availability of cereals has also increased from 386.2 grams in 2001 to 407 grams in 2010. This availability is estimated to be at 686.7 grams in 2012, the highest ever in the country. It is only in case of pulses that the availability has declined over time. The cereal availability has increased in spite of a huge wastage of foodgrains through defective or lack of proper storage and tardy management, little realising that eliminating wastage amounts to additional production and availability. The CAG in May, 2013, reported that there was a storage gap of 331.85 lakh tonnes in the country, up from 59.5 lakh tonnes in 2007. Further, the utilisation of the existing storage is less than 75 per cent in many months and the location of storage capacity is also out of tune with its optimal spread. As a result, the wastage of grains increased from 0.28 per cent in 2011 to 6 per cent in 2012. Continuously increasing production is also leading to the increasing wastages due to management incapabilities. It is estimated that, on an average, yearly wastages, if checked can feed at least one lakh persons for the whole year.

In respect of other commodities, the per capita availability of edible oils increased from 8.2 kg in 2001 to 13.6 kg in 2011. The vanaspati availability understandably remained around 1.0 kg, due to the consumption preference shifting to refined oils. The sugar availability increased from 15.8 kg to 17.0 kg in this period. The milk availability increased from 217 grams per day to 281 grams. Compared to 1981, the availability has increased more than three and a half times for edible oils, about two and a half times for sugar and more than doubled in case of availability of milk. There is, thus, no shortage of food items in the country.

Per capita consumption is another indication of the higher level of availability of food in the country. Changing consumption patterns have reduced the consumption of cereals marginally in the rural areas, yet considerably in the urban areas, especially in respect of rice. Coarse grain consumption decreased from 2.29 kg per capita in 193-94 to 0.85 kg in 2009-10 in rural areas and from 1.03 kg to 0.38 kg in the urban areas in this period. All cereals consumption declined from 13.40 kg to 11.35 kg in rural areas and from 10.9 to 9.37 kg in urban areas during this period.

The per capita consumption of edible oils increased from 0.37 to 0.64 kg in the rural areas and 0.56 to 0.82 kg in the urban areas. In respect of fruits, the per capita consumption of bananas has increased more than three times, mango more than two and a half times, apple more than three times. Milk consumption has doubled, eggs consumption increased more than fourfold, fish and mutton one and a half times and chicken consumption per capita increased nine times during this period.

There is thus no shortage of food, both cereals and protective foods in the country. The total availability and per capita availability of food has increased and consumption patterns have shifted, although marginally, from cereals to the protective foods. It is a healthy trend, yet these are the averages. Averages often hide more than they reveal.

In spite of the per capita availability of foodgrains and major protective foods constantly increasing and exceeding the pace of population growth in the country, a large section of the poor population does not have adequate access to food, specially the protective foods. This is because of highly inequitable inter-personal distribution of productive assets and income levels in society. It is but natural that benefits of investment and ensuing growth and development would gravitate to the better placed segments of society to the disadvantage of a majority of the population in the country.

The 2009-10 NSS data showed that in India, 90 per cent of the rural population spent less than Rs 49 per capita per day, of which Rs 27 was on food items and Rs 22 on non-food items. The 50 per cent sample rural population was spending less than the inhuman poverty line expenditure of Rs 27 per capita per day.

Even the PPP (Purchasing Power Parity) estimates indicate that based on US$1 per capita per day expenditure 41.6 per cent of the population in India was below the poverty line. The poverty measured in PPP terms declined by meager 0.76 per cent per annum during the last 25 years. It is amply clear that in spite of tall claims by the government and multiplicity of high-sounding food security programmes, the country may not be able to meet the millennium goal of 50 per cent reduction in hunger by 2015. Surprisingly, the country's performance in this respect is lower than that of Pakistan even.

For the last several years the food security legislation has been in a limbo. No doubt it is desirable to have a Food Security Act, yet its absence does not stop the government from providing food security to the people. It is generally observed that societies that have more laws have lesser respect for them. Well-governed nations do not necessarily need a plethora of laws to create order in society and cater to the needs of their citizens. Executive orders are enough to make the services and benefits flow efficiently to the targeted population. Programmes like MNREGA can easily be expanded and linked to the food supply through partial payments in the form of food stamps for buying food items from the open market with adequately enhanced level of wages rather than rendering the people to the status of beggars through free or highly subsidised supply of food items, which are often pilfered with impunity and in large part do not reach the targeted population.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8283-13-july-2013.html

What comes after GDP?

What comes after GDP?

Source: By ASHOK V. DESAI: The Telegraph

Governments want economic growth. Statisticians measure it, and economists define it for them: it is growth in the gross domestic or national product ( the difference is income from abroad, which for India is substantial thanks to the Indians working abroad and sending money to their waiting wives). This growth worship is, however, getting rather outdated. It started in the 1930s, after Colin Clark showed how to measure a country's national income; he made the first estimates of Britain's national income, to give a statistical backbone to John Maynard Keynes's theory of income determination.

It gathered strength after the world war, as capitalist countries vied to outdo the fastgrowing Soviet Union. Now even poor countries like India know how to estimate GDP; rich countries have achieved levels of GDP that they can be satisfied with.

One of them is Germany. For the last couple of months I have been living in the centre of Berlin. Every day I passed a shop which displayed some second- hand books, all priced at half a euro: that is as cheap as it can get. Thus I picked up a little book about the surprising number of French- sounding words in Berliner jargon. For example, when they take leave of you, Berliners say " Tschuess !" I had always thought that this was a dematerialized kiss.

The French airkiss both your cheeks when they said goodbye; I thought the Berliners had turned this airkiss into a lilting greeting.

But I was wrong; this chuce is Berlinerisch for a French adieu . Slightly over two centuries ago, Napoleon passed through Berlin with his million soldiers on the way to Russia. Before that, Prussia had kings of high culture, who spoke only French to their queens and courtiers. They could not do that to their hoi polloi , but even their German was laced with a generous dose of French. Chuce is a remnant of that affaire française . T he books were a side business of a shop which sold secondhand goods, mainly clothes, given by religious people to the evangelical church ( although it was Martin Luther, a German, who founded the Protestant church, the Germans do not call it that; they prefer to called it evangelisch ). It also ran a restaurant, or more precisely, a soup kitchen. It was closed all day. Then in the late afternoon, hungry men began to hover near it.

At six in the evening it opened its doors. For the next two hours it served a thick, meaty soup free. Germany is prosperous, and jobs are easy to get. But there are some people who cannot get jobs or manage somehow not to do one; they were served by the soup kitchen.

The members of German parliament, however, felt that Germany was rich enough, and that it was time to start thinking about what came next; they appointed a parliamentary committee to answer the question. Its report is a model of systematic analysis.

The committee distinguished between four types of indicators: of economic achievement and material welfare, quality of life, sustainability and resilience. It did not have much to say about resilience. It only distinguished between three types of crises calling for resilience: economic, natural, and epidemic. Its list of economic indicators would also be familiar: welfare as indicated by income, consumption and wealth per head, distribution of income and wealth, work force participation as indicated by unemployment, underemployment and longterm joblessness, economic insecurity as indicated by risks of poverty, unemployment, and fall in earnings or in pension, and distributive risks indicated by levels of taxes and social contributions.

It made an elaborate list of aspects of quality of life: workplace quality as indicated by security of employment, chances of promotion, degree of consultation and job satisfaction; social inequality as indicated by inequality of income and wealth, and social mobility; health as indicated by infant mortality, adiposity ( body mass index over 30), inoculations, lost years of life ( deaths under the age of 65 or 70), depression, suicide rate, and availability of medical facilities; education in kindergartens, schools, colleges and occupational training; personal, political, economic and religious freedom; democracy and participation; environmental quality as indicated by open spaces and opportunities for physical activity nearby; work- life balance as indicated by hours of work and social contacts; personal security as indicated by crimes, vandalism, corruption and traffic accidents; gender equality in employment and incomes; and social integration of immigrants and handicapped people.

It made an equally elaborate list for sustainability: economic sustainability as indicated by investment in physical and human capital as well as innovation; administrative sustainability as indicated by government intervention in markets, obstruction of economic activity, monopolies and cartels; external sustainability as indicated by external debt level; fiscal sustainability as indicated by fiscal deficit, debt level and liabilities that may arise in the future ( such as pensions); financial sustainability; ecological sustainability as indicated by natural resources and energy, land use, forests and biodiversity; and global sustainability as indicated by international cooperation, and rate of consumption of nonrenewable resources.

These long lists reflect the German view of human happiness as a function of over a hundred little things. This is all right for a government that wants more things to do, but it makes happiness quite a fragile state: if he is not entirely fulfilled in any of these dimensions, the German is apt to feel unhappy. The government may keep toiling in a hundred spheres, and yet find that its people are ever less happy. Surely there must be a shorter way to happiness.

M y own experience is that physical comfort is a necessary condition of happiness; and it closely depends on the old minima of food, clothes and shelter. The German soup kitchen is one solution to the food problem; but chiki , about which I wrote some weeks ago, is better. A sari is an excellent solution to the covering problem, but it cannot cover anyone; a tailor has to come into the picture.

But an aam admi's government can surely give everyone 10 metres of dark blue cloth a year, and let him find his own tailor; or better still, give Shoppers Stop a contract to give everyone two pairs of clothes a year free. Shelter is the most difficult problem since nowadays it must include water, power and sanitation. Pre- reform Indian governments' solution was basic flats in four- story buildings which did not require lifts. My view is that underground caves can be made more comfortable at lower cost.

Anyway, that is something on which populist types can work. But beyond material comfort lies mental well- being; that is more difficult. Most people, however, are happiest when they live in and with a family. The Indian joint family was a good institution in this respect; it created an environment for ample company, care and education.

It is perhaps too late for Germans to recreate it; they divorce so easily these days that they cannot even keep together nuclear families. But Scandinavian communities, in which a large number of people live together, mate with whom they like and look after all the children, are a European equivalent of joint family; the Germans should work on this solution and perfect it with their gründlich approach.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8269-12-july-2013.html

Food insecurity

Food insecurity

Source: By Vandana Shive: The Asian Age

Every day we are losing 2,000 farmers. The deliberate annihilation of India’s small farmers is the end of national food security. The new Ordinance does not have one line on securing the livelihoods of farmers.

It is ironical that the more the government creates food insecurity through its “reform” policies, the more it talks of food security. Food security rests on a system, not on “schemes”. “Scheming” is a nasty word and the fact that the most vital parts of our lives are being reduced to government “schemes” is a major problem.

There is no vision and no systemic understanding of linkages between different parts of the food system.

For example, while constructing a house, one first builds a strong foundation. In the case of food security, the foundation is the ecological foundation of food production — healthy soils, diverse, resilient and renewable seeds and adequate water. Without conservation and rejuvenation of the ecological foundations of agriculture, there can be no food security.

The UPA government’s Food Security Ordinance does not address the ecological foundations of food security at all. It does not address the fact that our most fertile food-growing lands are being grabbed by the government to hand over to builders or to corrupt corporations to be spoilt by mining or to the industries to be poisoned and polluted. Land grab is a major threat to food security.

The pillars and support walls that uphold the architecture of food security are our hard-working small and marginal farmers. The reform policies of the last two decades have broken the backs of our farmers, and hence of our national food security system. Globalisation was imposed in India through the World Trade Organisation and global seed and biotechnology giants were given a free hand to lock Indian seed companies in licensing arrangements. As a result, farmers were trapped in unpayable debts due to costly, non-renewable seeds and chemicals and thousands of them were forced to commit suicide.

The latest Census data shows that there are nearly 15 million farmers (“main” cultivators) fewer than there were in 1991. Over 7.7 million less since 2001. Every day we are losing 2,000 farmers. The deliberate annihilation of India’s small farmers is the end of national food security. The Food Security Ordinance does not have one line on securing the livelihoods, production and incomes of our small farmers.

Distribution comes after production, and is the roof of the house. The Ordinance is thus an attempt to put up a roof, without securing the foundations and the support walls. The roof will clearly not hold. Also, can the government answer the simple question: where will the food come from?

The reason the government has not addressed production and procurement in the Food Security Ordinance is because these are the sectors the government wants to hand over to giant agribusiness corporations through other “reform” policies. That is why the Ordinance must be read with other policies that impact the livelihood of farmers and the right to food, like foreign direct investment in retail, changes in the State Agricultural Produce Marketing (Regulation) Acts, seed policies, the Biotechnology Regulatory Act etc.

Food sovereignty begins with seed sovereignty of farmers. The government is sowing the seeds of food insecurity by buying non-renewable hybrid seeds from MNCs at high cost and distributing to farmers at lower cost through taxpayers’ money.

The Ordinance must be read with food processing policies, which subsidise corporations and make junk food cheap. It must be read with the US-India Knowledge Initiative in Agriculture which Prime Minister Manmohan Singh had signed with US President George W. Bush in 2005, and which was a commitment to hand over seed to Monsanto, production and distribution of food to US agribusiness and retail to Walmart.

Since Independence, land reform, production and procurement were at the heart of our food security and food sovereignty policy. The universal public distribution system was central to it and it performed multiple roles. First, it integrated the country into one, with rich and poor buying rations at the same shop. Second, it helped regulate prices and prevented the phenomenon of steep price rise we witness today.

The economic policies imposed by the World Bank targeted agriculture and brought in multinational monopolies. It also turned the universal PDS into targeted PDS. The World Bank said this would reduce the budget expenditure as the government was spending too much on food subsidies. The food subsidy bill in 1991 was `2,500 crore. Last year, it was `50,000 crore and this year, it would be `60,000 crore. You are starving people and spending more money by not having a universal PDS to create food apartheid.

Most commentators have pointed out that the Ordinance is a political ordinance to garner votes in the next Lok Sabha elections. But in my view, it is also an economic ordinance and is part of the so-called “reform” process designed to break our food sovereignty and to facilitate the corporate hijack of India’s food system. Just as fertiliser subsidies do not go to farmers but the industry, the subsidy in the Food Security Ordinance will become a subsidy for the agribusiness.

First, a food system based on monopoly, corporate control, greed and speculation will lead to further uncontrollable increase of food prices. Since the government makes no commitment of buying from Indian farmers, it will buy from corporations. The combination of rising food prices in the market and cheap food to the “targeted” population can only be achieved through an ever-increasing transfer of our tax money to maintain the super- profits of agribusiness. This corporate subsidy that is built into the Ordinance is kept hidden. What is talked about is the “cash transfer” to the poor through “Aadhar”. Offering `3 for rice and `2 through cash transfer for wheat when the retail price is `40 and `20 respectively means that the poor are expected to spend `37 for rice and `18 for wheat from their pocket. Since they don’t have that money, the consequence will be mass starvation.
An alternative vision — where no child is hungry, no farmer commits suicide — is the Organic India Vision 2020. It was prepared by organic farmers at Vasundhara, the national gathering of ecological farmers on World Food Day. We can halve the costs of cultivation through ecological agriculture which makes the farmer free of costly seeds and chemicals, while doubling the nutrition output and health per acre.

Courtesy: 

Towards food for all

Towards food for all

Source: By BHASKAR DUTTA: The Telegraph

This version of the United Progressive Alliance team has earned itself the label of " masters of non- governance", largely because of its inability to steer major pieces of legislation through Parliament. A case in point has been the food security bill. The bill, one of the Congress's main election promises in 2009, guarantees cheap foodgrains to three- fourths of the rural and half the urban population as a legal right. Unfortunately, the Congress could not muster enough support among its coalition partners; perhaps there were rumblings of disquiet even amongst its own ranks. Finally, as its life comes to an end, it has been able to muster some kind of consensus to pass an ordinance to implement the bill. Of course, the bill still has to be approved in Parliament. It is unlikely that there will be enough explicit opposition in the Lok Sabha since parties who vote against it will be labelled anti- poor.

The food security bill has generated almost as much heat as the Right to Employment Act, one of the highlights of UPA- I, and for very much the same reasons. Economists, who would much rather leave everything to the market, feel that any kind of government intervention in favour of specific groups is unnecessary at best and plain wrong at worst. They would prefer the government to take steps to remove any possible road blocks in the growth process, and let growth take care of the rest.

The more vociferous critics argue that the bill will cause the level of food subsidy to reach stratospheric levels. This will increase the already high fiscal deficit, and make the public fiscal management completely unmanageable. However, this argument ignores the fact that the additional expenditure that will be incurred on the food security bill is relatively small compared to India's GDP. M any critics argue, not without some justification, that the main delivery system envisaged in the food security bill is the public distribution system, and that the PDS is quite unequal to the task of delivering any increased volume of food to the poor. They highlight the many inadequacies of the PDS — its uneven coverage particularly in rural areas, its inability to target the deserving, and the huge leakages in the form of diversion of subsidized grain to the open market.

Any increase in social welfare resulting from the operation of the PDS, they claim, is obtained at an exorbitant cost because of the leakages, not just because of the diversion of subsidized food to the open market but also because many BPL cardholders who get food at highly subsidized prices have incomes significantly above the threshold level.

It would be foolish to deny that the PDS is grossly inefficient and that many people have made their fortunes milking the system. But, as all readers of newspapers know, many armaments deals are also plagued by kickbacks and bribes paid by foreign suppliers, who then recover these costs by inflating the prices at which weapons are sold to the Indian government. However, this form of corruption, which has pretty much the same effect on the Indian exchequer, has not resulted in any clamour to stop defence purchases.

This is presumably because modern armaments for our defence forces are deemed to be absolutely essential.

So, the proper question is about the importance of legislation guaranteeing minimum quantities of food for the poor. Or, can we trust an accelerated rate of growth to ensure that the poor do not go hungry to bed? Some pieces of data provide an adequate answer. The International Food Policy Research Institute prepares a global hunger index — India ranks 65 out of 79 countries for which data are available. Moreover, even the government has been forced to admit that nearly half the children under five are chronically malnourished.

There is no doubt that in spite of almost two decades of reasonably fast growth, vast numbers of Indians lead lives that are well below any notion of an acceptable standard of living. This is a compelling rationale for legislation such as the food security bill. Of course, the actual contents of the ordinance still deserve close attention.

In the debate preceding the formulation of the bill, an overwhelming majority supported universal coverage even if that came with a lower quota. Universal coverage would have ensured that the state governments would not have to screen out those who are not entitled to subsidized food, almost entirely because almost all state governments have proved to be notoriously bad at this task. Also, a large segment of the top income bracket would probably have opted out of the scheme anyway because of the poor quality of grains typically available in the ration shops. Unfortunately, the Central government has dug in its heels and refused to go in for universal coverage — although they have reduced the quota recommended by the National Advisory Council.

The use of the PDS as the main delivery mechanism is also open to question. Some states, Chattisgarh being a leading example, have improved the functioning of the PDS beyond all recognition. But, in most states, the PDS is a leaky sieve. And here alternative arrangements need to be made. A refreshing change in attitudes is that the ordinance does not rule out the use of cash transfers in regions where food cannot be delivered physically.

It hopes that the increasing use of the Aadhar card, which will link a designated bank account to each card, will enable the cash to be directly transferred to the bank accounts of the beneficiaries.

The estimated quantity of foodgrain that will be required to support the food security bill is actually not significantly higher than the amount disbursed through the PDS today. The major change from the existing system is that the target group can now claim their quota as a legal entitlement.

The local ration- shop owner can no longer fob them off by saying that stocks have not arrived. Of course, the poor typically will not have the resources to claim what is rightfully due to them by taking their complaints against the local administration through the grievance redressal mechanism. This is an area where responsible NGOs can step in and fight legal battles on behalf of the deprived.

Many of the Opposition parties have claimed that the timing of the ordinance makes it clear that the bill is politically motivated — the Congress has issued the ordinance at this point of time because the elections are just round the corner.

But, of course, it is the Bharatiya Janata Party that is to blame for this — the party's agitation has disrupted the functioning of Parliament for a record number of days. Moreover, even if politics has played an important role in the formulation and timing of the ordinance, the important fact is that it has sound economic backing.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8382-20-july-2013.html

Nature’s writ & gene monopolised crops

Nature’s writ & gene monopolised crops

Source: By Tushar Chakraborty: The Statesman

After failing to push through Bt-brinjal in India, Monsanto shifted sights to Philippines and Bangladesh. While it lost the battle in the island nation, the jury is still out in Bangladesh. People there must pull out all stops to counter the threat.

Philippines is a nation of islands, rich in biodiversity as well as cultural diversity. It is part of the Indo-Malay-Philippine (IMP) biodiversity zone. As a biodiversity hot spot, Philippines is often referred as "Galapagos times ten". Unfortunately, the rate of environmental erosion is also high in Philippines. After the Marcos Dictatorship ended through a popular mass movement in 1986, a new constitution was enacted in Philippines. This 1987 Constitution proclaimed the protection of the environment as one of the policies of the State. It says the State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature. This sounds good, but how it can be guaranteed?

The Philippine Supreme Court subsequently took the initiative in giving flesh to this constitutional mandate. In 2010, it finally provided for the writ of kalikasan as the legal remedy, when the situation demands so. Kalikasan in Filipino language means Nature. This writ is an innovation of the Philippine Supreme Court to combat any large scale destruction of the environment, or such attempt. It clearly specifies "precautionary principles" as its guideline.

The microbial anti-insecticidal toxin carrying genetically modified (GM) Bt-Brinjal, which is genetically monopolised by Monsanto through patent rules, initially attempted to use India as its test ground. Once it was ready for the plate, they wanted to use 120 crore Indians as test or experimental animals. In the year 2009 came the moments of truth for them.

However, the commercialisation attempt of Bt-Brinjal in India by Mahyco, which is now an instrument for Monsanto, faced a tough challenge from farmers as well as citizens throughout the nation. It was clear from several public hearings during the time that releasing Bt brinjal would be too risky. People were already sensitised by the actual Bt-Cotton experience, which that ran havoc in cotton belts throughout India, specifically in Maharashtra. Finally a moratorium was declared by the ministry of environment and forests (MoEF) on 9 February, 2010.

This part of the story is well-known to most of the alert Indians. We also know how our prime minister expressed his frustration over the issue. He even shifted Mr Jairam Ramesh out of the MoEF and maligned the NGOs. But, what is unknown to most of us is Mahyco’s attempt to bypass this moratorium through illegal offshore operations in Philippines and Bangladesh.

Most probably, Mahyco was unaware that the Writ of Nature may be invoked against planting GM-crops in Philippines. In fact, due to the presence of International Rice Research Institute (IRRI) - a powerful platform for Agribusiness experimentation and initiatives run by chemical and biotechnology giants - Philippines is an easy prey for overt and covert agricultural operations. It is famous for the implementation of Green Revolution in the 1960s.

Around 1991, Philippines emerged as the poster boy for GM success stories. The project started with GM corn. The country’s experience with GM corn is similar to India’s experience with Bt-cotton.

However, the sudden offshore landing of Mahyco and the company’s alignment with some University of Philippines Los Banos (UPLB) associates alerted Greenpeace activists and MASIPAG (a farmer-scientist alliance), who were already agitated about GM-crops.  The Writ of Kalikasan was invoked by these plaintiffs in 2012.
In the hearing of this Writ in the Court of Appeals appointed by the Supreme Court of Philippines, I had a chance to appear as an expert witness to oppose Prof P Davies of Cornell University, USA from USAID.

We found that the Mahyco operation is actually being backed by the US government; field trial of Bt-brinjal is not an isolated research project, but part of a crafted design.

The court hearing and the dealing of the case under the Writ of Kalikasan was exemplary. The field trial of Bt-talong (talong is the brinjal in Filipino) was revealed as an error in the court room itself, which violated precautionary principles. The cornerstone of environmental safety in this type of case is the precautionary principle, especially when the magnitude of potential damage, both in time and space are huge.

The verdict was finally announced in May 2013. The special 13th division of the Court of Appeals in the Republic of Philippines ordered: a) permanent halt to field trials of Bt-Talong; b) protection, perseveration, rehabilitation and restoration of the environment in accordance with the judgment. This is perhaps the strongest indictment against GM-crops in a court room.

If any law-abiding citizenry thought this was the endgame for Bt-eggplant, he would have been terribly wrong; for, the US-supported GM-crop patent holding biotech lobby is worse than the Hollywood’s Western gun-toting bandits. Following the verdict, they just shifted their operation and turned to Bangladesh, which is one of the weakest links in terms of GMO regulatory rules or frameworks.
Monsanto, in the garb of Mahyco, is now targeting one of the most popular, common, and cheap vegetable loved by millions in Bangladesh. We hope the people will take cues from Bt-brinjal’s faulty journey from India to Philippines and stop its further spread.

Meanwhile, in India, Monsanto received a blow. The Intellectual Property Appellate Board of India rejected Monsanto’s patent application on a so-called salt-tolerant GM crop; it ruled that tinkering with nature was not patentable. So, it is really a bad season for Monsanto.

Since the beginning, Europe has been highly sceptical about the utility of GM-crops and GM-food in general. Despite possessing this technology and playing a pioneering role in its developments, Europe gradually choose to follow precautionary principles. At the time, it was not known what stand the developing world would take with regards this post-modern agricultural technology.

Four countries adopted GM-crop technology at large - US, Canada, Brazil and Argentina. But further expansion of GM crops faltered thereafter. Its spread till now remains more restrictive than nuclear energy technology.

The US industrial lobby has often sneered at this reaction as a mere European aberration. They have engaged USAID to spread this technology in developing countries, including South-East Asian nations. India, Philippines, Bangladesh and Indonesia are being "cultivated" through bribery and coercion. Perhaps, GM-crops are the part of the infamous US "food weapon" strategy as well.

However, crude food-shortage panic and vending for techno-fix solutions are no longer cutting ice these days. Farmers as well as public opinion and the judiciary are taking a serious view on the open release of all kinds of GMOs, especially genetically modified plants. Their risks and utility are being weighed cautiously.
Now, we also know that the use of GMO in the open environment will have to be judged in a scientific manner, but not by handpicked, state-nominated scientists alone. That is what the apex court in Philippines showed clearly. Whether this might be the road to extinction for genetically monopolised organism via social and natural selection, only time can tell.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8450-25-july-2013.html

Fables for democracy

Fables for democracy

Source: By Shiv Visvanathan: The Asian Age

Democracy is sometimes compared to an onion. As we peel the layers, sometimes in tears, we get a different sense of its meanings and textures. Scale and size become crucial to democracy. A village is not a smaller version of a state. It represents a different kind of politics.

India is rife with democratic debates from Bodoland to Telangana. There is also the bigger rumour of a national election. Despite all these reports, I often sense something is missing in our tales of democracy.

The importance of this came out with stunning clarity from the occasional reports on palli sabha (village council) hearings in Orissa. The Vedanta mine and the Dongria tribals are drawn in a battle. On one side is the owner of a bauxite mine with two bits of irony about him. He calls his firm Vedanta. The Orientalist irony is devastating. Vedanta, as a collection of Upanishads, is a meditation on absolute reality, a reflection on the cosmos. Here Vedanta becomes the name of a mine that eats up the reality of tribal people. The chairman is called Anil Agarwal. For environmentalists, this name is associated with one of India’s most respected environmentalists, the late Anil Agarwal who started the legendary Centre for Science and Environment. One wishes the businessman would reach a similar level of enlightenment.

Less publicised are the Dongria tribals. They call themselves Jhangarias, which literally means “protectors of stream”, a name which evokes a sacred act of trusteeship. For over a decade, this community of 8,000 people aided by a few activists has been fighting a battle against the mining of their mountain, Niyamgiri. The Supreme Court intervened recently with a brilliant move demanding that the villages in the area be consulted about the mine. What is sacred for one is bauxite for the other. What is a way of life for the Dongrias is aluminium to be extracted, refined and sent all over the world. Profit goes to the company while suffering becomes the only share of the tribe.

Orissa high court nominated the district and sessions judges of Kalahandi and Rayagada to act as observers in the much-awaited gram sabha to decide fate of the proposed bauxite mining for Vedanta atop Niyamgiri Hills.

Typically and bureaucratically, the number of villages listed for hearing was whittled down from a hundred to 12. Eight of the villages have voted and each, in turn, has voted against the mine. The hearings are literally a microcosm of democracy. On one side we have poor tribals, often in tattered clothes proverbial axe in hand, and on other judges and bureaucrats. A little event was revealing. Some of the tribals asked for a copy of the resolution they were supposed to sign. The imperious judge from Rayagada district was enraged. As an English daily reported, he accused them of trying to act smart, saying if this was the case while they were illiterate… they would have sold the country if they had been literate. The clash between the oral and textual worlds is obvious. Deeper still is the contempt for the tribal as part of the tenets of development. There is an implicit development discourse present even in the newspapers which predicts gloomily that the Dongrias might disappear from malaria rather than development. The bias is clear and, sadly, it becomes the fate of the tribe.

The story of the palli sabha hearing is a moving one. The defence of Niyamgiri mountain becomes a way of life and an act of trusteeship. It goes beyond the contract, evoking the roots of the sacred. The mountain for the tribals is God, cosmos and creator of a way of life and living. It is not a mine, a piece of real estate to be sold away. To think like this would be a sacrilege. The defence of the mountain thus becomes a moral and religious act. The Supreme Court recognised this and held that Vedanta had to recognise the right to religion of the people, making mining truly an act of sacrilege.

I do not want to create an ethnography of this protest. Journalists and activists have done a heroic job. But I want to amplify the story and distil a few lessons from it. Call it a few fables for democracy.

Firstly, development for all its middle-class appeal as a slogan, an aspiration creates problems for democracy. Development as dam, as a mine often displaces marginal people who rarely benefit from the process. There is an arrogance to development which we must temper. Development needs a hearing aid. It needs rituals of humility to understand what marginal voices are saying in dialects and idioms we are distanced from.

Secondly, our chronicles of development are failures of storytelling. Many parts of the story disappear. The shareholder survives and the stakeholders are often forgotten. We need to look at the real costs of development, developing narratives beyond the idiocy of poverty-lines narrative. Development cannot suffice with economics as a lens. It needs suffering as kaleidoscope of voices to eventually evaluate it.

Thirdly, we need to go beyond the juggernaut of large democracies to understand little democracies — panchayat meetings, jan sunvayis, forest hearings. The voices heard here need representation. Here small is as critical as the big. These are not scaled down democracies; these are democracies in their crystalline essence.

Fourth, the language of rights is not enough. One needs the language of sacred and the commons. One needs a sense that a lot of the sacred as grove, stream, forest belong to the commons. A commons is crucial as a space, as a bundle of rights.

Finally, development needs a language of social suffering. Mere indicators of income, energy use are not enough. Development has to understand the language of suffering and belonging. Economics and dialects of growth might be inadequate for this.
Just listening to the tribals speak is an epiphany, a revelation of wisdoms we have forgotten. This is ethics at its best. We should be grateful to the Dongria for preserving not just the streams but the streams of memory that make up our civilisation.

 Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8650-09-august-2013.html

Operation Telangana

Operation Telangana

Source: By B.G. Verghese: The Tribune

The formation of Telangana has been announced at last after repeated failed promises, but in a most clumsy manner. Many would-be states are expectedly up in arms in the heartland and the Northeast. Telangana has not been clearly defined. Will it be limited to the 10 districts of Telangana proper or will possibly two other districts of Rayalseema, Kurnool and Anatapur, be added on to create Rayala-Telangana in order to balance the number of Assembly seats in the two new States? Why?

The idea of carving out Hyderabad as a Union Territory has fortunately been abandoned but it is to be the joint capital for ten years until Seemandhra (a new nomenclature for the residual stare) has time to build a new capital. A make-shift capital could be readied in six months. Ten years gives time for vested interests to dig in. Recall Chandigarh. Equally absurd is the Home Minister's unwise statement that the (district) boundaries of Telangana will have to be settled. This is inviting trouble. Further, Telangana will move forward, he said, whether the united Andhra Assembly resolves accordingly or otherwise.

Seemandhra is already up in arms, with many Congress MPs and MLAs handing in their resignations in protest. Nothing daunted, the Home Minister has said the legislative and administrative processes to bring Telangana into being will take six to eight months to complete. This is to hand out an IOU on a shaky bank. The ham-handedness of Operation Telangana is a supreme example of how not to do it. The TRS President, Chandrashekhara Rao has added fuel to the fire by his incendiary statement that once Telangana is formed all Seemandhra-born government employees will have to leave Hyderabad.

Numerous fallacies are being cheerfully touted. One is that Coastal Andhras have invested heavily in the growth and prosperity of Hyderabad city. So what? They can continue to enjoy property and corporate control in and dividends from the city. Another red-herring is the cost of building a new capital and finding the land for it - an estimated Rs 3 lakh crore and at least 15,000 acres just for the Raj Bhavan, Assembly, Secretariat and associated housing alone, according to some estimates, plus compensation for land acquisition. These are bogeys.

India is steadily urbanising and is building cities to accommodate the numbers that would otherwise crowd noisome shanty towns. Rohini or Vasant Kunj in Delhi is bigger than the projected Andhra, or some-day Haryana capital. The land and the money were found.

Just 10 days ago, Delhi was host to an All-Bodo Student's Union-sponsored National Convention on New States presided over by P.A. Sangma in which delegates from Karbi Anglong and Dima Hasao, the Gorkhaland Task Force, Kamatapur, the Tripura Hills, Bundelkhand, Harit Pradesh, Vidarbha and Telangana participated. The demand was for new states as these people felt marginalised and felt interim solutions had failed. The Bodo and Gorkha representatives in particular said that if Telangana was granted, Bodoland and Gorkaland must be simultaneously conceded else there would be trouble.

The Bodoland Territorial Council was dubbed unsatisfactory as real powers had not been devolved and even after a decade the Territorial Council had been unable to get the Assam Governor's assent to a single Bill passed by it or to approve rules and regulations for 14 other enactments. This sorry record demands an explanation and offers a legitimate cause for frustration. The temper of the convention was unmistakable - there had been too much dithering and patchwork approaches.

Vidarbha has been hanging fire for long while the UP Assembly under Mayawati approved a resolution to divide that giant state of 200 million into four further units. Other demands for Coorg, Saurashtra-Kutch, Mithila, etcetera, are incipient.

The controversy over Telangana has revived the debate on the merits of smaller (not small) versus larger states. Indian states and districts are by and large huge in terms of population and even area by world standards. So with a growing population, 1.25 bn today and 1.7-1.8 bn by 2060 (a fifth of mankind), India could rationally do with maybe 50-60 states, 1200 districts (or double the present number) and a corresponding increase in the number of (national extension service) blocks and nagarpalika wards for better and more participative and accountable governance. Governance is becoming ever more complex and technical and there are limits to size for efficient management and administration.

Small, however, is not necessary beautiful or efficient by itself, but size does constitute a very relevant factor in good governance, viability and coherence. The Northeast has seven tiny states and further division could be problematic on grounds of economy, scale, coordination, strategic considerations and so forth. Identity formation could be rationally encouraged in the immediate aftermath of Independence when former "wholly and partially excluded areas" were plunged into the vast, turbulent ocean of Indian humanity and needed time to find a place in this new commonwealth in the making.

Identity was an obvious organising principle for state formation, regional and local autonomy. The situation is different today and identity, culture, language and development in confined areas and for small, scattered communities may no longer be workable answers. Real decentralisation (panchayati raj, PESA, active gram sabhas, non-territorial councils) may offer superior solutions and greater "autonomy", with simultaneous aggregation or consolidation at other levels to achieve scale, coordination, and a critical mass of human and natural resources.

It would need a second states reorganisation commission to define the new parameters, critical issues and pitfalls in any such exercise and to chart the way forward in a phased process of nation building. Education, development and employment are the real engines of progress and hope rather than futile lamentation over loss of land and forests that can no longer support rising aspirations. One sees nothing of this larger framework, vision and imagination in the current official discourse on Telangana or new state formation. The political parties mouth partisan inanities and much media discourse is riveted on trivia.

Meanwhile, one can only lament the cosy corruption and chicanery being practised by the BCCI in which so many leading politicians are involved. That saga has not ended with a bogus report produced, astonishingly, by two retired High Court judges who served on an illegally constituted committee. Matching this is Gopinath Munde, the BJP leader's assertion that his defiant boast of having spent Rs 8 crore on his last election was only a "figure of speech" and not a criminal violation of the election code!

And then we have the scandalous conduct of the UP Samajwadi Party leadership under the Mulayam and Akhilesh Yadav father and son duo, in concert with the sand-mining mafia and known party thugs, to penalise and silence a young IAS officer, Durga Shakti Nagpal, for doing her duty. They have flouted every rule in the book, sought to terrorise officials through penal transfers and suspensions and played the communal and caste card to cover their nefarious designs and loot the state. Their only defence, as usual, is that others do likewise. The country is up in arms. None can be silent. When moral authority is lost, everything is lost.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8636-08-august-2013.html

Telangana-What next

Telangana-What next

Source: By Kalyani Shankar: The Echo of India

At last, Telangana’s here. The people of this backward region have realised their sixty-year’s dream while the prosperous Andhra region has lost out. The Congress Party has taken risks in taking a decision after years of dithering. But the million-dollar question is whether the creation of the 29th state is a solution or a problem? On the face of it, more problems are staring at the Congress than the solutions.

Andhra Pradesh, the first entity formed on linguistic basis was created in 1953 out of the erstwhile Madras Presidency with Kurnool as its capital. With the State Reorganization Act 1956, the merger of Hyderabad and Andhra states took place and Andhra Pradesh state was born in November 1956.  Now it has been proposed to carve out the 29th state of Telangana.

While there could be a case for creation of smaller states, the decision on Telangana is a gamble, which could well turn out to be a shortsighted decision. The main assumption is the hope that the Congress can cut its losses in the 2014 elections. Out of the 17 Lok Sabha seats in Telangana, the party hopes to get at least 15 after a merger of the TRS with the Congress (this has been promised by the TRS chief Chandra Shekhar Rao). The Congress is resigned to losing the rest of the 42 seats in the state. As for the Assembly polls, there will be no Congress presence in Andhra, which had been a citadel of the party.

On the face of it, although there is jubilation in Telangana, the challenges ahead are many for the Congress, the UPA government and the state government and even for the newly created state. They include economic and political.

A political turmoil seems to be on the cards, which may turn out to be costly for the Congress. Politically, there can be a backlash as had been witnessed during the Telangana agitation and Andhra agitation in the sixties and seventies. Right now, the supporters of a united Andhra Pradesh are seething with anger, which may turn into violence soon. The centre has already dispatched more central forces expecting trouble. Nobody knows what course the protests will take. The vested interests may soon jump in to stoke the fire. The fact that Andhra could lose Hyderabad ultimately is one reason for the rich investors from the Andhra region to support protests. The violence may ultimately end up in law and order problem and imposition of President’s rule.

Secondly, the impact of the creation of Telangana on other states should be more worrying as it might result in agitations in several parts of the country. Emboldened by the decision, Rayalaseema has begun to demand a separate state. Already the Gorkhaland agitation has been revived in West Bengal and so has the Bodoland demand in Assam. Some working committee members like Mukul Wasnik have raised the Vidarbha issue. Civil Aviation Minister Ajit Singh will revive his long pending Harit Pradesh demand. The BSP chief Mayawati will be emboldened to demand cutting UP into four states.  Then there is a demand for Saurashtra, Kutch, Ladakh and many more for smaller states. One way the centre could deal with this is to setup a second State Reorganization Commission to look into the entirety of the issue for smaller states because the Congress has opened up the Pandora’s box.

The third is the economic challenge and how to distribute the assets between the newly created Telangana and Andhra. The fortunes of people in both states would be affected. Andhra Pradesh has the risk of losing its primacy.  The united Andhra Pradesh boasts of successfully brining down the poverty rate to 9.2 per cent, which is less than half of the national average.  There are several concerns about Hyderabad, which have not been addressed fully. There are fears about the real estate prices, which may fall because of the instability. Will more foreign investment come to Hyderabad? Will it continue to be the pride of Information Technology companies? These are questions that remain unanswered.

The fourth is that while there is a case for smaller states, there is also an inherent political instability, which is evident in many smaller states and the North East. Will creation of Telengana result in more regionalism and fracturing of the polity?  Even on development, states like Jharkhand, Uttarakhand and most in the North East do not perform well while states like Himachal Pradesh and Haryana have done well. Telengana could go either way.

Fifthly, there is a fear that the naxal infested Telengana might totally go into their hands. This was one of the arguments advanced by the United Andhra Pradesh supporters. Already one third of the country is under the influence of the naxalites. While it will be a good thing if the naxalites decide to come into the mainstream and fight elections, they can also be dangerous.

Looking ahead, now that Telangana has become a reality, a lot of responsibility rests on the leaders of the state who fought for it. They should fulfill the expectations of the people and take the state forward. There should be inclusive politics and determination to build the young state. As of now there is no visionary in the horizon who can achieve this.   The Congress has no big leaders in the region while the Chandrasekhar Rao family including his son, daughter and nephew dominates the TRS.

The Congress party has veered towards creating Telangana taking too many risks but the over riding consideration seems to be short-term electoral gains. The immediate impact is that Congress has lost Andhra and may gain Telangana. Only time will tell whether this gamble will work or it will boomerang.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8626-07-august-2013.html

Telangana-What next

Telangana-What next

Source: By Kalyani Shankar: The Echo of India

At last, Telangana’s here. The people of this backward region have realised their sixty-year’s dream while the prosperous Andhra region has lost out. The Congress Party has taken risks in taking a decision after years of dithering. But the million-dollar question is whether the creation of the 29th state is a solution or a problem? On the face of it, more problems are staring at the Congress than the solutions.

Andhra Pradesh, the first entity formed on linguistic basis was created in 1953 out of the erstwhile Madras Presidency with Kurnool as its capital. With the State Reorganization Act 1956, the merger of Hyderabad and Andhra states took place and Andhra Pradesh state was born in November 1956.  Now it has been proposed to carve out the 29th state of Telangana.

While there could be a case for creation of smaller states, the decision on Telangana is a gamble, which could well turn out to be a shortsighted decision. The main assumption is the hope that the Congress can cut its losses in the 2014 elections. Out of the 17 Lok Sabha seats in Telangana, the party hopes to get at least 15 after a merger of the TRS with the Congress (this has been promised by the TRS chief Chandra Shekhar Rao). The Congress is resigned to losing the rest of the 42 seats in the state. As for the Assembly polls, there will be no Congress presence in Andhra, which had been a citadel of the party.

On the face of it, although there is jubilation in Telangana, the challenges ahead are many for the Congress, the UPA government and the state government and even for the newly created state. They include economic and political.

A political turmoil seems to be on the cards, which may turn out to be costly for the Congress. Politically, there can be a backlash as had been witnessed during the Telangana agitation and Andhra agitation in the sixties and seventies. Right now, the supporters of a united Andhra Pradesh are seething with anger, which may turn into violence soon. The centre has already dispatched more central forces expecting trouble. Nobody knows what course the protests will take. The vested interests may soon jump in to stoke the fire. The fact that Andhra could lose Hyderabad ultimately is one reason for the rich investors from the Andhra region to support protests. The violence may ultimately end up in law and order problem and imposition of President’s rule.

Secondly, the impact of the creation of Telangana on other states should be more worrying as it might result in agitations in several parts of the country. Emboldened by the decision, Rayalaseema has begun to demand a separate state. Already the Gorkhaland agitation has been revived in West Bengal and so has the Bodoland demand in Assam. Some working committee members like Mukul Wasnik have raised the Vidarbha issue. Civil Aviation Minister Ajit Singh will revive his long pending Harit Pradesh demand. The BSP chief Mayawati will be emboldened to demand cutting UP into four states.  Then there is a demand for Saurashtra, Kutch, Ladakh and many more for smaller states. One way the centre could deal with this is to setup a second State Reorganization Commission to look into the entirety of the issue for smaller states because the Congress has opened up the Pandora’s box.

The third is the economic challenge and how to distribute the assets between the newly created Telangana and Andhra. The fortunes of people in both states would be affected. Andhra Pradesh has the risk of losing its primacy.  The united Andhra Pradesh boasts of successfully brining down the poverty rate to 9.2 per cent, which is less than half of the national average.  There are several concerns about Hyderabad, which have not been addressed fully. There are fears about the real estate prices, which may fall because of the instability. Will more foreign investment come to Hyderabad? Will it continue to be the pride of Information Technology companies? These are questions that remain unanswered.

The fourth is that while there is a case for smaller states, there is also an inherent political instability, which is evident in many smaller states and the North East. Will creation of Telengana result in more regionalism and fracturing of the polity?  Even on development, states like Jharkhand, Uttarakhand and most in the North East do not perform well while states like Himachal Pradesh and Haryana have done well. Telengana could go either way.

Fifthly, there is a fear that the naxal infested Telengana might totally go into their hands. This was one of the arguments advanced by the United Andhra Pradesh supporters. Already one third of the country is under the influence of the naxalites. While it will be a good thing if the naxalites decide to come into the mainstream and fight elections, they can also be dangerous.

Looking ahead, now that Telangana has become a reality, a lot of responsibility rests on the leaders of the state who fought for it. They should fulfill the expectations of the people and take the state forward. There should be inclusive politics and determination to build the young state. As of now there is no visionary in the horizon who can achieve this.   The Congress has no big leaders in the region while the Chandrasekhar Rao family including his son, daughter and nephew dominates the TRS.

The Congress party has veered towards creating Telangana taking too many risks but the over riding consideration seems to be short-term electoral gains. The immediate impact is that Congress has lost Andhra and may gain Telangana. Only time will tell whether this gamble will work or it will boomerang.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8626-07-august-2013.html

Poverty of Thought

Poverty of thought

Source: By Surjit Bhalla: The Financial Express

Let me say it bluntly—I have never been more embarrassed as a professional than with the shameful debate that has occurred in India ever since the UPA released “record breaking” poverty data.

These data have caused considerable heartburn and political soul-searching within the Congress party. My educated guess would be that Ms Sonia Gandhi hastily called a meeting of the National Advisory Council and her closest political advisers (the PM, Dr Manmohan Singh, was pointedly not invited!) and asked:

“What should we do? We have just promulgated an ordinance on food security which rather explicitly believes, and states, that two-thirds of the Indian population is severely malnourished and in need of our help. We also have an election coming up and my Congress party is known for its commitment to the poor. Now how can we justify expanding PDS to 67% of the population when my own Planning Commission tells me that only 22% of the population is poor. This is unacceptable—now go forth and multiply my wisdom and concern.”

How do you discredit your own government and your own performance? What should have been a matter of celebration, i.e. record decline in poverty, turned out to be in Congress’s case an existential despair moment, a moment of soul searching, and a moment of truth.

The truth had to change. In disciplined Goebellian fashion, the followers went about discrediting the poverty decline by discrediting the poverty line. Card carrying NAC member Mr NC Saxena took upon himself the task of “proving” that the poverty line was too low. The proof was “easy”—the poverty line was the same value as in 1973-74! “Civil society is not happy with the low poverty cut-off line of R27 per capita per day for rural areas and R33 for urban areas at 2011-12 prices, as it is difficult to meet one’s basic expenses and survive on such an inadequate income. Economists are questioning the need for subsidised food for 67% of the population if poverty levels are really so low. Estimating the scale of poverty with respect to a fixed poverty line—which was R1.63/1.90 per capita per day for rural/urban populations in 1973-74—and since then has remained unchanged after adjusting it for inflation.” (Business Standard, A poor debate on poverty in India, July 25, 2013, emphasis added).

It is strange, and shocking, that somebody as distinguished as Mr Saxena should make this simple conceptual (and ideological) error. As is well known, the Tendulkar committee raised the original 1973-74 rural poverty line by 25.9% and the urban line by 6.4%.

How did Mr Saxena feel that he could get away with a plain big-time lie? One explanation is that the media does not play its check and balancing role, and neither do most of the ideologically-biased and well-funded civil society. The ethos in upper upper class India is not to question any of the ideological left, i.e. the Sonia Gandhi-led Congress, primarily because they are so comfortable applauding it. Otherwise how else do you explain the following lie by no less an intellectual godfather like Amartya Sen who stated that “every week that the Food Security Bill was not passed was causing 1,000 deaths.” He expanded on this lie in a CNN-IBN interview: “There’s no way applying an exact estimation of that but I would have thought that an order of that magnitude of that kind may be relevant”!

There are several misconceptions in the Sen falsehood. Just who is dying if the Food Bill is not passed? Does Prof Sen know that the government’s own claim is that the Food Security Bill will only cost R25,000 crore more (it is another story that the government’s claims are just not credible). So an expenditure of R25,000 crore will save 52,000 deaths, or R50 lakh expenditure to save one life. It does not get much sillier than this.

Kapil Sibal, the Union law minister, had this to say about the poverty line: “If the Plan panel said those who live above R5,000 a month are not at poverty line, obviously there is something wrong with the definition of poverty in this country. How can anybody live at R5,000?” Hence, poverty is very high in India and we obviously need the populist Food Security Bill.

The debate about food security and the poverty line centres around starvation, hunger, survival. The left intelligentsia, TV and print media, and most Congress politicians as well as many from the me-to BJP have been having a field day discussing survival and the food necessary for survival. Many of their examples centre around restaurant meals, and these so-called intellectuals cannot comprehend that in a poor country like India restaurant meals are a luxury—a reflection of the poverty of the poor is that they cannot afford dhaba, let alone restaurant meals.

Can a person survive on R30 a day? The table shows the food expenditure pattern for different households in India in 2011-12 (NSS survey from where the poverty estimates are obtained). The top 10% of rural Indians spend on an average R30.5 a day on basic food while the marginal poor (between the 20th and 25th percentile) spend only R12 a day. Middle rural India spends only R4 per day more on basic food than poor India. (Basic food is total food expenditure minus discretionary food expenditure consisting of beverages, packaged and restaurant food).

Even the richest urbanites, where Sibal, Jean Dreze, Sen, and TV reporters and anchors live, spend only R40 per person per day on basic food, or in terms of rural prices (22% lower) R33. This is nearly the same as the richest ruralites. The poor are surviving, and necessary food expenditure is not what separates the poor from the urban elite. Hence, hallucinating about expensive meals for the poor is not going to either help the poor, or offer any solutions to the poverty problem. And neither does the Food Security Bill have much economic content, either for the urban elite or the rural poor. Whether it has the proposed political content we will know next year.

One additional point to note regarding the low poverty line in India. The NSS surveys capture less than half (46%) of total expenditures recorded in the national accounts. The likely reality is that the poor have a per capita monthly expenditure about 80% more than stated in the NSS survey, i.e. R50 a day or about R7,500 a month for a family of five. Does that make sense, TV anchors and Mr Sibal?

Silliness, or lies, for a good cause must be eminently excusable—some philosopher must have said that. Sen’s co-author and another NAC member Jean Dreze had this to say regarding the ongoing Food Security Bill debate: “Statistical hocus-pocus has been deployed with abandon to produce wildly exaggerated “estimates” of the financial costs of the bill … The fact that the food bill could bring some relief in the lives of millions of people who live in conditions of terrifying insecurity seems to count for very little.”

I have provided evidence as to who is actually practising statistical voodoo. Surjit S Bhalla is chairman of Oxus Investments, an emerging market advisory firm, and a senior advisor to Blufin, a leading financial information company.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8582-04-august-2013.html

Depressed Indian economy

Depressed Indian economy

Source: By Charan Singh: The Tribune

IN the RBI's first quarter report for 2013-14 the worst expected has materialised as many argumentative economists, visiting and resident in India, would amicably agree. The growth projection for 2013-14 has been revised downward as domestic economic activity weakened during April-June 1013. Industrial production is muted and consumer durables have declined mainly due to a fall in passenger cars and motorbikes.

The capital account deficit (CAD) is expected to deteriorate as the jaws of trade deficit have widened, on account of contraction in exports and a sharp rise in gold imports. The risks to CAD have increased as unwinding of the unconventional policy in the US begins, as was evident by the trailer that had caused global bond sell-off and capital outflows from the emerging markets. Worst still, external sector vulnerability indicators have deteriorated, especially short-term debt rising to 44 per cent of the total debt at the end of March, 2013.

So, very worrisome is the fact that the services sector has recorded the lowest growth in 11 long years. The asset quality of the banking sector has deteriorated which has kept the credit growth below the indicative trajectory. Despite such a tight monetary policy, CPI inflation has hovered around double digits and food inflation has not eased up either, though WPI inflation has been lower than 5 percent. In a nutshell, everything except inflation, house prices and subsidies, is down and so also are business expectations. As would be anticipated, having taken strong monetary measures in the last fortnight, monetary policy has not initiated any change in interest rates, which have already been high for some time now.

The Indian economic situation continues to be rather grim but then every failure is an opportunity in disguise. June 1991 was a turning point in India's economic history. But should India always wait to be at the brink to realise the consequent abyss? To arrest the slide some concerted efforts would have to be made and innovative measures undertaken as traditional methods have failed to yield results. A herculean battle seems to be on the horizon for policy-makers in India.

There are available opportunities and windows that can help the economy recover. In addition to the standard stalled reforms, and projects which the government would hopefully clear soon, there are specific projects which the government can consider. First, the housing sector suffers from a shortage of nearly 18 million units, especially for the low and economically weaker sections of society. As housing has linkages with nearly 300 industries, the housing sector, can be incentivised. Secondly, in view of the general slowdown, government revenue is expected to be lower than budgeted. In this context, expenditure saved is income earned, and the government rather than resorting to traditional curtailing of capital expenditure could reconsider the implementation of the Food Security Bill 2013 until the economic situation improves.

Further, if rising imports of gold are any indication, then it implies that there are available financial resources in the economy, and nearly three-fourth of gold demand comes from the rural sector in a quest to address uncertainty in the market. The demand for gold is expected to continue to be high as the price of gold, based on various international estimates, is expected to be benign for the next few years as also due to a large proportion of the young population below 25 years in India, implying an increase in marriages, and rapidly rising rural incomes. Therefore, instead of simply imposing controls on gold imports, to curtail the demand for gold, the government should offer an alternative financial instrument to the public, especially in the rural areas. One such avenue to consider could be inflation-indexed small saving instruments to be sold through the network of more than 1,55,000 post offices, and bank branches.

To tap resources from the rural sector, the government could consider unconventional means like floating local and specific-project related infrastructure bonds. These specific infrastructure projects, which also hava links with many industries, should be physically visible so as to interest the rural population like the construction of a local bus station, a trading-cum-shopping centre and a local road connecting to the nearest urban centre. In view of the fact that the project is located in the local area would appeal to local sensitivities, attract local financing and ensure local subscription.

Still better would be to make the local authority responsible and accountable for the completion and operations of such infrastructure projects. Also, given the crowded shopping malls, swelling numbers of cell phones and crowded airports/luxury hotels/dance bars, it may be time to tap the resources swirling in black markets and raise resources through special bearer bonds once again.

The global economic environment is not very encouraging for India's exports. In addition, the exchange rate had been depreciating rather rapidly for which many in the markets were not prepared and hence had sought the RBI's intervention to restore the rupee to a range of Rs.54-56 with the US dollar. And the RBI intervened rather strongly. This level is difficult to justify by economic logic. In the determination of exchange rates, inflation differential between the two countries is an important factor in the long run. Illustratively, the average annual inflation rate in India has been 6.0 percent during 1993-94 to 2011-12 compared with 2.4 percent in the US over the similar period. The average exchange rate of the rupee with the US dollar was Rs 31.4 in 1994 and adjusting for the inflation differential of 3.6 percent per annum would justify an adjustment of the rupee, which should continue.

Finally, the RBI would help the economy recover by lowering interest rates. The government could consider lower interest rates, at least for loans to the housing sector and infrastructure to spur growth. Finally, to ensure recovery, special concessions could be considered for auto industry as were granted by President Obama in the USA. The need is to revive growth and all-out effort to achieve growth should be made by the policy-makers.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8611-06-august-2013.html

When growth divides

When growth divides

Source: By Pavan K. Varma: The Asian Age

If growth just makes those who are rich richer, and does not impact in equal measure the plight of the poor, then while it may still reduce poverty, it needs course correction and equitable direction.

I am a little mystified about the Jagdish Bhagwati Amartya Sen controversy. Economists of such repute can have differences of opinion on how to best deal with the massive problems of poverty and deprivation in India, but to me their differences are not so wide and intractable as to justify the kind of acrimony and bad blood that we have recently seen.

From what I can understand, Dr Bhagwati appears to be emphasising the importance of high economic growth rates, but I do not believe that he is against targeted interventions at the level of the state for the specifically deprived. Similarly, Dr Sen seems to be emphasising the importance of growth with equity and, in this context, the importance of state interventions for the specifically deprived, but I do not believe that he is against high economic growth rates.

If this, indeed, is the crux of their differences, it appears to be more a matter of relative emphasis within the overall matrix of strategies to deal with poverty and hunger in India, and not an insurmountable polarity as it is being made out to be.

My own view -and I am not a trained economist -is that India needs a bit of both approaches. Chanakya emphasised 2,000 years ago that economic prosperity is the backbone of a nation's strength. If the treasury is empty, all promises are slogans, and all pretensions to power are so much hot air. Obviously, therefore, India needs high economic growth rates, which generate the req uisite revenues to deal with poverty. Indeed, any objective assessment will reveal incontrovertibly that when overall economic growth rates are high, the poor are benefitted more than when growth falls and populist policies are pursued. In the decade after the economic reforms of 1991, when growth rates for the first time rose to around eight per cent per annum, more people were raised above the poverty line than in the previous three decades of so-called socialism.

The co-relation between growth and poverty reduction is evident too in a state like Bihar, where poverty is endemic. The latest estimates from the Planning Commission show that Bihar saw one of the highest falls in the number of the absolutely poor in the past few years. It is not coincidental that in the same years Bihar also saw the highest economic growth rates, averaging around 11 per cent per annum. Estimates reveal that if India manages a growth rate of around nine per cent in the next five years it could redeem from below the poverty line about 100 to 150 million people.

This being said, it is important to also understand that growth is not an undifferentiated monolith. Jean Dreze and Dr Sen speak of the importance of “growth mediated development” where the priority is also equity, which essentially means that growth must be visible, too, in those sectors of the economy which are directly related to the interests of the poor. If growth just makes those who are rich richer, and does not impact in equal measure

The plight of the poor, then while it may still reduce poverty in some measure, it needs course correction and equitable direction. This is the essential plank of the “inclusive” model of growth, which Bihar chief minister Nitish Kumar, among others, espouses. India is a nation of many segments. There are the rich, the middle class, the poor, the very poor, the extremely backward and the dalits. Women and children require special attention too.

The vulnerable must not remain endemically hungry or denied health services and access to education. Further, within India as a whole, there is need for balanced development, where backward regions can also have opportunities for high growth.

Economic prosperity that does not embrace all of India in its vision is, given the vast numbers of our poor, flawed. We need to improve the instrumentalities to ensure inclusive development, but we cannot say that the latter is unimportant and only high growth rates which disproportionately benefit the already privileged must be the goal. Surely, Dr Bhagwati cannot disagree with this proposition.

I think the real reason why the Bhagwati-Sen debate has acquired high decibel acrimony is because both have become, willingly or unwillingly, accessories to larger political antagonisms. Dr Bhagwati is partial to Narendra Modi. Dr Sen believes the Gujarat model of development is flawed in many ways, not the least in the manner in which it has performed in the crucial areas of the development of human resources for the underprivileged. Dr Sen has also stated that Mr Modi would not be his choice for the post of Prime Minister, because of his past track record in handling the sensitive issue of minorities. The worrying thing is the manner in which the supporters of Mr Modi have lashed out at Dr Sen. I have known Chandan Mitra as a friend for decades now; we were contemporaries in St. Stephen’s; I have also been briefly a columnist in the newspaper he edits. His expostulation that Dr Sen should have his Bharat Ratna taken away because he has reservations about Mr Modi is preposterous and I am glad he has since apologised for it.

What I find even more disturbing is the tone of intolerance and intimidation that Mr Modi’s supporters are introducing to national discourse. The right to disagree is sacred in a democracy. We need only recall the many points of disagreement between Mahatma Gandhi and Jawaharlal Nehru, or between Nehru and Vallabhbhai Patel, and the civilised manner in which they expressed their differences, to understand the enormity of what seems to be going wrong. Dr Bhagwati and Dr Sen are becoming cannon fodder in this larger deterioration of the quality of our public discourse. As economists, I am sure they will be able to have an amicable discussion on where they disagree.

As agents co-opted in the increasingly intolerant political hostility being introduced in our polity, what they say and write is being distorted by some to suit extraneous political agendas.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8595-05-august-2013.html

Can’t defy Nature

Can’t defy Nature

Source: By Suranjana Banerji: The Statesman

It is debatable whether the development policies being pursued by governments in different parts of the world are necessarily compatible with the concept of sustainability. India was economically under-developed at the time of independence and one of the basic objectives of  policy formulation was to accelerate the pace of economic development through  industries and infrastructure. The goal was, no doubt, laudable; but the consequences in many cases have been quite disastrous.

For example, according to environmentalists, the unprecedented destruction caused by rain and floods in Uttarakhand  is not the outcome of nature’s fury alone; it  is also a  man-made disaster, the result of thoughtless development. Thus to meet the  greed of a few, many have paid with their lives. The construction of roads in a haphazard manner, building of new resorts and hotels on fragile river banks, uncontrolled stone-crushing and strip-mining along the banks of the Ganga in Uttarakhand and the execution of several hydro-electric projects across the state’s river system has triggered this environmental disaster. There are reportedly six dams and four barrages in Uttarakhand. Taken together they produce 2600 MW of electricity, but they have also caused enormous damage to the river systems as well as the environment. The dams have damaged the Alakananda river and the tributaries of the Bhagirathi. The tunnels that were built and the blasts that were carried out for the hydro-electric projects have affected ecological equilibrium.

When the floods struck Uttarakhand, about 28 million tourists were visiting the state, while the local population is close to half that number. Many have even questioned whether the government should have allowed such a huge number of tourists in this ecologically fragile region, particularly during the monsoon. Since  tourism is an important economic activity of this state, the government should have adopted suitable environmental norms as well as disaster management techniques.

In February 2013, the Uttarakhand High Court had passed an order asking the state government to demolish structures that had come up within 200 metres of the river banks. However, the administration took no action, and many of these illegal structures were washed away by the floods. Therefore, the disaster was rooted in short-sightedness and flawed planning. On 13 June 2011, exactly two years before the recent catastrophe, a sadhu named Swami Nigamanand, who had been on an indefinite fast to protest against the extensive stone-crushing and strip mining along the banks of the Ganga, passed away at the Himalayan Institute of Medical Sciences in Dehra Dun. His death was almost unnoticed and the government did little to address his concerns.

There are several other examples which illustrate that development, if undertaken to cater to short-term needs, may not be environmentally sustainable in the long run. The decision to set up multi-purpose river-valley projects by constructing large dams did not prove to be environmentally sustainable. When such projects were undertaken after Independence, they were regarded  as the symbol of economic development. The initial results were satisfactory; the construction of dams helped generate electricity and facilitated irrigation of agricultural lands. Subsequently, however, the adverse consequences of such policies became apparent. In most cases, such river-valley projects have turned out to be environmentally disastrous. Over time, damming of rivers has resulted in reduction of water flows, accumulation of silt, and raising of the river beds. This has resulted in floods during the monsoon.

The controversy over the Sardar Sarovar project on the Narmada has put a question mark over the future of large river-valley projects as they also result in displacement of the people. The Narmada Bachao Andolon Committee spearheaded the movement against the Sardar Sarovar Project, and the World Bank which was funding the project, withdrew its support.

Beyond the river-valley projects lies the larger issue of development. Does it imply a growth in GDP, without caring for the social and environmental consequences of development policies? During the last decade, the West Bengal government acquired 1000 acres of fertile agricultural land in Singur for setting up a small car factory by Tata Motors. The question of sustainable development was totally ignored. Ultimately, the project had to be abandoned in 2008 because of political opposition. In the name of promoting tourism, the government had encouraged the setting up of resorts and hotels at Mandarmani and Sankarpur, resulting in severe ecological damage to the entire coastal region in East Midnapore district.

The present dispensation is also planning to promote eco-tourism in the Sunderbans. This could lead to the degradation of the mangrove forests. Similarly, the sponge iron industry, spanning the tribal areas of Jharkhand, Odisha and Chhattisgarh, is being opposed because the units have been located near human habitation. On 15 November 2009, The Statesman had reported the high level of pollution in these states.

According to a study conducted by the UN, potential disaster threats  were ignored during the construction of the Delhi Metro. The risk is high in no fewer than 50 stations. There could be huge casualties in the event of a flood or an earthquake. 

The term ‘Sustainable Development’ was used in the World Conservation Strategy of 1980, whose document was published by the International Union for Conservation of Nature and Natural Resources. Sustainable development has been defined as ‘the integration of conservation and development to ensure that modifications to the planet do indeed secure the survival and well-being of all people’ (JUCN, 1980, Section 1.2). The issue of sustainability dominated the discussion on development during the 1980s. The Brundtland Commission, in its report ‘Our Common Future’, published in 1987,  emphasised the principles of equitable distribution and democratic participation.

The Commission defined Sustainable Development as ‘development which meets the needs of the present without compromising the ability of future generations to meet their own needs’ (WCED, 1987). Whether this concept can be implemented is debatable. Failure to achieve environmental sustainability can be attributed to the low priority accorded to maintenance of public welfare by governments. Since in many respects the environment is a matter of public welfare, this often results in waste of natural resources. Inadequate environmental regulation and enforcement and poorly functioning environmental institutions can aggravate the problem. This is particularly relevant for India where concern over environmental sustainability is not much in evidence. Therefore,  the development of environmental regulations and their implementation have been rather inadequate. This may be the result of the lack of good governance. Development polices should be formulated with a long-term perspective, so that these are sustainable in the long run.

This can be ensured if a balance is maintained between development and environmental sustainability, and through equitable distribution of the benefits of development. Good governance also requires coordination of policies between the different departments and proper implementation of the declared policies. Corruption amongst bureaucrats, businessmen, technocrats and politicians can lead to development policies that ignore the norms of sustainable development. They often view environmental issues as roadblocks to the path of development and not as facts of nature that should be dealt with on their own terms. Unfortunately, nature does not function out of logical self-interest, so we either abide by its rules, or else it will have its way either today or tomorrow ~ as illustrated by the Uttarakhand disaster.

Courtesy: http://www.ksgindia.com/study-material/today-s-editorial/8572-03-august-2013.html