THE HINDU – CURRENT NOTE 28 March
SC counters push for Aadhaar
•The recently-passed Finance Bill made Aadhaar mandatory for filing tax returns and getting a permanent account number (PAN). The court’s observations came during a mentioning for an early date for hearing pending petitions raising the issue of Aadhaar as a violation of the citizen's privacy. The court, however, did not agree for an out-of-turn hearing.
•In October 2015, the government had assured the Constitution Bench that the requirement for Aadhaar would be purely of a voluntary nature for citizens to access public subsidy. The court had said this would remain so till it took a final decision on whether the Aadhaar scheme was an invasion of privacy.
•The then Chief Justice of India H.L. Dattu, who led the Constitution Bench, had even asked Attorney-General Mukul Rohatgi, for UIDAI, to make a statement in open court that “you will not insist (on Aadhaar) till the matter is finally decided here or a legislation is introduced in the Parliament”.
•“Suppose we decide that Aadhaar is purely voluntary and any attempt to make it mandatory would be treated as contempt of court... are you ready to give an assurance or make a statement here to this effect?” the CJI had asked Mr. Rohatgi. "No person will be denied benefits under any government scheme for want of Aadhaar card,” the A-G had responded.
•The Constitution Bench had extended the voluntary use of Aadhaar card to Mahatma Gandhi National Rural Employment Gurantee Scheme, all types of pensions schemes, employee provident fund and the Prime Minister Jan Dhan Yojana.
•With this, the Supreme Court had modified an August 11, 2015 order issued by its three-judge bench restricting Aadhaar use to only PDS and LPG (cooking gas) distribution.
•The government had argued that the Aadhaar card was not to be seen in the sinister light of State surveillance and censorship.
•Mr. Rohatgi had argued that the Aadhaar was rather a fool-proof method for government to identify the actual beneficiaries of social benefit schemes and not get duped into distributing welfare paid by taxpayers' money on fraudsters.
•Supporting the Centre, Gujarat government had justified Aadhaar as a means for citizens to directly connect with welfare schemes without intermediaries.
Supreme Court for policy to curb farmer suicides
•The Supreme Court on Monday said the Centre should address the “serious issue” of farmers taking their own lives and implement a comprehensive policy to be adopted by the State governments for preventing the tragedy.
•“Farmers committing suicides is a serious issue. You [Centre] should bring the proposed policy dealing with all the real issues which force the farmers to take extreme step. We are with you,” a Bench led by Chief Justice of India J.S. Khehar told the Centre.
•Additional Solicitor General P.S. Narasimha said the government was coming up with a comprehensive policy to address the problems of the farmers.
No need for middlemen
•He said now the government was directly procuring food grains from the farmers at the minimum support price and they did not need to take the help of middlemen or market.
•Mr. Narasimha said the policy would address crop loss or crop failure and a compensation for farmers.
‘More Insurance cover’
•“Insurance cover has been increased for the farmers. Earlier, it was for those who took agriculture loan but now it has been extended to all the farmers,” he said.
•Senior advocate Colin Gonsalves, appearing for NGO Citizens Resource and Action and Initiative, said that over 3,000 farmers had committed suicide in the last few years.
Find alternatives to pellet guns: SC
•Reminds govt. that a ‘welfare state’ is meant to protect all with harm to none
•Reminding the government that it is a ‘welfare state’ meant to protect all without causing harm to none, the Supreme Court on Monday asked the Centre to come up with alternatives to pellet guns used by security forces against agitators and stone-pelting mobs on the streets of Jammu and Kashmir.
•“You are a welfare state. It is your duty to ensure the safety of the people as well as the security forces. Your purpose of being there is not to harm or injure individuals,” a Bench led by Chief Justice of India J.S. Khehar addressed Attorney-General Mukul Rohatgi.
•Mr. Rohatgi responded that security forces are face-to-face with violent mobs, sometimes used as a human shield by militants who open fire at them. The agitators even throw petrol bombs at the forces. In short, Mr. Rohatgi said security personnel battle for their own lives and use these guns, at the minimum, as a means of self-defence, and at the most, to bring law and order back on the streets.
•“We appreciate that... there are lots of pressure. However, what can be adopted should not cause harm to individuals,” Chief Justice Khehar replied.
•The court expressed its concern about how minors, students and innocent by-passers of the Valley become collateral damage, sometimes scarred permanently for life, in the battle for the streets between forces and the mobs. For their sake and that of their parents and loved ones, the court asked the government to consider other alternatives to quell the mobs.
The Bench posted the hearing for April 10.
•In December 2016, the Supreme Court sought a similar assurance from the Jammu and Kashmir government to avoid the “indiscriminate” use of pellet guns on protesters in the restive State.
•The court’s reservations about the use of pellet guns without “proper application of mind” came while hearing a petition filed by the Jammu and Kashmir High Court Bar Association.
‘Many jawans injured’
•The Attorney-General, who was countering the contention of the J&K Bar Association counsel over the death and injuries of protesters besides spectators watching the incidents from their houses, said a total of 1,775 CRPF personnel were injured of whom 79 were grievously injured in the protests held between July 8 and August 11, 2016.
•The High Court had on September 22 rejected the plea for a ban on pellet guns on the ground that the Centre had already constituted a Committee of Experts through its memorandum of July 26, 2016 for exploring alternatives to pellet guns.
•The High Court had also declined to accept the plea to prosecute the officers who ordered pellet guns to be used and those who shot the agitators.
Giving short shrift to children’s rights
•In the last three years, important entitlements for children have been undermined by the Centre
•The recent notification of the Ministry of Human Resource Development, making Aadhaar compulsory for midday meals in government schools, has attracted the criticism it deserves. This notification serves no clear purpose other than to force children to get enrolled under Aadhaar. The government, unfortunately, managed to create the impression that the notification had been retracted, when nothing of the sort has happened.
•This is just the latest in a series of attacks on child-related rights during the last three years. A few examples, not exhaustive, are as follows.
No maternity entitlements
•First, the Central government has violated women’s right to maternity entitlements under the National Food Security Act (NFSA), 2013 for more than three years. Under the Act, every pregnant woman is entitled to maternity benefits of Rs. 6,000, unless she is already covered by maternity schemes in the formal sector. The Economic Survey 2015-16, in a welcome chapter on “Mother and child”, made a strong case for maternal and early-life health programmes, including maternity benefits, noting that they “offer very high returns on investment”. Yet, the Union Budget that followed, for 2016-17, did not make any provision for maternity entitlements beyond the pilot scheme (for 53 districts only) initiated by the previous government. This was all the more startling as the Central government had assured the Supreme Court in writing, on October 30, 2015, that this scheme — Indira Gandhi Matritva Sahyog Yojana — would be extended to all districts in 2016-17.
•On December 31, 2016, Prime Minister Narendra Modi proudly announced that pregnant women nationwide would soon be getting maternity benefits of Rs. 6,000. He projected this as a “new scheme” (sic), without any reference to the NFSA, perhaps hoping that the victims of demonetisation would appreciate the gesture. With the Prime Minister finally endorsing maternity entitlements, things started moving after that, but not much: the allocation of Rs. 2,700 crore in the 2017-18 Union Budget is barely enough to cover a fourth of all births, even with the proposed 60:40 ratio for Centre:State funding. Word has it that the Central government may restrict the benefits to one child per woman, against the law. Further, there is still no sign of the said scheme. Quite likely, the government will take its own time to roll it out, and spend even less this year than the measly allocation of Rs. 2,700 crore. So much for maternity entitlements under the NFSA being “a promising opportunity to improve nutrition during pregnancy”, as the Economic Survey 2015-16 aptly put it.
No money, no eggs
•Second, the Central government is giving short shrift to the Integrated Child Development Services (ICDS), a critical programme that was making good progress until it was hit by Budget cuts in 2015-16. The initial Budget cut was about 50%. This was so mind-boggling that the government’s own Minister for Women and Child Development, Maneka Gandhi, criticised the cuts in public, mentioning inter alia that they had made wage payments a “month-to-month suspense”. The cuts were partly reversed later on, but, meanwhile, they had done much damage and sent a disastrous signal down the line. State governments were not amused.
•For instance, in a letter sent to the Central government on July 15, 2016, the Government of Odisha complained that salary payments to anganwadi workers were held up by Budget cuts, while planned schemes for pre-school education and medicine kits “could not be taken up”.
•Third, the midday meal scheme is also being starved. Like ICDS, the midday meal scheme received shock treatment in the 2015-16 Budget, with an initial Budget cut of 36%. The allocation for midday meals in this year’s Budget, Rs. 10,000 crore, is still 25% lower in money terms than the corresponding allocation four years ago (in real terms, the decline would be even larger). The Budget cuts, of course, must be seen in light of the fact that the share of States in the indivisible pool of taxes was raised from 32% to 42% in 2015-16. The question remains why the axe fell so heavily on children — no other schemes were hit so badly in 2015-16, with the possible exception of drinking water and sanitation.
•And then there is the issue of eggs. Many State governments are now providing eggs with midday meals in schools (and sometimes also in anganwadis). This is a real breakthrough, considering the high nutrition value of eggs. Had the Central government taken this forward as a matter of national policy, millions of children would be better nourished today. But here is an interesting pattern: most of the major States where eggs are still off the menu in schools and anganwadis are States with a Bharatiya Janata Party (BJP) government, and vice versa. The BJP States, it seems, are not willing to antagonise upper caste vegetarian lobbies. No wonder the Central government is maintaining a studied silence on this matter.
Further blows
•Fourth, plans are afoot to scrap the Janani Suraksha Yojana (JSY), a scheme of conditional cash transfers aimed at promoting institutional deliveries. Recent data clearly show a surge in institutional deliveries in the last 10 years or so (e.g. from 39% in 2005-6 to 79% in 2015-16 according to National Family Health Surveys), and it would be surprising if this had little to do with JSY. Incidentally, the decline of maternal mortality has also accelerated in recent years. Yet the Central government is now planning to phase out JSY. In a presentation made at Vigyan Bhavan on February 22, 2017, the Secretary, Women and Child Development, explained that JSY would be “subsumed” under the maternity benefit scheme from next year, as the latter provides a “higher amount for institutional delivery”. In other words, maternity benefits will be made conditional on institutional delivery, in violation of the NFSA, and further, this linkage will be taken as an excuse to discontinue JSY, even though maternity entitlements and JSY serve distinct purposes.
•Last but not least, Aadhaar is now being made compulsory for all these schemes — midday meals, ICDS (yes), maternity benefits, JSY, you name it. This is being done in the name of curbing corruption, but no credible evidence has been given that identity fraud is a serious problem in these schemes, or that Aadhaar is the best possible solution. Rather, this seems to be part of the blind drive to make Aadhaar ubiquitous and universal, regardless of the possible damage. The imposition of Aadhaar on midday meals and related schemes exposes, once again, the claim that Aadhaar is a voluntary facility. It also shows that the Centre has no respect for Supreme Court orders, and that the Supreme Court, for some reason, does not mind.
•These examples suffice, I hope, to illustrate the Central government’s harsh treatment of children. Somehow, their well-being is not seen as an important part of the “sabka saath, sabka vikas” project. When I asked a senior official of the Finance Ministry, some time ago, why the 2015-16 Budget cuts had fallen so heavily on children, he said that this pattern had not come to his attention. The cuts, he added, were made in a hurry and the details had not been “thought through”. I mention this anecdote because it illustrates how easily children can fall off the policy radar. It is not that anyone is hostile to them, just that they have no voice.
•The silver lining is that there is still some action for children at the State level. For instance, Tamil Nadu, Odisha and Telangana have introduced maternity entitlement schemes with their own resources, without waiting for the Central government. However, the indifference towards children at the Centre may percolate to State governments sooner or later. That would be a tragic loss, not just for Indian children but also for the entire nation.
Powered by a pause
•Delays in the Indo-U.S. nuclear deal bring an opportunity to re-examine the energy basket
•Ever since it was announced in 2005, the Indo-U.S. civil nuclear agreement has faced one obstacle after another. So this week’s news that its operationalisation may be further delayed owing to Westinghouse’s financial difficulties and Japan’s procedural issues in ratifying the deal with India should come as no surprise. This sets back “work toward finalising the contractual arrangements by June 2017” for six reactors to be built in Andhra Pradesh by Toshiba-owned Westinghouse and the Nuclear Power Corporation of India Ltd. (NPCIL). But India has little control over both circumstances, and rather than seeing them as a setback, the government and officials should use this as an opportunity to re-examine the country’s engagement with nuclear energy for future needs. Westinghouse’s near-bankruptcy is part of a larger pattern of worldwide cost overruns and delivery delays across the nuclear energy industry. Nuclear manufacturer Areva (in partnership with Mitsubishi) has a similarly precarious position despite hopes of a bailout by the French government. Even Russian supplier Rosatom’s Kudankulam units 1 and 2, in the only foreign collaboration now operational in India, were built in double the time budgeted, while units 3 and 4 could see delays. The cost of importing reactors, relative to those based on indigenous design, is another concern. Land acquisition issues remain, along with the need for large water reservoirs for the reactors, which will only grow if the government goes ahead with its plans for 55 reactors of 63,000 MW in total by 2032. In addition, given concerns about a possible tsunami scenario along the Andhra coast, where many of these reactors are planned, the Department of Atomic Energy and NPCIL are looking for options farther inland.
•The promise of nuclear power has thus far outweighed all of these concerns, and India has reason to be proud of its technology and determination to look for non-fossil alternatives in its energy planning. However, with rapid progress in technology in other renewable energy sources such as wind and solar power, the collapse of oil prices and the expansion in gas projects as a viable and clean alternative, that promise has dimmed. These could also be more cost-effective for a developing country such as India, as the energy can be made available in smaller units, and then built up, unlike nuclear plants where nothing can be transmitted until the whole plant is complete and attains critical status. Above all, the risk surrounding nuclear safety is yet to be fully mapped, post-Fukushima. A Japanese court ruling holding both the state regulator and the operator responsible for the 2011 triple meltdown has sent sobering signals to the industry. This is the best time for India’s energy planners and government to use the breathing space provided by the delays in the Indo-U.S. civil nuclear deal and take a long, hard look at the cost-benefit analysis on the nuclear power balance sh
Trust the EVMs
•Machine-manipulation charges levelled by some political parties have no real basis
•The legitimacy of the election process is a key component of any democracy. When Bahujan Samaj Party leader Mayawati and Aam Aadmi Party convenor and Delhi Chief Minister Arvind Kejriwal alleged that the manipulation of electronic voting machines helped the Bharatiya Janata Party in Uttar Pradesh and the Shiromani Akali Dal-BJP combine in Punjab, they were casting doubts about the legitimacy of the results. While the BSP, through its leader’s statements and submissions to the Election Commission, was vague in its complaints, the AAP leader was more specific, suggesting that 20-25% of his party’s votes were “transferred” to the Akali Dal due to the EVMs. Complaints about the security of EVMs have been raised over a decade in courts, and the EC has repeatedly demonstrated how the security of the machines cannot be compromised. Indian EVMs, unlike online voting machines that were discontinued in some western countries, are stand- alone, independent electronic units. They record and lock votes only after being trigger-enabled by presiding officers through a control unit. The EC has sought to assure sceptics that the security of the machine is enabled through both technological and procedural means. The wiring-in of software in a one-time programmable chip disallows external manipulation, time stamping of every key pressed allows for monitoring, production testing is done for quality control, and so on. Checks of EVMs along with representatives of political parties, randomised allocation and sealing make the machines tamper-proof before and after votes are cast.
•The EC has also sought to increase the use of a voter verifiable paper audit trail (VVPAT) that helps in corroborating the results from the machine, and expects its full implementation by the 2019 Lok Sabha election. The data tallied from VVPAT-enabled EVMs in U.P. in around 20 constituencies in the recent Assembly election corroborated the election results. Prima facie , there is nothing to suggest that EVMs have been subject to manipulation. In fact, the use of EVMs has enhanced electoral democracy in tangible ways. Before electronic voting became universal in State and parliamentary elections in 2004, paper ballot-based polling had seen a high incidence of inadvertent invalid voting. A statistical study published in The Hindu last year showed that in about 14% of the 35,937 Assembly seats where elections were held between 1961 and 2003, invalid votes were greater than the margin between the winner and the runner-up. In more than 300 constituencies, invalid votes were as high as the votes polled for an effective candidate. The use of EVMs has cancelled out the effect of invalid votes, making the process robust besides keeping it simple and effective. EVMs are here to stay and there is no need to be distracted by politicians who criticise them to explain away their defeat.
Turning the clock back
•With several bilateral investment treaties lapsing on March 31, FDI inflows could take a hit
•Come April 1, the Narendra Modi government would have taken India back to the pre-1991 inward-looking economic era as far as India’s approach to bilateral investment treaties (BITs) is concerned.
•Till the early 1990s, India didn’t sign BITs because foreign investment was not considered significant in a statist India. The absence of BITs meant foreign investors couldn’t use international arbitration to hold India accountable under international law for any detrimental regulatory overreach. So, when the Foreign Exchange Regulation Act that came into force in 1974 required a foreign company to convert foreign equities into minority holdings of 40%, many helpless foreign companies like Coca-Cola, IBM, Kodak and Mobil either quit India or applied to the government to do so.
•In 1991, India lifted its self-imposed economic exile by starting the process of experimenting with the market and wooing foreign investors. As part of this image makeover, India started signing BITs from the early 1990s. The signing spree continued unabated till 2010 with India inking BITs with 83 countries. However, rattled by many BIT claims brought by foreign investors from 2011 onwards, last year, India unilaterally issued BIT termination notices to 58-member countries. Reportedly, these BITs would lapse on March 31 after the expiry of the mandatory one-year notice period. Although the terminated BITs will continue to be relevant for existing foreign investment in India and Indian investment in these countries for the next 10-15 years due to survival clauses, any new investment, either from these 58 countries to India or vice versa, shall not enjoy BIT protection as was the case before 1991.
BITs and foreign investment
•Some argue that foreign investment inflows to India are not dependent on BITs. Two studies question this wisdom. The first, done by Rashmi Banga, examines the impact of BITs on FDI inflows in 15 Asian developing countries including India from 1980-81 to 1999-2000. The study shows that BITs signed by these 15 countries with developed countries had a stronger and significant impact on FDI inflows in these 15 countries. However, BITs signed by these 15 countries with developing countries didn’t have much impact on foreign investment inflows. Till the year 2000, out of the 14 BITs India signed, nine were with developed countries. Therefore, BITs had a significant impact on FDI inflows in India, which rose from $393 million in 1992-93 to $4,029 million in 2000-01. The second study, a very recent one by Niti Bhasin and Rinku Manocha, considers the impact of BITs on FDI inflows in India from 2001-2012. This study also demonstrates that BITs signed by India contributed to rising FDI inflows in the said period by providing protection and commitment to foreign investors. The significance of BITs in attracting investment was also emphasised by Canada’s Trade Minister during his recent visit to India. The Minister said that absence of an India-Canada BIT is restricting the scope and volume of investments that Canadian pension funds can make in India.
•It is nobody’s case that BITs alone determines FDI inflows, but they do play a critical role in mitigating regulatory risks and thus encouraging investors to invest — critical for India, which has a dubious distinction of not being a friendly place to do business in.
Few takers for the Model BIT
•To be fair to the government, it wants to sign new BITs with all these 58 countries based on the new Model BIT adopted in 2016. However, most developed countries have not shown much interest in the Model BIT because instead of striking a balance between investment protection and state’s right to regulate, it tilts towards the latter. There are fundamental differences between the Indian approach and the Canadian and European approach to protection of foreign investment, as reflected in the investment chapter of the recently signed EU-Canada Comprehensive Economic and Trade Agreement (CETA). First, the EU-Canada CETA contains a ‘most favoured nation’ (MFN) provision — a cornerstone of non-discrimination in international economic relations — which is missing in the Indian Model BIT. Second, the Indian Model BIT, unlike the EU-Canada CETA, mandatorily requires foreign investors to litigate in domestic courts for five years before pursuing a claim under international law. Third, the EU-Canada CETA provides protection to foreign investors in situations where the state goes back on the concrete representations it made to lure an investor, which the investor relied upon while investing. The Indian Model BIT is silent on this, thus exposing foreign investors to regulatory risks. Fourth, the EU-Canada CETA talks of pursuing the establishment of a multilateral investment court to settle investment disputes. Will India support such a proposal?
•Due to these differences, an India-Canada BIT or an investment treaty with EU looks difficult. Will the Modi government reconsider its BITs policy? If not, we are set to return and remain in the pre-1991 era, ironically, under the leadership of someone who was entrusted with the mandate to deepen economic reforms.
‘Digital platform to help railways save Rs. 60,000 crore’
•Entire operations can be monitored on a single platform
•Indian Railways will invest about Rs. 12,000 crore in developing a common digital platform for integrating information from all its departments leading to savings of about Rs. 60,000 crore, said Suresh Prabhu, Railway Minister.
•“In the last Rail Budget, I had announced an Enterprise Resource Planning system that will be an IT-based platform for system-wide integration and planning,” Mr. Prabhu said during a conference involving leading software companies, to draw the roadmap for the software.
•“We then took the advice of [former] Tata Consultancy Services CEO N. Chandrasekaran [now Tata Sons Chairman] and other eminent personalities in framing the terms of references. Now, we will start working on the common platform,” Mr. Prabhu said.
•The Minister said Rs. 10,000–Rs. 12,000 crore of investments will be required for the enterprise-wide digital platform called IR-One ICT that will lead to benefits worth Rs. 50,000–Rs. 60,000 crore to the Indian Railways in the long run.
•“It might take at least two-three years to complete the first phase. With the common platform, the monitoring of the entire Indian Railways operations can be done on a single platform,” he said
•“Several passenger complaints can be solved. We may also get to know the vacancies in a train and the number of people travelling. Maintenance issues can be handled remotely. There will be asset utilisation, revenue seepage will reduce and ultimately customers will benefit,” the Minister said.
•During the conference, the Minister said passenger complaints were the best pieces of information available to the Railways free-of-cost which can be used as a management tool to take informed decisions.
•‘One ICT’ will cover all the aspects of the Indian Railways, including cost analysis, attendance, accounting, asset management, medical management and land management.
•“Better capacity and asset utilisation would help the railways run more trains, carry more freight, provide better and reliable services to passengers, increase its revenues and make its operations more safe,” according to a statement from the Railway Ministry.
