Momentum 3 August 2014

28
TH

JULY 2014 TO 3
RD
AUGUST, 2014
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CHRONICLE
IAS ACADEMY
A CIVIL SERVICES CHRONICLE INITIATIVE
Weekly Current Affairs Bulletin
CONTENTS CONTENTS CONTENTS CONTENTS CONTENTS
TOPICS Pg. No.
National .......................................................................................................................... 4-9
International .............................................................................................................. 10-11
India and the World ................................................................................................... 12
Economy ..................................................................................................................... 13-15
Science & Technology............................................................................................. 16-17
Health.......................................................................................................................... 18-20
News in Brief ........................................................................................................... 21-24
Editorials .................................................................................................................... 25-59
Pick your battle ........................................................................................................ 25
Between life and death ........................................................................................... 25
Grand unification .................................................................................................... 26
Mapped out ............................................................................................................... 27
A khaki overhaul ..................................................................................................... 27
So many regulators ................................................................................................. 28
Ten year 25 miles later ........................................................................................... 30
In the name of india, why? .................................................................................... 31
The real threat to wto.............................................................................................. 32
Suffocating together, inside the bubble .............................................................. 34
Give 2013 law a fair chance .................................................................................. 35
Revisit and review .................................................................................................. 36
Weekly Current Affairs 27
th
July to 2
nd
August, 2014 [3]
A right to anonymity .............................................................................................. 37

Step up to the plate .................................................................................................. 38
Inclusion issues......................................................................................................... 39
Changing ownership wont help banks.............................................................. 39
Indias chinese dream............................................................................................. 41
Who will guard the guardians ............................................................................. 42
Labour reforms of the wrong kind ...................................................................... 43
Eating into the rural economy .............................................................................. 44
Time to axe the planning commission? .............................................................. 45
When russia is prodded and provoked.............................................................. 46
Rural india does not need loan waiver .............................................................. 48
A better way to manage NPA............................................................................... 49
Divvying up the bay of bengal ............................................................................. 51
Counter-productive rigidity.................................................................................. 51
A need to turn the corner on child health .......................................................... 52
Debate over a critical office ................................................................................... 54
Keep talking peace .................................................................................................. 54
Irrational prejudice.................................................................................................. 55
Battle lines sharpen over gm................................................................................. 56
Blue cloth over their conscience............................................................................ 57
Revisiting the ancient spice route ........................................................................ 59
[ 4] Weekly Current Affairs 28
th
July to 3
rd
August, 2014
NATIONAL
FIXED TENURE PROPOSED FOR THE CJI
Justice Shah in his note titled A Judicial
Appointments Commission for India: A Proposal
has suggested three changes, which became the
central point of debate between the Law Ministry
and eminent jurists. These three, are intertwined
with the overhaul required in the process of judicial
appointments. The meeting discussed the setting
up of a Judicial Appointments Commission (JAC)
as a permanent, Constitutional body to replace the
Collegium system.
According to Justice Shah, the retirement age
of Supreme Court judges was increased to 65 as
an incentive for High Court judges to leave the
comfort of their hometowns and come to New
Delhi. This consideration is no longer relevant. The
retirement age of High Court judges is 62. Elevation
to the Supreme Court guarantees them additional
three-year tenure.
Other finer points of the proposal:
Introduce a three-year cooling off period
for retired judges before the take up positions
offered by the government.
Chief Justice of India should get a fixed tenure
of two years in case their tenure as CJI is less
than two years. This step should be
implemented from August 26, 2022 after the
junior-most judge currently serving in the
Supreme Court, and who is slated to be CJI,
retires.
The JAC should be a seven-member body
with the CJI as chairperson, and three
Supreme Court judges.
The note has the Law Minister as the sole
representative from the government side to
ensure that the executive has a meaningful
voice.
The JAC to have a full-time Secretariat headed
by a retired High Court judge and a small
investigating team to verify the antecedents
of the proposed candidates.
The JAC to interview candidates in-camera;
have the entire process publicly disclosed with
adequate safeguards in place to protect
candidates' privacy; and publish annual
report on appointments made to ensure
transparency.
The JAC's recommendation of a candidate is
ordinarily binding on the President.
Law Commission of India
It is an executive body established by an order
of the Government of India. Its major function is
to work for legal reform. Its membership primarily
comprises legal experts, who are entrusted a
mandate by the Government. The Commission is
established for a fixed tenure and works as an
advisory body to the Ministry of Law and Justice.
Members include a Chairman, 1 permanent
member, 1 member secretary and 6 part-time
members.
The first Law Commission was established
during the British regime in 1834 by the Charter
Act of 1833. The First Law Commission of
independent India in 1955 with the then Attorney-
General of India, M. C. Setalvad, as its Chairman.
The 20th Law Commission was established in
2013 under the Chairmanship of Judge of Supreme
Court D.K Jain. Its tenure has been fixed till
2015.The terms of reference of the 20th Law
Commission include review/repeal obsolete law,
examine the existing laws, revise Central acts of
general importance etc.
The Reports of the Law Commission are
considered by the Ministry of Law in consultation
with the concerned administrative Ministries and
are submitted to Parliament from time to time.
th
July to 2
nd
August, 2014 [5]
KHADI COMMISSION DISSOLVED
A release issued by the Ministry of Micro, Small
and Medium Enterprises (MSME) has said that as
per the provisions of the Khadi and Village
Industries Commission Act, all members including
the Chairman shall vacate their office as members/
Chairman of the Commission with immediate effect.
The Government has dissolved the Khadi and
Village Industries Commission (KVIC) with effect
from 24th July, 2014.
This has been done to revamp the institution
to make it professionally competent, effective and
efficient body for the development and promotion
of Khadi and Village Industries and for generation
of more employment opportunities in the rural non-
farm sector. All the properties and funds which,
immediately before the dissolution on 24th July,
2014 were in the possession of the Khadi and
Village Industries Commission shall now vest in
the Central Government. All the properties and
funds which, immediately before the dissolution
on July 24, 2014, were in the possession of KVIC
shall now vest in the Central Government.
A detailed study of the khadi sector had been
assigned to PricewaterhouseCoopers (PwC) in 2008
by the Department of Economic Affairs (DEA) on
the basis of a concept note prepared by KVIC. The
study had formulated a scheme to revitalise the
sector, after which the former Government started
the Khadi Reforms and Development Programme,
which is being implemented with assistance of $150
million from the Asian Development Bank.
RS500cr PROJECT TO PROTECT INDIGENOUS BREED
'Rashtriya Gokul Mission', a nationwide scheme,
was announced by the Centre recently. The mission
aims to protect indigenous breed of cow and set
aside Rs 150 crore for this purpose during the
current financial year. Since the scheme will be
implemented by states, the agriculture ministry has
called a meeting of state animal husbandry
ministers in September to work out the modalities.
Out of 37 recognised indigenous cattle breeds,
breeds such as 'Krishna Valley" breed in Karnataka,
'Nimari' in Madhya Pradesh, 'Vechur' in Kerala,
'Punganur' in Andhra Pradesh and 'Pulikulam' in
Tamil Nadu are rapidly declining in the country
warranting immediate attention.
The Mission was a focussed project under
National Programme for Bovine Breeding and Dairy
Development, with an outlay of Rs 500 crore during
the 12th Five Year Plan. During 2014-15, Rs 150.00
crores will be allocated for development,
preservation and conservation of indigenous breeds.
Finer points of 'Rashtriya Gokul Mission':
The Mission will be implemented with the
objectives to development and conservation
of indigenous breeds; undertake breed
improvement programme for indigenous
cattle breeds so as to improve the genetic
makeup and increase the stock; enhance milk
production and productivity; upgrade
nondescript cattle using elite indigenous
breeds like Gir, Sahiwal, Rathi, Deoni,
Tharparkar, Red Sindhi and distribute disease
free high genetic merit bulls for natural
service.
Funds under the scheme will also be allocated
for establishment of Integrated Indigenous
Cattle Centres "Gokul Gram" and streng-
thening of bull mother farms to conserve high
genetic merit Indigenous breeds.
The Gokul Grams will be established in the
native breeding tracts and near metropolitan
cities for housing the urban cattle.
It will act as centers for development of
Indigenous Breeds and a dependable source
for supply of high genetic breeding stock to
the farmers in the breeding tract.
The Gokul Gram will be self sustaining and
will generate economic resources from sale
of milk, organic manure, vermi-composting,
urine distillates and production of electricity
from bio gas for in house consumption and
sale of animal products. It will also function
as state of the art in situ training centre for
farmers and breeders.
Each Gokul Gram will be set up in a PPP
mode. It will maintain milch and
unproductive animals in the ratio of 60:40
and will have the capacity to maintain about
1000 animals.
th
July to 3
rd
August, 2014
Nutritional requirements of the animals will
be provided in the Gokul Gram through in
house fodder production. Disease free status
of Gokul Gram will be maintained through
regular screening of animals for important
diseases like brucellosis, TB and JD.
An inbuilt dispensary and AI centre will be
an integral part of the Gokul Gram. It will
also be set up near to metropolitan cities for
managing urban cattle. Metropolitan Gokul
Gram will focus on genetic upgradation of
urban cattle.
CENTRAL PUSH FOR KEY LABOUR REFORMS
The government has cleared long-pending
amendments to three critical laws in the sector that
would enable a doubling of the overtime limit for
workers, exemption for firms employing up to 40
workers from compliance of labour regulations and
allow more trades to be included under the
Apprenticeship Act. It is the first major step
towards overhauling the countrys labour laws.
The Union Cabinet cleared 54 amendments to
the archaic Factories Act, 1948, changes to the
Apprenticeship Act, 1961 and the Labour Laws
(Exemption from Furnishing Returns and
Maintaining Registers by Certain Establishments)
Act, 1988. Proposals to amend all three of these
Acts have been cleared. Amendments to the
Apprenticeship Act are expected to help the
government fulfill its vision of implementing Skill
India as 500 new trades, including IT-enabled
services, would be included in the scheme, allowing
more employers to participate in training and
employment of such workers.
India has 300,000 apprentices; Germany has
more than 3 million. Amending the Act would open
the doors to employment as apprentices for millions
more. The proposal to amend Labour Laws
(exemption from furnishing returns and
maintaining registers by certain establishments) Act,
1988, will allow thousands of small industries to
file just one return for compliance with a dozen or
more labour laws. Once the amendment is passed,
it will exempt small industries with less than 40
workers from the need to comply separately with
each of the laws.
Key points of the new Labour Laws include:
Increasing the limit of overtime for workers
from 50 hours per quarter to 100 hours per
quarter, improving safety of workers and
lifting relaxations on night shifts by women
in factories.
The changes also aim to prohibit pregnant
women and persons with disabilities from
being assigned to machinery-in-motion and
reducing the eligibility for entitlement of
annual leave-with-wages to 90 days from the
current 240 days.
More importantly, shifting the focus from the
states, the Centre would now be empowered
to make rules on some of the provisions of
the Act.
Significantly, a draconian provision that
called for arrest and imprisonment of
employers who did not implement the
Apprenticeship Act will now be dropped as
comparing the size of the Indian economy,
the performance of the Apprenticeship
Training Scheme is not satisfactory and a
large number of training facilities in the
industry are unutilized.
These firms will now also be allowed to file
a combined compliance report for 16 labour
laws, up from the current nine. In the
Apprentices Act, the government is seeking
to expand the scope of employment as
apprentices on the shop floor.
Until now, most apprentices have been from
engineering backgrounds; the government is
seeking to push for the induction of non-
engineers as apprentices. It is aimed at
allowing young job seekers and students to
gain industry-relevant skills on the shop floor.
In the first year, an apprentice will get 70%
of what a semi-skilled worker gets, in the
second year 80% and in the third year 90%.
For those employed in small-scale industries,
the government will pay 50% of their salary
and the factory management the remainder.
SHARP RISE IN EMPLOYMENT RATE: ECONOMIC CENSUS
The Sixth Economic Census-2013 has revealed
that the rate of employment in the country has
been on rise in recent years. The census does not
include employment in agriculture, public
administration, defence and compulsory social
security services activities. The employment growth
would have been lower if these sectors were
included. The economic census results will be used
th
July to 2
nd
August, 2014 [7]
for GDP calculation as well, as this helps with the
small and unorganised sector manufacturing data.
The provisional sixth economic census results
showed there were 58.47 million establishments in
the country engaged in different economic activities,
excluding crop production, plantation, public
administration, defence and compulsory social
security services.
Finer points of the Sixth Economic Census-2013
include:
The number of people employed in the
country rose by 34.35% to 12.77 crore in eight
years to 2013.
The employment in urban areas increased by
37.46% to 6.14 crore, while in rural India the
growth was 31.59% to 6.62 crore between
2005 and 2013.
The proportion of women in total workforce
increased to 25.56% in 2013 from about 20%
in 2005. In urban areas, the proportion of
female workers was 19.8% compared to
30.9% in rural areas.
Among the states, Maharashtra was on top
of the ladder with maximum number of
employees at 1.43 crore, followed by
Uttar Pradesh at 1.37 crore, West
Bengal at 1.15 crore, Tamil Nadu
1.08 crore and Gujarat at 90.63
lakh.
Among the Union Territories, Delhi
has the maximum number of
employees at 29.84 lakh followed by
Chandigarh at 2.38 lakh and
Puducherry at 2.17 lakh.
In terms of percentage growth in
total employment during the period,
number of workers grew at higher
rate of 83.29% in Manipur, followed
by 78.84% in Assam, 77.14% in
Sikkim, 75.26% in Uttar Pradesh
and 68.81% in Himachal Pradesh.
Uttar Pradesh was the top
employment generator among big
states in eight years ended 2013,
creating jobs at over double the
national average rate.In Uttar
Pradesh, the number of employed
rose over 75% during the same
period.
It was fourth overall in job creation,
behind Manipur, Assam and Sikkim.
Gujarat was placed ninth. Maharashtra was
the biggest employer, accounting for 11.26%
jobs in the country, followed by Uttar
Pradesh, West Bengal, Tamil Nadu and
Gujarat.
There was 41.7% rise in number of
establishments. Nearly 60% of these establish-
ments were in rural areas. Uttar Pradesh,
Maharashtra, West Bengal, Tamil Nadu, and
Andhra Pradesh together accounted for about
48% of the total number of establishments in
the country.
The average employment per establishment,
however, fell in the eight year period from
2.3 to 2.1 worker.
Northeastern states reported significant jump
in both the number of establishments and
employment creation, suggesting improve-
ment in economic activities. Manipur saw a
109.37% increase in the number of establish-
ments between 2005 and 2013.
In terms of growth in the last eight years of
establishments, against a national average of
41.73%. The newly formed state Telangana
experienced a 79% jump in eight years.
th
July to 3
rd
August, 2014
UP housed 11.36% of country's total
establishments, followed by Maharashtra and
West Bengal. Since these are just provisional
estimates, they do not provide activity-wise
or size-wise break up of data.
NAVY GETS NEW COMMUNICATION HUB
The state-of-the-art very low frequency (VLF)
transmitting station was commissioned at INS
Kattabomman in Tirunelveli, Tamil Nadu. With this,
the Navy has acquired a new advanced facility to
communicate with the silent predators, with India
planning a larger fleet of nuclear-powered
submarines, which can prowl underwater for
several months at a time and let loose their nuclear-
tipped missiles as and when required. The new
facility will boost the ability to communicate with
submarines, which have trailing wire antenna to
pick up the coded VLF radio waves, on an
uninterrupted basis throughout the year.
India is down to just 13 old diesel-electric
submarines, barely half of which are operational
at any given time, and a single nuclear-propelled
submarine INS Chakra on lease from Russia without
any long-range missiles. But India's first three SSBNs
(nuclear-powered submarines with nuclear ballistic
missiles) are already being built at the secretive Ship-
Building Centre at Vizag to complete the country's
nuclear weapons triad - the capability to fire nukes
from land, air and underwater.
The first, the 6,000-tonne INS Arihant, is slated
to go for extensive sea trials soon after its miniature
83MW pressurized light-water reactor, which went
critical in August last year, attains full power in
the next couple of months. Moreover, there is an
ongoing proposal to build six SSNs (nuclear-
powered attack submarines, usually without
ballistic missiles).
Only a handful of nations have such a VLF
capability, which is critical to pass coded orders to
nuclear submarines on long-range deterrent patrols.
Diesel-electric submarines have to surface every few
days to get oxygen to recharge their batteries and
have limited endurance due to fuel requirements.
Nuclear-powered submarines, armed with nuclear-
tipped missiles, in turn, are considered the most
effective and difficult-to-detect nuke platform since
they can operate underwater at long ranges for
months at end.
FARMER SUICIDES ON RISE
According to the latest government report, the
rate of farmer suicides in India's Maharashtra state
has gone up in recent years despite expensive relief
schemes.
Thousands of farmers have committed suicide
in Maharashtra in recent years, saddled by debts
they could not repay. The state and the federal
government together pledged more than $1bn to
provide relief to farmers in distress. It blames poor
implementation and lack of co-ordination between
government agencies for the failures. Some 10,000
farmers a year are estimated to commit suicide in
India.
The report, prepared by the Comptroller and
Auditor General of India, says there have been
serious efficiency lapses in implementation of the
relief schemes. Considering the deficiencies noticed
in the various components of the packages,
underutilisation of available funds, important areas
of agrarian distress not being covered under the
packages, and coverage of only a fraction of
distressed farmers, reduction in farmers' distress in
Vidarbha region does not inspire confidence. In
2005, the Maharashtra state government
announced a relief package for "farmers in distress"
after the number of suicides went up from 146 in
2003-2004 to 455 the next year. In 2006, the central
government also announced a "special rehabi-
litation package" which covered the six most
affected districts in the Vidarbha region of
Maharashtra and 25 other districts from four
different states. Vidarbha is the area of Maharashtra
where the farmer suicide problem is worst.
Key points of the Report:
According to official records, the deaths in
Vidarbha region increased to 1,414 between
April 2006 and March 2007.
The report says there were more than 600
deaths in the first six months of 2007-2008.
1.3m of 1.76m farmers in Maharashtra were
For the first time, data for handloom and
handicraft was included in the economic
census, which accounted for 3.75% of the
total establishments of the country.
th
July to 2
nd
August, 2014 [9]
declared "distressed", of which
434,000 were declared under "maxi-
mum distress".
The report also blames the govern-
ment for not spending funds on
educating farmers about the rights.
Nearly 75% of farmers were unaware
of the ban on illegal money lending
and many farmers continued to pay
high interest rates despite these debts
being declared illegal, the report says.
There have been also instances of
banks claiming higher interest rates
than permitted.
In many cases, banks did not give out
fresh loans to farmers which meant
they ended up without having enough
seeds and other farming assistance.
The worst-hit states for farmer suicides
are Andhra Pradesh, Karnataka,
Kerala and Maharashtra.
Year Mahrashtra Andhra Karnataka Mp All India

1995 1083 1196 2490 1239 10720
1996 1981 1706 2011 1809 13729
1997 1917 1097 1832 2390 13622
1998 2409 1813 1883 2278 16015
1999 2423 1974 2379 2654 16082
2000 3022 1525 2630 2660 16603
2001 3536 1509 2505 2824 16415
2002 3695 1896 2340 2578 17971
2003 3836 1800 2678 2511 17164
2004 4147 2666 1963 3033 18241
2005 3926 2490 1883 2660 17131
2006 4453 2607 1720 2858 17060
2007 4238 1797 2135 2856 16632
2008 3802 2105 1737 3152 16796
2009 2872 2414 2282 3197 17368
2010 3141 2525 2585 2363 15964
2011 3337 2206 2100 1326 14027
2012 3786 2572 1875 1172 13754
SOURCE: National Crime Records Bureau. * NCRB data merely
records suicide by farmers. It does not specify the reasons for suicide.
[10] Weekly Current Affairs 28
th
July to 3
rd
August, 2014
INTERNATIONAL
KIDNAPPING BECOMES GLOBAL BUSINESS FOR QAIDA
Kidnapping Europeans for ransom has become
a global business for Qaida, bankrolling its
operations worldwide. An investigation by The New
York Times found that Qaida and its direct affiliates
have taken in at least $125 million in revenue from
kidnappings since 2008, of which $66 million was
paid just last year. The US treasury department
has cited ransom amounts that, taken together, put
the total at around $165 million over the same
period. These payments were made almost
exclusively by European governments, who
funnelled the money through a network of proxies,
sometimes masking it as development aid, according
to interviews conducted for this article with former
hostages, negotiators, diplomats and officials in 10
countries in Europe, Africa and the Middle East.
The inner workings of the kidnapping business were
also revealed in thousands of pages of internal
Qaida documents found in northern Mali last year.
The foreign ministries of Austria, France, Germany,
Italy and Switzerland denied in emails or telephone
interviews that they had paid the terrorists. Yet
the fact that Europe and its intermediaries continue
to pay has set off a vicious cycle. While in 2003 the
kidnappers received around $200,000 per hostage,
now they are netting up to $10 million, money
that the second in command of Qaida's central
leadership recently described as accounting for as
much as half of his operating revenue.
AFGHAN ELECTION RESOLUTION INCHES FORWARD
Alleged fraud during the June 14 election has
plunged the country into a crisis as US-led troops
wind down their war against Taliban insurgents
and President Hamid Karzai prepares to step down
after ruling since 2001. Afghanistan's floundering
attempts to declare a winner of its presidential
election inched forward with a deal allowing an
audit of all votes to restart. But, the United Nations
warned of the risk of further delays.
The Independent Election Commission (IEC)
said that the two poll rivals, Ashraf Ghani and
Abdullah Abdullah, had finally agreed how the
massive audit would separate fraudulent ballots
from genuine votes.
As the deepening stand-off threatened to spark
a return to the ethnic violence of the 1992-1996
civil war, US Secretary of State John Kerry flew
into Kabul earlier this month and persuaded the
two opponents to agree to the audit. But the process
has been beset by stoppages as the campaign teams
fought over each disputed ballot paper. Kerry
described the audit as painstaking and slow,
stressing that the two candidates should fulfil their
commitment to accept its results and then form a
national unity government.
A smooth election was seen as essential to justify
the costly US-led military and civilian aid effort
since the Taliban regime fell in 2001, and recent
insurgent offensives have heightened fears of a
worsening spiral of violence. The disputed result
and uncertainty over when Karzai will hand over
power has tainted earlier celebrations over the high
turnout and lack of major militant attacks in both
the April first-round vote and the run-off seven
weeks ago.
DILUTION OF SAFEGUARDS DENIED BY WB
The World Bank hit back at a wide coalition of
NGOs, fending off allegations that it was watering
down environmental and community safeguards
for its lending activities and possibly endangering
the livelihoods of indigenous peoples and others
worldwide.
The furore stemmed from a leaked report of a
draft safeguards framework, which was said by
th
July to 2
nd
August, 2014 [11]
the Bank on Human Rights as moves from one
based on compliance with set processes and
standards, to one of vague and open-ended
guidance, threatens to render technical improvements
meaningless. BHR, which includes groups such as
Human Rights Watch and Amnesty International
highlighted the new proposals inclusion of an opt-
out clause from protections for indigenous peoples,
of a definition of discrimination that was not
consistent with international law and lack of
rigorous framework for enforcing human rights.
BHRs analysis, shared by the organisations
coordinator, Gretchen Gordon, of the before-versus-
after comparison of the Banks wording on
safeguards is rigorous, and on involuntary
resettlements and land acquisitions it supplied a
matrix of evidence showing how the policy would
get weakened over on the issue of whether
communities displaced by Bank-funded projects
would merely get compensation or whether, as in
the past, they would also benefit from sustained
development programmes. Similarly on environ-
mental and social assessments BHR supplied
another matrix showing that the new wording
proposed would result in dilution in terms of the use
of borrower systems, by focusing on the project level.
According to Bank officials, the proposals under
consideration, which needed endorsement from the
Banks Committee on Development Effectiveness
before progressing to a second round of
consultations with stakeholders, hoped to use as
much as possible the borrower countrys own
environmental and social standards. Since India is
the Banks largest borrower-client the change, if
passed, could have a significant impact on minority
and indigenous communities.
UGANDA TOO IS GAY-FRIENDLY NOW
The new anti-gay laws that had been branded
draconian and abominable by rights groups, has
been over-turned by Uganda's constitutional court
recently. The legislation was signed by Uganda's
veteran President Yoweri Museveni in February,
recommending that homosexuals be jailed for life.
It also outlawed the promotion of homosexuality
and obliged Ugandans to denounce gays to the
authorities.
Cheering gay rights activists celebrated the
ruling, but supporters of the law said they would
appeal at the Supreme Court. US Secretary of State
John Kerry likened the law to anti-Semitic
legislation in Nazi Germany, and Western nations
made a raft of aid cuts to Uganda's government.
But homosexuality in Uganda remains illegal and
punishable by jail sentences under previous
legislation, which is expected to return after the
court's decision.
Government spokesman Ofwono Opondo said
that the law, as it is on paper remains valid, and
it had been struck down on a matter of procedure
and not over its content. The ruling has not nullified
the anti-homosexuality law, it only ruled on the
validity of the procedure in parliament. Lawmakers
could seek to reintroduce a bill to parliament, a
potentially lengthy process, with the last such bill
taking four years from introduction to the final
vote. The decision was welcomed by the Rights
groups, who said the law triggered a sharp increase
in arrests and assaults of members of the country's
lesbian, gay, bisexual and transgender community.
According to Amnesty International, even though
Uganda's abominable anti-homosexuality act was
scrapped on the basis of a technicality, it is a
significant victory for Ugandan activists who have
campaigned against this law. Homophobia is
widespread in Uganda, where American-style
evangelical Christianity is on the rise. Gay men
and women face frequent harassment and threats
of violence. The 10 petitioners including two
Ugandan rights organisations had also claimed
that the law violated the constitutional right to
privacy and dignity, as well as the right to be free
from discrimination, and cruel, inhuman and
degrading treatment.

th
July to 3
rd
August, 2014
INDIA & WORLD
JOINT MEETING ON CLIMATE ISSUE
India and the US held their first meeting nearly
ten months after setting up a joint working group
on combating climate change, where both countries
agreed to closely coordinate on many issues
including the contentious matter of phasing out
climate damaging refrigerant hydro fluorocarbons
(HFCs). During the meeting, both countries agreed
to cooperate in the areas of clean energy, smart
grid and energy efficiency, development of
technology and sharing of information on best
practices on adaptation measures specifically for
extreme weather events.
New Delhi stuck to its stand of handling the
refrigerant issue under the multilateral UN
convention which safeguards the interest of
developing countries. It merely discussed the
scientific and technical aspects of the issue so that
both countries may prepare a common strategy
without diluting India's stand. The working group
discussion was preceded by a meeting of
environment minister Prakash Javadekar and US
special envoy on climate change Todd Stern, in
which the former underlined the importance of
quickly capitalizing the Green Climate Fund (GCF)
and using the money to purchase Intellectual
Property Rights (IPRs) of climate friendly technologies.
A pitch for similar funding of technologies to
replace HFCs from developing countries was made
by Indian representatives during the working group
meeting. The US group, on its part, agreed to
discuss these issues and work together to find out
alternatives that are technologically viable and
economically feasible. The working group discussed
both scientific and technical aspects of the issue to
prepare a common strategy. Representatives from
both sides agreed to continue to include HFCs
within the scope of the UN convention for
accounting and reporting of emission.
The joint working group was one of the
outcomes of the summit meeting of US President
Barack Obama and the former Indian Prime
Minister in Washington in September last year
when both countries agreed to work on post-2020
strategy to deal with climate change. Both countries
had then agreed to discuss using the expertise and
the institutions of the Montreal Protocol to phase
down the consumption and production of HFCs,
based on economically viable and technically
feasible alternatives without deviating the issue of
refrigerant gas from the scope of the UNFCCC and
its Kyoto Protocol.

th
July to 2
nd
August, 2014 [13]
ECONOMY
47% OF BANKING AGENT UNTRACEABLE
The success of the governments thrust on
financial inclusion, largely hinges on the role played
by business correspondents (BCs), but it has recently
faced with a harsh reality check. According to a
recent survey conducted by the RBI College for
Agriculture Banking and the Consultative Group
to Assist the Poor (CGAP) reveals that not only
were a substantive number of banking agents
untraceable, but that even among those found to
be working, a significant number have never
conducted even a single transaction.
Experts say that there is more of an account
opening exercise that is currently going on rather
than the real task of focussing on financial inclusion.
While the government and the RBI claims that they
have over 2.2 lakh banking agents, experts say that
the survey suggests that the quality of the same
is terrible.
Daniel Radcliffe, senior program officer with
the Bill & Melinda Gates Foundation, which is a
member organization of CGAP said that their
assessment is that the Ministry of Finance and the
RBI have relied far too heavily on a target-driven
approach to financial inclusion, whereby the RBI
mandates that banks open a minimum number of
accounts in poor and rural areas. This has led to
card rampages, with banks aggressively opening
accounts to meet their targets, but investing little
in establishing high-quality agent networks that
encourage account usage.
Finer points of the survey:
According to the survey, which tried to
contact 2,358 agents across 15 large states in
the period between September and November
2013, only 53 per cent could be reached and
the remaining 47 per cent could not be
reached.
Even among those who could be reached, 16
per cent of that agents have not done a single
transaction till date.
The survey also found out that the attrition
rate of business correspondents is anywhere
between 25 and 34 per cent per annum and
that does raise a question mark on the
sustainability of the existing model.
The agent activity is significantly lower in
India relative to that in several African
countries. While the median agent conducts
only 9 transactions per day in India, those in
Kenya do 62 and those in Tanzania and
Uganda do 35 and 34 transactions, respectively.
In India the remuneration for the agents is
also low and the median agent earns only
$45 (Rs 2,700) per month, or $1.50 per day
well below the $5 break-even point seen
in other markets.
There are further issues in the same as the
account opened through an agent takes 9
days for activation as compared to 3-5
minutes in East African markets.
The survey shows big loopholes in the existing
network of agents of banking correspondents
but in its exercise to extend banking services
to remote areas the RBI recently permitted
banks to appoint non-banking finance
companies as their business correspondents.
BCs are hired by banks to offer banking
services in remote areas where they do not
have branches and therefore the BCs act as
agents of the parent bank.
While RBI had allowed banks to use BCs to
organise a network of customer service points
in 2006, the number of banking agents grew
to over 2.2 lakh till 2013.
GUJARAT RECORDED HIGHEST TREND GROWTH RATE
According to a recently concluded study by
apex industry body ASSOCHAM, Gujarat has
recorded the highest trend growth rate of 8.2 per
cent of per capita income (PCI) during 2004-2013
amid high income states. The study titled States
Finances Convergence-2, conducted by The
Associated Chambers of Commerce and Industry
of India (Assocham) highlighted that Gujarat has
th
July to 3
rd
August, 2014
taken a massive leap forward in this regard from
annual PCI trend growth rate of 2.9 per cent that
had remained constant during the decade long
periods of 1980-93 and 1993-2004.
Finer points of the study:
Amid other high income states, Maharashtra
and Haryana have closely followed Gujarat
in this respect clocking annual PCI trend
growth rate of 7.2 per cent and 6.9 per cent,
respectively.
With annual PCI trend growth rate of six per
cent and 4.8 per cent respectively, Kerala and
Punjab have also remained ahead in this aspect.
Among the low income states, Bihar remained
on top with an annual PCI trend growth rate
which had increased from 1.1 per cent during
1980-93 and 1.7 per cent during 1993-2004
to 7.2 per cent during 2004-13.
With a median value of 12.02 per cent of
nominal gross domestic product (GDP)
between FY 2006 and FY 2012, Gujarat has
emerged as a leader amid high income states,
while national median value of nominal GDP
remained at 8.37 per cent.
Amid high income states Gujarat has ranked
second only to Maharashtra in terms of the
states own tax revenue, share in Central
taxes, states own non-tax revenue and grants
from the Centre.
Clocking a growth rate of over 36 per cent,
Gujarats own tax revenue grew from over
Rs. 44,250 crore to over Rs. 60,200 crore
during FY 2011-12 and FY 2013-14 while the
states share in Central taxes grew at over
five per cent from over Rs. 7,700 crore to
about Rs. 8,200 crore.
Besides, growing at about 21 per cent and
about 55 per cent, Gujarats own non-tax
revenue and grants from the Centre have
respectively grown from over Rs. 5,200 crore
to over Rs. 6,300 crore and from over Rs.
5,800 crore to over Rs. 9,000 crore.
While amid low income states, Bihar has
ranked on top with states own tax and non-
tax revenues clocking a growth rate of over
66 per cent and about 284 per cent i.e. from
over Rs. 12,600 crore to over Rs. 20,900 crore
and from about Rs. 890 crore to over Rs. 3,400
crore respectively during 2011-12 and 2013-14.
The study suggested that states must
undertake to raise resources locally especially
through non-tax route and rationalize
revenue expenditures to generate more
revenue surpluses.
Besides, in order to improve Centre-State
relations, the governments must enter into a
compact setting forth certain well defined
objectives.
CLIFFHANGER DEAL GETS NEW PROPOSAL
India has chosen to remain committed to the
pact and will continue to pursue its proposal to
find a permanent solution to its food security issues,
notwithstanding the failure of WTO members to
reach a consensus on Trade Facilitation Agreement
to simplify global customs rules. According to
Commerce Secretary Rajeev Kher the WTO will be
on vacation for a month and during this time, India
will focus on follow up action.
Amid hectic parleys in Geneva to clinch the
elusive WTO trade facilitation agreement (TFA),
the deadline for which was set to expire on July
31, India is learnt to have offered a new proposal
within the contours of the original one clinched at
Bali, as a last ditch effort to break the impasse.
This was even as the US expressed hope for a
compromise to end Indias opposition to signing
up for the TFA. Earlier, US secretary of state John
Kerry, after meeting external affairs minister
Sushma Swaraj and finance minister Arun Jaitley,
told that they are obviously encouraging their
friends in India to try to find a path here where
there is a compromise that meets both needs.
India has been maintaining that the TFA must
be implemented only as part of a single
undertaking including the permanent solution on
food security. However, its stand has met with stiff
opposition from developed countries which have
joined hands against New Delhi, asking it to not
veto the TFA of the WTO. In the general council
meeting last week, India had proposed establishing
an institutional mechanism including a dedicated
special session of the committee on agriculture to
find a permanent solution on public stockholding
for food security by December 31, 2014. It had
proposed a review of the progress of the discussions
in October by the council. For adoption of the TFA,
which aims at simplifying customs procedure and
promote global trade, the consent of all 160-WTO
members is needed.
th
July to 2
nd
August, 2014 [15]
INDIAS FIRM STAND ON FARM SUBSIDY
India has refused to agree on a TFA because it
wants the WTO to decide simultaneously on a
higher limit on stockpiling of agriculture produce
to feed the poor. Due to a lack of agreement on the
second issue, India has not consented to a TFA at
the WTO, where all issues are decided by consensus.
A day after the collapse of efforts in Geneva to
strike an eleventh-hour compromise to salvage the
first deal in the 19-year history of the World Trade
Organization (WTO), India stood firm, dismissing
dire warnings by rich nations over the future of
the multilateral forum. At the same time, India also
offered to help find a negotiated solution to its
proposals on food security stockholdings that led
to WTOs failure to meet a 31 July deadline for
wrapping up the trade facilitation agreement (TFA).
India believes progress on TFA has been quicker
than that over its proposal on food securitya
departure from WTOs practice of single
undertaking, under which all parts of an agreement
move together. At the heart of the problem is a
WTO rule that caps subsidies to farmers in
developing countries at 10% of the total value of
agricultural production, based on 1986-88 prices.
Developing countries complain that the base year
is outdated and that they need to be given leeway
to stock enough grains for the food security of
millions of their poor.
The TFA is meant to simplify customs
procedures, facilitate the speedy release of goods
from ports and cut transaction costs. Indias refusal
to compromise on its demand for a permanent
solution to the issue of food stocks and subsidies
put paid to what would have been a landmark
trade facilitation deal. Talks at the World Trade
Organization (WTO) failed as developed countries
such as the US and those from the EU opposed
Indias demand for a commitment that no action
would be taken against its stockpiling and
agricultural subsidies till there was a permanent
solution to address its food security concerns.
India wants to protect its subsidy programme
from any retaliatory action if the WTO cap on
stockpiling is breached. India has suggested that as
a permanent solution, its food procurement
subsidies should either not be subjected to the 10
per cent cap, or the reference price for calculating
the subsidies on foodgrain should be made more
realistic by bringing it to the current year from the
1986-88 base rates. The trade facilitation deal aimed
at lowering trade costs by reducing paperwork,
easing border delays and speeding up transit,
thereby increasing the flow of goods and, in turn,
revenue generation.
In Bali, India was extended protection for its
subsidies under a peace clause up to the 11th
Ministerial in 2017.
SEBI INKS PACT WITH EUROPEAN UNION
SEBI has entered into pacts with 27 securities
market regulators in the European Union (EU) for
consultation, cooperation and exchange of
information related to the supervision of Alternative
Investment Fund Managers. The bilateral MoUs
were signed in pursuance of the EU Alternative
Investment Fund Managers Directive (AIFMD)
which requires that adequate supervisory
cooperation arrangements are put in place between
EU and non-EU supervisory authorities including
SEBI. AIFMD was adopted by the European
Council and Parliament in July 2011. Under the
AIFMD framework, such co-operation
arrangements between EU and non-EU authorities
is a pre-condition for allowing greater market access
and cross border functioning of the AIF business.
These MoUs would thus enable Indian fund
managers to manage or market AIFs in the EU
region and the EU fund managers to manage or
market AIFs in India. As such, these MoUs would
mutually benefit the Alternative Investment Funds
Industry of the two jurisdictions, the statement
added. The bilateral MoUs were signed on July 28,
2014. These bilateral arrangements mark a crucial
step in SEBI commitments towards enhancing
mutual co-operation with the securities markets
regulatory authorities world over. The text of the
MoUs was finalised by SEBI and European
Securities and Markets Authority (ESMA). ESMA
is an independent EU Authority that works in close
co-ordination with the EU in standard setting and
international supervisory co-operation.

th
July to 3
rd
August, 2014
SCIENCE & TECH
INDARC DEPLOYED IN THE ARCTIC
The first multi-sensor moored observatory of
India, IndARC was successfully deployed in
Kongsfjorden Fjord of the Arctic roughly halfway
between North Pole and Norway on July 23.
The Kongsfjorden is an established reference
site for the Arctic marine studies. The Kongsfjorden
has been considered as a natural laboratory for
studying the Arctic climate variability, as it receives
varying climatic signals from the Arcitc/Atlantic
in the course of an annual seasonal cycle. ESSO-
NCAOR has been continuously monitoring the
Kongsfjorden since 2010 for understanding
response of the fjord to climate variability at
different time scales. The temperature and salinity
profiles of the fjord, water column nutrients and
diversity of biota are being monitored at close
spatio-temporal scales throughout the spring-
summer-fall seasons. There exists a great need to
know on how the fjord system is influenced by, or
responds to exchanges with the water on the shelf
and in the deep sea outside during an entire annual
seasonal cycle. In particular, there is a need for
continuous observations of the water transport into
the interior part of the fjord. One of the major
constraints in such a study has been the difficulty
in reaching the location during the harsh Arctic
winter and obtaining near-surface data.
The IndARC observatory is an attempt to
overcome this lacuna and collect continuous data
from depths very close to the water surface as well
as at different discrete depths. The data acquired
would be of vital importance to the Indian climate
researchers as well as to the international fraternity.
In addition to providing for an increased
understanding of the response of the Arctic to
climatic variabilities, the data would also provide a
good handle in our understanding of the Arctic
processes and their influence on the Indian
monsoon system through climate modelling studies.
The deployment of the countrys first polar
mooring is a testimony to the capabilities of the
ESSO in designing, developing and installing
underwater observatories. The technical and
logistics support extended by the Norwegian Polar
Institute, is a good example of the increasing
scientific and technical co-operation between India
and Norway in addressing the global climate change.
Key details of the Observatory include:
A team of scientists from the Earth System
Science Organisation-National Institute of
Ocean Technology (ESSO-NIOT) Chennai and
ESSO-National Centre for Antartic and Ocean
Research (NCAOR) termed the same as a
milestone in Indias scientific endeavours in
the Arctic region.
This observatory, designed and developed by
ESSO-NIOT and ESSO-NCAOR with ESSO-
Indian National Centre for Ocean
Information Services (INCOIS), Hyderabad,
was deployed from the Norwegian Polar
Institutes research vessel R.V. Lance.
Team led by Dr.Venkatesan deployed the
same during its annual cruise to the
Kongsfjorden area and the mission was
guided by the Director of ESSO-NIOT and
the Director of ESSO NCAOR.
The observatory is presently anchored about
1,100 km away from the North Pole at a depth
of 192 m and has an array of ten state-of-
the-art oceanographic sensors strategically
positioned at discrete depths in the water
column.
These sensors are programmed to collect real-
time data on seawater temperature, salinity,
current and other vital parameters of the fjord.
The data acquired would be of vital
importance to the Indian climate researchers
as well as to the international fraternity.
In addition to providing for an increased
understanding of the response of the Arctic
to climatic variabilities, the data would also
provide a good handle in our understanding
of the Arctic processes and their influence on
the Indian monsoon system through climate
modelling studies.
th
July to 2
nd
August, 2014 [17]
OPPORTUNITY BREAKS DISTANCE RECORD
US space agency's Opportunity rover, which
journeyed across 40 km of Martian terrain, has
created a record of any man-made vehicle to reach
another celestial body. That surpasses the previous
record, held by the Soviet Union's Lunokhod 2
rover, which landed on the Moon in 1973 and
drove about 39 kilometres in less than five months.
Opportunity has driven farther than any other
wheeled vehicle on another world. According to
Mars Exploration Rover Project Manager John
Callas of NASA's Jet Propulsion Laboratory (JPL)
in Pasadena, California the Opportunity rovers 40
km is remarkable considering that it was intended
to drive about one kilometre and was never
designed for distance.
Opportunity and its twin rover, Spirit - now
defunct - discovered wet environmental conditions
on ancient Mars, some of which are mild enough
to have been favorable for life.
Opportunity is now exploring the Endeavour
Crater on Mars. Its next-generation robotic
counterpart, the Curiosity rover, launched in 2012
and is tooling around near the Gale Crater on Mars.

th
July to 3
rd
August, 2014
HEALTH
ANTIBIOTIC RESIDUE FOUND IN POULTRY IN DELHI, NCR
A new study released here today by Centre for
Science and Environment (CSE) has suggested that
Indians are developing resistance to antibiotics and
some of this might be due to large-scale unregulated
use of antibiotics in the poultry industry.
Releasing the findings of the study which has
been conducted by CSEs Pollution Monitoring
Laboratory (PML), Sunita Narain, director general,
CSE, said that antibiotics are no more restricted to
humans nor limited to treating diseases. The poultry
industry, for instance, uses antibiotics as a growth
promoter. Chickens are fed antibiotics so that they
gain weight and grow faster. The CSE lab study
found residues of antibiotics in 40 per cent of the
samples of chicken that were tested.
According to Chandra Bhushan, CSEs deputy
director general and head of the lab, public health
experts have long suspected that such rampant use
of antibiotics in animals could be a reason for
increasing antibiotic resistance in India. But the
government has no data on the use of antibiotics
in the country, let alone on the prevalence of
antibiotic resistance.
HIGH LEVELS OF ANTIBIOTICS IN POULTRY
70 Chicken samples from Delhi-NCR tested
for six commonly used antibiotics
40 per cent samples test positive; residues of
more than one antibiotic found in 17 per cent
samples
Antibiotics that is important to treat diseases
in humans, like ciprofloxacin, being
rampantly used by the industry. This is
leading to increased cases of antibiotic
resistance in India. For instance, ciprofloxacin
resistance is growing rapidly in the country
India has no regulation on controlling
antibiotic use in poultry industry, or to control
sales of antibiotics to the industry. It is free
for all
Recommendations to the Government
Ban use of antibiotics as growth promoters
and for mass disease prevention. Antibiotics
critical for humans should not be allowed in
the poultry Industry
Antibiotics should not be used as a feed
additive; the government should regulate the
poultry feed industry
The government should promote
development of alternatives and good farm
management practices
Set up systems for monitoring and
surveillance of antibiotic use and antibiotic
resistance in humans and animals
Set pollution control standards for the poultry
industry.
IPV VS POLIO VIRUS
According to a study done in India, a dose of
injectable inactivated poliovirus vaccine (IPV) given
to children aged between 1-4 years who had been
vaccinated with oral poliovirus vaccine (OPV)
boosts intestinal immunity to poliovrius offering
substantially greater benefit compared to an
additional dose of OPV. This conclusion was drawn
by researchers on 450 children of two groups with
225 children receiving IPV and 225 no vaccine.
Both the groups had stool samples available for
primary analysis seven days after bivalent OPV
challenge. In the IPV group, 27 (12 per cent)
children shed serotype 1 poliovirus and 17 (eight
per cent) shed serotype three poliovirus compared
with 43 (19 per cent) and 57 (26 per cent) in the
no vaccine group, suggesting those given IPV did
not allow poliovirus to multiply in the gut, hence
was better immunised as compared to those who
did not receive this.
The finding backs the use of IPV vaccine
th
July to 2
nd
August, 2014 [19]
included in the national immunisation programme
on July 3, to accelerate polio eradication by boosting
herd immunity in endemic regions, prevent
international spread by travellers, and minimise the
risk of poliomyelitis outbreaks due to imported
wildtype or vaccine-derived polioviruses. In a paper
published in The Lancet, the team of authors, led
by Jacob John and Sidhartha Giri and others,
conclude that intestinal immunity induced by OPV
is imperfect and wanes with time, permitting
transmission of infection by immunised children.
Inactivated poliovirus vaccine (IPV) does not
induce an intestinal mucosal immune response, but
could boost protection in children who are
mucosally (oral or gut) primed through previous
exposure to OPV.
These children were healthy, had not received
IPV before, and had had their last dose of OPV at
least six months before enrolment. The substantial
boost in intestinal immunity conferred by a
supplementary dose of IPV given to children
younger than five years who had previously
received OPV shows a potential role for this vaccine
in immunisation activities to accelerate eradication
and prevent outbreaks of poliomyelitis, the authors
point out.
OPV has been the vaccine of choice for the
Global Polio Eradication Initiative (GPEI) because
of its ease of administration in mass campaigns,
low cost, and ability to induce strong intestinal
mucosal immunity against poliovirus shedding and
transmission.
Although children and adults vaccinated with
oral polio vaccine are protected against poliomyelitis
if they mount a neutralizing antibody response to
all three serotypes they might still be susceptible to
infection and transmit wild poliovirus. The injected
inactivated poliovirus vaccine has excellent
immunogenicity that does not vary between
populations.
However, it does not induce an effective
mucosal immune response, poliovirus-specific IgA
is undetectable in serum or saliva in most children
after administration of IPV and offers restricted
protection against poliovirus shedding in the
intestine after challenge with OPV. As a result,
IPVs ability to prevent transmission in areas where
faecal-oral transmission is efficient stands
compromised.
The inclusion of IPV in the immunization
programme was more of a risk mitigation effort as
part of the polio end game. However, not all
vaccines can be delivered this way and even those
that can be delivered thus appear to perform poorly
in settings that require the vaccines most. IPV could
be used as a complement to OPV in several ways:
to prevent international spread by boosting
intestinal immunity among travellers, to accelerate
eradication in infected areas with poor OPV
immunogenicity through use in campaigns, and to
maximise herd immunity in advance of the planned
global withdrawal of serotype 2 OPV in 2016.
Inactivated polio vaccine (IPV)
Inactivated polio vaccine (IPV) was developed
in 1955 by Dr Jonas Salk. Also called the Salk
vaccine, IPV consists of inactivated (killed)
poliovirus strains of all three poliovirus types. IPV
is given by intramuscular injection and needs to be
administered by a trained health worker. The
inactivated polio vaccine produces antibodies in the
blood to all three types of poliovirus. In the event
of infection, these antibodies prevent the spread of
the virus to the central nervous system and protect
against paralysis. IPV is one of the safest vaccines
in use. No serious systemic adverse reactions have
been shown to follow vaccination.
Advantages
As IPV is not a 'live' vaccine, it carries no risk
of vaccine-associated polio paralysis.
IPV triggers an excellent protective immune
response in most people.
Disadvantages
IPV induces very low levels of immunity in
the intestine. As a result, when a person
immunized with IPV is infected with wild
poliovirus, the virus can still multiply inside
the intestines and be shed in the faeces, risking
continued circulation.
IPV is over five times more expensive than
oral polio vaccine.
Administering the vaccine requires trained
health workers and sterile injection equipment
and procedures.
EBOLA OUTBREAK CREATING HAVOC
The World Health Organization has warned
that an Ebola outbreak that has killed more than
700 people in West Africa is moving faster than
the efforts to control the disease. Ebola is now
th
July to 3
rd
August, 2014
infecting people
in three African
capitals for the
first time in
history. If the
situation continues
to deteriorate, the
consequences can
be catastrophic in
terms of lost lives
but also severe
s oci oeconomi c
disruption and a
high risk of
spread to other
countries. Thou-
sands of people
have contracted
Ebola since the
mid-1970s, but
this year's out-
break represents
the largest on
record.
Ebola has no vaccine and no specific treatment.
The fatality rate of the current outbreak is about
60 percent, but experts say the risk of travelers
contracting it is considered low because it requires
direct contact with bodily fluids or secretions such
as urine, blood, sweat or saliva. In the advanced
stages of the hemorrhagic fever patients sometimes
bleed from the eyes, mouth and ears.
At least 729 people in four countries Guinea,
Sierra Leone, Liberia and Nigeria have died since
cases first emerged in March. Some people in the
affected areas have apparently lost faith in their
respective medical systems, further complicating

efforts to curb the outbreak. Many sick patients
have refused to go to isolation centers, or families
have been reluctant to bring them in, partially
because of fear of subsequently being unable to see
them again.
Further west, Ivory Coast set up four
surveillance posts equipped with epidemiologists
along its western border, where many maintain
strong ties with Liberia. Health officials in Germany
and France have advised against non-essential travel
to the three affected nations, and the outbreak has
had unexpected effects beyond its borders.
th
July to 2
nd
August, 2014 [21]
NEWS IN BRIEF
NEWSMAKERS
Nepali women climb K2
Three Nepali women have successfully climbed
K2, the worlds second-highest mountain and
considered to be the most difficult. The Nepali
women, who reached atop the 8,611 metre high
Mount K2, are Maya Sherpa, Dawa Yangzum
Sherpa and Pasang Shrepa, leader of the
expedition. They are the first Nepali women to
climb Mount K2 located in Pakistan, which is
considered one the worlds most difficult peaks to
climb. The ascent came as Pakistan celebrated the
1954 feat of two Italian climbers who were the
first to reach the 8,611-metre peak. It was the first
time that Nepali women have climbed the
mountain.
The womens expedition carried the slogan
Women climbing for climate change, to raise
awareness about global warming. A joint team of
six climbers from Pakistan and Italy also climbed
K2 to mark the diamond jubilee.
G Rajagopalan
Senior Advocate G. Rajagopalan has been
appointed by the President as the Additional
Solicitor General of India in the Madras High Court
for a period of three years. The appointment is
with effect from July 28, 2014.
Rajagopalan was born in Thanjavur hails from
a distinguished, long-standing legal family. His
father, late K. Ganesa Iyer was a leading member
of the Thanjavur Bar, while his eldest brother, late
G. Ramaswamy was an Attorney General of India
between 1990 and 1992. Enrolled as an Advocate
in 1983, Rajagopalan has been appearing as senior
counsel for various bodies including the Election
Commission of India, the Tamil Nadu State
Information Commission, the Union Public Service
Commission and the Delimitation Commission.
The posts of the Solicitor General and the
Additional Solicitors General are merely statutory.
An Additional Solicitor-General for South India,
G. Masilamani, had resigned from the post, as the
new government took to office.
Dy NSA Nehchal Sandhu
The former Intelligence Bureau chief and Deputy
national security advisor Nehchal Sandhu has
resigned from his post citing personal reasons.
According to sources, the deputy NSA had been
nudged by the government to relinquish his post
just as several governors and other retired officials
holding important positions resigned recently after
getting signal from the government.
Sandhu, a 1973 batch IPS officer of Bihar cadre,
was part of the National Security Council Secretariat
that functions within the PMO. Sandhu, who was
the Director of the Intelligence Bureau between
2010 and 2012 was appointed Deputy NSA in
March 2013 for a fixed three year term. Though he
was a UPA-appointee, it was widely assumed
Sandhu would serve out his term owing to his
proximity to National Security Adviser Ajit Doval.
Ajit Lal, a former special director in the IB, was
due to retire on June 30 but stayed on after getting
a one-month extension. The Joint Intelligence
Council compiles strategic intelligence assessments
for the nation's top leadership.
Dalbir Singh Suhag
Lt Gen Dalbir Singh Suhag has succeeded
General Bikram Singh and taken over as the Head
of 1.3 million strong Indian Army. Suhag, whose
appointment had kicked up a row, was designated
as Army chief in May by the former government
ignoring protests from his predecessor Gen VK
Singh and BJP.
The new chief takes over at a time when the
force is facing challenges of modernsation in its
artillery, infantry and air defence arms and is also
preparing itself for facing a possible multi-front war.
59-year-old Suhag, a Gurkha officer who had
participated in the 1987 Indian Peace Keeping
Force (IPKF) operation in Sri Lanka, was till now
the Vice Chief of Army Staff. He will have a tenure
of 30 months as the 26th Army chief. Suhag was
made the Vice Chief of Army Staff in December
last year. Before that, he was the Eastern Army
Commander from June 16, 2012.
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He was at the centre of a controversy triggered
by 'discipline and vigilance' ban imposed on him
by the then Army Chief General V.K. Singh in
connection with an intelligence operation in Assam
earlier. The ban on Suhag, the then 3 Corps
Commander, was lifted soon after General Bikram
Singh took over in May 2012.
An alumnus of Sainik School, Chittorgarh, he
joined National Defence Academy in 1970 and was
commissioned in June 1974. The General Officer
has attended various career courses in India and
abroad which include LDMC at CDM,
Secunderabad in 1997-98, NDC Course at New
Delhi in 2006, Executive Course in USA in 2005
and Senior Mission Leaders Course (UN) in Kenya
in 2007. He holds the distinction of commanding 8
Mountain Division in Kargil from October 2007 to
December 2008.
AWARD
Magasaysay Award 2014
The Board of Trustees of the Ramon Magsaysay
Award Foundation (RMAF) has announced the
winners of Magsaysay award, Asias Nobel Prize.
The winners are Hu Shuli, Wang Canfa, Saur
Marlina Manurung, Omara Khan Masoudi, Randy
Halasan, and the Citizens Foundation.
Hu Shuli, founder and editor of Caijing, a
business magazine, is being recognized for her
unrelenting commitment to truthful, relevant, and
unassailable journalism, her fearless promotion of
transparency and accountability in business and
public governance, and her leadership in blazing
the way for more professional and independent-
minded media practices in China.
Chinese lawyer Wang Canfa, 55, founder of
the Centre for Legal Assistance to Pollution Victims,
is being recognized for his discerning and forceful
leadershipthrough scholarly work, disciplined
advocacy, and pro bono public interest litigation
in ensuring that the enlightened and competent
practice of environmental law in China effectively
protects the rights and lives of victims of
environmental abuse, especially the poor and the
powerless.
Indonesian anthropologist Saur Marlina
Manurung is being recognized for her ennobling
passion to protect and improve the lives of
Indonesias forest people, and her energizing
leadership of volunteers in SOKOLAs customized
education program that is sensitive to the lifeways
of indigenous communities and the unique
development challenges they face.
National Museum of Afghanistan director
Omara Khan Masoudi is being recognized for his
courage, labor, and leadership in protecting Afghan
cultural heritage, rebuilding an institution vital for
Afghanistans future, and reminding his
countrymen and peoples everywhere that in
recognizing humanitys shared patrimony, we can
be inspired to stand together in peace.
the Pakistani non-government group The
Citizens Foundation is being recognized for the
social vision and high-level professionalism of its
founders and those who run its schools, in
successfully pursuing their conviction that, with
sustained civic responsiveness, quality education
made available to allirrespective of religion,
gender, or economic statusis the key to Pakistans
brighter future.
Filipino teacher
Randy Halasan is
being recognized
for his purposeful
dedication in
nurturing his
Matigsalug students
and their commu-
nity to transform
their lives through
quality education
and sustainable
livelihoods, doing
so in ways that
respect their uniqu-
eness and preserve
their integrity as
indigenous peoples in a modernizing Philippines.
Since 1957 the award is given every year to
individuals or organizations in Asia who manifest
the same selfless service that ruled the life of the
late and beloved Philippine President Ramon
Magsaysay.
George Polya Prize
Indian mathematician Nikhil Srivastava has
been named as a joint winner of the prestigious
George Polya Prize along with Adam W. Marcus
and Daniel A. Spielman for cracking Kadison-Singer
conjecture. Three of them started working on this
problem while they were at Yale University and
Indian recipients of the
Award (since 2001)
Rajendra Singh 2001
Sandeep Pandey 2002
James Michael Lyngdoh 2003
Shantha Sinha 2003
Laxminarayan Ramdas 2004
V Shantha 2005
Arvind Kejriwal 2006
Palagummi Sainath 2007
Neelima Mishra 2011
Harish Hande 2011
Kulandei Francis 2012
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continued even after they graduated. They
collaborated with each other through emails.
The Kadison-Singer conjecture was first
proposed by Richard Kadison and Isadore Singer
in 1959, pertaining to the mathematical foundations
of quantum mechanics about a year ago.
While explaining its application Srivastava said
the Kadison-Singer problem arises from the question
of how to describe, i.e., parameterize, the states of
a quantum system. For example the state of an
electron in a hydrogen atom can be described
completely in terms of four quantum numbers
n, l, m and s (energy, angular momentum,
magnetic, spin). Since quantum mechanics is
formulated in the language of linear algebra, the
question of whether or not this is mathematically
possible for a general quantum system boils down
to certain questions about infinite dimensional
matrices.
Further he said the original question about
infinite matrices was reduced by Anderson to
certain questions about finite matrices. Specifically,
whether all finite matrices of a certain type can be
partitioned evenly into two balanced pieces. Since
every finite network can also be represented as a
matrix, this translates naturally into a question
about partitioning networks into balanced parts.
It resolves a mathematical issue with a widely
used formalism for quantum mechanics (although
this is not an issue that actual physicists, who
largely consider it a technicality, were concerned
about). It also tells us new things about properties
of networks, as well as certain schemes for
transmitting information robustly. Basically, since
lots of different objects can be encoded as matrices,
it has the potential to shed light on many areas.
The Polya Prize named after a Hungarian
mathematician credited with fundamental
advances in combinatorics, numerical analysis,
number theory, and probability theory, is presented
by SIAM every two years.
TERMINOLOGIES
Landslides
Landslide can describe a range of processes that
result in the downward and outward movement
of slope forming materials, including rock, soil,
artificial fill or a combination of these. The material
may move by falling, toppling, spreading or flowing.
When do landslides take place? In India,
increases in pre-monsoon (April and May) rain and
monsoon rainfall could lead to an increase in
landslides in the Himalayas and Western Ghats. If
there is increased pre-monsoon rain in April and
May, it can cause soil moisture to build sooner and
elongate the landslide-prone risk period. In southern
India, landslide incidence is greatest during
retreating monsoon, between October and
December.
What causes landslides? Landslides can be
caused by human and natural factors. Natural
factors can include lithology, structure, slope, land
cover, seismicity and rainfall precipitation, while
human factors can include deforestation, improper
land use and unplanned activities. For the
construction of 1km road in the Himalayas, 30,000
to 40,000 cubic metre of soil or rock material is
excavated. Strong earthquakes also trigger
landslides, particularly in regions marked by
critically disposed and unstable slopes.
How is rainfall related to landslides? Most of
the landslides are triggered by rain. Intense rainfall,
along with many other factors can cause slope
saturation, which is a primary cause of landslides.
High amount of rainfall and long duration are
responsible for landslides, and are also related to
debris flow. Landslides produce 550 cubic metre of
debris per year.
Is the frequency of landslides increasing?
Experts believe that the frequency of landslides is
indeed increasing. The main reasons for this are
primarily unplanned development in landslide
prone areas which can change the geomorphology
of that area. Because of accelerated deforestation,
rampant urbanization, high frequency of
earthquakes, fragile geological structures, steep
topography and intense rainfall in the mountainous
regions of the South Asia, the number of fatal
landslides, casualties and economic loss is increasing
year by year, according to the Saarc Disaster
Management Centre. Increasing extreme events due
to climate change are also responsible for this
phenomenon. Rainfall is becoming extreme in India,
either heavy or scanty. If there is a lot of rainfall in
a short span of time, then the soil is not able to
absorb the moisture, which makes it vulnerable to
erosion and slope instability, eventually leading to
landslides.
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Which areas in India are most vulnerable to
landslides? The Geological Survey of India
estimates that 15% of Indias landmass or 0.49
million sq. km area is prone to landslide hazard.
While 20 states of India are affected by different
degrees of landslides, Sikkim and Mizoram are in
the severe hazard category. The Himalayas and
the north-eastern region are highly vulnerable to
slope instability due to the immature and rugged
topography, fragile rock conditions, vulnerability
to earthquakes resulting from proximity to the plate
margins, and high rainfall. Human developmental
activities also contribute to increasing the hazard
of landslide in the Himalayan and north-eastern
regions.
SPORTS
India showcases well at the CWG
Indian wrestlers put on a stunning show with
two-time Olympic medalist Sushil Kumar, Amit
Kumar and teenager Vinesh Phogat bagging three
gold medals in their respective categories at the
2014 Commonwealth Games at the Scottish
Exhibition and Conference Centre. India got a silver
medal when Rajeev Tomar put up a fight but lost
to Canadian Korey Jarvis in the final of the men's
125kg freestyle final.
Sushil, who has Olympic bronze and silver
medals, took just 107 seconds to beat Pakistan's
Qamar Abbas to win the gold medal in the men's
freestyle 74kg category wrestling final. Former
World Champion Sushil, who had won the gold in
the 66kg category in 2010, was leading 6-2 in the
first period. It was the third gold for India after
Amit Kumar and Vinesh Phogat's triumph in their
respective categories.
Amit won the gold medal in the men's freestyle
57kg category beating Nigerian Ebikweminomo
Welson. Amit won the bout 3-1 on classification
points. It was the second gold medal for India from
wrestling after Amit Kumar's triumph in the 57kg
category.
CWG 2014 Medal Tally
Rank Country Gold Silver Bronze Total
1. England 58 59 57 174
2. Australia 49 42 46 137
3. Canada 32 16 34 82
4. Scotland 19 15 19 53
5. India 15 30 19 64
CWG
The Commonwealth Games is an international,
multi-sport event involving athletes from the
Commonwealth of Nations. The event was first
held in 1930, and, with the exception of 1942 and
1946, which were cancelled due to World War II,
has taken place every four years since then.
The 2014 Commonwealth Games, officially the
XX Commonwealth Games were held in Glasgow,
Scotland, from 23 July to 3 August 2014. The
motto for this years games was: People, Place,
Passion.
The Glasgow Games had 18 sports and 261
medal events. India did not field athletes only
in three disciplinesNetball, Rugby sevens
and Triathlon.
Vikas Gowda won a gold in the Men's Discus
throw event, thus winning the first gold
medal for India in men's athletics in 56 years.
Joshana Chinappa and Dipika Pallikal
scripted history by winning the first gold for
India in Squash at Commonwealth Games.
Kashyap Parupalli won a gold in Badminton
Men's Singles, becoming the first Indian male
shuttler in 32 years to win a gold medal in
the singles event at the Commonwealth
Games.
Dipa Karmarkar scripted history by becoming
the first Indian woman gymnast to win a
medal at the Commonwealth Games after
she bagged a bronze in the vault event.
Karmakar is the first Indian woman and
second person from the country to clinch a
Commonwealth Games medal in artistic
gymnastics winning the women's vault
bronze.
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EDITORIALS
PICK YOUR BATTLE
India is threatening to veto the implementation
of the Trade Facilitation Agreement, which is part
of the Bali package agreed on last year and is due
to be ratified by the WTO general council by July
31. The TFA places a common obligation on all
WTO members to streamline border procedures for
the easier movement of goods. The Indian
government is insisting that the deadline for the
accession protocol that would implement the TFA
be extended until its concerns on food security and
public stockholding are met. As per current WTO
requirements, food subsidies cannot exceed 10 per
cent of the value of foodgrain production calculated
based on 1986-88 prices. There can be no doubt
that this method of calculation is arbitrary and
outdated it does not take into account the huge
increase in food prices since. India wants these
norms to be renegotiated, as they clearly have
domestic political implications. However, the gains
from such a stance are limited. India needs to
rethink its stand in deeper ways.
Studies have pointed out that the Indian
consumer is shifting away from staples like wheat
and rice towards vegetables, fruit and meat. Indias
food subsidies and support prices, however, remain
directed towards wheat, rice and other staples.
There is, therefore, good reason to question why
India is insisting on protecting its right to subsidise
and procure the production of food items consume
are shifting away from. While there is a need to
ensure food security in a poor country, the present
methods of subsidisation and command and control
policies have failed to deliver. High food inflation
and supply-side issues persist. Importantly, there is
no single commodity that is driving such inflation.
In a market economy, a shift in prices of one
commodity would generate a shift in resource
allocation in production, allowing supply to match
demand at a lower price. Also, it is well
documented that subsidies in India have failed to
always reach intended beneficiaries. The NDA
government has stated its intention to reform the
food procurement and public distribution system.
The current WTO negotiations create incentives to
push for reform such as moving towards per-
acre agricultural subsidies in lieu of MSPs and direct
benefits transfer instead of the right to buy
subsidised foodgrain.
In fact, integration with international markets
may be a panacea to the problems that Indian
agriculture faces. India has become globally
competitive in many sectors. This has come about
due to a liberalisation of trade and a gradual
reduction in tariffs and subsidies due to international
commitments. An Indian potato farmer, however,
does not have the opportunity to be competitive
due to the multiple layers of restrictions and
controls. India should reconsider its stand on the
TFA to address the very problems it thinks it is
addressing by blocking it.
Source: Indian Express
BETWEEN LIFE AND DEATH
A constitutional bench of the Supreme Court is
presently hearing a petition relating to questions of
assisted dying, withdrawal of life support and
euthanasia, which have been deeply controversial
for a long time. This is not the fit time that the
Supreme Court is hearing a case on the right to
die. In the 2011 case of Aruna Shanbaug, the court
allowed for passive euthanasia under some
conditions. This was a petition in which a friend of
Shanbaug, who was in a permanent vegetative
state, sought the permission of the court to
withdraw her life support. This particular request
was rejected, but the Supreme Court permitted
passive euthanasia and laid down guidelines for
applications to be made to high courts for
permission to withdraw life support of terminally
ill people and those in a permanent vegetative state.
Detailed directions on how high courts would have
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to consider each application were given.
Now a public interest litigation in the Supreme
Court raises the issue of active euthanasia in
which a peon in her right frame of mind can make
a living will, or the wish to end her life if she
becomes terminally ill. In the process, the Aruna
Shanbaug decision is also being reconsidered. I
would put forth four arguments as to why the
court should not be going into this question at all.
Fit, the basis for this PIL is itself rather vague.
The Supreme Court preliminarily found that the
Aruna Shanbaug judgment wrongly interpreted an
earlier decision of the court in the Gian Kaur case,
which, in fact, held that the right to life does not
include a right to die. Therefore, a correct reliance
on Gian Kaur could not have led to a decision
permitting passive euthanasia. If this is indeed the
argument, then surely a reconsideration of Aruna
Shanbaug cannot lead the court to decide even
more far-reaching issues of active euthanasia.
Second, the Aruna Shanbaug case was a
moving story of a woman who was in a permanent
vegetative state because of a brutal rape and was
being looked after by hospital staff for several years.
The court could take a decision looking at the
circumstances surrounding that case. Questions
relating to end-of-life decisions, withdrawal of life
support, who has the right to decide for the patient,
whether the patients consent was given freely, are
extremely difficult and can only be decided by
courts when there are real cases with evidence
before them. Each case is different and would have
its own facts based on which the courts decisions
could differ.
For the Supreme Court to take a decision on
assisted suicide and termination of medical
treatment in the absence of a live case of a real
peon in a PIL is highly problematic. As Justice
Leonard Hoffmann said in the famous Anthony
Bland case, Modern medicine faces us with
fundamental and painful decisions about life and
death which cannot be answered on the basis of
normal everyday assumptions. Is it then possible
for the court to take a decision in the abstract,
based only on principles and constitutional values,
without a real peon claiming that right?
Third, it would be useful to have some empirical
evidence on what happened after the Aruna
Shanbaug judgment. We need to know how many
applications were made to high courts seeking
permission for the withdrawal of life support and
how the courts decided. It is unclear if this has
been done. Without such empirical reports, any
decision on euthanasia would be premature.
And finally, are these issues not best left to
Parliament to decide? All over the world, these
issues are raising new questions about who decides
when a peon is beyond treatment. Two recent cases
of June 2014 are important to consider. The
European Court of Human Rights recently ordered
French doctors to continue the treatment of a
comatose patient in a complicated case in which
his familys views on his treatment and last wishes
were divided. The UK Supreme Court similarly
ruled last month in the landmark judgment of R
(on the application of Nicklinson and another) vs
Ministry of Justice, rejecting the request of three
people who sought permission for assisted suicide.
The court there held that assisted suicide was
incompatible with human rights. The UK Supreme
Court held that these issues raise sensitive and
difficult moral questions, in which courts should
take a cautious approach. It was felt that it should
be left to parliament to take a democratic decision
and frame such regulations and protective features
as it feels appropriate.
In a 2012 report on euthanasia, the Law
Commission of India had suggested a draft bill that
would address this issue for Parliament to consider.
Having usually taken a stand in favour of a strong
judicial role, in this case it is perhaps best to let the
legislature take over. We are not ready to have
courts deal with the complicated issues of personal
autonomy, religious and moral views about life and
death, and assisted dying, over which our beliefs
are so deeply divided.
GRAND UNIFICATION
With the establishment of a Central ministry
for skill development and entrepreneurship, the
Narendra Modi government has gone into
silobreaking mode. This is welcome. The move
wrests the core elements of the prime ministers
vision for growth from various ministries and pools
them under one minister, Sarbananda Sonowal, and
under one budget, which could be in the region of
25,000 crore. Negotiations had begun in June with
almost two dozen ministries, and most of them
had apparently objected to losing their turf.
However, it is time to consolidate the numerous
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skilling initiatives taken by various ministries and
institutes. The National Policy on Skill Development
declared a training capacity of only 3.1 million.
This year, the National Skill Development Agency
set a higher target of 7.3 million. But the economies
of scale and unified vision, which must result from
consolidation, would be required to meet even the
UPA governments goal of skilling 500 million
worker by 2022. Indeed, the target would have to
be escalated if growth accelerates the exodus from
agriculture.
Rapid skilling is essential if India is to convert
what has been described as a population problem
into a demographic dividend. Fast-growing
economies require the highly skilled in far greater
number than the highly educated. Besides, skilling
addresses the social problem of the highly educated
but unemployed, a familiar phenomenon for several
decades. India has one of the worlds biggest
workforces, but the proportion of qualified skilled
labour is quite small, and the primary opportunity
could lie in certification.
For now, far too much of young India learns
on the job. It learns well but lacks the stamp of
authority, and languishes in low-paid jobs or in
the informal sector. Apart from the obvious goal of
training the wholly unskilled, the new ministry
should give some thought to certifying the armies
of the irregularly skilled who form the backbone of
unorganised manufacturing. Several trades like
those of machinists and carpenter would benefit
from certification, and jobs and assured incomes
even dollar incomes would follow. However,
skilling on a national scale, preparing worke for
both Indian and international markets, requires
centralised overnight and unified vision. The
purpose would have been indifferently served by
training bodies under diverse ministries. It is time
for a grand unification.
MAPPED OUT
For a country with a rather organic sense of
direction, with livestock sharing landmark duties
with constantly metamorphosing shops and stalls,
a call to map is perhaps as necessary as it is
daunting. In 2013, Google, in a bid to shepherd
lost souls back on the straight and narrow while,
no doubt, carving out a nice new slice of advertising
pie for itself, launched Mapathon, a contest that
invited use to map local hospitals, eateries and
places of worship. Crowdsourcing map-making,
especially in a landscape that evolves as frequently
as in India, seemed like a win-win: use get to
participate in charting their surroundings, Google
builds a better product more cheaply and efficiently
than if it went it alone, and the unsuspecting Google
Maps consumer turns left when told and, voila,
arrives at her intended destination.
But the CBI, egged on by the Survey of India,
would apparently rather that Indians flounder
around or employ the time-honoured tradition of
flagging down the nearest passer-by. It has
launched a preliminary inquiry against Google for
holding the Mapathon without seeking permission
from the surveyor general who, under the National
Map Policy, 2005, has the responsibility for
producing, maintaining and disseminating the
topographic map database of the whole country.
Not only that, Google has allegedly jeopardised
national security, they say, by mapping sensitive
areas and defence installations.
So what does the government offer as an
alternative? The country according to the Survey
of India, which has a monopoly on map
distribution, looks mostly like a collection of
squiggles sometimes interrupted by shrubbery.
Useful information like locations of petrol pumps,
ATMs, hospitals or banks is consigned to
cartographic oblivion, presumably lest one of them
turn out to be a nuclear plant in disguise.
Apparently, the imagined risk posed by a
smartphone-wielding miscreant outweighs the very
real needs of the people.
A KHAKI OVERHAUL
Much like Bollywood movies where the police
appear in the last scene, when the full story has
already been told, the recent report by three DGPs
is a belated realisation. That Muslims are poorly
represented in the armed forces, including the
police, has been known and documented for
decades. Every commission report on communal
riots has provided further evidence of police bias
against the largest minority community in the
country. Justice Srikrishna, in his inquiry on the
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Mumbai riots of 1992-93, stated: Police officers
and men, particularly at the junior level, appeared
to have an in-built bias against the Muslims which
was evident in their treatment of the suspected
Muslims and Muslim victims of riots. That
Muslims continue to distrust the khaki and see it
as communal should be a surprise to the three
senior DGPs or the home ministry. The only
welcome part of their report is that this is the first
admission by the police establishment of having
neglected the Muslims of India.
For decades, police forces have been blind to
the need to earn the faith of the community. Even
in areas with a high proportion of Muslims in the
population, their sense of insecurity and alienation
has been apparent. Terrorism in the name of Islam
has led to further profiling, which has engulfed a
large number of innocent Muslim youths. The
acquittal and the scathing remarks by the Supreme
Court in the Akshardham case reveal how anti-
terrorist operations in the country target innocent
Muslims. The police have yet to develop a response
to the sense of persecution and the growing
ghettoisation of Muslims, as seen in Gujarat and,
more recently, in Muzaffarnagar.
Improved training, countering rumours through
modern communication systems, better public
relations and monitoring provocateurs, as
recommended by the DGPs, are all welcome and
much-needed steps. However, it is doubtful if these
steps can bridge the gulf between Muslims and the
Indian police. According to National Crime Records
Bureau data, in 2013, there were 1,08,602 Muslims
serving in the police, that is, around 8.05 per cent
of the total number of personnel. Thus, in no state
police force, except Jammu and Kashmirs, do
Muslims serve in proportion to their numbers in
the general population. Unfortunately, there is no
data to determine how many Muslims occupy
supervisory positions and importantly, are posted
at police stations where service to the Muslim
community is more meaningful.
But numbers alone do not matter. The small
proportion of Muslims does not necessarily reflect
a bias in the recruitment of police personnel. For
the subordinate ranks, the selection begins with a
physical test. This entails running a mile, which
has to be done in open fields. It is difficult to
discriminate against anyone qualifying in these
physical tests, though nepotism and corruption in
the final selection are known to exist. The small
number of Muslims going for higher education
similarly affects their representation in the IPS
cadre. The DGP panel did not examine whether
greater representation of Muslims alone is likely to
close the gulf between the community and the
police force. The reservation of posts for Scheduled
Castes and Tribes has not controlled atrocities
against these communities. The government policy
of a three-year term limit at any post restricts any
possibility of the personnel building ties with the
local community. Rather than numbers, it is the
prevailing politics that explains the alienation and
sense of insecurity among Muslims.
The Indian police is a discredited organisation.
Citizens repose little faith in its capability or even
reliability. The harassment experienced in reporting
crime, seeking assistance and dealing with anti-
social elements is not only ubiquitous but also deep-
rooted. Political considerations affect every function
of the police and every community, including
Muslims, experiences the brutality, indifference and
inefficiency of poorly trained and corrupt
personnel. No citizen is willing to approach the
police for help unless there is no other recourse.
In such a situation, public relations, hiring more
Muslims and talk of community policing are mere
window dressing. The police needs an urgent
overhaul and wide reform. An organisation where
80 per cent of the personnel with power to arrest
are still restricted to a role of watch and ward, and
treated on par with class IV employees, can hardly
provide succour to citizens. The poor working
conditions and lack of resources, a policy that
comes in the way of police personnel developing
roots in the community and a leadership that is
aloof and feudal are well-known shortcomings of
the Indian police. A re-evaluation of the criminal
justice system and an emphasis on due processes
are some of the initial steps that are needed. Muslims
and every other community will be served better
by a professional police, accountable for its actions
and properly supervised, than by more numbers
being added to the present decrepit system.
SO MANY REGULATORS
Much has been written about the leanness of
Narendra Modis cabinet, constituted on the mantra
of minimum government, maximum governance.
This shift may mean a shrinking government, but
it also means a changing role for it. In several
markets, government intervention is necessary to
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enhance market performance. Government
intervention affecting industry structure and
behaviour takes two forms: regulation and antitrust.
Regulatory agencies and antitrust authorities are
only two of the several institutional players defining
the competitive environment. Regulators define ex
ante a set of permissible business conduct for
operators by regulating entry conditions, licensing
requirements, tariff standards, access, control over
price, quantity and quality, etc. Antitrust enforcers,
in contrast, check ex post that anti-competitive
conduct as identified by competition law is not
pursued.
This diarchy of economic regulation is meant
to be complementary and ensure the structural and
behavioural competitiveness of the Indian economy.
However, sectoral regulators, taking advantage of
their overlapping jurisdiction with the Competition
Commission of India (CCI), the antitrust agency,
have continuously tried to chip at its mandate. This
has resulted in regulatory parallelism amongst
sectoral regulators and the CCI.
For instance, in August 2012, the Central
Electricity Regulatory Commission (CERC)
introduced draft regulations to grant itself the
power to regulate anti-competitive agreements,
abuse of dominant position and anti-competitive
mergers (all in the CCIs domain) in the electricity
sector. Such efforts would virtually eliminate the
CCIs regulatory oversight, creating a parallel and
conflicting competition regime for the electricity
sector. Further, the CERCs exercise took place
without any enabling legislation or legislative
mandate, and was rooted using a residual clause
under the CERCs parent legislation, the Electricity
Act, 2003. Interestingly, the CERC, which was
created in 2003, only chose to legislate on this after
the CCI had been made fully functional. The CERC
has the mandate to promote competition in
electricity markets by creating appropriate
competitive and efficient market structures.
However, it cannot usurp the jurisdiction of the
CCI to ex-post regulate distortion of such
competitive markets through such conduct.
The RBI has also attempted to curb the CCIs
regulatory jurisdiction. It has successfully lobbied
the government to exempt mergers of failing banks
from the purview of the CCIs antitrust scrutiny,
and wants compulsory mergers to be exempted from
competition scrutiny. This is in spite of the fact
that the Competition Act specifically mandates the
CCI to consider failing business as a factor while
evaluating mergers. Therefore, the exemption to
failing banks is an exercise of regulatory
redundancy. The RBI is the prudential regulator of
banks, limiting their risk-taking, ensuring the safety
of depositors funds and stability of the financial
sector, while the CCIs review of bank mergers is
aimed at ensuring that such mergers do not cause
an appreciable adverse anti-competitive effect on
the financial sector. The CCI is not a prudential
regulator and the RBI is not a competition regulator,
and both are required to complement each other.
The government intervened on behalf of the
CCI to restrict such sectoral backlash and has
proposed amendments to the Competition Act,
which make it mandatory for sectoral regulators to
refer to the CCI if the decision taken by such sectoral
regulator raises any competition issue. However,
such amendments have failed to see the light of day.
Defendants of anticompetitive complaints before
the CCI have often taken advantage of such
opportunistic behaviour to seek judicial intervention
on the ground that the sectoral regulator and not
the CCI has jurisdiction. The judiciary has also been
less diligent in curbing such posturing and on
numerous occasions, has stayed proceedings before
the CCI on the pretext that such proceedings would
allegedly impinge upon the regulatory jurisdiction
of the applicable sectoral regulator. For example,
the CCI has been stopped from investigating alleged
anticompetitive practices of three state-owned oil
marketing companies (OMCs) at the behest of the
Delhi High Court, which has stayed multiple CCI
proceedings against them.
In two separate actions before the CCI, the
OMCs were charged with alleged acts of price
collusion and denial of market access to private
players. The CCI has the exclusive statutory
mandate to investigate and regulate acts of
cartelisation and price collusion; however, the
OMCs approached the Delhi High Court and
successfully stayed the proceedings on the pretext
that the case fell under the jurisdiction of the
Petroleum and Natural Gas Regulatory Board
(PNGRB). Such efforts to oust the CCIs jurisdiction
have led to regulatory confusion and impeded its
efforts to enhance competition.
The Supreme Court in Subrata Roy Sahara vs
Union of India lamented the posturing antics of
litigants aimed at forum shopping. It has stated
that such antics result in cases which ought to
have been settled in no time at all, before the first
court of incidence, [being] prolonged endlessly, for
years and years, and from court to court, upto the
highest court. This message should not be lost on
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July to 3
rd
August, 2014
the high courts which, by admitting competition
matters, contribute to prolonging a pattern of
illegitimate claims that should be ideally settled by
the CCI.
The new government needs to focus its reform
agenda to address such regulatory duplicity to
create a more enabling business environment for
industry. A governance reform agenda built on the
expectation that regulated markets will deliver
growth requires such reforms to trickle down to
the new-age independent sectoral regulators.
Without eliminating regulatory chaos, delivering on
the expectations of Indias polity will be difficult.
TEN YEAR 25 MILES LATER
Last Sunday, the Nasa Mars rover, Opportunity,
broke the record for off-Earth driving, previously
held by the moon rover, Lunokhod 2, which was
launched by the former USSR in 1973. Not only
has Opportunity driven 25 miles, it has heralded
long-term robotic presence on the surface of another
planet.
While life continued on Earth, on July 27,
unknown to most outside the mission team,
Opportunity completed a spectacular drive on Mars,
surpassing 25 miles, and in the process became the
vehicle to drive the longest distance outside Earth.
Opportunity landed on Mars in January 2004, with
the objective of surviving 90 days and driving one
kilometre. Ten years and 40 km later, Opportunity
is still trooping forward on Mars, continuing its
mission to explore an unknown world, to feast its
eyes on landscapes that no human has seen before
and to leave its wheel tracks where no vehicle has
driven before. Opportunity shows some signs of
ageing, but for the most part, it is functional. In
fact, its solar arrays are clean and the energy
generated by the arrays is comparable to the first
year of the mission.
Opportunity landed at Eagle Crater, but it has
driven far beyond to Endeavour Crater. It is trying
to track down the signs of clay minerals in the
western rim of Endeavour Crater seen from orbit
by CRISM, a spectrometer on board the Mars
Reconnaissance Orbiter. Clay minerals help scientists
figure out questions related to water and to the
hospitality of past environments for life on Mars.
The longest road trip that I have been on was
two days long, when I drove from Washington DC
to Florida. But Opportunity has been on the road
for 10 years, exposed to the sun, winds, dust and
radiation. It has been witness to the change in
seasons, the regional dust storms on Mars that
obliterate the sun and the freezing temperatures of
five Martian winters. And of course, as it drove,
Opportunity has seen the wonderful vistas of Mars
from Martian sunsets to iron meteorites, from
cirrus clouds to the spectacular world of Martian
rocks that have been viewed for the first time
through its microscopic imager. Throughout the
roadtrip, Opportunity has had no physical repairs.
It has never had the luxury of swapping some old
parts for new, no new lubrication for the wheels,
no new battery or motherboard for the onboard
computer.
In the broader scheme of things, courtesy five
orbiters, four rovers and one lander, we have
covered significant ground in Mars exploration over
the last 18 years since the Mars Global Surveyor
landed on that planet in 1996. We have confirmed
the presence of ice at the Martian poles and
evidence of liquid water in the past. Spirit and
Opportunity, together with Curiosity, have set the
stage for the next rover mission, Mars 2020, which
will likely have the capability of looking for
biological evidence related to life and a mechanism
to generate oxygen on Mars. We have made huge
strides in obtaining geologic, chemical, mineralogic
and atmospheric data from Mars, which have
greatly helped scientists understand the geologic
and atmospheric evolution of that planet. Mars has
transitioned from a distant object to an accessible
planet that is inundating us with new data every
day from two rovers and four orbiters.
Behind Opportunity lies a team that has
developed and operated the vehicle. The team has
battled incredible odds to operate a vehicle about
200 million km away. From landing on Mars to
driving across it, it has been a journey into an
unknown parameter space from an engineering
standpoint, which calls for customisation, iterative
learning and reworking. A strategic mistake in
preparing for the long term or an oversight in
planning a single observation on Mars has the
potential to cause irreversible damage to the rover.
For more than 3,735 sols (or Martian days), the
team has commandeered activities that have
balanced the requirements of science, the
adventurism of trying something new and the
conservativeness of not taking irrational risks.
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IN THE NAME OF INDIA, WHY?
In my previous article (A principled Congress
stand at the WTO?, IE, July 29), I reached three
conclusions. First, that there was an urgent need
for the representative WTO reference price for
agricultural products to be made a dynamic price
rather than the present outdated average 1986-88
price. Second, with this dynamic price adjustment,
the minimum support price paid by the Indian
government to its farmers is well in excess of that
allowed by WTO rules. Third, that Indias present
WTO stance is without logic or empirical support.
Unfortunately, the computations in my July 29
article contained errors with respect to international
reference prices for rice and wheat. In the
transformation between statistical programmes, the
price for 2013 was mistakenly taken as the price
for 2004, the price for 1990 was the price for 1981,
that is, the price levels were shifted backwards by
a uniform nine years for each data point. My error,
my apologies.
I have written close to 1,000 articles in newspapers
over the last 30 years, and this is the first time I am
making an empirical error and for this I must
apologise. I have made other important errors, for
example that I believed that the government had
no option but to present a good budget in 2011,
2012 and 2013, and I had egg on my face, and
worse, when the government of the day did not
oblige. These were errors of judgement and not
errors of calculation.
This error of calculation has allowed me to
correct other assumptions detailed in the footnotes
to the table. When all these corrections are
incorporated, there is no material change in any of
the conclusions mentioned above (phew!). Indeed,
the 32-year average excess price provided to Indian
producers of rice increases from minus 17 per cent
of the world fob price to plus 17 per cent. In the
case of wheat, there is no change between the earlier
calculation and the present one in both cases,
our prices have been, on average, 14 per cent above
the world price.
One advantage in redoing
the numbers is that it allows one
to answer some questions. First,
how is it that India has been able
to export wheat and rice in the
last few years when our
domestic fob price has been
above the world price? For the
last three years, India exported
each year an average 9 million
metric tonnes (MMT) of rice, and
4 MMT of wheat. In value terms,
about Rs 40,000 crore per year
not small.
A further point deserving
emphasis is that the fob price
(relevant for exports and
relevant for WTO production
subsidy calculations) is the
minimum support or
procurement price plus freight
(for example, from Punjab to the
nearest seaport) plus port
handling costs. These costs are
elastic and vary according to the
self-interest of the estimator.
Indian grain organisations will
tend to understate this important
cost component; foreign
organisations will tend to
Excess of domestic
Price of rice ($/tonne) Price of wheat ($/tonne) over in till prices (%)
Year India International India International Rice Wheat
1983-1985 280 274 166 157 2 6
1986-1988 264 209 157 121 26 29
1989-1991 225 283 143 150 -20 -5
1992-1994 260 266 143 140 -2 2
1995-1997 268 309 172 178 -13 -4
1998-2000 268 286 167 133 -6 26
2001-2003 288 189 171 130 52 32
2004-2006 308 244 207 152 26 37
2007-2009 481 445 290 258 8 13
2010-2012 552 354 310 254 56 22
2012-2014 540 352 294 314 53 -6
Average 339 292 202 181 17 14
Earlier 214 288 163 146 -17 14
Calculation(3)
Source: WEO 2014 for international prices: department of agriculture (Gol) for Indian
Prices.
Notes:
1. All Indian prices for rice and wheat are FOB prices calculated as procurement
prices plus handling and transportation costs (taken as 25 per cent of the
procurement price). The price of rice has been constructed from the price of
paddy using a conversion factor of 0.52 (rate of conversion of wet paddy to dry
unhusked paddy conversion is 83.12 per cent: for dry unhusked paddy to rice
conversion is 62.85 per cent: therefore, wet paddy to rice is 0.8312* 0.6285 = 0.52).
2. All international prices are calcullated as three-year moving averages, lagged
by one year. These prices are representative FOB prices - Thailand for rice and
US for wheat, post 2008 the more relevant vietnamese FOB price has been used
for rice.
3. This is from the previous artide A principled Congress stance at the WTO?
IE, July 29.
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rd
August, 2014
overstate it. The fact remains that this cost is a
grey area and can explain apparent anomalies.
Such costs are estimated by outside experts (for
example, US Wheat Associates (USW), which
promotes US grain sales) as approximating $80 per
tonne in 2013-14; according to Indian experts, this
extra cost is closer to $50 or 22 per cent of the MSP
of $231 in 2013. In my calculations, I have taken
the freight, etc costs as 25 per cent of the MSP.
Our self-righteousness leads us to point fingers
at others, especially the US, when the fault is
entirely our own. Many Indians argue that the US
exorbitantly subsidises its grain production, so why
shouldnt India as well? Indeed, this is one of the
background arguments for Indias stance at the
WTO. If the US is the reference fob price, no
calculation can show that it is subsidising its wheat
exports. But what about the hidden subsidies
provided to the farm sector in the US? Such
subsidies have totalled $36 billion for the 18 years
between 1995 and 2012, or about $2 billion a year.
For 2012, US wheat production was 49 MMT and
hidden subsidies totalled $1 billion or 5.5 per
cent of total production. WTO agreements allow
such subsidies in developed economies to not
exceed 5 per cent. Thus, whatever arguments are
made against the US not being WTO compliant,
wheat production subsidy, hidden or otherwise, is
not one of them.
When all else fails, invoke the poor. Indias
favourite argument against signing the Trade
Facilitation Agreement is: please dont mess with
our food security act for the poor and consumer
subsidies because that offends our sensibilities, our
integrity and our honour. Well, BJP or Congress,
dont bleed your hearts, and especially not with
such deep cuts. The WTO agreement only involves
production subsidies, not consumer subsidies.
Indeed, according to the WTO and most countries
in the world, India can do what it wants with its
food subsidies. It can buy food from farmers at Rs
20 per kg and sell it to consumers at Rs 0, 1, 2, or
3 per kg or any food subsidy level it chooses. The
rest of the world does not care, as long as India
does not pay its producers much above the fob price.
There is a political economy lesson in food
pricing. For example, Thailand lost its treasured
place as a rice exporter to Vietnam because of its
own populist food policy initiated in 2011. All
correlations of political trouble in Thailand with its
destructive food policy may not be coincidental.
Neither, as pointed out in the July 29 article and
several previous ones, is it coincidental that the
Congress grotesquely messed up on food prices and
this had a major effect on its outsized political loss
in the 2014 elections.
This foray into data leads to the following robust
conclusions. India has engineered unprecedented
food inflation through the UPAs belief that such
practices would help it win the 2014 election; it
obviously did not. Second,
India is making itself a laughing stock in the
eyes of the world community (perhaps it does not
matter) by violating agreements it made just six
months earlier when it made the WTO accept its
unreasonable demands. Third, India cannot make
any case for its new unprincipled stance. So the
question arises given that the BJP has just formed
a majority government with no obligations, implicit
or explicit, to the previous UPA regime, and given
that Prime Minister Narendra Modi is widely
believed, and correctly so, to be his own man, then
why, in the name of god and India, is Modi-BJP
pursuing an illogical and regressive stance at the
WTO?
THE REAL THREAT TO WTO
Aside from war and migration, observed the
Nobel prize winning economist, Thomas C.
Schelling, trade is what most of international
relations are about. For that reason, trade policy is
national security policy.
One of the few economists to take any serious
academic interest in national security issues, and
known for his analysis of nuclear deterrence from
a game theoretic perspective, Schelling made these
observations in 1971 to a United States
Congressional Commission on National Security
Considerations Affecting Trade Policy.
While economists like to believe that trade policy
is defined by rational calculus, the wielders of
power and policy have always known that trade
policy is integral to a nations strategic policy. The
transatlantic powers created a post-war trading
regime under the auspices of the General
Agreement on Trade and Tariffs (GATT) designed
to serve their geoeconomic interests. This was
sought to be democratised, though only partially,
with the World Trade Organisation (WTO), creating
not just a rules-based trading system but also a
disciplinary mechanism to enforce those rules.
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India correctly took the view that it had a
strategic stake in such a multilateral rules-based
system, and successive governments have worked
hard with the West through the WTO. The current
impasse in the WTO has in fact been created by
the dilution of Western commitment to that regime,
and not by developing-country intransigence, much
less Indias.
In the current stand-off on Indias stance on its
food security policy, Western powers are pretending
as if they are the upholders of fair play and India
the spoiler. The fact is that major trading powers
have never shied away from being spoilers in
multilateral trade talks whenever it has suited their
national interest. It should be recalled that the US
and EU have readily deployed non-economic
weapons to threaten their trade partners whenever
their economic interests have been threatened.
When Japan emerged as a competitive global
exporter, building a huge trade surplus vis--vis
the transatlantic economies, the US deployed
domestic laws, Special and Super 301, to get Japan
to adopt voluntary export restraints (VERs). The
EU single market was created in the early 1990s
as a conscious response to Japans rise.
Hence, it would be churlish for the West to
criticise the Indian government for giving primacy
to domestic politics in external trade negotiations.
The real threat to the WTO-based multilateral
trading system has come in recent months from
the US initiative to enter into WTO-plus plurilateral
agreements, namely, the Trans-Pacific Partnership
(TPP) and the Transatlantic Trade and Investment
Partnership (TTIP).
While a plethora of such agreements around
the world has virtually sidelined the WTO, the TPP/
TTIP challenge is the biggest threat so far to a rules-
based development-oriented multilateralism. This
assessment came through clearly at a recent
conference on Trade and Flag: Changing Balance
of Power in the Multilateral Trading System,
organised by the Geoeconomics and Strategy
Programme of the International Institute of Strategic
Studies (IISS).
The TPP and the TTIP have been cooked up as
a geoeconomic response to Chinas emergence
as a mega-trader, while being touted as defining
a new gold standard for international trade.
While Japan has reluctantly joined the TPP, most
major emerging economies, especially the BRICS
economies Brazil, Russia, India, China and South
Africa remain outside TPP-TTIP.
It is against this larger Great Game in global
trade that one must view Indias current stance.
True, the shadow of domestic politics, and public
concern about food inflation and food security,
loom large over the Narendra Modi governments
stance, which is but a continuation of the view
taken by the Manmohan Singh government.
However, it is also clear that this is not the only
factor shaping Indian official thinking on trade
policy. There seems to be an assessment that the
transatlantic powers are digging their heels in on
market access, trade liberalisation and weakening
the WTOs rules-based trading system. Perhaps
India is not the target of their actions and China is.
But India would suffer collateral damage and, so
far, the US has not provided any assurance that
India would not be a victim of the unintended
consequences of a US-China trade war.
Differences over trade come against the
background of several other differences that have
dogged US-India relations during the tenure of
President Barrack Obama. These issues ought to be
ironed out when US Secretary of State John Kerry
meets Indias new political leadership.
Regrettably, Kerrys remarks on WTO and India,
on the eve of his arrival in New Delhi, are not
particularly helpful. He said on Tuesday, India
must decide where it fits in the global trading system.
Its commitment to a rules-based trading order and
its willingness to fulfil its obligation will be a key
indication. It could well be argued that the US
too must come clean on its commitment to a rules-
based system that is fair to developing economies.
The impasse in Geneva will get sorted out when
Washington DCs intentions behind TPP/ TTIP are
better explained and the US wins the confidence
of developing countries. The US must address
Indian concerns that it may abandon the WTO
and pursue a trade agenda inimical to India once
it gets the trade facilitation deal through. For its
part, India must reform its food security system
and its agricultural economy as a whole, and ensure
they are WTO-compatible. For now, however, the
US and India must resist quarrelling on this issue
and revive their relationship.
What can perhaps change the game and revive
trust between India and the US is a revival of the
larger strategic engagement between the two
democracies that was initiated by US Presidents
Bill Clinton and George Bush. Obama has not been
able to retain that trust with India. Prime Minister
Modi has made a new beginning. It remains to be
seen whether Kerry is able to win back New Delhis
trust and affection, restoring balance to a wayward
relationship.
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SUFFOCATING TOGETHER, INSIDE THE BUBBLE
Israelis and Palestinians are imprisoned in what
seems increasingly like a hermetically sealed bubble.
Over the years, inside this bubble, each side has
evolved sophisticated justifications for every act it
commits. Israel can rightly claim that no country
in the world would abstain from responding to
incessant attacks like those of Hamas, or to the
threat posed by the tunnels dug from the Gaza
Strip into Israel. Hamas, conversely, justifies its
attacks on Israel by arguing that the Palestinians
are still under occupation and that residents of Gaza
are withering away under the blockade enforced
by Israel.
Inside the bubble, who can fault Israelis for
expecting their government to do everything it can
to save children on the Nahal Oz kibbutz, or any
of the other communities adjacent to the Gaza Strip,
from a Hamas unit that might emerge from a hole
in the ground? And what is the response to Gazans
who say that the tunnels and rockets are their only
remaining weapons against a powerful Israel? In
this cruel and desperate bubble, both sides are right.
They both obey the law of the bubble the law of
violence and war, revenge and hatred.
But the big question, as war rages on, is not
about the horrors occurring every day inside the
bubble, but rather it is this: How on earth can it be
that we have been suffocating together inside this
bubble for over a century? This question, for me, is
the crux of the latest bloody cycle.
Since I cannot ask Hamas, nor do I purport to
understand its way of thinking, I ask the leaders of
my own country, Prime Minister Binyamin
Netanyahu and his predecessors: How could you
have wasted the years since the last conflict without
initiating dialogue, without even making the
slightest gesture towards dialogue with Hamas,
without attempting to change our explosive reality?
Why, for these past few years, has Israel avoided
judicious negotiations with the moderate and more
conversable sectors of the Palestinian people an
act that could also have served to pressure Hamas?
Why have you ignored, for 12 years, the Arab
League initiative that could have enlisted moderate
Arab states with the power to impose, perhaps, a
compromise on Hamas? In other words: Why is it
that Israeli governments have been incapable, for
decades, of thinking outside the bubble?
And yet the current round between Israel and
Gaza is somehow different. Beyond the pugnacity
of a few politicians fanning the flames of war,
behind the great show of unity in part
authentic, mostly manipulative something about
this war is managing, I think, to direct many Israelis
attention towards the mechanism that lies at the
foundation of the vain and deadly repetitive
situation. Many Israelis who have refused to
acknowledge the state of affairs are now looking
into the futile cycle of violence, revenge and
counter-revenge, and they are seeing our reflection:
a clear, unadorned image of Israel as a brilliantly
creative, inventive, audacious state that for over a
century has been circling the grindstone of a
conflict that could have been resolved years ago.
If we put aside for a moment the rationales we
use to buttress ourselves against simple human
compassion towards the multitude of Palestinians
whose lives have been shattered in this war,
perhaps we will be able to see them, too, as they
trudge around the grindstone right beside us, in
tandem, in endless blind circles, in numbing despair.
I do not know what the Palestinians, including
Gazans, really think at this moment. But I do have
a sense that Israel is growing up. Sadly, painfully,
gnashing its teeth, but nonetheless maturing
or, rather, being forced to. Despite the
belligerent declarations of hotheaded politicians and
pundits, beyond the violent onslaught of right-wing
thugs against anyone whose opinion differs from
theirs, the main artery of the Israeli public is gaining
sobriety.
The left is increasingly aware of the potent
hatred against Israel a hatred that arises not
just from the occupation and of the Islamic
fundamentalist volcano that threatens the country.
It also recognises the fragility of any agreement
that might be reached here. More people on the
left understand now that the right wings fears are
not mere paranoia, that they address a real and
crucial threat.
I would hope that on the right, too, there is
now greater recognition even if it is accompanied
by anger and frustration of the limits of force;
of the fact that even a powerful country like ours
cannot simply act as it wishes; and that in the age
we live in there are no unequivocal victories, only
an illusory image of victory through which we
can easily see the truth: that in war there are only
losers. There is no military solution to the real
anguish of the Palestinian people, and as long as
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nd
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the suffocation felt in Gaza is not alleviated, we in
Israel will not be able to breathe freely either.
Israelis have known this for decades, and for
decades we have refused to truly comprehend it.
But perhaps this time we understand a little better;
perhaps we have caught a glimpse of the reality of
our lives from a slightly different angle. It is a
painful understanding, and a threatening one,
certainly, but it is an understanding that could be
the start of a shift. It might bring home for Israelis
how critical and urgent peace with the Palestinians
is, and how it can also be a basis for peace with
the other Arab states. It may portray peace such
a disparaged concept here these days as the
best option, and the most secure one, available to
Israel.
Will a similar comprehension emerge on the
other side, in Hamas? I have no way of knowing.
But the Palestinian majority, represented by
Mahmoud Abbas, has already decided in favour of
negotiation and against terrorism. Will the
government of Israel, after this bloody war, after
losing so many young and beloved people, continue
to avoid at least trying this option? Will it continue
to ignore Abbas as an essential component to any
resolution? Will it keep dismissing the possibility
that an agreement with West Bank Palestinians
might gradually lead to an improved relationship
with the 1.8 million residents of Gaza?
Here in Israel, as soon as the war is over, we
must begin the process of creating a new
partnership, an internal alliance that will alter the
array of narrow interest groups that controls us.
An alliance of those who comprehend the fatal
risk of continuing to circle the grindstone; those
who understand that our borderlines no longer
separate Jews from Arabs, but people who long to
live in peace from those who feed, ideologically
and emotionally, on continued violence.
I believe that Israel still contains a critical mass
of people, both left-wing and right-wing, religious
and secular, Jews and Arabs, who are capable of
uniting with sobriety, with no illusions
around a few points of agreement to resolve the
conflict with our neighbours.
There are many who still remember the future
(an odd phrase, but an accurate one in this context)
the future they want for Israel, and for Palestine.
There are still but who knows for how much
longer people in Israel who understand that if
we sink into apathy again we will be leaving the
arena to those who would drag us fervently into
the next war, igniting every possible locus of conflict
in Israeli society as they go.
If we do not do this, we will all Israelis and
Palestinians, blindfolded, our heads bowed in
stupor, collaborating with hopelessness continue
to turn the grindstone of this conflict, which crushes
and erodes our lives, our hopes and our humanity.
GIVE 2013 LAW A FAIR CHANCE
After intensive and extensive consultations
lasting for over two years, the UPA 2 government
succeeded in getting Parliament to pass a historic
new land acquisition law in September 2013. This
law completely replaced the colonial Land
Acquisition Act, 1894. The new legislation did not
fully satisfy everybody but it came to be widely
acknowledged that it, for example, ended the era
of forcible acquisitions, enhanced compensation for
both land-owners and landless families significantly,
provided for the essential resettlement and
rehabilitation of families displaced on account of
land acquisition, curtailed the abuse of the urgency
clause, gave farmers a share in the appreciated
value of the acquired land, provided for the return
of unused land and the creation of land banks,
and gave gram sabhas new powers to decide on
land acquisition. Since January this year, the
Supreme Court has upheld the new law, particularly
the retrospective clause, in four separate judgments.
Gopinath Munde, before his tragic death,
publicly stated that he would ensure the effective
implementation of the 2013 act. But his successor
in the rural development ministry, Nitin Gadkari,
firing from the shoulder of the states, seems to have
other views and has previously announced that he
is in favour of amending the new law substantially.
Specifically, it appears that the consent clause that
provides for land acquisition for private companies
only after the written permission of farmers will be
diluted and the mandatory social impact
assessment prior to land acquisition, in order to
judge its essentiality and to identify both land and
livelihood losers, will be dropped. There are other
changes proposed that will entirely alter the law.
The concerned parliamentary standing
committee had recommended that government
should not acquire land at all for private companies
under any circumstances. This committee was
headed by senior BJP leader Sumitra Mahajan, who
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is now Speaker of the Lok Sabha. The UPA 2
government did not accept this recommendation.
But it provided for such acquisition to take place
only after 80 per cent of the farmers give their
written consent, with the consent requirement being
70 per cent when public-private partnership
projects are involved. However, here an important
exception was made. For projects carried out by
the government, for the government (for public
purpose) where the land would remain absolutely
and completely in the government, no consent
would be required.
Indubitably, the Land Acquisition Act, 1894 was
a draconian legislation that had been the cause of
widespread displacement and heinous atrocities,
all committed in the name of advancing
development. The principal reason why the law
was a relic and necessitated a revisit was because
of the complete absence of any safeguards against
its abuse. Any authority could decide, unilaterally,
that land was required and it could simply make
a claim for it. Hearings against it were perfunctory
and often dispensable. In this day and age, when
we prize due process as an essential promise to
our citizens, such a law just could not be allowed
to continue on the statute books.
A social impact assessment is now being argued
to be an inconvenience, a cause of delay. But before
any acquisition begins, should there not be a
transparent public process, whereby a thorough
and systematic inquiry could be made to ascertain
if the acquisition is even necessary to begin with?
In other words, the acquisition process should not
be subject to the whims and fancies of governmental
authorities. The social impact assessment study is
also limited to a deadline within which it has to be
carried out six months.
A third point apparently being made by Gadkari
is that states must have flexibility. Of course they
must, and indeed they do in the new law. States
are free to decide on whether land should be
acquired, purchased or leased, and they are also
free to decide on the extent to which multi-cropped
irrigated land should be acquired, keeping in mind
considerations of food security. It is also the
prerogative of the states to decide when resettlement
and rehabilitation should take place when land is
being purchased directly by private parties from
farmers. The sliding scale of compensation (between
twice in urban areas and four times in rural areas)
is for the states to fix.
The 2013 law was passed with the complete
support of the BJP and, indeed, of all political
parties, each of which made important
contributions to the final version. Both amendments
recommended by the BJP in the Lok Sabha, relating
to lease and share in future sale of acquired land,
were included without changes. Amendments
suggested by the Madhya Pradesh chief minister to
smoothen land acquisition for irrigation projects
were accepted in the Rajya Sabha and included in
the final legislation.
Drafting a law requires a balancing of competing
interests a task of immense proportions in a
country with many diverse groups. The new land
acquisition law must be given a fair chance because,
for the first time, the concerns and interests of
farmers, livelihood losers and scheduled caste and
scheduled tribe communities have been given the
highest priority as part of land acquisition. That
should not now be abandoned. The focus should
be on passing amendments to the Registration Act,
1908, for which UPA 2 had introduced a bill in the
Rajya Sabha. This will ensure greater accuracy in
arriving at land values and also in determining
beneficiaries for payment of compensation. Other
initiatives launched in the past four years for
modernisation of land records and a national land
reforms policy must also be taken forward.
REVISIT AND REVIEW
India needs a comprehensive shift towards
better infrastructure, more manufacturing and
faster urbanisation, all of which are dependent on
the availability of land. The legislation for land
acquisition, the Right to Fair Compensation and
Transparency in Land Acquisition, Resettlement
and Rehabilitation Act, was notified in December
2013. But it is believed to be under review by the
new government and rightly so, as many provisions
included in the act make land acquisition almost
impractical.
The new act, which replaced the 1894 legislation,
was expected to cater to development imperatives
while also providing a better deal for land-owners
and others dependent on the land. However, it
only freezes land acquisition through lengthy
procedures and the imposition of high costs that
render projects unviable.
The CII has taken up the onerous land
acquisition legislation with the government over
the years, stressing that the principles underlying
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the process need to promote industrialisation and
urbanisation, and that the people impacted by land
acquisition must be substantially better off after the
process. Land acquisition must be speedy, simple
and beneficial for all stakeholders. The issues to be
addressed include administrative procedures, the
definition of project-affected families and their
resettlement and rehabilitation, and compensation
for land.
Technology and satellite imagery have made it
possible to go in for scientific land acquisition,
beginning with the identification of fallow and
unproductive lands. These should be demarcated
for land bank corporations in each state, which
would develop infrastructure and offer plots for
industrial use in a transparent manner. Digitisation
of records must be fast-tracked to introduce
transparency and facilitate detailed planning of
land use for industrial, agricultural and residential
development. Simultaneously, ex ante zoning of
land should segregate available land for different
purposes over a 100-150-year horizon.
The act mandates consent of 80 per cent of the
affected families when land is acquired for private
projects. This should be reduced to 60 per cent,
irrespective of land use by public or private entities.
Moreover, there should be a specific time-frame for
the possession of land after the required consent
has been obtained so as to avoid prolonging the
process by those who did not acquiesce.
Currently, administrative procedures under the
act are complex, convoluted and lack clarity. They
require multiple public consultations for various
environment and forest clearances, lengthy and
detailed negotiations, and the setting up of several
authorities and groups for different purposes. The
flow-chart would take a minimum time of almost
five years if the schedules stipulated in the act are
adhered to, and more if not.
A socio-economic and cultural profile of the
affected area is to be prepared through a social
impact assessment (SIA), which would consider
land required, alternate land availability, impact
on infrastructure, and many other issues. Formal
public hearings are to be held to present the findings
of the SIA to obtain feedback and incorporate
additional comments. Hearings would also be held
at gram panchayats, whose land will not be
acquired if they are found to be affected. The
number of such hearings is not specified in the act.
After the SIA report is finalised, it would be
disseminated and an independent multi-disciplinary
expert group would be set up to examine it. There
is also a long process of identifying owners and
affected persons to obtain consent that commences
after the SIA. The gram sabha would then pass a
resolution giving or withholding consent to the land
acquisition, along with the negotiated and agreed
terms of resettlement and rehabilitation (R&R). The
required funds can now be placed with the district
collector and the R&R process can begin, requiring
the construction of a township with specified
infrastructural facilities.
The effort should be to ensure transfer of land
to the requiring body within two years. Some
procedures could be carried out in parallel and a
number of public consultations with the same set
of people can be avoided. The SIA is a complex
procedure and requires professionals with uniform
standards of assessment. Model terms of reference
may be prepared for different projects for
standardisation and a representative of the requiring
body should be included in the SIA team.
The compensation package in Schedule I of the
act is another factor to be considered with respect
to ascertaining if projects are viable. As per CII
calculations, stipulated compensation increases the
cost of land by about 3-3.5 times, which might
deter projects altogether. The new act also mandates
employment, cash or annuity at the same rates for
all project-affected families, including those who
do not substantially lose livelihood, thus adding to
land cost.
Industry has also been concerned about
retrospective applicability of the act where awards
under Section 11 of the earlier act had not been
made, and about the return of unused land within
a short period.
We hope that the new government will take all
these issues into account and review the current
act. The country and its young population cannot
afford a long wait for the revival of growth and
development.
A RIGHT TO ANONYMITY
Last month, the European Court of Justice
delivered its verdict in the burqa ban case. The
court upheld the French law imposing a blanket
prohibition on wearing veils that conceal the face
in public places. The ban was challenged by a
French citizen, a young woman of Pakistani origin,
who complained that the prohibition offended her
freedom of religion, her freedom of expression and
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the guarantee of privacy under the European
Convention on Human Rights. France defended its
position with the assertion that the practice of
covering the face in public was at odds with the
values of the French republic expressed in the
maxim, liberty, equality and fraternity. The
practice of wearing a veil, asserted France, was
incompatible with secularism, symbolic of
subservience, and constituted infringement of
liberty, dignity and gender equality. Further, France
argued that the face-covering burqa represented a
denial of fraternity, constituted a negation of
contact with others, violating the French principle
of vivre ensemble or living together.
The argument that impressed the European
Court was that the burqa, which entailed
concealment of the identity of the wearer from the
rest of society, raised a barrier against fellow
citizens, offending their right to live in a space of
socialisation which makes living together easier.
The veil restricts social access, a fundamental facet
of the right to fraternise in a multicultural
democratic society. The court found that religious
freedom does not always guarantee the right to
behave in the public sphere in a manner that is
dictated by ones religion or beliefs. It ruled that in
democratic societies where several religions co-exist,
it may be necessary to place limitations on the
freedom to manifest ones religion in order to
reconcile the interest of others.
It may be worth examining how this issue
would be treated in India were it ever to arise.
Traditionally, our society recognised purdah nashin
women and, even today, archaic provisions exist
to protect legal arrangements executed on behalf
of such women. Unlike in Europe, the veil worn by
Muslim and some non-Muslim women is not
culturally alien in India. Yet, is there a protected
right to anonymity in the modern state?
Would the right to wear a veil be protected by
the freedom of religion guaranteed under Article
25 of our Constitution? Article 25 protects only
those practices that are absolutely essential or
integral to religion. Experts on Islamic jurisprudence
have opined that there is no religious compulsion
in Islam for a woman to cover her face. If so, the
right to wear a face-concealing burqa is unlikely to
be regarded as an essential part of religious practice,
which qualifies for protection under Article 25.
Would protection be available under freedom
of expression under Article 19(1)(a) ? The right to
dress as one pleases is inherent in that freedom.
Choice of attire is an important facet of identity,
personality and personal autonomy. It defines how
a person wishes to present herself or be looked
upon by society. In a recent judgment, recognising
the constitutional status of transgenders, the
Supreme Court drew on the Yogyakarta principles
on the application of international human rights
law in relation to sexual orientation and gender
identity.
These stipulate: Everyone has the right to
freedom of opinion and the expression of identity
or personhood through speech, deportment, dress,
bodily characteristics. It may be argued that if
some women can be permitted to wear as little as
they sometimes do, why should others not be
allowed to cover up all of themselves if they so
choose? Neither can be stretched to the extreme.
The right to dress is subject to reasonable restrictions
on grounds such as public order, morality or
decency. In a country as vast and varied as ours
which gladly accepts both burqas and bikinis,
contemporary standards may be difficult to
determine. However, it is doubtful whether attire
that swaddles an individual in anonymity can be
regarded as compatible with the rights and duties
of a modern citizen. Indeed, the burqa by barring
social access, impedes the realisation of fundamental
rights and the fulfilment of fundamental duties.
Yet, the burqa flourishes in India. Unlike France,
India does not impose a forced fraternity on its
citizens. Rather, India interprets vivre ensemble in
the spirit of deference to diversity. A more mature
approach, embedded in the philosophy of
accommodation and assimilation are the values,
sarva dharma sambhava and vasudeva kutumbakam.
STEP UP TO THE PLATE
A plateful of chicken and a glass of milk may
sound to some like a wholesome meal. But an
investigation by the Centre for Science and
Environment (CSE) has found that large-scale and
indiscriminate use of antibiotics in poultry and meat
farming contributes to the growing incidence of
antibiotic resistance in India. Along with the
frequently irrational and inappropriate prescription
and usage of antibiotic medication, their use in
animal feed small doses administered daily,
researchers say, make most animals gain as much
as 3 per cent more weight than they normally would
leads to the animals developing resistance to the
drug, which could then be transmitted to humans.
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The WHO recognises this practice as posing a
serious health hazard, and has urged efforts to
terminate or rapidly phase out antimicrobials for
growth promotion if they are used for human
treatment.
But the Indian government appears not to have
noticed. This is despite the fact that India faces a
high burden of infectious disease and cost
constraints limit the extent to which older antibiotics
can be replaced with newer and more expensive
medication, compromising the management of
common and lethal bacterial infections. Though the
use of antibiotics as growth promoters in food
animals has been banned in places like the
European Union and Canada, there are no
regulations in India on the use of antibiotics for
poultry or dairy cows. The Prevention of Food
Adulteration Rules, 1995, only regulates the use of
antimicrobials and other pharmacologically active
substances for seafood. The recommendations made
in the National Policy for Containment of
Antimicrobial Resistance in 2011 to frame the
requisite regulations to ban non-therapeutic use and
draw up labelling requirements have yet to be
acted on.
This indifference is mimicked across the food
production chain. The Food Safety and Standards
Authority of India, the nodal agency, acknowledged
in its 2011 National Survey on Milk Adulteration
that much of the milk consumed was contaminated.
Previous studies by CSE and others have found
that the banned hormone oxytocin is used on cattle
to improve yield, and has been linked to the early
onset of puberty in girls. Though the poultry
industry complies with stringent EU standards for
export, the absence of domestic regulation and lax
implementation of laws means that Indians get
stuck with unsafe and substandard meals that may
do much worse than offend taste buds.
INCLUSION ISSUES
A recent survey by the Reserve Bank of India
points to troubling issues within the RBIs model of
financial inclusion. It found that 16 per cent of
traceable business correspondents have not done a
single transaction till date (47 per cent of BCs could
not even be reached for the survey). The RBI
permitted BCs with the objective of ensuring greater
financial inclusion in the early 2000s. The findings
of the survey raise difficult questions regarding the
success of the approach of strict regulation and
supervision towards the sector and to financial
inclusion in general.
When first introduced, the BC model was
primarily focused on banks as agents of financial
inclusion. It did not allow for the demand for other
types of financial services to be met organically
through market forces. Additionally, a number of
other regulatory barriers focused on safety and
stability prevented the model from taking off. These
included restrictions stipulating that a BC has to
have a bank branch within 15 km in rural areas.
Moreover, a single BC could act as a correspondent
for only one bank. For-profit companies were not
allowed to become BCs until 2010. BCs were,
further, not allowed to charge customers (they
received remuneration from the banks) or
differential pricing policies (by peak hours,
geographical location etc). At the same time, there
was a target-driven mandate imposed on banks.
All these requirements reduced the space for
competition on prices or quality, and the regulatory
framework effectively made the BC model a non-
starter.
Many of these regulatory barriers have been
undone over the years, and the BC model has been
liberalised to some extent. The rate of reform,
however, has been extremely slow. It is still focused
on the safety and stability of the system, rather
than allowing the market to develop and then
intervening to prevent market failures. The
paternalistic model of intervention also displays low
regard for the financial viability and business
models of entities involved in the BC business, and
is illustrative of the tendency to restrict competition
and market forces for the sake of stability. The goal
of a regulator should be to allow the market to
develop organically, and to step in only when the
safety of the system is threatened. Inclusion need
not always be mandate driven. It can also be
propelled by the market.
CHANGING OWNERSHIP WONT HELP BANKS
How do we make the Indian banking system
stronger and more disciplined, better able to
provide more loans to deserving borrowers? The
easy answer is to reduce government ownership.
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The perceived wisdom is that a state-owned bank
does not fear for its survival and so is less efficient
and less disciplined. Some complain that in an
otherwise accomplished first budget by the Union
finance minister Arun Jaitley, there was no detailed
plan for the privatization of state-owned banks,
merely a nod towards some dilution of the states
interest. Ian Frasers recently published Shredded:
Inside RBS, The Bank That Broke Britain tells of
the critical role of the self-aggrandizement of Fred
Goodwin, Royal Bank of Scotlands (RBS) chief
executive officer, in its break-neck expansion and
subsequent, 45.5 billion, collapse in 2008. There is
more than a little bit of inefficiency and indiscipline
in the private sector as well. I have come to believe
that a small number of medium-sized, state-owned
institutions, focused on those things the private
sector does not do well, such as long-term lending
or banking the unbanked, in a predominantly
privately-owned sector, is probably the right
balance. But history suggests that ownership is no
guarantee of a safer banking system. The key to
that is better regulation. Better regulation is often
a code for more capital. But this is also too easy an
answer. Just prior to the global financial crisis in
2008, American and European regulators were
writing assuredly in their financial stability reviews
of the strong capitalization of the banking system.
Indeed, if you add up all of the additional capital
being required of international banks today, it is
still below what the major international banks
reported just prior to the crash. Capital ratios are
calculated against risky assets (lending to risky
borrowers). The idea being that banks dont need
to hold capital against safe assets and that this
encourages them to lend more safely. The problem
is that financial crises do not happen because banks
dont have enough capital against their risky assets,
but because what they considered safe becomes
risky. The inconvenient truth is that financial crises
follow financial booms and the booms are caused
by people doing things they think are safe, not
risky, so safe that they believe they can safely double
and triple up. Financial crashes are not caused by
a few crooks but by collective hubris. The answer
then is not to lean more heavily on an insurance
systemcapital against risky lendingthat fails just
when you need it. The answer is that we need to
risk manage the financial system and encourage
risks to go where they can be absorbed if we prove
to have underestimated them. There is not one risk
but different types of risk. They are different, not
because we give them different names, but because
we would hedge each differently. The liquidity risk
of an asset is the risk that if you were forced to sell
the asset tomorrow, you would have to accept a
deep discount in the price to bring out an unwilling
buyer, compared to the price you would achieve if
you had a longer time to find a more willing buyer.
The way you hedge liquidity risk is not by owning
a wide range of equally illiquid assets, but by having
the time to sell, perhaps through long-term funding.
The credit risk of an investment is the risk that a
counterparty defaults on its payments and
principal. Credit risk is not hedged by having more
time in which the default can take place (this would
increase credit risks), but by spreading the risk
across uncorrelated credits. A pension fund or life
insurance firm has the capacity to absorb liquidity
risks, but no particular ability to diversify credit
risks. A bank that is funded with overnight deposits
and has a raft of different borrowers has the
capacity to absorb individual credit risks, but little
capacity to absorb liquidity risks. If risks in the
financial system are in the wrong place, there is no
reasonable amount of capital that will save it. This
could be done simply, by requiring that all financial
institutions, irrespective of what they are called and
what sector they say they are in, place capital
against separate mismatches of liquidity, credit and
market risks. This would incentivize those with
wells of liquidity to draw liquidity risk from others
and, in return, sell them credit risks that they cannot
easily match and vice versa. We will have stability
strengthening transfers of risks across the financial
sector. If liquidity risks were held by those with the
biggest capacity for holding them, and the same
for credit and market risks, the system would be
safest and it would be most resilient to mistakes in
the assessment of risk. Sanity is not statistical. This
approach would also require the least amount of
unproductive capitalsupporting economic
growth. More capital is not costless. Risk managing
the system requires a single regulator for the
financial system as a whole that can facilitate risk-
reducing transfers between the sectors. I suspect
more critical to improving the safety of the Indian
financial system is not changing the ownership of
the banksthough a better balance needs to be
achieved here as wellbut ensuring there is one
regulatory institution that owns systemic risks
across the entire financial sector and has the
authority to manage it.
Source: LiveMint
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INDIAS CHINESE DREAM
In recent years, China and India have both
emerged as global economic superpowers, with
China leading the way. But, with Chinese growth
slowing and the need for structural change
becoming increasingly acute, will the economic-
reform efforts of Indias new prime minister,
Narendra Modi, enable the country to catch up?
Since the 1980s, China has experienced
unprecedented economic growth, fuelled by
abundant low-cost labour, high saving and
investment rates, substantial market reforms,
outward-oriented policies, and prudent
macroeconomic management. Its leaders now hope
to achieve high-income status by developing more
technologically sophisticated industries. Indias
economic performance has been less remarkable.
Economic growth began to accelerate dramatically
in the early 1990s, owing to trade liberalization
and other economic reforms. Then reforms stalled,
the fiscal and current-account deficits soared, and
annual gross domestic product growth fell to 4-
5%. As a result, China has pulled ahead, with per
capita income last year standing at $11,850more
than double Indias $5,350. The question now is
whether Modis push for faster growth can narrow
the income gap in the coming decades. The most
important factor working in Indias favour is its
demographic dividend. In China, population
ageing and low fertility rates are already causing
the prime working-age population, people aged 15-
59, to decline. From 2015-2040, this group is
expected to shrink by more than 115 million.
Meanwhile, Indias prime working-age population
will increase by 190 million. But favorable
demographics alone will not bring about the kind
of growth that has made China the worlds second-
largest economy. Indias leaders must develop a
comprehensive plan to eliminate barriers to
economic competitiveness, expand employment
opportunities in manufacturing, and improve
workers education and skills. As it stands, India
ranks 60th in the world for economic
competitivenessmuch lower than China, which,
at 29th, is closing in on high-income countries such
as South Korea (25th) and France (23rd). The
reasons for this are not difficult to discern: India
performs poorly on the fundamental drivers of long-
term economic prosperity. Indeed, despite steady
improvements, public health and education levels
remain low (102nd worldwide). Moreover, the lack
of adequate transport, communication, and energy
infrastructure (85th) is undermining Indias
productivity growth. And India lags behind China
in the efficiency of its product and labour markets
(ranking 85th and 99th, respectively). Only by
addressing these shortcomings can India attract
sufficient investment and boost growth. At the same
time, India should expand labour-intensive
manufacturing, thereby creating employment
opportunities for its growing pool of workers. Given
that manufacturing contributes only 15% of Indias
output, compared to 31% in China, there is
considerable room for growth. In a sense, India
has the advantage of being able to learn from
China. China transformed its agrarian economy
by building a strong, labour-intensive industrial
base, shifting workers from agriculture to
manufacturing and construction, and improving
productivity across all sectors. Today, the
agricultural sector accounts for only one-third of
total employment in China, compared to one-half
in India. Indias structural transformation and
sustainable growth will hinge on its efforts to build
a flexible labour market, centred on the easing of
outdated and complicated employment laws. The
legal protections of workers in Indias formal sector
exceed those of most developed countries, as well
as China, with mandated requirements rising as
the number of employees increases. As Jagdish
Bhagwati and Arvind Panagariya have pointed out,
excessive labour-market regulations deter Indian
entrepreneurs from employing unskilled workers
and developing labour-intensive manufacturing,
implying that the Indian government should
redouble its reform efforts in this area. Equally
important, Indian workersespecially young
peopleneed opportunities to upgrade their skills
continuously. The McKinsey Global Institute
estimates that, of the potential global oversupply
of 90 million low-skilled workers in 2020, 27 million
will be in India. Meanwhile, the country will face
a shortage of 13 million medium-skilled workers.
Despite Indias educational expansion, especially
at the secondary and tertiary levels, its system of
higher education, including technical and
vocational education and training, remains
inadequate. Though Indias public vocational
education and training systems are well
institutionalized, they lack the scale, curriculum,
financing, and incentives needed to prepare young
workers to meet the demands of rapid globalization
and technological advancement. The good news is
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that Modi seems committed to boosting Indias
competitiveness by improving its business climate.
For example, he has already announced measures
to promote foreign direct investment in insurance,
defence, and telecommunications, including higher
infrastructure spending and new tax incentives for
savings and investment. Indias government will
also sustain its predecessors efforts to strengthen
vocational education and skills training. What
Modis plan lacks is a strong focus on expanding
Indias labour-intensive industries. That, together
with the planned reforms, would enable India to
seize the opportunities that arise with favourable
demographics and achieve Chinese-style growth.
Source: LiveMint
WHO WILL GUARD THE GUARDIANS
In the past one month, the Union government
courted controversy when it rejected the name of
Gopal Subramanium for appointment as a judge
of the Supreme Court. Weeks later, a former judge
of that court, Markandey Katju revealed how
during the first term of the United Progressive
Alliance (UPA) government, an allegedly corrupt
judge of the Madras high court was allowed to
remain on the bench because of political pressure
from an ally of the UPA in Tamil Nadu. Both
controversies are products of the manner in which
judges to the high courts and the Supreme Court
are appointed in India. These judges are appointed
by the President after consultation with the Chief
Justice of India (CJI) and judges of the Supreme
Court. But by a series of judgments, the apex court
has interpreted this procedure (described in Articles
124(2) and 217(1) of the Constitution) to mean
concurrence with the CJI and senior judges of
the court. So where the executive initiated the
appointment process once upon a time, it now
merely serves as an approvals office for the
judiciary. The allegation against senior judges of
the country today is that they are a self-selecting
club. Judges appointing judges, it is said, is unheard
of in a democracy. This viewpoint, to which one
can be sympathetic, ignores the failures and high-
handedness of the executive that created the
situation in the first place. Having said that, one
must recognize that there is such a thing as judicial
politics. It is naive to expect that an institution
wielding such extraordinary power will be immune
from expressing its interests and act robotically only
to deliver judgments and dispense justice. Normally,
in any country, the judiciary often prevents the
executive from high-handedness. This does not
automatically put the two branches at loggerheads.
The US supreme court is a good example of a court
that not only prevents executive excesses but even
ends up writing laws. In India, the situation is
different. Until the mid-1960s, the judiciarys
outlook, basically the limits of intervention in other
domains remained minimal. Until then, the apex
court rarely exercised the power of judicial review.
The Supreme Court turned expansionist in the
1970s as other institutions slackened. Public interest
litigation, widening of the power of judicial review,
implied limitations to the powers of the legislature
and interference in the functioning of the executive,
were all products of that decade. In fact, over time,
the functioning of the executive has only worsened.
That situation persists. While serving Indian
democracy admirably, this approach has costs. In
recent years, many CJIs have courted controversy
and not only for their judicial decisions. It is hard
to conclude if these failings were only the result of
poor quality judges. But it is certain that
somewhere, a self-selection bias has crept in the
system of appointments. In any such system, fall in
quality is the next step. That is obvious now in
India. So while individual judges may be great, the
system will crumble because of these biases. It is
time the judiciary reflected on these shortcomings
instead of being defensive about what it does. Any
changes to the method of appointment of judges
should not be based on a theory of compromise
between the judiciary and the executive. The six-
member national judicial commission, envisaged
under the Judicial Appointments Commission Bill
2013, which expands the current collegium system
by including non-judicial members, avoids this
pitfall. The Union law minister is the only
representative of the executive in the commission.
This is not to say that the executive has turned
saintly and should have a deciding role in
appointments. None of this has happened. But
having a representative from the executive, within
overall judicial dominance, may not be a bad idea.
The Bill may not be of perfect design possibly
conceivable but it certainly does not mark a return
to the era of executive primacy in appointments. It
also has the potential to avoid the pitfalls of self-
selection and as such is a framework worth trying
out. Whittling down of judicial independence in
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India will require a strongly authoritarian
government or a government that actively believes
in subverting the judiciary. At one time that danger
was real. But the weakness and venality of the Union
executive, which is unlikely to disappear soon, will
ensure that judges continue to hold governments
accountable. And that is how it should be.
Source: LiveMint
LABOUR REFORMS OF THE WRONG KIND
High among the expectations from the
avowedly industry-friendly government in Delhi is
that it will muster the political will to reform
labour laws to render these more flexible. The
rigidities of the current labour regulatory regime, it
is alleged, are major hurdles to attracting private
investment to manufacturing. Greater freedom to
hire and fire workers, a less intrusive labour welfare
supervisory regime and reduced power of unions
will, it is argued, benefit workers, as greater private
investment will result in higher economic growth
and therefore, more jobs. There are many problems
with these arguments. Firstly, during the high noon
of growth in India, 2004-05 to 2009-10, when
growth averaged 8.43%, only two million new jobs
were added for 55 million people who joined the
workforce. Second, although labour law prohibits
appointment of contract workers for perennial
tasks, these years saw a sharp growth in contract
and casual work, at the expense of regular
employment. Atul Sood, Paritosh Nath and
Sangeeta Ghosh in a recent paper in the Economic
and Political Weekly (Deregulating Capital,
Regulating Labour, 28 June) demonstrate that the
share of contract workers in total organized
employment rose from 10.5% in 1995-96 to 25.6%
by 2009-10, while the share of directly employed
workers fell from 68.3% to 52.4% in the same
period. Even regular workers are appointed
increasingly on short-term contracts, with little or
no social security, as termination of their
employment is not legally barred. The increasing
informality in the organized labour market has, in
turn, blurred distinctions between formal and
informal labour. In this way, without changing
laws, fewer and fewer workers enjoy the
protections of secure employment and social
security which the letter of the law intends. This
regime is of what commentators describe as
reform by stealth. This unstable employment
landscape is further stymied by a poorly staffed,
badly trained, and loosely supervised labour
department, notoriously prone to rent-seeking. The
growth sector of construction is almost entirely
powered by unprotected, unorganized workers at
dirt wages and unhealthy environments, in open
violation of the law. Likewise, a greater part of
factory floor work is shifting to home-based work,
where low wages are paid for long hours, with no
social protection; the work environment is
extremely unhealthy and child labour has
burgeoned through the back door. In this light,
labour law amendments introduced by the
Vasundhara Raje government in Rajasthanand
likely to be passed by its large majorityis a cause
for deep disquiet. These amendments firstly reduce
the application of the Contract Labour Act to
companies with more than 50 workers, against the
current 20. This statute prohibits engagement of
contract labour in tasks requiring perennial work
in the production process, and prescribes a
mechanism for registration of contractors. The
amendments, likewise, reduce the protections of
the Factories Act only to units employing 20
workers with power supply and 40 workers
without power supply, down from the existing
norm of 10 and 20 workers respectively. This, in
effect, reduces protections of workers with health,
safety and welfare standards their employers were
earlier legally bound to ensure. The proposed legal
changes further exempt factories employing 300
(up from the current 100) workers from the
protections of the Industrial Disputes Act, which
provides for collective bargaining, and raise the
minimum numbers of workers required to register
a trade union from 15% to 30%. Sood et al estimate
that after this amendment, around 57-60% workers
in the formal sector can be fired, or subject to
suppressed wages and degraded work conditions.
The cumulative impact of these amendments will
be to free more employers from even the poorly
enforced and modest obligations they currently hold
for ensuring job security, health and social
protection of their workers. It is hardly convincing
to state that this dilution of labour protections will
indeed spur economic growth, or that this is an
ethically just social bargain even if it does. And
there is even less evidence that this is an assured
pathway for creation of millions of jobs which
Indias teeming youth aspire for. What is more,
even the scant, fast-eroding and poorly enforced
protections extended by Indias labour laws exclude
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nine out of ten workers who toil in the unorganized
workforce. The only guarantee these workers enjoy
is of uncertain, sporadic, low-paid, often unhealthy
work, without social protections for health and old
age. Labour economist K.P. Kannan believed that
the major problem of construction workers was
payment of minimum wages, until he realized their
predicament was more often the payment of any
wages at all, as every other worker he met in
construction sites had not been paid any wages for
long durations. Sociologist Jan Breman records
poignantly the plight of millions of footloose
workers: hunters and gatherers of any kind of
work, on any terms, anywhere in the country, in
unending struggle to keep their families alive. There
is indeed an urgent need for labour reforms, but
not the dilution of the few labour protections which
still survive on Indias statute books. Instead, what
is essential is the rationalization and codification
of all labour protections into a single law, and the
commitment of employers and governments to
adhere to this law and extend its coverage resolutely
to every worker in the country. It is only the
assurance of decent work to all workers which can
ensure that households can afford food, education,
healthcare and housing necessary for a life of basic
dignity for all, a promise withheld too long from
most Indians.
Source: LiveMint
EATING INTO THE RURAL ECONOMY
Whenever I take a train from Vaishali or Patna
in Bihar to Delhi, I see tall, bull-sized animals in
herds of no less than 10 or 15, merrily grazing on
the tender leaves of precious crops such as rice,
wheat, pulses, maize and everything that humans
grow and consume.
These are the nilgai, once not so easily spotted,
which would keep their distance from human
habitation.
In my own village, called Jalalpur as well as
Vishnupur Gambhir, located in the Lalganj police
station area of Vaishali district in Bihar, nilgais come
20 to 50 strong, their calves included.
While adults consume the leaves on the tops of
plants, the calves polish off the lower-level leaves.
Their raids continue through day and night; they
stop only when the sun is too bright or the nights
are too dark. On moonlit nights, they have a field
day. There is no respite for farmers, exhausted from
toiling during the day.
This nilgai animal has taken away all the
happiness in life. Ninety per cent of my time is
spent protecting my vegetable crops, the mainstay
of my livelihood, says Rambabu Rai, a Yadav
farmer, who produces ghia (bottle gourd) and
karela (bitter gourd) on a two-acre plot of leased
land.
Nilgais appeared in my village sometime in
1993-94. About a dozen of them walked into our
farmlands, located along the banks of the river
Gandak. Their arrival was hailed as the dawn of a
golden era (Ma Lakshmi aa gayi hai) by some
superstitious farmers. They came, they stayed, they
multiplied.
Golden era gone sour
Soon, they started wreaking havoc on wheat,
barley, paddy, maize, sugarcane, pulses and other
major crops. They would devour banana
plantations and eat small mango and litchi plants.
They can reach up to low-hanging fruits and
vegetables by standing on their hind legs.
Bablu Shukla, a small farmer, took a Rs2 lakh
loan in 2002 to do large-scale farming on 50 acres
some of the land was his and some leased.
He planted sugarcane on 10 acres, maize on 10
acres, masoor dal on 5 acres, and wheat on 25
acres. The nilgais cleaned out the sugarcane, maize,
and masoor crops. The wheat was damaged, but
since it is sturdy, some of it was saved.
Shuklas been living in debt ever since. However,
his father, a retired junior commissioned officer
(JCO) of the Indian Army, bought him a tractor,
and that has helped him earn an income and repay
his debts slowly. But not everyone is as lucky as
Shukla.
Multiplier effect
There are numerous cases of small farmers who
have had to sell off their lands to pay their debts.
The loans people take in my village, as in the
hundreds of thousands of villages around the
country, are not from banks and other institutions,
but from usurious money-lenders who charge
interest rates of anything between Rs2 and Rs5 a
month for every 100 rupees.
This financial debacle has had a multiplier
impact. Paddy is grown only in a limited upland
area of the village where it can be protected. Wheat,
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being a sturdy crop, is the crop of choice for most
farmers. Some farmers also grow mustard because
its bitter leaves are not a delicacy for the nilgai. But
no one dares to grow winter maize or masoor,
except in very small plots of half or one-fourth an
acre.
This deliberate move to shrink production
unleashes its own dynamics on the village
population. Income and nutrition levels have fallen
because little is grown these days and the
production of pulses, still the only means of protein
for most villagers, has almost stopped.
In the absence of year-round work, that was
earlier provided by the raising of spring and
summer pulses, maize and oilseeds crops, and
sowing of paddy in the diara (alluvial soil)areas,
most of the farm hands have had to migrate to
urban centres in search of work.
And yet farmers are by law not allowed to kill
the nilgais. These animals fall in the category of
protected species under the Wild Life Protection
Act 1972.
When the Act was passed, India had a large
population of tigers, cheetahs, leopards, and wolves
to contain the population of these animals.
Since 1972, however, predatory animals have
vastly declined in number. This has facilitated the
unbridled growth of the nilgai all over the country.
And the law-makers indifference to this reality has
triggered chaos in the rural economy.
Source: Business Line
TIME TO AXE THE PLANNING COMMISSION?
Should the Planning Commission be abolished?
There are many in the Union infrastructure
ministries such as highways, power, civil aviation
and shipping who salivate at the prospect. By some
convoluted reasoning in the UPA Government, the
Commission became the focal point for
infrastructure; it was the body that serviced the
Cabinet Committee on Infrastructure, chaired by
the Prime Minister.
Many mandarins in these ministries feel the
country has paid a heavy price for that decision.
Over the past few years, the development of
physical infrastructure roads, ports, power,
airports was hamstrung by a number of factors.
This included the constant bickering, nagging and
one-upmanship by the Commission, which
conducted itself as a super body without any
accountability.
The letters written to the Government by the
chairman of the National Highways Authority of
India in the last couple of years adequately highlight
what happens in a scenario of authority, divorced
from responsibility and accountability. The alacrity
with which the copyright of a document prepared
by inputs from many officers and various
government departments was claimed by the
Commission did not endear it to those who had
contributed to the document.
The environment was so soul-destroying that
some secretaries to the Government had sought to
move out of their ministries as they felt that the
blame for lack of performance would be tagged on
to them even though the actual problem lay
elsewhere.
Policy mavens
But this was not always so. Set up in March
1950 by an executive order, the Commission has
had a galaxy of deputy chairmen heading it, not
excluding the last incumbent. Names such as DR
Gadgil, DT Lakdawala, PN Haksar and C
Subramaniam (who was also minister for planning)
come to mind. The objectives of the Commission
were to promote a rapid rise in the standard of
living of the people by efficient exploitation of the
resources of the country, increasing production and
offering opportunities to all for employment in the
service of the community.
Over the last six decades, it has produced a
number of useful documents which have helped in
policy formulation. However, it is widely believed
that the quality of its output has declined. But to
judge its usefulness by aberrations in its functioning
may not be fair. To take a considered view, it is
worthwhile to examine its raison detre and
determine if those activities are best performed by
other agencies.
Some of the more important functions of the
Commission are: (i) allocation of resources between
the Centre and States, within the Central ministries,
between States and between various development
programmes in the States; (ii) mediation in inter-
ministerial disputes; (iii) appraisal of projects; (iv)
evaluation of programmes; and (v) the preparation
of a Five-Year Plan.
Is the Commission really supposed to allocate
resources? With the Finance Commission, Finance
Ministry and the modified Gadgil formula (and, if
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necessary, fresh guidelines) doing the same job, the
Commission need not be burdened with this
responsibility.
The annual unseemly wrangle between the
Commission and the Finance Ministry about the
size of the Plan which subsumes incorrect notions
of developmental and non- developmental
expenditure, based on a distinction between Plan
and non-Plan will also be put to rest. Along
with this, the ritual of chief ministers of States
calling on the deputy chairman to fix the size of
their annual plans can be jettisoned. The
Commission was never meant to be a mediator in
inter-ministerial disputes. The structures for
resolving such disputes exist. The Committee of
Secretaries at the official level chaired by the Cabinet
Secretary is mandated to do this job. If
disagreements still persist, the Cabinet steps in.
The Planner
The appraisal function of the Commission is a
significant one as it provides inputs which facilitate
investment decisions of the Centre. This activity
could be spun off to the Finance Ministry. The
programme evaluation set up in the Commission
was meant to assess the delivery and impact of
programmes objectively and independently.
However, for many reasons, it has lost its credibility
and utility. This work could be outsourced to bodies
that are at arms length from the Government.
But perhaps the most important function of the
Commission is the preparation of a Five-Year Plan.
It is argued that many countries do not have such
plans, and therefore we too can do without it. That
said, given the state of development of the economy,
the need for optimum utilisation of resources,
linkages between different sectors and their impact,
as well as an articulation of the developmental
philosophy of the Government, a Plan document
which intricately weaves the above factors is
required. Without it, the danger of a drift becomes
more pronounced.
However, the requirement that state Plans are
to be approved by the Commission has been found
to be irksome, if not repugnant. There is
considerable merit in the view that States cannot
be straitjacketed in their resource allocation by a
body that may not fully comprehend their needs.
A think tank
So, should the Planning Commission be
abolished or reformed? The Independent Evaluation
Office has suggested in a recent paper that the
Commission be abolished and in its place a Reform
and Solutions Commission, which would function
as a think tank of the Government, should be
established. This Commission would be staffed by
experts with domain knowledge.
Given the fact that planning to optimise use of
resources is necessary and that correcting the tardy
implementation of programmes is critical, perhaps
the best way forward would be to convert the
Commission into a body that will prepare medium-
and long-term plans five, 10 and 20 years
and will actively monitor implementation. The
Commission can be rechristened as the Planning
and Implementation Commission and can have two
wings. One will be in charge of perspective planning
and the other of implementation.
The ministry of statistics and programme
implementation can be downsized to become the
ministry of statistics. In any case, the basic role of
this ministry was to monitor certain programmes
and projects. It essentially provides information on
projects which have been sanctioned, completed
and delayed. It does not have the mandate to look
at issues of implementation.
Projects worth more than Rs6 lakh crore are
stuck due to issues of land acquisition, environment
and forest clearance, financing and so on. As a
consequence, the economy has slowed down and
banks are stressed. Over time, new projects will
get added.
In order for the reformed Commission to be
effective in resolving hurdles in implementation, it
will need to be adequately empowered. This should
not be difficult considering the Prime Minister
would be the chairman of the body. Instead of
meeting once in six months or annually, the
reformed body would meet every month where
issues of implementation can be discussed, debated
and sorted out under the chairmanship of the Prime
Minister.
WHEN RUSSIA IS PRODDED AND PROVOKED
In the early hours of July 17, Malaysian Airlines
Flight 17 with 298 people on board was shot down
over eastern Ukraine, now controlled by Russian
separatists engaged in a civil war against the Kiev
government. The Russian-speaking minority has
evidently been reinforced and equipped by kinsmen
from across the Russia-Ukraine border. They carry
heavy firepower including tanks, armoured
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personnel carriers and a range of surface to air
missiles.
The shooting down of MH17 came alongside
rebel missile attacks over the past four weeks, which
have downed two military transport and three state
of the art Sukhoi attack aircraft of the Ukrainian
Air Force. It is evident that the attack was based
on the mistaken assumption that it was a Ukrainian
Air Force aircraft.
There have been seven incidents of inadvertent
shooting down of civilian aircraft in the past. In
1983, the South Korean Airlines Flight 007 with
277 passengers and crew strayed into Soviet
airspace. It was shot down by a missile fired from
a Soviet MiG, 269 people died. After the usual
rhetoric, the former US president Ronald Reagan
and the president of the erstwhile USSR Mikhail
Gorbachev returned to business as usual.
On July 3, 1988, Iran Air Flight 655 flying from
Tehran to Dubai with 290 passengers, mostly
pilgrims headed for Mecca, was shot down over
Iranian territorial waters, by two missiles fired from
US Navy Missile Cruiser, USS Vincennes; 290
people died. The US refused to accept responsibility
for the action. It paid a sum of $61.8 million as
compensation to the families of victims, following
the ruling of an International Tribunal.
What the US paid was less than 3 per cent of
what it got from Libya, for the bombing of Pan
Am 103, parts of which then crashed in Lockerbie,
Scotland. The captain of the USS Vincennes was
awarded Combat Action Ribbons shortly after
shooting down the civil airliner!
Surprising response
Washingtons displeasure at Russian supply of
surface to air missiles to the Russian resistance in
Ukraine is surprising. It was the US that started
the practice of providing lethal weaponry to non-
state actors. The CIA liberally provided lethal
Stinger surface-to-air missiles (SAM) to the anti-
Soviet mujahideen in Afghanistan, through the ISI.
Three Indian Air Force Aircraft a MiG 21, a
MiG 27 and a helicopter gunship were shot down
and a Canberra bomber damaged, during and just
prior to the Kargil conflict. The IAF aircraft were
fired at by Pakistans Northern Light Infantry, using
what were assessed to be Stinger SAMs.
Given the relentless US policy of strategic
containment of Russia after the disintegration of
the Soviet Union, it was inevitable that pushed into
a corner by American and Nato pressures, the
Russians would reach a position of saying: Thus
far and no further.
The erratic policies of the former Russian
president Boris Yeltsin and his advisers such as
Yegor Gaidar and Andrey Kozyrev immediately
after the disintegration of the Soviet Union,
evidently encouraged the US and its Nato allies to
erode Russian influence in the Balkans and
undermine its credibility in Kosovo. Simultaneously,
members of armed Chechen separatist groups were
openly welcomed in western Europe. Yeltsins
incompetence in Chechnya and his inability to deal
with the expansion of American-led influence just
across Russias borders contributed to his being
eased out of office and replaced by Vladimir Putin.
Reintegrating the republics
Even as the Russians tried to integrate the
former Soviet republics economically and
strategically, the US and its Nato allies also held
out lucrative offers for economic integration with
the European Union and membership of the Nato
military alliance. Russia faced economic isolation
and military encirclement. It responded by
developing economic partnerships with the former
Soviet republics and establishing the Collective
Security Treaty Organisation (CSTO).
The economic and security inroads by the EU
and Nato have, however, significantly eroded
traditional Russian influence in its immediate
neighbourhood. These moves have resulted in the
former Warsaw Pact members the Czech and
Slovak republics, Hungary, Bulgaria, Rumania and
Poland joining Nato. In the Balkans, Croatia
and Slovenia are now Nato members, as also There
are also moves to consider EU and Nato membership
for Ukraine, Azerbaijan, Armenia, Kazakhstan,
Moldova and Georgia.
Ukraine was ruled by Russian Tsars for three
centuries prior to the formation of the Soviet Union.
It was regarded as part of the sphere of Russian
influence. Its eastern region bordering Russia was
increasingly populated by Russians. Ukraines
Crimean region was transferred by the former
Soviet premier Nikita Khrushchev to Ukraine in
1954, as a gesture of goodwill, marking the 300th
anniversary of Ukraine being a part of Tsarist
Russia.
Inconsistent stand
The US-led attempts to contain Russia have
been marked by inconsistencies. The dismem-
berment of Yugoslavia and the independence of
Kosovo were justified by the western powers on
the lofty grounds of respect for human rights.
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But, today these same powers are raving and
ranting against the separatists of the Russian
minority in Ukraine, who are seeking independence,
or merger with Russia. There is little doubt that
Russia today faces serious internal problems arising
from falling birth rates, alcoholism, drug addiction,
declining life expectancy and corruption. But it
would be a historical error to underestimate Russian
resilience in the face of adversity.
Attempts to dominate and marginalise the
Russian minority in Ukraine would be fiercely
resisted and reinforced by support from across the
border. What is needed is a realistic political
solution involving a united but federalised Ukraine.
More importantly, attempts at containment
of Russia will have to be eschewed and the
expansion of Nato across Russias borders ended.
Given the imperatives of stability and energy
security, responsible European countries such as
Germany and France would recognise this. Would
the Americans do likewise?
RURAL INDIA DOES NOT NEED LOAN WAIVER
When bankers are asked to respond to a state
government demand for loan waivers, they often
nod in agreement. Of course, they know such
decisions jeopardise a repayment culture which has
taken many years to shape. But no banker wants
to antagonise the political bosses.
Such decisions happen despite the fact that the
banking sector has been witnessing unbridled
growth in bad loans, largely led by funding
imprudent corporates and the infrastructure sector.
Why then is fiscal prudence thrown to the
winds? Why was the debt waiver of 2008 not used
for supporting the productivity of farms? Why was
it not channelised for building a supportive
infrastructure for farmers?
Its public money, fool
Banking being a Central subject, there is a clear
need for an RBI diktat against using public
institutions which are repositories of public
money for acts that can vitiate the repayment
culture. Should public institutions like banks be used
for mere political gains? To carry forward the
principle of minimum government and maximum
governance, what banks need is autonomy in its
true sense.
However, many feel even the Central bank is
only constitutionally independent, and the
Government has the power to direct its actions.
But this needs to change. Election manifestos of
political parties, which carry such populist schemes,
should be treated as a party liability and not a
sovereign liability of the state with taxpayers
money.
Well, with natural calamities occurring in
unforeseen succession, it is important to sift the
grain from the chaff, especially when farmers are
in dire straits and need help. In the case of genuine
crop failures, the banks need to ensure quick
implementation of the process of rescheduling term
instalments and converting crop loans to term
loans.
This has been in vogue and must be done or
allowed without bureaucratic delays. Needless to
say, designing newer financial credit products such
as cyclical credit for use in a fragile eco-system
is more pronounced now.
Take Andhra Pradesh; its loan waiver touches
two significant population groups farmers and
self help groups (read women). Often, Andhra
Pradesh was touted as the Mecca of the
microfinance movement in India; it had ushered in
an inclusive banking process with an NPA-savvy
financial product for the poor.
With almost 15 lakh SHGs with an average of
12 members, it touches base with 18 million
households and boasts a virtual carpet coverage of
poor households in urban and rural hinterlands of
the state.
However, the SHGs gradual switch to a
pampered client status with no-interest loans,
enticements, total financial inclusion (a debt to
repay debt scheme attempted by the State) have
not augured well to maintain the basic tenets of
SHG and the spirit of Self-Help the very edifice
of this community empowerment.
The poor often value self-respect and dignity
despite all odds, but such doles infuse more
complacency and dependency, and dampens self-
respect.
Dependency syndrome
With almost half of bank credit outstanding to
SHGs (Rs40,000 crore) being accounted for by the
State, it is likely to impact the very foundation of
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the programme, with repercussions in other states
as well.
The State could better serve its SHGs and poor
women by effectively leveraging their integrity,
honesty, and organisational and relationship
building capacities. Rather than attempt handouts
and promote dependency, it would be better to
assign minor government contracts to these groups
deals which would generally go to private
contractors.
The other major client segment for the debt
waiver scheme of the State is the agrarian
community. Though the State had introduced the
RythuMitra Groups a joint liability group of
farmers for enabling inclusion, many continue to
remain out of the banking fold.
Such programmes neither distinguishes between
wilful and non-wilful defaulters, nor irrigated and
non-irrigated agriculture. All these incentivises a
deviant client behaviour.
States with a higher share of household debt to
institutional channels are bound to benefit more
from the relief package. For instance, Andhra
Pradesh had a high share.
For long-term solutions
Mass debt relief rests on the hypothesis that it
would enable otherwise ineligible farmers to access
fresh loans from the banking channels which would
lead to an increase in farm investments and
productivity.
However, evidence has indicated that only
around 32 per cent of the farmer households who
had received relief or waiver had applied for a
new loan.
Many farmer households that received the relief
had resorted to borrowing from informal channels.
Thus it all ends up in a situation of poor client-
banker relationship and exclusion.
However, with repeated crop failures a
likelihood in arid mono-cropped, unirrigated tracts,
there could be some case for a selective write-off
and waiver of dues from the farmer.
However, the real longer-term solution lies in
putting appropriate risk mitigation systems in place
for crop production.
Crop insurance is often talked about as an
option for loanee farmers. However, its functioning
has been riddled with operational challenges, moral
hazard and sustainability issues, with the
Government often bearing the cost of insurance
coverage. Thus, the real longer-term issue lies in
putting climate proofing systems in place especially
in climatic hot spots.
While, the Gujarat model has shown how water
harvesting and conservation models using check
dams, farm ponds can recharge groundwater and
de-risk farming, but weather coding, climate
proofing and crop advisories could serve as a very
useful amalgam with water conservation measures
for the agrarian community.
This is particularly true when the farmer
constantly faces depressing terms of trade and
confidence- sapping monsoons trends. Therefore,
it is desirable that the State exchequer invests its
limited resources for the longer-term benefit of the
farmer, rather than look for short-term solutions.
A BETTER WAY TO MANAGE NPA
Prolonged slow growth has adversely affected
Indias financial sector. The banking system is
sitting on a pile of stressed assets which, if not
checked, will snowball into a larger problem. As of
December 31, 2013, gross NPAs had reached 4.4
per cent of total loans in the banking system, with
public sector banks such as the State Bank of India
(SBI) reporting much higher levels (over 6 per cent).
If restructured loans are added, stressed assets
are estimated at around 15 per cent of bank loans.
Of the total stressed assets, the industrial sector
(especially infrastructure) accounts for the largest
stock of NPAs.
Restoring the capex cycle is essential for
economic recovery. This will not be possible without
restoring the health of the banking system.
Given the present levels of impaired assets in
banks balance sheets and future credit
requirements, Indian banks require capitalisation
of about Rs5-10 trillion over the next five years.
Present system ineffective
The requirement is especially worrisome for
government-owned banks: they account for over
70 per cent of total banking assets. Reduction in
impaired assets helps lower the capitalisation
burden to an extent.
Thus, finding a solution for faster recovery and/
or rehabilitation of stressed assets is critical.
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Despite the presence of an established legal and
regulatory framework for resolution of stressed
assets, the existing system doesnt seem to be
working effectively. There are 14 registered asset
reconstruction companies (ARCs) in India, of which
four are active.
However, the process of removing stressed assets
from banks to ARCs is inefficient and ARCs have
not been successful in quick recovery/rehabilitation.
Despite a significant rise in NPAs over the last five
years, the sale of stressed assets (in value terms) to
ARCs has remained more or less stagnant.
Banks are under no pressure to clean up NPAs
and thus they prefer to roll over debt rather than
recognise an NPA and mark it down to its realisable
value.
Lately, the pressure to build books has forced
ARCs to make unrealistic valuations; the average
acquisition price over the past 12 months has
soared to 60 per cent of book value as against 25
per cent earlier, with over 90 per cent of transaction
value being paid through security receipts (SRs).
As a result, the secondary market for these assets
has failed to take off.
Look at the specific issue
Quick recovery by ARCs is also affected by
inadequate capital and inability to aggregate
consortium debt. Moreover, the unrealistic pricing
of underlying NPAs has kept foreign investors at
bay, despite the Government allowing foreign
investors to hold up to 74 per cent of the share
capital of an ARC. No wonder, over 90 per cent of
SRs are currently held by the selling banks, as most
of these ARCs are bank-sponsored.
An effective resolution of stressed assets thus
requires looking beyond the existing system and
addressing the specific nature of the problem
through a specialised ARC framework. A review
of international experience in this regard reveals
some common underlying principles in the
approach towards the resolution of NPAs by most
countries, regardless of different models being
adopted.
The research reveals several things. First, it is
much better, less expensive and less disruptive to
establish a specialised AMC prior to a financial
crisis as was done in the case of Malaysia and
Taiwan. Establishing an AMC once the crisis has
occurred results in the shrinkage of economy, and
the process of recovery is longer and more painful.
Second, in most cases, direct government
funding or government guaranteed bonds were
used to inject the capital required for clearing a
bulk of the NPAs, which was done through their
one-time transfer from banks to the AMC.
Third, the successful AMCs had one core
objective: the rehabilitation and restructuring of
viable assets. Additional funding mechanisms were
put in place for meeting working capital
requirements of the AMCs for rehabilitation of
viable projects. Finally, another common feature of
successful AMCs globally has been fair valuation
in asset pricing, which contributed in building
investor interest and developing a secondary market
for such assets.
Managing the assets
Based on these experiences, Ficci has suggested
the creation of a specialised entity called the
National Asset Management Company (Namco) to
effectively tackle large NPAs in India. The proposed
Namco framework is unique because it requires
Government/RBI sponsorship but no capital
injection or guarantees.
The Government shall encourage public sector
banks (PSBs) to take up to 49.9 per cent equity in
this entity and transfer large-scale stressed assets
to it. The selling banks will agree to provide up to
25 per cent of the sale price as additional last-mile
funding, for rehabilitation or completion, if
required. No new legislation is required; some
modifications would have to be made to existing
regulations.
Namcos focus would be on the rehabilitation
of large-scale NPAs, restructured loans and other
potential stressed assets, mainly in the infrastructure
sector. Given the long-term nature of underlying
assets, such specialised entities will be allowed to
issue SRs with a tenor of up to 12 years. To
encourage greater investor participation, Ficci has
suggested the transfer of stressed assets at fair
market value, determined by an independent
valuer.
Given the importance of restoring the health of
the banking system for supporting economic revival,
the Government and the RBI should facilitate the
creation of Namco by taking necessary
administrative steps in this regard.
A pro-active, preventive approach is desirable
if we have to ensure speedy revival of the economy.
Of course, this should be a time-bound and close-
ended framework to improve the overall hygiene
of the system.
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COUNTER-PRODUCTIVE RIGIDITY
World Trade Organisation (WTO) members
have failed to adopt a trade facilitation agreement
(TFA) aimed at simplification of their customs
procedures, thanks to India clubbing the signing of
this deal with a permanent solution addressing
its concerns over farm subsidies and public
stockholding of grain for food security purposes.
India, no doubt, is justified in demanding a revision
in the method for computation of subsidies under
the WTOs Agreement on Agriculture (AoA). A
wheat farmer, for instance, is considered to receive
a subsidy if the procurement price paid to him by
the Government is above the world reference price.
But the latter is fixed at 1986-87 levels, when global
wheat prices were $130-140 a tonne, as against
$300-310 now. The current minimum support price
of ?1,400/quintal or $233/tonne, thus, amounts to
the Indian farmer getting a subsidy of over $100,
using the AoA formula. If todays world prices are
taken which is how any subsidy computation
should be our farmers are actually subsidising
the Government!
These concerns, however, were acknowledged
at the WTOs Ministerial Conference at Bali in
December. The Bali ministerial had provided for a
four-year peace clause, during which no country
would be legally barred from implementing public
stockholding programmes for food security even if
the subsidy resulting from it (based on 1986-87
world reference prices) breaches the AoA-imposed
caps. Further, it was clearly stated that a
permanent solution to the food security issue
and, by extension, the farm subsidy computation
formula would be found during this interim
period. That being the case, Indias insistence that
this permanent solution be in place at the same
time as the TFA being inked well ahead of the
2017 target set at Bali seems somewhat
unreasonable. True, in doing so, it has made a
strong point about the need to overhaul the existing
AoA rules on farm subsidies, besides signalling no
compromise with regard to the interests of the
countrys low-income consumers and resource-poor
farmers. But in the process, the July 31 deadline
for wrapping up the TFA has passed which is
most unfortunate.
Having made its point, India now needs to
demonstrate that it is equally committed to an open,
rules-based multilateral trading system under
WTOs auspices. Standardisation of customs rules,
which will minimise documentation requirements
and delays in clearance of goods at ports/border
posts, is only part of this process of promoting global
trade. The TFA would be the first big trade reform
since the WTOs establishment in 1995. We know
how a twelve-fold increase in Indias exports and
imports in the last 19 years has been beneficial for
overall growth and incomes in the country. A TFA
can only further the gains from trade which is
why packaging it with a permanent deal on farm
subsidies/food security can ultimately prove
counterproductive.
DIVVYING UP THE BAY OF BENGAL
Asia is a hotbed of maritime disputes and The
Bay of Bengal is no exception. On July 7 this year,
a panel of five jurists of the Permanent Court of
Arbitration delivered the long-awaited award
concerning the maritime delimitation of Bangladesh
and India. Bangladesh/India cements the boundary
of the four maritime zones that the U.N.
Convention on the Law of Sea (UNCLOS) entitles
states to: the territorial sea, the exclusive economic
zone (EEZ), the inner continental shelf extending
up to 200 nautical miles from the coasts of the
states as well as the outer continental shelf
extending beyond 200 nautical miles from the coasts
of the states. The award is undoubtedly historic
but raises more questions than delivers answers.
To quickly recapitulate, under the UNCLOS,
the territorial sea of adjoining coasts (like those of
India and Bangladesh) must be delimited using an
equidistance line drawn from each coast. However,
no guidelines are provided for the delimitation of
the continental shelf or EEZ. The only caveat
provided by treaty is that the delimitation conforms
to equity. Prior delimitation awards have generated
a three-step analysis for dividing the continental
shelf and EEZ. The first step is the establishment of
a provisional equidistance line between the states,
the second, consideration of relevant circumstances
for the adjustment of this line and, finally, an ex
post facto correction of any disproportionality in
the final result.
The Bangladesh/India tribunal contributes to
greater certainty in EEZ and inner continental shelf
delimitation by explicitly stating that the three-step
test now constitutes international law.
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Unfortunately, while reiterating emerging
norms, the Tribunal also perpetuates their attendant
disadvantages by entangling itself in the redundant
rhetoric of equity. The three-step test emerged from
equitable considerations in the UNCLOS. Questions
have already been raised about the value of the
disproportionality stage in the three-step test as it
appears to be merely a synonym for equity. It is
alleged that discretion to correct for dispropor-
tionality adds unnecessary subjectivity to a test
already predicated on personal discretion.
Bangladesh/India complicates this further by
subjecting the relevant circumstances to equity
considerations as well. The court is overtly cautious
and is enlarging the scope for arbitral discretion in
maritime delimitation.
Outer continental shelf rights
The UNCLOS provides for the extension of the
continental shelf beyond 200 nautical miles where
a natural prolongation of the continental shelf
exists. The UNCLOS states that all outer continental
shelf claims must be submitted to the Commission
on the Limits of the Continental Shelf (CLCS) that
is created by the UNCLOS itself whose
recommendations are final and binding. The
Bangladesh/India tribunal acknowledges that
claims forwarded by India and Bangladesh are
pending before the CLCS but states that it has the
authority to delimit these territories anyway. If the
UNCLOS suggests that outer continental shelf rights
can only arise from CLCS approval, can the
Tribunal suo moto create a boundary where no
right exists? It is unlikely that a Tribunal would
have the necessary expertise to make this
determination. Moreover, such a jurisdictional
conflict might cast doubt on the finality of the award
if the CLCS was to make recommendations contrary
to the order. Perhaps it is these issues that caused
the Nicaragua/Honduras tribunal in 2007 to steer
clear of outer continental shelf delimitation. In the
words of that tribunal: Any claim of continental
shelf beyond 200 miles must be in accordance with
Article 76 of UNCLOS and reviewed by the
Commission on the Limits of the Continental Shelf
established thereunder.
The Tribunal extends the three-step test
discussed above to the delimitation of the outer
continental shelf as well. In doing so, as a lesson
for future arbitrations, the Tribunal makes efforts
to first, prevent excessive negative consequences
and second, distribute maritime entitlements in a
reasonable and mutually balanced fashion. The
difference between these considerations, that were
specifically pointed out by the Tribunal, and
concerns of equity that are constantly reiterated
remain obscure. However, Bangladesh/India hereby
obliterates any vacuum in outer continental shelf
delimitation by laying out a recommended
methodology for its treatment.
Also, the Bangladesh/India award creates a
grey area. This area is where Indias 200 nautical
mile EEZ and inner continental shelf overlaps with
the outer continental shelf of Bangladesh, resulting
in dual claims over a single zone. While India has
claims over the subsoil as well as the water column
above it, Bangladeshs claim is limited to the former.
The Tribunal acknowledges the existence of
overlapping obligations. Remarking that this is not
unknown in the realm of maritime delimitation,
the Tribunal hopes for the creation of a cooperative
arrangement, confident that this will ensure that
each is able to exercise its rights and perform duties
within this area. In determining Bangladeshs
maritime entitlements, the Tribunal settled on a
series of reference spots on land called basepoints
from which the four maritime zones would be
measured. Bangladeshs early claim was that its
constantly changing coastline militates against the
use of standard methods for its treatment. The
Tribunals response to Bangladesh is a reiteration
of the established position in international law, that
the future of a coastline is irrelevant.
The future
It is widely reported that the final award is a
victory for Bangladesh and less so for India.
However, the Indian government has stated that it
will accept the award as binding. What the grey
zone portends makes for interesting speculation.
Could this be a gateway to greater cooperation in
South Asia, which fits in neatly with recent efforts
to strengthen the role of SAARC or will grey zone
negotiations revive tensions? Bangladesh/India is
a crucial landmark in the determination of the
geographic and political contours of South Asia
but it is only a beginning to the resolution of a
long-standing problem.
Source: The Hindu
A NEED TO TURN THE CORNER ON CHILD HEALTH
At 400 million, India is home to the worlds
largest child population. More than 50 per cent of
the children are malnourished and almost 50 per
cent of them do not attend school. Thats the state
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of our country, soon to have the worlds largest
young population.
Under-five mortality
In 2012, almost 14 lakh Indian children under
the age of five died due to preventable diseases
including pneumonia, diarrhoea and measles. Lets
put this into perspective by doing a comparison
with the number of children who died just two
decades back.
In 1990, 28.5 lakh children in India died before
reaching their fifth birthday. Despite the decline in
child mortality, a large number of children are still
dying, the death of each individual child being more
than just a number. India continues to be
responsible for the highest number of child deaths
in the world, amounting to 21 per cent of the total
global burden of child mortality.
The official estimate of the countrys under-five
mortality rate is 56 per 1000 live births, as of 2012.
This shows that India is far behind from achieving
its millennium development goal of 42 per 1000
live births by 2015. Indias Under five Mortality
Rate compares poorly with that of countries in its
own neighbourhood; Bangladesh (41) and Nepal
(42). It is also worth noting that both have already
achieved their respective MDG 4s, unlike India.
Though the World Health Organization (WHO)
believes that India has been effectively reducing its
infant and maternal mortality figures, thanks largely
to the many successful programmes that have been
initiated by the Government of India such as the
National Rural Health Mission (NRHM), the results
have not been satisfactory, especially when it comes
to infant and maternal deaths.
The current scenario tells us that a lot needs to
be achieved in the next one and a half year. Luckily,
the subject has been able to attract the attention of
the new government. On July 3, 2014, the Bharatiya
Janata Party (BJP) government decided to introduce
rotavirus vaccine, rubella vaccine and Inactivated
Poliovirus Vaccine (IPV) into Indias Universal
Immunisation Programme (UIP), making the
vaccines available to all children.
In addition, Japanese Encephalitis vaccines will
be introduced in 179 endemic districts across nine
States. The government aims to reach 27 million
Indian children under the Universal Immunisation
Programme targeting, and protecting the largest
birth cohort in the world against ten potentially
devastating diseases. India reported half of the
global polio cases until the year 2009. Thanks to
the aggressive polio campaign in the country, India
has now become a polio-free country. But the fight
against polio is still not over, and as the world
moves to eradicate polio once and for all, high levels
of safe and effective vaccination with both Oral
Polio Vaccine (OPV) and IPV are needed. IPV is a
critical part of the strategy to protect against any
future risk of outbreak and, as recently reported in
The Lancet, a study from Christian Medical College
(CMC), Vellore showed that IPV also helps boost
the effectiveness of OPV vaccine. Adding IPV to
the UIP can contribute greatly to the success of
this programme and goal of global eradication.
A birds eye view into rotavirus may give us a
clear perspective of why the government needed
to introduce the vaccine immediately. Diarrhoea
alone kills more children across the world than
AIDS, malaria and measles combined. It is the
second leading cause of child mortality worldwide
and India alone accounts for a fourth of global
child diarrhoeal deaths.
Rotavirus is the leading cause (>40%) of
moderate to severe diarrhoea. As per the 2012
demographic and child mortality data, rotavirus
kills more than 50,000 children each year in India.
Up to a million more are hospitalised. Dr. Vinod
Paul of All India Institute of Medical Sciences
(AIIMS) points out that even with improved
sanitation, rotavirus will continue to cause
diarrhoea as it did in all the developed countries
prior to vaccination.
Rotavirus causes rapidly progressing diarrhoea
which can quickly lead to severe dehydration and
death, especially if children do not receive the
appropriate care such as Oral Rehydration Solution
(ORS) and/or intravenous hydration. Therefore, it
is essential to introduce a vaccine to save lives and
prevent serious disease. Globally, more than 55
countries already use the rotavirus vaccine as part
of their immunisation programme.
Economic implications
The rotavirus vaccine has economic implications
as well. With up to one million rotavirus
hospitalisations each year, many Indian families
are pushed below the poverty line because of this
illness. According to estimates, the average cost of
hospitalisation for each episode of rotavirus
diarrhoea is approximately Rs.3,000, which is
equivalent to 7.6 per cent of an average Indian
familys total annual expenditure. Billions of rupees
are spent on health care-related costs and the
impact on GDP adds up as children do not grow
up to contribute to Indias economy.
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It is really a historic moment for India to be
turning the corner on child health. So much
progress has been made on the polio front and we
are at the cusp of eradicating the disease. Emphasis
is being placed on ensuring that children grow up
to lead healthy and productive lives. As a leader
vaccine producer, India is poised to move forward
as a world leader. Now is the time to make the
most out of the governments decision and do what
is needed to make the policy a reality and achieve
what has long been missed for Indias children and
the nation. As the leading economic power in the
region, India has a moral obligation to ensure that
every one of its children has access to life saving
interventions like vaccines.
Source: The Hindu
DEBATE OVER A CRITICAL OFFICE
The Attorney Generals opinion that the
Congress is ineligible to claim the post of Leader of
the Opposition (LoP) in the Lok Sabha as it does
not have the requisite number of 55 members to be
recognised as a Parliamentary Party is based on
precedent established since the first Lok Sabha. But
it may not be the last word on the question. That
precedent was followed by the Congress itself when
in power, and for long periods in the history of the
Lok Sabha there was no recognised leader of the
opposition. The rationale was that the leader of
the opposition being in line to form an alternative
government should be able to hold the House with
the required quorum of 10 per cent of its strength.
The 10 per cent rule was established by G.V.
Mavalankar and incorporated later in the Directions
for the functioning of the Lok Sabha as Direction
121, though it did not mention the LoP as such.
The 1998 law concerning the facilities to be given
to leaders and whips of recognised parties and
groups, which fixes 55 as the minimum number of
members required for recognition as a
Parliamentary Party in the lower House, does not
mention the LoP either. It is the 1977 statute on
the LoPs salary that does so. And that definition
says the LoP shall be the leader of the party in
opposition with the greatest numerical strength and
recognised as such by the Speaker. While the
statute itself is silent on it, the question arises if the
Speaker, while recognising the LoP, needs to go by
parliamentary precedent and Direction 121.
It needs to be noted that after the anti-defection
law in the Tenth Schedule of the Constitution came
into force, the system of recognising political parties
in the legislature ended. Now, even a lone member
elected on a party ticket is enough to form a
legislature party. The constitutional provision will
override any Direction, and it is debatable whether
the Speakers decision on the recognition of a Party
or a Group can any more be dependent on the 10
per cent norm. Further, there are recent laws that
require the leader of the opposition to be part of
selection panels for the Central Vigilance
Commissioner, the Chief Information
Commissioner, the Lokpal and the CBI Director.
Some of the relevant Acts do say that where no
person has been recognised as the LoP, the leader
of the opposition party with the largest numerical
strength may play that role. A recognised leader of
the opposition is necessary for the proper and
harmonious functioning of Parliament and for the
working of several of the recently enacted laws.
Legal ambiguity, the Congress partys own flawed
record and the BJPs triumphalism over its rivals
poor electoral performance, should not stand in
the way of an important parliamentary office being
filled.
Source: The Hindu
KEEP TALKING PEACE
The four-month extension of talks to halt
Tehrans bid to make an atomic bomb is an
indication of the positive if limited fallout from the
historic late-2013 interim agreement. Beneath that
was well-founded and deep scepticism in the
United States, Europe and even among the Israeli
intelligence of any resort to brute force as a
means to restrain Irans pursuit of nuclear weapons.
The five permanent members on the United Nations
Security Council (UNSC) and Germany accordingly
decided to ease sanctions worth $7 billion for six
months. The readiness of the latter to relent on
Irans continuation of uranium enrichment up to
the level necessary for power generation was in
sharp contrast to past UNSC resolutions requiring
Tehran to freeze all enrichment. In return, Iran
agreed to limit its nuclear programme and permit
vigorous multilateral inspections of its facilities.
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Whereas U.S. President Barack Obama insisted that
such relief was conditional and reversible, the
Republican hard-liners and Israel decried the
November agreement as a huge mistake. It is
significant that the International Atomic Energy
Agency (IAEA) should have acknowledged in June
that Iran was cooperating with investigations into
the so-called Possible Military Dimensions to its
nuclear programme. The IAEA had also observed
that such inspections could necessarily proceed in
a step-by-step manner a possible case to extend
the deadline for negotiations.
There is evidently no guarantee that the
November deadline would yield the outcome that
all parties envisage. Tehran has offered to freeze
the countrys operations at current levels over the
next three to seven years and thereafter resume
uranium production as per its own requirements.
Conversely, Washington and its partners insist that
Iran dismantle major aspects of its uranium
enrichment facilities and that current restrictions
should continue for well over a decade. The real
force behind these stated positions may also be
influenced considerably by geopolitics in the Middle
East. A foremost factor is the election last year of
Irans moderate President Hassan Rouhani, which
almost coincided with the interim nuclear
agreement. A thaw in Britains relations with
Tehran could prove to be a vital channel for the
European powers and the U.S. to exert pressure
on the radical Sunni Islamic groups in Iraq and
Syria. These are factors with a strong potential to
influence the course of nuclear talks. The road to
long-term peace lies in eschewing hard positions;
one that goes to the root of the global Nuclear non-
Proliferation Treaty (NPT). Nuclear weapon-states
championing disarmament ought to tread a delicate
line vis--vis potential aspirants in order to
strengthen world peace.
Source: The Hindu
IRRATIONAL PREJUDICE
That India still has no anti-discrimination law
to protect the interests of HIV positive people shows
how little the nation as a whole cares about them
and how callous society is to their plight. As a
result, discrimination against HIV positive people,
including children, rears its ugly head time and
again. The latest example is the case of 13 HIV
positive orphans studying in a school in Rivona,
Goa, being forced to leave school because of
pressure from parents of other students; these
children join the ranks of a couple of hundred others
in India who have faced the same fate. Stigma and
discrimination have affected and gravely impeded
the battle against HIV. Besides anxiety and denial,
the mortal fear of being stigmatised and
discriminated against prevents many from seeking
early testing and treatment. As a result, they not
only fail to get timely intervention but also go about
infecting others. Only about half of the 2.1 million
people in India who are HIV positive are currently
on antiretroviral treatment. Its a shame that this
situation prevails even 28 years after the first person
with HIV was diagnosed in Chennai. Besides doing
nothing to end discrimination, this incident amply
demonstrates that the state has failed to raise
awareness and dispel the myths and misconceptions
about the routes of HIV transmission. The sexual
route, transfusion of HIV infected blood, being
pricked by a needle used on an HIV positive person,
and from infected mother to child are the only
modes of HIV transmission. Also, the fact that
young children are infected with the virus turns
the spotlight on our failing to eliminate transmission
from pregnant mother to child. Preventing vertical
transmission is one of the easiest ways to cut the
incidence rate.
Refusal of school admission and expulsion from
school are but only the beginning of a long journey
of discrimination and negative social response that
HIV positive people encounter. Eviction of HIV
positive tenants from houses, refusal to employ such
people and even ostracism from villages are not
uncommon. But most alarming is the refusal by
most private hospitals to admit HIV positive people,
and the fear among many doctors and paramedics
to treat them. These individuals who are supposed
to be best informed seem to suffer from the same
paranoia that has seized the common man. In stark
contrast, doctors have no hesitation in treating those
with hepatitis B and C, which are much more easily
transmissible than HIV by the same routes. Hence,
the compulsion to broad-base the Health Ministers
initiative to mainstream AIDS awareness to reduce
HIV infection rate to also address the issue of
discrimination cannot be overemphasised.
Source: The Hindu
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BATTLE LINES SHARPEN OVER GM
Union Minister of Environment , Forests and
Climate Change, Prakash Javadekar, was petitioned
by farmers and the Swadeshi Jagran Manch to halt
trials of transgenic crops approved by the Genetic
Engineering Appraisal Committee (GEAC) on July
18 and there is some confusion if the government
has actually taken such a decision. However, from
what the Minister said subsequently, no such call
has been taken to freeze field trials of five crops.
The GEAC decision has come even before the
Supreme Court decides on a writ petition filed by
Aruna Rodrigues in 2005, demanding a moratorium
on genetically modified (GM) crops. A court hearing
on July 15 did not take place but three days later,
the GEAC cleared field trials for some GM crops.
The Centre had filed a response to the report of
the Technical Expert Committee (TEC) in April
2014; the apex court is yet to adjudicate on it. The
GEAC was quick to point out that the Supreme
Court had not imposed a ban on confined field
trials. But the comprehensive Parliamentary
Standing Committee report on agriculture in 2012
had taken a clear stand against field trials.
Call for greater regulation
The TEC called for strengthening the existing
regulatory system before granting permission for
conducting more field trials. In the absence of a
ruling from the Supreme Court, the GEAC steamed
ahead with what it thought fit, even as some States
were against GM field trials. It clearly went against
the opinion of the TEC and parliamentary
committee reports and also a letter endorsed by
over 250 scientists against field trials of GM crops.
Research is important, said a GEAC official, even
as he maintained that a blanket ban is unacceptable.
The GEAC, it seems, could not wait for the Supreme
Courts decision.
From a committee of approvals, the GEAC has
become an appraisal committee. It did not meet for
almost two years from April 2012 to March 2014
and there were 79 pending applications for field
trials, which included 37 for revalidation and 42
for confined field trials of various crops.
Even before he met farmers and the Swadeshi
Jagran Manch, Mr. Javadekar on July 21 sent
conflicting signals through a tweet that said field
trials of GM crops are not a government decision.
It is a recommendation of the GEAC. But he failed
to mention that the committee is under his own
ministry.
On July 23, he clarified in Parliament that there
is no proposal for a complete ban on the release of
genetically modified organisms either for
commercial cultivation or for experiments. . He
added that in view of various concerns on safety,
efficacy and agronomic performance of transgenic
seeds, extensive evaluation takes place before
regulatory approval is given.
It is this very regulatory process that has come
into question in the past by the parliamentary
committee and the TEC, which was constituted by
the apex court in 2012 to advise it on issues related
to GM crops field trials and bio-safety assessment.
After the TEC submitted an interim report in
October 2012, the Centre said it was scientifically
flawed and did not address the terms of reference
and merits outright rejection since it has exceeded
its mandate. Later, the apex court appointed Dr.
Rajendra Singh Paroda as a member who submitted
a separate dissenting report when the five other
TEC members submitted theirs in July 2013.
The Centres affidavit trashed the TEC report
on several counts and accepted Dr. Parodas report
which it felt had addressed all the terms of
reference. It defended the present regulatory system
in the country saying it was adequate and robust
and the government was committed to
strengthening it while praying for this writ to be
dismissed.
Ever since Bt cotton was granted approval in
2002 without much debate, the issue of transgenic
crops has created sharp divisions. A letter presented
in November 2013 to the then Prime Minister
Manmohan Singh asked him to accept the
recommendations of the TEC and disregard Dr.
Parodas report.
The Centres affidavit said the process of
preparation of the TEC report by five members was
non-transparent, non-participatory and
undemocratic, so much so that one member [Dr.
Paroda] was constrained to submit a separate
report.
Beyond the committees mandate
The Centre was also perturbed by TECs
suggestion that there should be a moratorium on
trial for crops which originated in India. The TEC
had also recommended a moratorium on field trials
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of herbicide-tolerant crops until the issue had been
examined by an independent committee. The
government said such recommendations were
beyond the mandate of the TEC and based on
scientifically flawed reports..
The GEAC, by granting approval to GM trials
even before the Supreme Court ruled in the matter,
has shown an undue haste which has marked the
history of transgenic crop approvals in India.
In a way, it has disregarded the committee of
experts appointed by the government itself after
the Courts order. There are grave concerns about
a loss of biodiversity something that has
happened already in the case of cotton and some
other crops and bio-safety regulations.
India is a signatory to international conventions
on both subjects. It is imperative to proceed with
caution on the issue of GM crops, move away from
conflict of interest situations and take an impartial
and rigorous scientific view which should benefit
humanity at large and not just powerful
corporations.
Source: The Hindu
BLUE CLOTH OVER THEIR CONSCIENCE
On the night of Tuesday, July 29, three shells
hit the Jabalia Elementary Girls School a U.N.
designated emergency shelter for 3,300 Palestinians.
Those who had taken refuge there came because
the Israelis had warned them to leave their homes.
The U.N. had given the Israelis the coordinates of
this school 17 times. Their warnings made no
impact. The shells killed at least 16 people and
wounded hundreds. The U.N. official in charge,
Pierre Krhenbhl (of UNRWA), said in a powerful
statement, Children killed in their sleep; this is an
affront to all of us, a source of universal shame.
Today, the world stands disgraced.
No ceasefire is on the horizon. The
humanitarian pause of August 1 broke down after
two hours. The U.N. Security Council could not
agree on the language for a resolution its
strongest instrument. A toothless presidential
statement from the Council called not for an end
to the conflict but for an immediate and
unconditional humanitarian ceasefire, allowing for
the delivery of urgently needed assistance. In other
words, the U.N. Council members recognise that
they have no authority to end the conflict. All they
can do is to ask for humanitarian pauses so that
the U.N. agencies can bring in emergency supplies
to a desperate population.
Israel has destroyed Gazas only power plant,
which impacts the already fragile sewage and water
purification system as well as food storage.
Electricity is mostly off, which means that the
Palestinians are in danger of being cut off from the
world. As it is, when Israel conducts its
operations inside Gaza, it seals the area,
preventing media from entrance. The aftermath of
these operations has been devastating, whether in
Gaza Citys neighbourhood of Shujaiyya or the
town of Khuza. Forty-four per cent of Gazas 140
square miles (360 square km) have been designated
a buffer zone by the Israelis. Gazas Ministry of
Health puts the figure for the dead at over 1,300
and the wounded at close to 8,000 this number
rises steadily.
The U.N. says that over 250,000 of the 1.8 million
Palestinians in Gaza are now in their shelters. The
U.N. is on its last legs as far as supplies go. We
have reached the tolerable limit that we can
accommodate, Mr. Krhenbhl told the Security
Council on July 31. Gaza continues to be under
siege by Israel, and the border crossing with Egypt
at Rafah is effectively closed. The tunnels
that the Israelis are destroying had been the arteries
for the Palestinians to break the embargo. That is
now closed to them.
U.S. Secretary of State John Kerry travelled
around the region trying to move a ceasefire
agenda. The Palestinians are clear that any genuine
ceasefire must include an end to the siege. Even
Mr. Krhenbhl agreed, telling the Security Council
on July 31, The illegal blockade of Gaza must be
lifted.
This is unacceptable to Israel, which believes
that the suffocation of Gaza is in its security interest.
An official of the Eshkol Regional Council had told
the International Crisis Group (ICG) in 2009, Our
forces should flatten Gaza into a parking lot, destroy
them. An end to the siege is the last thing that
such a political view would allow. Members of the
Israeli Prime Minister Benjamin Netanyahus inner
circle called Mr. Kerrys plan a strategic terrorist
attack. The ceasefire plan brokered with Qatar
and Turkey, the Israeli officials said, would spur
them to expand their operations against Gaza
to flatten Gaza.
th
July to 3
rd
August, 2014
Relations with U.S.
Israeli insults against the Obama administration
have been legion. In 2010, the Israelis announced
the building of new settlements in Occupied East
Jerusalem on the day that U.S. Vice-President Joe
Biden arrived in Israel with a peace proposal that
included a moratorium on settlement building. He
was humiliated. The next year, Israeli Prime Minister
Benjamin Netanyahu went before a joint session of
the U.S. Congress to say that Israel would never
make peace with Hamas. It was seen as a direct
snub at U.S. President Barack Obama, who had
suggested that a hard-line position against Hamas
would not occasion a peace process.
Mr. Netanyahus attitude toward the U.S. was
clear in his 2001 visit to Ofra, an illegal settlement
in the West Bank. He talked to the settlers about
the need to pummel the Palestinians. A settler asked
him if he worried about the world reaction to such
a policy. Not at all, he replied, especially today
with America. I know what America is. America
is something that can easily be moved. 80 per cent
of the Americans support us. We have that kind of
support.
Mr. Netanyahu is correct. Despite abuses from
the Israeli government, the U.S. political class fully
supports Israel. In the midst of this campaign on
Gaza, with all evidence pointing to a violation of
the rules against collective punishment, the U.S.
Congress unanimously voted to give full support
to the Israelis. It also charged the U.N. Human
Rights Council with hypocrisy over its resolution
that asked for an investigation of Israels conduct
in the war. The U.S had cast the only No vote in
Geneva. Not only this, the U.S. Defense Department
handed over its stockpiles of weapons that are
stored in Israel.
A U.S. defence official said that Israel took
possession of 120 mm mortar shells and 40mm
grenades both of which are being used in this
bombardment. Seventy nine of the hundred U.S.
Senators supported the U.S.-Israel Strategic
Partnership Act, which would allow for more arms
to be delivered to Israel. The act also encourages
the U.S. to ensure that Israel continues to have a
qualitative military edge over its neighbours. The
U.S. political class, despite the abuses from Tel Aviv,
seems eager to back Israel to the hilt
diplomatically, financially and militarily.
In 1937, for two hours, the German Condor
Legion bombed the small Basque town of Guernica.
The incendiary bombs killed hundreds of civilians.
Colonel Wolfram von Richthofen, who commanded
the squad, wrote that their firebombs resulted in
complete annihilation.
Picasso turned his talent to bring this event to
life, which resulted in his masterpiece, Guernica.
Later, he would say, that the painting allowed him
to express his horror of the military caste which
takes the world into an ocean of misery.
A tapestry of the painting used to hang outside
the U.N. Security Council. When U.S. Secretary of
State Colin Powell went to make his fraudulent
case for a war against Iraq in 2003, a blue cloth
was hung over Guernica. It could not interfere with
the masters of war. Today, a blue cloth is hung
over any statement that questions Israels right to
annihilate Gaza.
International political action
Valerie Amos, U.N. head of the Humanitarian
Affairs and Emergency Relief department, asked,
Where is the humanity, the morality? Its children,
civilians dying. Mr. Krhenbhl, in an equally
emotional statement, noted, We have moved
beyond the realm of humanitarian action alone.
We are in the realm of accountability. I call on the
international community to take deliberate
international political action to put an immediate
end to the continuing carnage. The apposite phrase
here is international political action. Mr.
Krhenbhl meant the U.N. Security Council. From
August 1, the president of the Council is the U.K.s
Ambassador, Sir Mark Lyall. In his statement to
the Council on July 30, Sir Mark blamed both
sides for the conflict, saying, The people of Israel
have the right to live without constant fear for
their security, but the people of Gaza also have the
right to live safely in peace.
The argument of both sides erases the context
of this bombardment the occupation of the
Palestinian lives and the scale of Israels offensive.
There is no parity here. Sir Marks approach shows
that the UNSC has no appetite to move a resolution
based on the U.N. principle of Responsibility to
Protect (R2P). That form of humanitarianism is only
useful when it suits western interests. When it does
not, the lives of civilians are of no concern. No
wonder Mr. Netanyahu can so casually say, We
need to be prepared for a protracted campaign in
Gaza.
Source: The Hindu
th
July to 2
nd
August, 2014 [59]
REVISITING THE ANCIENT SPICE ROUTE
Kerala has embarked on a historic journey to
protect and promote the Spice Route heritage that
existed between the State and 31 countries in Asia,
the Far East, Africa, and Europe.
Unesco Director and representative to India
Shigeru Aoyogi signed a memorandum of
understanding with State Tourism Secretary Suman
Billa here on Friday to formalise a framework of
cooperation in heritage protection and promotion.
Addressing mediapersons after the event, Mr.
Aoyogi said Unesco was happy to work with the
State government for inter-cultural and inter-faith
dialogue to preserve heritage. Under the agreement,
the Spice Route initiative will form the bedrock of
cooperation between the two sides, along with
protection and promotion of historically important
areas of the State.
The partnership with Unesco is a major step
towards reviving and remembering an ancient
heritage (trail) in which Kerala was the undisputed
leader on the global stage. By taking the initiative
in bringing together different countries that were
once part of the historic spice trade between Kerala
and the rest of the world, we are not only
promoting peace and cultural exchange, but also
aiding the people of the State to become partners
in development by realising its mammoth tourism
potential, State Tourism Minister A.P. Anil Kumar
said.
Tourism Secretary Suman Billa spoke of how
the agreement marked one of the biggest tourism-
linked conservation projects ever undertaken in the
world. By inviting todays global travellers to tread
the path once travelled by ancient day traders and
explorers, Keralas Spice Route initiative throws
open unprecedented collaboration between a large
number of countries from many continents. The
State is also expected to witness a conference of
ambassadors from the Spice Route countries.
Source: The Hindu

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