September 11, 2013

criminal acts in the name of economic development

Does capitalism which is supposed to protect property rights really do so? The answer is no, when it comes to rural and tribal people living in remote areas of a country. The Narmada dam issue in India was among the first so-called development projects which demonstrated the hypocrisy and criminal intent of the capitalists and governments subscribing to their ideology. 

I say this to all capitalism-believing people with specific regard to the tenet of property rights: By all means do protect property rights, but do it for everyone. Else, you are nothing but a criminal disguised as a capitalist.

Below is the latest development in the Narmada valley taken from

September 10th,2013

Historic Civil Disobedience Movement by Oustees of Indira Sagar Dam
Jal satyagraha ongoing at 6 places in three districts
Delegation of oustees meets Mrs. Sushma Swaraj
Oustees should also be beneficiaries of development projects
Oustees human chain in protest
Oustees sit-in-water agitation

Since the last ten days, a historic civil disobedience movement is being carried out by thousands of oustees of the Districts Dewas, Khandwa, and Harda of Madhya Pradesh affected by the Indira Sagar dam which has the largest impoundment in the country. Although the State has tried to crush the movement by declaring S.144 on the waters of the Indira Sagar dam, but in all three districts, thousands of oustees have broken S.144 and offered arrests, and spread Jal satyagraha further. Thus Jal satyagraha is being carried out in 6 places with full vigor and determination. The Narmada Bachao Andolan demands that instead of using police force on the people, the State Government should fulfill their legitimate demands and undo the historic injustice that has been wreaked on them.
 It is noteworthy that 254 villages are affected by this dam causing the largest submergence in the country. Despite there being a land for land policy, not a single oustee was offered land, and the oustees were evicted after giving pittances in the name of compensation. As per government figures, 85% of the farmers whose lands were acquired were unable to purchase any land, and became landless. The landless were also evicted after being given pittances, and were rendered paupers. In addition, the acquisition of lands and homes falling in the submergence and the rehabilitation of thousands of families is pending. Despite stay orders of the Hon’ble High Court and the Apex Court staying any reservoir filling above 260 M, the water level in the reservoir was filled up to 262.13 m, because of which houses in the villages of Lachora, Kalisaray, Piplani and many other villages became submerged, and 2000 acres of land became islands.
 Delegation of representatives meet Sushma Swaraj
 A delegation of representatives from the three affected districts of the Indira Sagar dam along with NBA activist Ms. Chittaroopa Palit met Ms. Sushma Swaraj, and apprised her of the grave situation of submergence, the health of the affected persons and the Jal satyagraha.  Ms. Swaraj heard the oustees with seriousness and assured that she would converse with the Chief Minister and a decision would soon be taken.
 Jal Satyagraha: Civil disobedience by displaced persons
 On the 1st of September, Jal satyagraha was started in the three districts of Khandwa, Dewas and Harda in the villages of Barkhalia, Mel-Piplia and Uwa respectively. However instead of considering their demands, the State invoked S.144 in the submerged area and began arresting hundreds of satyagrahis. However the satyagrahis accepted the challenge and began a civil disobedience movement by repeatedly breaking S.144 and entering the waters. Senior activist of the movement, Ms. Chittaroopa Palit and displaced persons from Barkhalia were arrested and sent to jail. Hundreds of men and women oustees from Mel Pipliya were arrested and 67 were sent to jail.  In Harda district, the satyagrahis were arrested first in Uwa, then Bichola, then Kalisaray and Saktia. However the resolute satyagrahis continued with their satyagrahas which is now ongoing at 6 places. Today the Jal-satyagraha is ongoing with great vigor and vitality in villages of Malud, Nandana, Piplani and Lachora in District Khandwa, Village Hanifabad in District Harda, and Village Mel-Pipliya in District Dewas.

Health of satyagrahis dwindles, but spirits soar
Women showing wrinkle legs caused by water
Women showing wrinkle feet caused by water
The satyagrahis are gradually becoming weaker and developing fever, boils, allergies.The skin of many satyagrahis is falling off, and blood is seeping out, Thie r bodies are being eaten by animals who live in the reservoir. Since the water is polluted, grave diseases are apprehended. But despite these adverse circumstances, their spirits are high. Today, 14 women satyagrahies had to be hospitalized from Malud Satyagrah.

Wrinkle feet
Wrinkle feet

Largest displacement in the country
 The Indira Sagar dam on the Narmada has caused the largest displacement in the country. More than 50,000 families or 3 lakh persons have been affected by this project. The rehabilitation policy enacted for this project has been completely violated and the oustees were evicted without giving a single oustee land for land. Today these oustees are fighting for their rights. The oustees demand (1) the water level in the Indira Sagar dam should be brought down to 260 m. (2) Land holders should be provided land for land with a minimum of 2 ha of land or assisted to purchase the same. (3) Landless persons should be given a grant of Rs. 2.5 lakhs so that he can arrange for his livelihood at the new place. (4) Thousands of farms and houses affected by the submergence should be acquired and the concerned families rehabilitated and resettled. (5) Bridges and roads be constructed to create access to the islands formed by the reservoir.
 Oustees must be beneficiaries of development
 Any development project based on exclusion of and injury to thousands of oustees cannot be called a development project. It is essential that the oustees must be included and benefit from the process of development. It is a matter of shame in this democracy, that the oustees are being compelled to rot their bodies in the reservoir created over their own lands, only in order to obtain their rights. The Narmada Bachao Andolan appeals to the general public to support the movement of the oustees, and demands that the State Government must immediately provide the required rehabilitation to the affected people. Gandhiji had taken the path of civil disobedience for the freedom struggle. Today the oustees have also chosen the path of civil disobedience. The oustees are determined that they will obtain their rights by placing even their lives at stake.

 Alok Agarwal                    Ram Vilas Rathor    Rajendra Prasad      Ramnath Singh
Village-Uwa (Harda)   Village-Badgaon       Village-Mel Pipliya
Shyam singh                              Krishnabai                Devisingh            Rameshwar Patel
Village Malud(Khandwa) Village Bichola, Harda Village Lachora, Khandwa Vilage Mirzapur, Dewas
2, Sai Nagar, Mata Chowk, Khandwa, M.P.
Tel: 9425394606, 9009710068,

August 22, 2013

has syria used deadly, toxic chemical gas weapons on its citizens?

Has Syria used deadly, toxic chemical gas weapons on its citizens?

Below is a newsreport from Guardian and after that is  one of many videos (at which claim to depict the horror underwent by the victims:

If all this is indeed true (my sense tells me there is no deception here and that chemical weapons has indeed been used) then it is one of the greatest criminal acts being committed by a government/regime (or whoever the perpetrators are) on its own citizens. Little children, men and women -- all gassed with toxic chemicals! I can not but not cry.


Syria conflict: chemical weapons blamed as hundreds reported killed

Death toll claimed to be as high as 1,400 as Syrian government admits launching offensive but denies using chemical weapons

Martin Chulov, Mona Mahmood and Ian Sample
The Guardian, Thursday 22 August 2013

Hundreds of people are believed to have been killed in an apparent gas attack on rebel-held parts of eastern Damascus that is thought to be the most significant use of chemical weapons since thousands of Kurds were gassed by Saddam Hussein in Halabja 25 years ago.
Medics, as well as opposition fighters and political leaders, said the death toll had reached 1,400 and was likely to rise further with hundreds more critically wounded in districts besieged by the Syrian military. Other estimates put the current death toll at between 200 and 500. None of the figures could be independently verified. On Thursday morning rebels said new bombardments of rockets and mortars struck neighbourhoods hit by the gas attack.
The Syrian government acknowledged it had launched a major offensive in rebel-held districts in the east of the capital – described by pro-regime media as the biggest since the start of the civil war – but strongly denied using chemical weapons.
"These are lies that serve the propaganda of the terrorists," a Syrian official said, referring to the armed opposition. "We would not use such weapons."
However, George Sabra, the head of the main Syrian opposition group, laid the blame squarely at the Assad regime, saying the scenes "constitute a turning point in the regime's operations".
"This time it was for annihilation, rather than terror," he said.
Syria gas attack Location of Wednesday's attack. Credit: Guardian graphics International reaction intensified throughout the day. The UN security council called an emergency session and the White House formally requested the UN to investigate the attack. William Hague, the foreign secretary, said the UK was "deeply concerned".
The UN secretary-general Ban Ki-moon called for "a thorough, impartial and prompt investigation" of allegations of chemical weapons use.
UN deputy spokesman Eduardo del Buey said earlier that the secretary-general was "shocked" at the alleged use of chemical weapons and is determined to ensure a "thorough investigation" of all reported incidents.
After a two-hour, closed-door meeting, the council president said there was "strong concern" about the allegations "and a general sense that there must be clarity on what happened."
A UN inspection team arrived in Damascus this week to look into earlier claims of chemical weapon use, but was granted permission to enter Syria with a limited mission to investigate only three specific sites. An expanded mandate to investigate Wednesday's attack in eastern Ghouta – only 10 miles from the team's hotel – must be sought by the UN secretary general and then approved by Syria.
The US moved quickly to make the request. The White House said: "For the UN's efforts to be credible they must have immediate access to witnesses and affected individuals, and have the ability to examine and collect physical evidence without any interference or manipulation from the Syrian government. If the Syrian government has nothing to hide and is truly committed to an impartial and credible investigation of chemical weapons use in Syria, it will facilitate the UN team's immediate and unfettered access to this site."
Rescuers and victims said the shelling of eastern Ghouta started shortly after 2am and targeted three districts, Ein Tarma, Zermalka and Jobar, all rebel strongholds for the past year.
"It was around 2.30am Wednesday when we received calls from Zemalka and Jobar," said a Free Syria Army (FSA) officer, Captain Alla'a al-Basha, who has documented previous alleged chemical attacks in the area.
"The FSA members were asking for more forces to evacuate the civilians as the shells were coming in at around five per minute. As soon as I and my team arrived at the scene, I saw bodies scattered in the streets. I saw whole houses – none of their residents were alive. When I got there, I could smell what seemed to be burning sulphur and something like cooked eggs. The smoke was not pure white.
"Most of the victims were shivering and they turned yellow. I saw a woman who was tearing at her clothes as she could not breathe. The number of the casualties that we were able to document so far is 1,228 martyrs. The doctors think that more than 20 shells were fired with fatal gases.
"Most of the victims did not appear to be injured but died out of suffocation. I held a young boy whose body was like a piece of wood and his colour was very blue. He did not have any wound."
By Wednesday night, more than 120 videos had been uploaded to the internet, most depicting scenes of men women and children in respiratory distress, on watery floors, and doctors describing the victims' symptoms. Other videos showed scores of bodies wrapped in white shrouds, or lying on grey concrete. White foam was bubbling from the mouth and nostrils of many victims. Some writhed in distress, apparently struggling to breathe.
Doctors at makeshift clinics said they were working without oxygen and had been overrun by the number of victims, many of whom needed lifesaving treatment that they could not provide.
Treatment of victims appeared rudimentary, with water and vinegar among the means of trying to dilute the effects. "We know when we have an area targeted by fatal gases we would take plastic masks and put wet cloths on our noses and mouths," said Basha. "But most of the civilians do not know that they have to do that."
Sergeant Abu Ali, who runs a field hospital in the Nashabiya area of eastern Damascus, said he had received patients who were vomiting and had high temperatures, breathing problems, limb stiffness and were in comas. "We received 60 cases. Most of them were sent to the nearby farms after their situation was stabilised and those with acute symptoms were kept here. I have very few medicines and all the oxygen tubes I have had run out now. People need intensive care."
One witness told Reuters: "We would go into a house and everything was in its place, every person was in their place. They were lying where they had been. They looked like they were asleep. But they were dead."
Ralf Trapp, a consultant on chemical and biological weapons, said getting access to the scenes of the attacks was paramount for inspectors. "The logical thing to do would be to go in and start interviewing doctors and getting blood and urine samples.
"This is the ideal moment to collect samples because it is so shortly after the attack. They may get intact agent – in the first day or so you would still find intact sarin, for example.
"Within a few days, you would find degradation products. If you link those to clinical examinations and testimony, you can build up a very precise picture of what happened.
"They need to try to get to the site where it happened, talk to people who were on the spot when it happened, to victims and observers, to create as complete a picture of the actual attack. They want to discriminate against other types of weapons that might cause similar effects or release something by chance."
Charles Duelfer, a former US chief weapons inspector, said: "[Video] reports of doctors treating these people, that's real data." Duelfer said the scale of the attack could probably be proved by the intelligence community. "It will be pretty clear pretty quickly because various countries' intelligence apparatus will have noticed something on this scale, whether it's artillery, rockets, or shells. These are knowable things."The White House is going to be hard pressed to construct an answer to this one. It was easy to waffle a bit so long as alleged use was minor and didn't happen again, but this is really putting the administration in a corner.""


August 17, 2013

sand mining in india -- government's head buried in the sand

Here is an editorial I contributed recently in the newspaper I work for presently on the issue of sand mining in India (picture to the left is courtesy a November 2010 blogpost in 

Head in the sand

The country can ill-afford to ignore the perils of un-fettered sand mining, legal or not

Almost every state in the country which has sea coasts or rivers flowing through their territories, the issue of illegal sand mining crops every now and then with alarming frequency. The recent spotlight on sand mining in Uttar Pradesh, as a result of the sacking of an Indian Administrative Services' official most probably due to action taken by her against illegal sand miners, is only the latest incidence. For reasons, political or otherwise, the ministry of environment was quick to set up a 3-member panel on August 6 to look into the adverse environmental impact of alleged illegal sand mining. The panel was also fast enough to submit its report, late last week, less than four days after being set up, with a conclusion of a confirmation of illegal sand mining. All the panel members did was collective visit the sites by car, take photographic evidence and speak informally to some local villagers.

Given that it was quite easy and quick to arrive a conclusion of illegal sand mining, one wonders why no similar efforts can be deployed to hundreds of river banks and coastal sea-beds across the country where citizens and activists have been straining to make governments sit up and take notice of illegal sand mining happening there. An all-India audit on the issue of sand mining is long overdue.

Mined sand is used in construction as the main ingredient in concrete whose use is perhaps second only to the use of water in the country given the construction spree in all the cities and towns of the past two decades. Given this economic aspect, mining of sand along coastal sea-beds and river banks is not banned in the country. The fact that construction makes up for around 8 per cent of our GDP and the fervent endeavours to show higher GDP growth rates means that, barring for isolated political opportunism cases, sand mining will continue to get the short thrift from policy-makers and law-enforcers. Be that as it may, rampant, un-regulated and un-scientific sand mining does destroys sensitive ecologies and we all know about the climatic havoc and resultant economic losses which can be caused by devastated ecologies

Successive central governments and state governments have been reluctant to frame tough laws and been more than willing to look the other way in case of violations of the existing ones. Only as recently as 2006 did the central government tightened a little bit the norms pertaining to sand mining by requiring mining projects to obtain prior environmental clearance under the amendments made to environment impact assessment notification of that year. But it left a loop hole -- clearances were not required for lease areas of below 5 hectares. One had to wait for Supreme Court, hearing citizens' petitions on sand mining, to issue a direction in February last year to the government to require environmental clearances for all mining areas, regardless of size.

Un-fettered sand mining ought not to be allowed to continue. Even when state governments legally allot lease areas for sand mining these should be monitored rigorously, and not lazily, by the environment protection agencies of the government, as well as get audited by the Comptroller and Auditor General to cull out instances of fake bidders or benami allotees.

Alternatives to sand-based concrete by the construction industry ought to be seriously and quickly pursued. These do exist such as the cast-off from copper furnaces and granulated blast furnaces (in the iron and steel industry), and many more including the use of construction and demolition waste. The Indian standards on construction need to allow for these to be used as a viable substitute for sand. The government should no longer bury its head in the sand.

August 13, 2013

two contrasting ways at apply continuous asset allocation

Asset allocation is interesting but to do it on a continuous basis, year after year, requires an investor to be aware of some complex elements.

Here is a story on this subject which I contributed recently in the newspaper I work for presently:

Two contrasting ways to apply new asset allocations
Not much is understood about the application method of dynamic asset allocations. Here is a primer.

With financial planning taking firm roots among investors the concept of asset allocation is no longer an alien one. There is, however, some confusion of its actual application in the process of continuous investing. Investing is a continuous process for investors in their working years as they keep generating fresh investible surpluses from their earnings.

How to apply dynamic asset allocations. Asset allocation disciplines an investor since it compels her to think clearly and decide on how much to invest in equities, debt, gold and other asset classes. But it is not a one-time process since dynamic, age-based financial planning requires her to allocate different percentages every year or every few years.

The question facing such investors is whether the new asset allocations should be applied only to the fresh investible surplus or also to the existing, accumulated investment portfolio from the previously-allocated percentages. There are two views on this.

Applying new allocations to accumulated investments as well. One view is similar to portfolio re-balancing. Says Rahul Mantri, certified financial planner and founder of Midas Touch, a Pune-based advisory firm, "we provide new asset allocation advise to our clients after an interval of five years and we advise the new allocations to be applied to both--to the existing portfolio as well as to any new investible surplus from thereon." In Mantri's firm's asset allocation re-jig equities get lower percentages as the client's age increases. "You need to skew your entire portfolio towards debt as you approach the retirement age of 60 years. When you reach retirement we believe equities should not make up for more than 10 per cent of your accumulated portfolio," says Mantri.

Only on fresh investible surpluses. There is another view which says changing asset allocations should not be applied to earlier investments and should only apply to new investments made from new investible surpluses. So, for instance, a new investor, say 27 years old, invests Rs 50,000 for the first time and of this she deploys 60 per cent in equities, 30 per cent in debt and 10 per cent in gold. Say, she follows these same allocations every time she has fresh investible surplus from her annual salary. But when she attains 33 years of age, say, she decides to tweak her allocation ratios to 50:35:15 in equities:debt:gold.

Her current portfolio, accumulated over the previous five years, would have grown to some amount. But she will not touch this portfolio to apply the new allocations although she may want to re-jig existing securities in each asset class based on her chosen investment philosophy for each asset class from various styles such as 'buy and hold' and 'book profits in some and re-invest in other'.

She will, instead, apply her new allocations only to the investments she makes from the new investible surpluses she generates from the salary she earns in her 34th year and thereafter. After five years, when she is in her 39th year, she may decide to apply newly-changed allocations to her investible surplus from her 39th year salary onwards. This cycle will continue.

The justification her is that an equity exposure taken when she was 27 years old will fetch her far higher annualised return than any new investible surplus she deploys in equities in her 40s and 50s.

July 25, 2013

stock exchanges' own financials--analysis of revenues & profits of nse & bse

I did an analytical piece on Indian stock exchanges' financials, a few days ago for the newspaper I work for presently. Here is what I wrote:

F&O turnover rise of no help to NSE's own financials

NSE sees a fall in operating revenue, gets bailed out by investment income

Corporatised stock exchanges attract attention on their own financials and not just on the financials of the companies listed on their stock exchange platforms. An analysis of the financial statements of the two major stock exchanges in the country, National Stock Exchange (BSE) and Bombay Stock Exchange (BSE) reveals some interesting facets of the financial consequences of their trading services.

Despite a 6.5 per cent decline in its revenues from trading services which form its core stock exchange operations to Rs 1,001 crore, the NSE managed to shore up its net profit by almost 25 per cent to Rs 878 crore in FY13. Its operating profit from trading services, however, did take a knocking of 8.8 per cent falling from Rs 522 crore in FY12 to Rs 476 crore in FY13.

NSE's financial statement for FY13 splits its total income from operations into two accounting heads, one of which is referred to as 'income from operations' and the other as 'other operating revenues'. The first, apparently, covers the core of NSE's operations which is the transaction charge NSE imposes on its member-brokers on every trade. In the past, the exchange's transaction fee income had risen from Rs 573 crore in FY09 to Rs 768 crore in FY10. It peaked recently in FY12 when it touched Rs 821 crore, only to fall by 6.2 per cent in FY13 to a level of Rs 770 crore.

NSE's turnover in its equity cash market on the decline since FY10, came down in FY13 as well but the quantum of fall was less than in previous years. The cash market turnover was about Rs 27,08,000 crore in FY13 compared to Rs 28,11,000 crore in FY12, Rs 35,77,000 crore in FY11 and Rs 41,38,000 crore in FY10.

No such decline was seen in NSE's equity futures and options turnover but that did not help its core operating revenues since the level of transaction charges in equity F&O segment are far lower than that in cash market. In FY13, NSE's equity F&O turnover rose to an all-time yearly aggregate high of Rs 315,33,000 crore, up from FY12's level of Rs 313,50,000 crore.

The 'other operation revenues' head, in the case of NSE, includes listing fees, annual subscription charges on members, book building fees and the charges the exchange collects on its co-location services for brokers.

Interestingly, NSE's income from its investments and deposits in the form of interest and dividends helped shore up its bottomline such that a 24.5 per cent growth was seen in NSE's profit after tax figures from Rs 705 crore in FY12 to Rs 878 crore in FY13. The FY13 figure included an exceptional income item of Rs 36 crore which was a profit NSE recorded on selling its equity holdings in two of its subsidiary companies, to a newly formed subsidiary called NSE Strategic Investment Corporation.

BSE, main competitor to NSE, had no luck with its profit after tax, which on a consolidated accounting basis, fell from Rs 178 crore in FY12 to Rs 109 crore in FY13. Its total income from its stock exchange operations fell to Rs 384 crore in FY13 from Rs 418 crore in the previous year, while its operating profit from stock exchange operations fell to Rs 118 crore from Rs 203 crore.

Part of the hit on BSE's net profit was the amount it expended on its liquidity enhancements schemes for its equity F&O segement which shot up to Rs 95.50 crore in FY13 from Rs 60.50 crore in FY12.

July 15, 2013

food security ordinance does not augur well

India does need a strong legislation on food security but the politicisation of it by Congress-UPA and the BJP & other opposition parties is unfortunate.

Here is an editorial I contributed on the issue of food security in the newspaper I presently work for:

This rush does not augur well
Food security is indeed needed for the nation but not the least in the manner as it is being rushed through by the current government

The months leading to a general election in the country are almost never conducive for a majority of the nation's population if one looks at the long-term impact. Much-needed and well-intentioned ideas and solutions, benefiting the non-affluent sections of the population, otherwise gathering dust in ministerial files get pulled up and after regressive distortions these are sought to speedily executed. 

Because all this takes place at the fag end of a government's tenure one has no choice but to surmise that this is largely to extract the maximum electoral gains and very little to do with a genuine desire to help the people of the country. This is the context under which the frantic efforts, late last week, by the central government to press for the immediate implementation of the National Food Security Ordinance with the chief ministers of Congress-ruled states. 

Other political parties, not in the ruling alliance, too, have left no stone unturned to belittle the issue of food security for our rural and urban poor; much of it coming solely due to lack of any electoral gains for themselves. 

In a country such as ours where either fatal starvation or a vicious lack of health impoverishes a vast section of the population, the idea of food security which tries to provide assured access to low-cost food is extremely vital for the long-term well-being of the nation and its economy, notwithstanding the short-term pain an economy in deficit has to endure. In their impishness, the political parties of our country have turned this sensitive matter into a nasty football match.
Even if we keep aside the untidy nature of rushing through a National Food Security Ordinance and getting it passed in a jiffy by the President who was till recently a high-ranking minister in the same government, this piece of legislation needed to be debated by the entire parliament in order to give a chance of strengthening it further. 

The food security legislation, as passed by the ordinance, encompasses two-thirds of the country's population. If there exists no adequate infrastructure and preparations to implement it to reach every man, woman and child concerned, then a phase-wise approach would have made better sense. In the greed for electoral gains the rushed attempts to reach out to the entire target level could seriously botch up the entire program. The over Rs 1,00,000 crore amount which is expected to be foregone on account of the food security program is not exactly a small sum to fritter away in inefficiencies. 

Of course, such high amounts of revenue foregone is not unique to the issue of food security. Other subsidy areas, including petroleum, fertilisers and others, together gobbled up close to Rs 2,50,000 crore in financial year 2012-13. This is not all. The government's statement of revenue foregone to difference between effective tax rates and actual applied tax rates for FY13 indicated huge sums such as Rs 68,000 crore for corporate taxpayers, Rs 37,000 crore for individual taxpayers, Rs 2,06,000 crore in excise duties and Rs 2,56,000 crore in customs duties. 

Consider, for instance, the break-up of revenue foregone in customs duties, Rs 61,000 crore for gold and other precious stones and their jewellery, and Rs 57,000 crore for petroleum. The high cost which the food security bill will impose on the country, therefore, does not stand out in isolation. 

But the country can not afford another adverse future audit report by Comptroller and Auditor General like its recent one on the Rs 58,000 crore farm loan waiver scheme. That scheme was doled out at the fag end of UPA-1 government's tenure and CAG in its audit found several cases of mis-appropriations and other issues such as exclusions of genuine loan-affected farmers. No one, therefore, can find it easy to believe that the UPA-2 government will not do the same with the food security ordinance. 

If food security is not really achieved and only an erroneous impression of it being achieved is created, it would be a tragedy.

June 24, 2013

ignoring climate change events at our own peril

The human, animal and ecological tragedy which unfolded in the wake of extremely heavy rainfall over the Himalayan mountains in Uttarakhand state 10 days ago, is yet another wake-up alarm for us (Indians) and everyone else elsewhere.

I wrote an editorial on this issue recently in the newspaper I work for currently. Here is what I wrote:

Ignore at own peril

Last week's unfolding of human and ecological consequences of extreme weather events raises several red flags

As an economy we need to come out of our lethargy in planning, accounting, budgeting and enforcing policies for mitigating the huge negative economic consequences of climate change-induced events abetted in a large part by ecology-insensitive development models. 
This is one immediate and glaring lesson to draw from the unprecedented loss of human lives and the massive suffering inflicted on humans, animals, ecology, places and structures in the Himalayan hills due to sudden and extremely high levels of rainfall in the region over a week ago. Extreme weather events are not new to our country given its vast expanse and multiple eco-systems but they have become more extreme and more frequent. Like Mumbai's extreme rainfall event of July 26-27 2005 and the recent cloudbursts-accompanied extreme rainfall over the Himalayan region in Uttarakhand, the extreme weather events have also become much faster in their onset, without even a day's warning sign.

Climate change deniers might argue against the very concept of global warming caused by dangerous levels of carbon dioxide and other deadly gases in the atmosphere. If they are right we can only be set back a few decades in our rapid development drive due to the high costs associated with mitigation measures. But if they are wrong and climate change-induced disasters cause all-round devastation will not only not develop the economy but it will set it back by centuries.

India came out with its first national action plan on climate change exactly five years ago, on June 30, 2008 to be precise. It was not exactly an early start but still it had to come out one day and was welcomed by one and all. However, red flags were evident even then in the criticisms of the action plan, the pre-dominant one being the climate change plan was only a bundling of existing national plans on renewable energy, water, agriculture and a few others. Much of what the plan detailed was already in the open and what was required was a new, dynamic plan marked with much-needed urgency in financing, implementation and enforcement. Ironically, the national climate change plan had a separate mission for sustaining the Himalayan ecosystem which included adoption of best practice norms for infrastructure construction, promotion of sustainable tourism and regulation of tourist inflows. None of these apparently got translated from the written, lofty word to ground-level hard physical enforcement. If this continues to be this nation's track record then we can very well kiss double-digit GDP growth rates good-bye since extreme weather events leaves behind ferocious economic consequences, immediate and futuristic, and which tends to have severe cascading impacts on the entire country.

A new World Bank report, released earlier this month, focused on climate extremes and regional impacts, and it stated the likelihood of 4 degrees celsius global warming being reached or exceeded this century has increased in the absence of near-term actions and further commitments to reduce emissions. This rise in temperatures in India is, as per the World Bank report, projected to cause 10 per cent increase in annual-mean monsoon intensity and a 15 per cent increase in its year-to-year variability, which taken together imply chances of extreme wet monsoon increasing to once every 10 years from once every 100 years. At other times, the report states the abruptcy in the Indian monsoon, identified as a potential tipping element of the Earth system, can cause drier, lower rainfall conditions in South Asia.

The onus to mitigate such unprecedented changes in our country lies with this government, and will lie more so on the next one. One hopes the allure of rapid development does not continue to blind the government and the electorate at the cost of our country's already-fragile ecology.

June 09, 2013

agriculture needs to be respected, not scorned, by government of india

I share below an insightful article (actually excerpts from a book being written) from the latest issue of a weekly news magazine:

Sanjay Rawat
Out of the green? Our PM wants young people to move out of farming and seek jobs in the cities, which aren’t prepared for them

No Country For Countrymen

As the Manmohan Singh government makes evident its unfriendliness to villages, the nation hurtles towards disaster. It’s a danger no one wants to face.
Arun Sinha

Prime Minister Manmohan Singh has been trying for years to make us believe that agriculture is a vast marshland in which a huge population is stuck ankle- to neck-deep and it is his duty to rescue them. “Our salvation lies in moving people out of agriculture,” he says in one speech. “We need to move people out of agriculture by giving them gainful employment in non-agricultural sectors,” he says in another. He says it whenever he talks of agriculture. His alter ego, Montek Singh Ahl­uwalia, echoes it whenever he can. Whether agriculture is a marshland or a Garden of Eden—and how it came to be so—is another thing. First, Dr Singh, we need to ask where you will take the evacuees.
Your government departments and public enterprises are cutting down on staff. Private companies are buying technologies to replace labour. Traditional industries, such as the glassware industry of Firozabad and the shoemaking industry of Agra, where labourers’ hands and not machines produced goods, are devastated with the opening of international trade and inundation with foreign brands. Artisan industries are closing down because of growing consumer preference for the machine-finished quality of goods from big cities. Companies are not investing their surpluses in rural manufacturing, saying Manmohan Singh must first create infrastructure. Manmohan says his government has no money; only private capital can do it.
So, you see, the country is in a fix. Seventy per cent of Indians, who live in villages, are in a fix. And that makes more than 80 crore farmers, labourers,, women and children. Where do you want to take them?
You say there is no food in the villages; food is in the towns. But how will you feed them? How will you house people from six lakh villages in 8,000 towns? How will you guarantee that they will not have to live in cramped, disease-breeding slums with open drains and no toilets? How will you ensure that they get tap water and electricity? Will they have public transport? If you can’t ensure all that, why are you moving them out of the villages in the first place? Why are you playing host in a royal Indian wedding when you have no food, accommodation, comfortable transport and no fans and lights to offer to the baraatis?
Photograph by Narendra Bisht
Messrs Manmohan Singh and  Montek Ahluwalia, you have already humiliated them enough. By saying that they are trapped in a marshland, you have made them feel there is disgrace in being a farmer. They have come to believe agriculture is an accursed occupation. They feel they have brought themselves greater disgrace by reproducing more. You are shrewd enough not to betray your Malthusian humour, but when you say the proportion of our population dependent on agriculture is very high and unsustainable, your attitude towards them barely remains secret. But is overpopulation really why they are in the bog? Are you not to blame?
The nation has benefited more from farmers than farmers have from the nation. The nation has used them as horses to gallop to the goal of food self-sufficiency, to come out of the crippling shame of the ship-to-mouth days. As long as the political leadership was assured of enough food in the stocks, they were not bothered how the farmers were producing more and more. The consequences are there for everyone to see in Punjab, Haryana and western Uttar Pradesh. This was a region consciously selected by the national leadership for cruising to self-sufficiency because it was well-endowed with fertile soil, irrigation and robust husbandry traditions. The natural minerals of the soil have been driven away by chemicals. So much water has been pumped by tubewells that the groundwater aquifers have shrunk. The same hybrid seeds that produced plenty are not yielding more any more. Farmers have been left in the lurch.
Now, the nation awaits a technological breakthrough to end the stagnation. It has been waiting for that breakthrough for over two decades. It is causing anxiety in the national leadership. The anxiety is not about farmers. The anxiety is about the nation. The fear is about the nation losing self-dependence for food, it’s about food inflation that will force town employers to raise wages. When Manmohan and Montek say, “Agriculture must grow at four per cent,” they are talking about the GDP. The attitude of the post-reform leadership is no different from that of the pre-reform leadership. Farmers are still, in their view, no more than draught animals. The best example of it is seen in cotton. The leadership introduced a technological breakthrough in genetically modified (GM) seeds to meet the objective of reducing import of cotton, which caused a drain on foreign exchange reserves. Within a few years, India became a cotton-exporting country. Then crop failure struck, as soon as the monsoon started failing, and thousands of farmers committed suicide. Bt cotton should not have been allowed to be grown in regions with low water availability, as it required a lot of water. But the leadership was not worried who was growing cotton where and how many were taking their lives—as long as its objective of achieving self-sufficiency in the commodity was met. The nation was happy, even if farmers were not.
Photograph by Apoorva Salkade

The government wants Indian agriculture to take the American road. But the conditions that shaped American agriculture are not the same as those in India. For us, the American road leads to ruin.

The political leadership has left the farmers to themselves. It says: if you can survive, stay on; if you can’t, too bad, swallow your pride—and your pesticide. We won’t intervene. We are going to spend less and less on agricultural subsidy, support, infrastructure. The State must withdraw as the market takes over. (But the market is not taking over.) Of course,  you can’t help wondering what actually public spending in the past yielded. Dams and canals took decades to build, guzzled money several times the original budgets and yet could not deliver as much water to as many farmers as they promised. Trillions of rupees supposedly advanced to farmers as credit still left most of them dependent on borrowings from food traders, moneylenders and relatives. What happened to the long list of programmes intended to insulate farmers from the vagaries of monsoon in the rain-fed areas­—60 per cent of the total area of cultivation?
Why did the Planning Commission introduce a programme in one Five Year Plan, calling it key, crucial, game-changing, and then express regret in the following Five Year Plans that it was not properly implemented? Why was the nation rich in ideas, poor in practice? Why did we see little implementation, but plenty of lamentation? And why it is still so? What revolutionary restructuring of administration have you brought about during your two terms to change that?
The institutional failure in alleviating poverty was not only obvious in the poor management of crop productivity- raising programmes, it was also evident in the non-implementation of land ceiling and redistribution policies. Only, in these policies, the political leaders consciously opted to be poor managers. They would do nothing to destabilise the class and caste hierarchies in the village; on the contrary, they played along with them to survive and thrive in politics. Had they sincerely worked to see that the landless got even an acre or less, poverty would have been much less acute, as the beneficiaries would have conceivably at least grown food for their families. The consequence of unbroken social hierarchy was not only that the poor in the village remained poor, but they could either get no jobs or only low-paid jobs in towns where men from the higher castes would have a monopoly of better-paid and skilled jobs.
But what political leaders dare not do, the higher castes and classes have brought upon themselves. Never keen as agriculturists, they have sold their land or divided it among inheritors or ceded to militant cultivating peasants. The number of large farm holdings (10 ha and above) has plunged from 4.37 million in 1960-61 to 1 million in 2010-11. During the period, the total number of farm holdings has risen from 48 million to 137 million. Holdings under 2 ha (small and marginal farms) make 85 per cent of this total. In the next 20 or 30 years, most large holdings will split up, making India a country almost wholly of small farmers.
How does the nation take care of the crores of small farmers? Our economist-doctor knows only one remedy: Move them to towns. Urbanise, urbanise, urbanise. But he does not say all should move or only a certain percentage of them. What would be that certain percentage? Or does he want India to follow the path of America, where 80 per cent of the population was engaged in agriculture in the 1850s and only one per cent today is?
He will ruin India if he takes her along the American road. The historical factors—a small population of settlers and a continent of land; the World War II, which drew rural populations to the army and the post-war reconstruction boom—that shaped US agriculture are not to be seen in India. Nor are the cultural factors—a meat-eating population, requiring large grazing lands for animals. Nor indeed the economic ethos—a faith in capitalism bred by blind hatred of anything resembling socialism. The World War II and India’s wars with China and Pakistan did not drain villages of youth. India was a largely vegetarian country, comprising self-contained villages where peasants grew food for themselves and needed small pastures for their draught and milch cattle. The mean size of farms in the US increased from 50 hectares in 1870 to over 200 hectares by 2000. The average size of a farm in India shrank from 2.3 hectares in 1970-71 to 1.16 hectares in 2010-11. 
What is Manmohan’s vision—that we draw out most of the farmers in order to facilitate the takeover of the countryside by big capital? In the United States today, less than 10 per cent of the farms account for 65 per cent of sales of agricultural products. Despite the ‘prosperity’ from the Green Revolution, even Punjab, Haryana and western Uttar Pradesh have not witnessed concentration of cultivable lands on such an epic scale. The ‘rich’ farmers do not have much capital to buy lands. Corporates have big capital. Agribusiness multinationals have big capital. And they are eyeing India. They are goading the doctor at the top to do the surgery on rural India.
We have had a ‘socialistic’ past, the Congress party is shrinking, and there is a very real danger of disaffection among farmers turning toxic: so the doctor fears going for his scalpels and retractors. But that is what his heart seems to be telling him to do; he is obsessed with it, so he is doing it without surgery. His alternative remedy is: supply less nutrition to agriculture; smoke out the village population by causing a conflagration in their bellies.

The model that seems workable in India is for most farmer families to grow their own food, while extra income comes from jobs in industry or services in towns or the smaller cities near their villages.

But that is going to be destructive. Agriculture is the engine of economic growth. To weaken agriculture is to weaken India’s foundations. How can we forget that the tiger economies of Southeast Asia were built upon a strong agricultural base? How can we not see that China could cope with the loss of millions of jobs in towns in the global financial meltdown because the job losers could go back to work the farms in their villages. Manmohan cannot run away from his responsibility to strengthen agriculture. The guilt of the past governments (mostly Congress) in weakening agriculture is obvious. He has joined the galaxy of the guilty. Yet there is so much that can still be done. The crop productivity of rain-fed areas is less than half of that in irrigated areas. The productivity in irrigated areas is far lower than in developed economies. If we improve agriculture, farmers will stick to villages. America and Europe are allocating special budgets to sustain their village populations. They have recognised their mistakes belatedly. We are still in a stage where we do not have to lure populations to villages; they are already there. Get rid of the misconception that farmers want to leave agriculture. A lot of migration is natural; members of farming families take up non-farm jobs in towns. But let that be voluntary. Today migration is forced. Let agriculture develop and let youth from farming families move to non-farm jobs by their free choice.
Farmers are deeply attached to the land. Even landless labourers are using earnings from non-farm employment to buy land, for land provides food security, is still a good asset and source of prestige. Villagers’ attachment to the land, their skills and their indigenous wisdom are pillars on which a strong edifice of agriculture can be built.
What better examples of this can one find than in the villages where farmers, frustrated by institutional failure, have developed and are managing water resources on their own. In the command area of the Waghad dam on the Kolwan river in Maharashtra’s Nashik district, it is farmers’ water user associations—and not irrigation department engineers—that are managing the operations and maintenance of the canal network. The cash crop boom resulting from their water management has ended out­-migration and is attracting in-migration.
In Ralegan Sidhi village in Ahmednagar district of Maharashtra, Anna Hazare brought water to the fields simply by mobilising villagers to go in for watershed development, reducing out-migration. In the Bhaonta-Kolyala village in Alwar district of Rajasthan, villagers developed watersheds in a similar manner, reducing out-migration. Rajendra Singh—the ‘Waterman of India’—is credited with bringing assured irrigation through participatory watershed development and management. This he has done in over a thousand villages through Tarun Bharat Sangh, his voluntary group. That just goes to show that if watershed is developed and managed by water users, the rain-fed areas—where much of India’s poverty resides —can grow crops round the year, raise productivity, create round-the-year employment and raise agricultural wages to reduce pauperisation and migration.
Census 2011 has discovered that fewer migrants are coming to megapolises like Mumbai, Delhi and Chennai, and more to smaller towns. That goes to show that given the choice, migrants would work in non-farm jobs, even if less paying, in towns nearer their homes.
An ideal India would be one in which non-farm jobs are available to working-age members of farming families near their villages. Food can come from the small farm, while the non-farm income fulfils other needs, without breaking the families, without breaking up the communities. But for this to happen, there must be robust rural industrialisation. And for that the State has to draw private capital to new places and provide education and skills to youth in farming families. Manmohan’s State is not taking the farming families in that direction. It is forcing the rural youth to move far away from their villages. That will leave only old people in villages and there will be nobody to cultivate their land after they die.
Who will take their lands?
Our economist-king is keeping that secret to himself.

(The writer is working on a book called No Country for Countrymen: How India is Ruining its Villages.)

May 27, 2013

government's fixing of the stock market

It never fails to amaze me how finance ministers of our country only want the domestic equity market to keep rising.. forever..

Here is an editorial I wrote, on a related issue, in the newspaper I work for presently:

Let the stock market be

Growing government impatience with even small market corrections is a severe setback for free markets

It is not the first time, and unfortunately it does not look like it will be the last, that our finance minister has intervened with stern remarks against equity market traders when there is the occasional scary fall taking place in the stock market. So, on Thursday morning, when there was a series of small meltdowns rocking Asian markets, including our own when it opened for trading, our current finance minister, P Chidambaram, rushed in to admonish market traders for hitting the panic button in what he evidently thought to be in a mindless manner. "The Indian market should read the situation correctly rather than be influenced by something happening elsewhere," is how this admonishment came from the country's finance minister at a hurriedly press conference on a day when Japan's equity market went into a tailspin with a four per cent fall by around the time the Indian stock market opened for trading. 

It is noteworthy that by this time other Asian markets had not fallen as much, with their declines being around 1-2 per cent only. These eastern markets typically look at how the western-most US market fared the previous day and what they saw was 1.7-2.1 per cent fall in US equity indices in the latter half of Wednesday. While Ben Bernanke's statement that if the US economy maintained momentum the US Federal Reserve would scale back in its monthly $85 billion bond buying program was the primary trigger, the Asian markets were also reacting to domestic events such as a sharp rise in Japanese government bond yields or Chinese. Even the Indian equity market opened low and had fallen by just 1.7 per cent by noon. 

Except for Japan's equity market, Asian markets, including India's, were not exactly crashing. Which is why it was surprising to observe the hasty intervention by our finance minister who one is to assume is a very busy man. But more perplexing was his admonishment that Indian market should not be influenced by something happening elsewhere. 

Chidambaram had himself opened his February 28 budget speech with this: "I shall begin by setting the context. Global economic growth slowed from 3.9 percent in 2011 to 3.2 percent in 2012. India is part of the global economy: our exports and imports amount to 43 percent of GDP and two-way external sector transactions have risen to 108 percent of GDP. We are not unaffected by what happens in the rest of the world and our economy too has slowed after 2010-11." 

So, clearly the FM does not expect the  country's economy to stay unaffected by what happens in the rest of the world but he expects the country's stock market traders to not get influenced by happenings elsewhere. 

Finance ministers of our country have never lost sleep during bull runs in the stock markets. Towards the end of 1991 when the market was in the grip of bulls which included the  scamster Harshad Mehta, the then-finance minister, Manmohan Singh had remarked that he did not lose sleep over stock market movements. But even during bull runs the markets need to take a pause and inhale some breath. Instead of scolding them like a school principal the finance ministers would do well to welcome market falls and corrections today or else they stand a chance of having to tackle scam-like bust ups in the markets tomorrow. Growing intolerance for even small market fall such as the two per cent fall we saw last week does not augur well for a free market economy, now does it.