📰 Subsidise rail losses: PMO
Finance Ministry asked to reimburse expenses on non-profitable routes
•The Prime Minister’s Office (PMO) has directed the Ministry of Finance to fund the losses incurred by the Indian Railways in operating non-profitable trains on strategic lines and backward areas.
•The directive ends a tussle that began following the merger of the Railway and Union Budgets, as the Ministry of Finance had discontinued the practice of providing an annual subsidy to the Railways.
•“The PMO in a meeting held last month has directed the Ministry of Finance to reimburse the losses incurred on strategic rail lines discontinued following the merger of Budgets,” said a senior Ministry of Railways official, who didn’t wish to be identified. The meeting was chaired by Principal Secretary to Prime Minister, Nripendra Misra, to resolve the issues arising out of the merger of Budgets. Railway Board Chairman A.K. Mital, Railway Board Financial Commissioner B.N. Mohapatra, Department of Financial Services Secretary Anjuly Chib Duggal and joint secretary (Budget) in Ministry of Finance were present, according to sources.
•The decision comes as a relief for the Railways which feels that the social service obligation borne by it in running non-profitable lines of national and strategic importance should be funded by the Central government.
📰 Revealed: 4,000-year-old bone jewels
Archaeologists thrilled at first-time discovery of perfect ornaments near Hyderabad
•Ancient jewellery and decoration has a new meaning, with the discovery of bone ornaments in Telangana that go back about 4,000 years. In a find that has excited archaeologists, 50 pieces of bone ornaments have been found in a hamlet of Narmetta, an agricultural village on the outskirts of Hyderabad.
•Shaped precisely like a rhombus with round holes in the middle and circular indentations, these are thought to have been used as jewellery. Samples of the artefacts are being analysed at the Centre for Cellular and Molecular Biology in Hyderabad.
•Historian Prof. K.P. Rao, who led the 2005 Gachibowli megalithic excavation that dated the earliest megalithic site to 2200 BC said, “Bone ornaments have not been found till date in India. We had perforated teeth but this I am hearing for the first time.”
Capstone found
•Along with the bone ornaments, officials of the State Department of Archaeology and Museums (DAM) also unearthed one of the biggest capstones in the region. The stone, weighing about 42 tonnes, had to be moved using a crane. “The season was fantastic, with discoveries that have given us a better understanding of megalithic history [of the region]. Once the bone samples are analysed, we will know which animal they came from,” said N. R. Visalatchy of DAM.
•A 20-acre site at the farming village of Siddipet was excavated earlier, and in 2017, archaeologists began digging at a raised mound. Here, they found their first anthropomorphic menhir — an upright stone with human traits.
•“Anthropomorphic menhirs have been documented at multiple locations in south India, dating between 1300 BC and 200 BC but this is a first for Telangana,” said Ramulu Naik, a DAM official.
•The 2.95-metre menhir was vertical.
•“The tradition of anthropomorphic figurine worship continues among some tribes. So, I am not surprised at the finding,” said Prof. Rao. The team also found four well preserved fire stands used by people to keep warm.
•The pottery and other items were discovered at a three- metre depth.
•“The people who lived there had evolved burial norms which we are following even now. The head is on the south side and the feet are in the north direction,” said G. Nagaraju, who was part of the excavation team.
•“These findings are just a sample. Many of the other rock formations and burial sites have been disturbed or destroyed by the people living nearby so that they can cultivate their land. We have to carry out our excavations quickly, as I don’t think any of these sites will be allowed to remain in their present status,” said G. Nagaraju, who was part of the excavation team.
📰 Nandankanan zoo to get 12 vultures
Zoological park had been struggling for 5 years to find birds for its conservation breeding programme
•With the Central Zoo Authority (CZA) directing authorities of the Gandhi Zoological Park in Gwalior to provide 12 rescued long-billed vultures to the Nandankanan Biological Park (NBP), its conservation breeding of white-backed vultures is expected to be back on track soon.
•“We are in touch with the Gwalior zoo for shifting of the vultures,” said NBP director Sisir Acharya.
•The NBP, one of six institutes selected for the vulture breeding programme, has been struggling to find vultures for captive breeding.
Long search
•In the past five years, the NBP had approached the CZA, Jatayu Conservation Breeding Centre, Pinjore, Rani-based Vulture Conservation Breeding Centre (VCBC) and Bombay Natural History Society to find vultures for its programme, but with no success.
•With financial support from the CZA, construction on a conservation breeding centre for white backed vultures began in 2011-12 in an off-exhibit area of Nandankanan over an area of 0.3 acres, surrounded by about seven acres of forested area.
•“The breeding centre has been developed as a satellite campus with basic facilities. Two nursery aviaries (10x12x8 feet) and one colony aviary (100x40x20 feet) have been constructed. We already have electronic surveillance system in place for the project,” said Mr. Acharya.
Financial issue
•The NBP will sort out a minor financial issue with the CZA before re-initiating breeding programme.
•Proposal for carrying out captive conservation breeding of vultures was first moved by the NBP in 2008.
•The CZA had sanctioned Rs. 1 crore for the project. About Rs. 30 lakh is lying unutilised with NBP, but the zoo authorities want the CZA to earmark more funds for the programme as upkeep of vultures is an expensive affair.
•The Nandankanan zoo currently has three vultures, each belonging to a different species. The authority cannot use them for conservation, but these vultures will soon be shown in exhibit areas.
Endangered birds
•Experts said that breeding and conservation of vultures has become very important as the bird species are now endangered. Almost 95% of vultures in India have disappeared. They were said to have perished after consuming carcasses of cattle, which were tainted with Diclofenac, a pain-killer drug.
📰 Beijing sets terms for talks on sea feud code
•China’s top diplomat said on Sunday that talks for a non-aggression pact aimed at preventing clashes from erupting in the disputed South China Sea may start this year if “outside parties” don’t cause a major disruption.
•Chinese Foreign Minister Wang Yi said the start of talks for a “code of conduct” in the disputed waters may be announced by the heads of state of China and the 10-member Association of Southeast Asian Nations (ASEAN), when they meet at an annual summit in the Philippines in November if Beijing’s conditions are met.
Non-interference
•Mr. Wang said those conditions include non-interference by “outside parties”, apparently referring to the United States, which Beijing has frequently accused of meddling in what it says is an Asian dispute that should be resolved only by the countries involved.
•China’s territorial disputes in the strategic and potentially oil-and gas-rich waterway with five other governments intensified after it built islands in disputed waters and reportedly started to install a missile defence system on them, alarming rival claimant states, the U.S. and other Western governments. “If there is no major disruption from outside parties, with that as the precondition, then we will consider during the November leaders’ meeting, we will jointly announce the official start of the code of conduct consultation.”
📰 Let’s talk about a supplemental income
The concept of a basic income must be qualified to restrict beneficiaries to groups that are easily identified
•There has been a lot of discussion on universal basic income (UBI) in both developed and developing countries. The primary objective is to enable every citizen to have a certain minimum income. The term ‘universal’ is meant to connote that the minimum or basic income will be provided to everyone irrespective of whatever their current income is. The adoption of a universal basic income can impose a burden on the fisc which is well beyond the capabilities of most developing countries, including India. In discussing the applicability of the concept of basic income to India, three questions arise. The first is whether it should be ‘universal’ or ‘restricted’; the second is what the level of minimum income is and how this is to be determined; and the third is about the financing mechanism for implementing such a scheme.
Cash versus services
•Above all, there is a philosophical question, whether support to vulnerable sections should be in the form of goods and services or as cash. Cash gives the discretion to beneficiaries to spend it any way they like. But it is assumed they would be wise in their discretion. On the other hand, the provision of services or goods directly to beneficiaries may be directed to achieve certain objectives in terms of nutrition or health or education. In the provision of services, the concern is about leakages and quality of service. Some countries have adopted a middle path of conditional transfers, which means that transfers in the form of cash are subject to the condition that they are spent on meeting defined needs.
•However, as far as India is concerned, we are not starting with a clean state. There are a whole lot of services provided by the state, and it would be impossible to knock them off and substitute them with general income support. We need to think of income support as a supplement to services already provided even though a hard look at some of the provisions is absolutely essential. Poor quality of services from government-run institutions has become a matter of concern.
‘Universal’ or restricted?
•Coming to the concept of the UBI, it is necessary to first decide whether income supplements should be ‘universal’ or limited to certain easily identifiable groups. Most calculations involving the provision of income to one and all are beyond the capabilities of the present Central government Budget unless the basic income is fixed at too low a level. It is extremely difficult to cut so-called implied subsidies or hidden subsidies in order to fund resources, as some proponents argue. These supports range from subsidised bus fares to subsidised power tariff. The attempt must be to think in terms of reducing the number of beneficiaries using easily definable criteria. Elaborate exercises for identification will defeat the purpose. It is true that a universal scheme is easy to implement. Feasibility is the critical question. There is also the consideration of fairness. But strict targeting will run into complex problems of identification.
Minimum increase
•The issue whether the scheme should be universal or restricted depends on the level of basic income that is proposed to be provided. If we were to treat the cut-off used to define poverty as the minimum income, then the total fiscal burden would be enormous. This apart, there is no consensus regarding what that cut-off should be. Our analysis using different poverty lines shows that poverty is concentrated around the poverty line. In fact, more than 60% of the total poor lies between 75% of the poverty line and the poverty line. Therefore, what is needed is a supplement to fill the poverty gap. One alternative would be to determine the required income supplement from the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS). The total annual income supplement can be equivalent to 100 days of the wages prescribed under the MGNREGS. This is equivalent to Rs. 20,000 per year. This amount can be treated as the income supplement.
•The next question is who the beneficiaries should be. Here again, it is difficult to cover the entire population. Even providing one person per household with this income will mean Rs. 5 lakh crore per annum, which is 3.3% of GDP. Perhaps what is feasible is a scheme which limits the total expenditure to around 1.5 to 2% of GDP, which is between Rs. 2 lakh crore and Rs. 3 lakh crore. We need to evolve a criterion which can restrict the total cost to this amount. One way of doing it will be to limit it to all women above the age of 45. This is an easily identifiable criterion because Aadhaar cards feature the age of the person. However, this is only one alternative. But others may be thought of. Restricting the beneficiaries to the elderly or widows or those with disabilities may have only a limited impact. Making available a minimum of Rs. 20,000 per year for almost 10 crore people — which means a total expenditure of Rs. 2 lakh crore — must make a dent on poverty since at least half of them would be for the poor or people a little above the poverty line.
Financing the scheme
•The feasibility of raising even Rs. 2 lakh crore is not easy. Some analysts have suggested that we can remove all exemptions in our tax system which would give us enough money. Apart from the difficulties in removing all exemptions, tax experts advocate removing exemptions so that the basic tax rate can be reduced. Perhaps, out of the Rs. 2 lakh crore which is needed, Rs. 1 lakh crore can come from the phasing out of some of the expenditures while the remainder must come from raising additional revenue. Perhaps, one can phase out the MGNREGS, which will realise close to Rs. 40,000 crore. The employment scheme is very akin to the proposed scheme. Fertilizer subsidies are another item of expenditure which can be eliminated. Perhaps, requesting higher income groups to forego supplemental income will reduce the expenditure, as has been done successfully in the case of cooking gas.
•To conclude, introducing the UBI is unrealistic. In fact, the concept of a basic income must be turned essentially into a supplemental income. Such a scheme will be feasible provided we restrict the beneficiaries to groups which can be easily identified. This restriction essentially comes from fiscal compulsions. Regarding finances, it is not easy to remove all implicit subsidies. The design for financing the scheme has to be viewed in a more pragmatic way. Restricting the fiscal burden to 1.5 to 2% of GDP seems desirable and feasible. Half of this can come from phasing out some of the existing expenditures while the other half can come by raising fresh revenue. Lastly, the proposal here refers only to the income supplement that can be provided by the Central government. Similar efforts can be made by the respective State governments, if they so desire.
📰 Changing ideas of India
Europe’s complicated relationship with Asian knowledge traditions in the early modern period
•When Portuguese explorers first rounded the Cape of Good Hope and arrived in the subcontinent in the late 15th century, Europeans had little direct knowledge of India. The maritime passage opened new opportunities for the exchange of goods as well as ideas. As Professor Sanjay Subrahmanyam, who teaches at the University of California, says in his preface to Europe’s India: Words, People, Empires (1500-1800), “... the Europeans gradually were transformed, albeit in fits and starts, from marginal coastal players to substantial territorial conquerors.” Traders were joined by ambassadors, missionaries, soldiers, and scholars from Portugal, England, France and other countries, all hoping to learn about India for reasons as varied as their particular nationalities and professions. Prof. Subrahmanyam tracks Europeans’ changing ideas of India over the entire early modern period. An excerpt:
•We can say that beginning in the sixteenth century, the process of representing what India was in Europe became linked in a variety of ways to collecting objects and written materials on that part of the world. Furthermore, the objects that were collected were sometimes of sufficient cultural density and complexity that they had to be interpreted and translated in the sense that a sheaf of cinnamon or a sack of pepper might not (although other, lesser known “drugs and simples” sometimes required a form of translation for a European audience). The entire process can be seen as a multiple unfolding of different dimensions of a knowledge complex. It is also important to underline the fact that the participants in the process were many and varied; if some of them were Asian traders, intellectuals, and courtiers who spoke to the Portuguese and gave them knowledge, they also included a whole gamut of social and professional categories within Portuguese colonial society itself: missionaries, trading representatives of the Portuguese Crown (who were called feitores or “factors”), physicians, mariners in search of sailing directions, military specialists, and others including painters and printers.
•Two specific examples from the mid-sixteenth century can give us a sense of the diversity of such actors and their projects. One of these was the “New Christian” or converted Jewish physician Garcia da Orta, who was born in Portugal into a family of Jews of Spanish origin around 1501, and who came to India around 1534 after having studied medicine in various universities in Spain. Orta’s activities as a trader and physician eventually took him out of Goa into the Deccan, and he also appears to have held a property in the islands around what eventually became the territory of Bombay. He certainly knew Arabic quite well before arriving in Asia, and he added to this some knowledge of Persian, probably while working at the Muslim courts of the Deccan, which welcomed “Frankish” (that is to say, Portuguese) physicians as well. This distilled theoretical and practical knowledge was eventually put by him into an extremely important work entitled Coloquios dos simples e drogas e coisas medicinais da India (Colloquies on the Simples, Drugs and Medicinal Products of India), which was printed in Goa in 1563, a few years before Orta died. Though he was eventually denounced posthumously to the Inquisition for having secretly been a practicing Jew, this work remained a major reference on Indian plants and other medicinal products.
•A more complicated relationship with Asian knowledge traditions can be seen in the case of his contemporary, the aristocrat Dom Joao de Castro (1500-1548), who was not merely an accomplished military commander and navigator, but was also interested in pursuing theoretical investigations regarding such subjects as cartography and terrestrial magnetism. Castro was also a good draftsman, and a number of his maps, sketches, and rutters (mariner’s handbooks, or roteiros) have survived. It is possible that they too built in part on the local knowledge that he gained while navigating the Indian Ocean in ships where the crews were made up in a large proportion by Indians and other Asians, though this is less evident than in the case of Orta. At any rate, the influence of the work of men like Castro was passed on to the great mapmakers of Portuguese Asia, like the somewhat shadowy figure of Fernao Vaz Dourado (d. 1580), who produced a set of spectacular representations of the lands of Asia in his Atlas, which became the basis for later printed maps in the Netherlands. These representations were important for turning the page definitively on the Ptolemaic vision of that part of the world. Though these maps of India depended, for example, on knowledge based largely on coastal navigation (so that most of the place names were located on the coast, rather than in the interior), they produced an approximate vision of the regions of India with which the Portuguese had the most dealings from west to east, Sind, Gujarat, the Konkan, Kanara, Malabar, the Coromandel coast, Orissa and Bengal. They would also serve as the basis for the knowledge of the first Dutch and English merchants who arrived in those regions at the turn of the seventeenth century.
•Of course, Portuguese curiosity extended much beyond such “secular” subjects as medicine, botany, navigation, and cartography. They were also anxious to know as much as they could about the “religions” that were practiced in India, for which they often used the word “law” (lei), as was common in Europe at the time. The Portuguese who arrived in Asia in the first half of the sixteenth century certainly had some notions regarding Islam or the “law of Muhammad” as they called it, though these were often quite crude. They had to rediscover the difference between Sunnis and Shi’is in the course of their dealings in the Deccan and the Persian Gulf, but this eventually became an abiding trope in their representation of political alliances in the Indian Ocean. They saw one network, a Sunni one, that was oriented toward Istanbul and the Ottoman Empire, and another, a predominantly Shi’ite one, that drew inspiration from the newly emergent Safavid dynasty in Iran. So far as we can discern, no Portuguese intellectual of the time seems to have gone to great lengths to collect copies of the Qur’an, or other more obscure texts from any Muslim tradition. However, by the end of the sixteenth century, some European visitors to Asia — such as the Vecchietti brothers from Florence, Giovan Battista and Gerolamo — became interested in Judeo-Persian materials as well as Persian translations of the Gospel. The materials collected by them are among the earliest Indian (or Indo-Persian) manuscripts to appear in European collections, and which still survive.
•It was the other religious beliefs and practices in India and (South Asia, more generally speaking) that posed a far greater conceptual problem so far as the Portuguese were concerned. The people to whom these pertained were classified by the Portuguese as “gentiles” (gentios), and they included what we today might call Hindus, Buddhists, and Jains.
📰 Private power, public apathy
Modify landmark labour laws to bring domestic work under the purview of state regulation
•Domestic workers are among the most exploited sections of the Indian workforce. In the past, domestic work was closely enmeshed with feudal structures of labour extraction, such as begar . Typically, such work was unpaid, or was paid for at a nominal rate in kind. It was dominant, elite groups who extracted such work from predominantly ‘lower’ caste groups or labouring groups for domestic/household purposes. The 1931 Census recorded a large pool of labour, i.e. 27 lakh, as domestic workers, or ‘servants’ as they were then known. They were then predominantly male workers. These high numbers reduced considerably with the growing intensity of the anti-feudal struggle and development of occupational diversities in the post-Independence era. The 1971 Census recorded only 67,000 domestic workers. However, this trend has been reversed since the early 1990s when India’s economic policy pushed forward with liberalisation. The 1991 Census recorded 10 lakh domestic workers. Subsequent National Sample Survey Office (NSSO) data of the post-liberalisation period has mapped a continuous increase in this figure. The NSSO data of 2004-05, for example, has recorded 47 lakh domestic workers in India; the majority of whom, i.e. 30 lakh, were women. As of today, a large number of these workers are inter-State migrant labourers from impoverished districts in West Bengal, Assam and Jharkhand.
The Noida flash point
•The recent confrontation between this otherwise docile workforce of domestic workers and their wealthy employers in Noida (Uttar Pradesh) brought to light, yet again, the widespread exploitation of domestic workers, and the huge antagonism between their interests and those of their employers. The Noida incident has also revealed the sickening nexus between the police, employers, as well as right-wing politicians who have extended support to the wealthy residents. Within hours, an obvious labour issue, and the effort of workers to locate a missing female domestic worker was projected as a communal confrontation.
•With the accused employers and their sympathisers identifying the protesting workers and the missing domestic worker as ‘Bangladeshis’, the social media exploded with communal diatribe and messages of hate. Within days, shanty shops opposite building complex, on which the slum dwellers were dependent for their daily provisions, were razed to the ground by the civic authorities. The police, meanwhile, have focussed their entire investigation on the ‘riot’ that erupted at the housing society’s gates, and have arrested some workers. Their investigation does not take into account the first First Information Report lodged in this case, which is that of the female domestic worker who went missing on the night prior to the confrontation.
•The incident, yet again, exposes the crisis nurtured by the Indian state’s unwillingness to ratify the International Labour Organisation’s Convention 189 on Decent Work for Domestic Workers, and thereby, to modify landmark labour laws so as to bring domestic work under the purview of state regulation. Importantly, the unwillingness of the state to regulate this work relation means that it is complicit in keeping intact the private power of regulation enjoyed by the employer. In turn, the private nature of regulation has allowed the employer to exercise quasi-magisterial powers over the domestic worker in India. Such authoritarian power of the employer in the work relation bears close resemblance to penal work regimes of the early colonial period in which employers predefined the terms of contract and penalised attempts by the worker to leave or renegotiate the contract. Typically, workers’ attempts to renegotiate their terms of work or to leave such employment are outbid by verbal, and often, physical assaults by employers. If these measures don’t work then many employers simply proceed to debar the affected workers from entering the building complex for work at other apartments. Domestic workers then take on an almost absolute risk of unemployment or criminalisation when they try to obtain their dues.
Seeds of overexploitation
•Typically, the employer-dominated, domestic work industry is characterised by low, stagnant wage rates. Wages are particularly low for Bengali and Adivasi workers. Many women slaving away at such low wage rates are subsequently compelled to seek employment in more than one house, and to make their teenage daughters pick up similar work. Irregular payment of wages by employers, extraction of more work than agreed upon at the start of employment, and the practice of arbitrarily reducing wages are rampant problems that breed overexploitation of domestic workers.
•The near absolute authority of the employer, stemming from the lack of state regulation of domestic service, reduces the domestic worker to nothing short of servility. This is not the average employer–employee relationship where an employee has certain tangible rights, and thus, cannot be easily reduced to abject servitude. In sharp contrast, the very nature of the intense manual work performed, the persistent surveillance, and the quasi-magisterial authority of the employer means that the domestic worker functions like servile labour. It is, after all, not uncommon to find the average domestic worker tiptoeing around the apartment so as to least get in the way of employers, and being reduced to a submissive, docile existence. Such vulnerability and over-exploitation cannot be ignored any further, especially with the continuous growth in the number of impoverished women and children entering the domestic services industry in the post-liberalisation era. The lack of redressal machinery for workers in this rapidly developing industry is compelling desperate workers to resort to violent forms of agitation, and in such a scenario we may witness the recurrence of Noida-like incidents in the future.
📰 Skill, don’t detain
The Centre should reconsider its decision to scrap no-detention policy in primary schools
•India’s elementary education system may be getting better at providing access to greater numbers of children, but has never really been able to answer the question, what is the measure of its success? If producing curious minds that have had exposure to life skills is the test, the system generally scores poorly, since it primarily emphasises competition, tests and scores. In spite of policy improvements, it has to contend with a significant dropout rate. In 2015, that figure stood at about 5% at the primary level and over 17% at the secondary level, with government schools affected more. So when the Right of Children to Free and Compulsory Education Act became law in 2010, it appeared to be a bulwark against the various ills that prevent continued schooling of all children up to the secondary level. The guarantee of uninterrupted schooling that the Act provides under sections 16 and 30(1) is founded on the no-detention policy until Class 8. This is a protection that should not be trifled with to compensate for the overall failure to improve the school education system, beginning with the neglect of teacher education, bad recruitment policies, and confusion over what the goals of schooling are. The decision of the Union Cabinet to scrap the no-detention policy at the elementary level, and introduce detention of students who fail a designated test in Class 5 or 6, is fraught with the danger of going back to a regime of early dropouts. Such a move can only feed the pool of cheap child labour that has been the notorious record of the school education system, and facilitate the newly liberalised norms of allowing child labour under the guise of family enterprises.
•Building a schooling system that caters to every child without turning it into a testing factory is a challenge, but it should actually be easier in an era of robust economic growth, when there is a mismatch between the demand for a skilled adult labour force and what the system prepares the country’s youth for. Rather than detain a child early through a stigmatising test, a progressive system would open avenues for skills training after the elementary level for those who would prefer that over academic studies. Such a model has served industrial nations such as Germany for decades, raising the standard of living for all, while ensuring economic productivity. The objective is not to relegate academic attainments to a second order priority. On the contrary, the RTE Act has a provision for continuous and comprehensive evaluation, which governments have not found the time to develop scientifically. Raising the quality of classroom teaching, continuous monitoring of teacher attendance and introduction of free vocational and industrial skills training for all those with such an aptitude after elementary schooling should be the priority. Transferring the onus of performance in a narrow testing framework to children, many of whom come from underprivileged backgrounds, can only produce a less literate citizenry. A more open and liberal approach to schooling will have good long-term outcomes.
📰 Vice-President Naidu
He has to rely on his tact and temperamentin his new role as an apolitical elder
•As Vice-President, M. Venkaiah Naidu brings to the office his long years of experience as Parliamentary Affairs Minister, built on an amiable personality that has won him friends cutting across party divides. His election was no surprise given the numbers in Parliament, and the contest was something of a non-starter despite Gopalkrishna Gandhi’s attempt to portray it as an ideological face-off. That Mr. Naidu did not give much room for raising the profile of the battle for the office of the Vice-President is reflective of his tact and temperament, qualities that will stand him in good stead in his primary job as the Chairman of the Rajya Sabha. He can be expected to take on the ceremonial and diplomatic duties of the Vice-President, which are akin to those of the President, with minimum fuss. The Bharatiya Janata Party zeroed in on him for more than one reason. He is the most prominent face of the BJP in the south, having previously served as the national president of the party. Although Karnataka, and not his home State of Andhra Pradesh, is the first and only State in the south to vote the BJP to power, Mr. Naidu was in many ways the symbol of the party’s foray into the south.
•Left to himself, Mr. Naidu would probably have chosen to continue in active politics, and not take on this constitutional post. He was the BJP’s go-to person for making allies in the south. He developed a good equation with K. Chandrasekhar Rao in Telangana, N. Chandrababu Naidu in Andhra Pradesh and Jayalalithaa in Tamil Nadu. By all accounts, Mr. Naidu relished his political role in Andhra Pradesh and Telangana as much as his ministerial role at the Centre. But given the BJP’s new-found majority in the Lok Sabha, and its ambitious plan to expand its own base in the south beyond Karnataka, party president Amit Shah and Prime Minister Narendra Modi may have felt less need for Mr. Naidu’s ally-making abilities. But, even if the BJP leadership does not miss him in Andhra Pradesh and Telangana, Mr. Modi will still have a hole to fill in his Cabinet. Some of the senior ministers such as Arun Jaitley hold more than one important portfolio, and losing another senior hand will surely have an effect on the representativeness and balance of the Council of Ministers. Already Mr. Modi has lost the services of Manohar Parrikar, who moved to Goa as Chief Minister after relinquishing his job as Defence Minister. As for Mr. Naidu, he could well be the BJP’s choice for the next President. The Shah-Modi team is known for making long-term plans, and it cannot be ruled out that they made the choice with an eye on Rashtrapati Bhavan in 2022.
📰 In defence of Corbyn
Anti-austerity projects espoused by Corbyn and Sanders are viable models without structural weaknesses
•Socialist Jeremy Corbyn campaigned aggressively against austerity measures before the parliamentary elections in the U.K. His surprising performance mirrored that of social democrat Bernie Sanders, who nearly won the Democratic primaries in the U.S. presidential elections despite being an independent Senator. Today, Mr. Sanders is recognised as the most popular politician in a country that has a hugely unpopular President.
•Mr. Corbyn’s position in the Labour party has now strengthened. Since the elections, the Labour party has been raising issues that were long ignored in the three decades of the “neoliberal consensus” in the U.K.: wages of public sector employees and nationalisation of key under-performing sectors. This has caused much discomfiture to Britain’s right-wing cognoscenti, the Tories, and the Labour’s own Blairites who consider Mr. Corbyn and Old Labour as an anachronism.
•In this milieu, Mr. Corbyn’s critics have now latched on to a new bugbear: his past support for the Bolivarian socialists in Venezuela. Labour’s anti-austerity push is being likened to the policies of the rulers of Venezuela ever since the Chavistas came to power in 1999. For years, Venezuela sought to use receipts from petroleum extraction as a means of expansive welfare without adequately reforming the oil bureaucracy. This strategy yielded tremendous support for the Bolivarians till the mid-2010s when the global fall in oil prices resulted in a crisis for the economy. President Nicolas Maduro’s handling of the decline of support for his party in the face of the lingering economic meltdown since 2012 has been catastrophic. The recent holding of Constituent Assembly elections, which were boycotted by the opposition, has had even leftist supporters of the Bolivarian project opposing such manoeuvres.
•In a way, the subsiding of the “pink tide” in Latin America has coincided with Mr. Corbyn and Mr. Sanders’ rise. But can these be simply seen as cut from the same cloth? The answer is only partially “yes”. The “socialist” projects in Venezuela, Bolivia and Ecuador were focussed on reorienting the governments’ approach towards redistribution and recognition of the rights of long marginalised groups. In Venezuela, the government was only partially successful in reversing the hold over the economy by oligarchs; it failed in diversifying the country’s economy beyond the extraction sector.
•The U.S. and U.K. economies are vastly different. Mr. Corbyn and Mr. Sanders have articulated the need for social democratic policies that favour a reorientation of the state towards the benefit of many rather than a few — policies that are not radical. In fact, the economic boom post-World War II was made possible due to moderate state intervention leading to high levels of investment and employment in the developed economies. It is disingenuous to expect outcomes similar to what transpired in Venezuela to occur in Britain and the U.S. as well, if governments pursued expansive fiscal policies.
•At worst, the Venezuelan crisis is indicative of the weaknesses in the project for “21st century socialism”, which did not address economic and bureaucratic issues from the past.
📰 Partition and after
Have we written enough on the traumatic events?
•In Primo Levi’s The Drowned and the Saved , the epigraph is from Samuel Taylor Coleridge’s The Rime of the Ancient Mariner : “Since then, at an uncertain hour, /That agony returns,/ And till my ghastly tale is told/ This heart within me burns.” Shortly after completing the book, Levi, who chronicled the horrors of Auschwitz in eight books, committed suicide, with some arguing that he “killed himself because he was tormented by guilt — guilt that he had survived Auschwitz while others, better than he, had gone to the wall.”
•Though his was a drastic end, one wonders whether enough has been written on the Partition, one of the most traumatic events in our history that killed at least a million people and displaced millions more. In fiction, there are books such as Khushwant Singh’s Train to Pakistan , Attia Hosain’s Sunlight on a Broken Column , Salman Rushdie’s Midnight’s Children and Amitav Ghosh’s The Shadow Lines , to name a handful, but surely there are more stories to tell around the tragedy and the path to reconciliation. How much do we know about the Bengal Partition, for instance, which led to riots and an unprecedented exodus from then East Pakistan (now Bangladesh) into West Bengal? In 1994, Alok Bhalla edited three volumes of Stories About the Partition of India , as he wondered why even though Partition was a decisive moment in our social and political life, it had yet to become a central part of our nationalist discourse. He gathered stories from far and wide, by those who had been “appalled witnesses to an age of genocide”, including those by writers like Saadat Hasan Manto (Toba Tek Singh), Kamleshwar ( How Many Pakistans?), Narendranath Mitra ( The Four-Poster Bed ), Ismat Chughtai ( Roots ), and Samaresh Basu ( Adab ).
•If one were to consider non-fiction, a superb recent addition is Yasmin Khan’s The Great Partition: The Making of India and Pakistan , which argues that leaders of both countries were largely oblivious to “what Partition would entail in practice and how it would affect the populace.” Underscoring the catastrophic human cost, she explains how the recklessness with which it was completed has left a damaging legacy. Also counting the losses and examining how ordinary human beings wreaked such vengeance on the other is Nisid Hajari’s Midnight’s Furies .
•With the wounds of 1947 still fresh, the “paranoia and hatred” keeping communities apart, don’t we need more lessons from the past to inform our present?
📰 China’s RCEP push veils grand plan
Asian behemoth sees deal as stepping stone to linking the Belt and Road project with the FTAAP pact
•Community social media platform ‘LocalCircles’ recently did a survey on the Indian consumer’s perception about items imported from China. The results gave a peek into the minds of Indian consumers. It showed 52% of participants were of the opinion that for the same product, the quality of a ‘Made in India’ version was superior to the one from China. However, 83% said they buy Chinese products as those items were the cheapest. On the issue of addressing ‘quality concerns’ about imported Chinese items, 98% said there should be better screening of such products before they enter the Indian market — including ensuring that only those imports meeting the Indian (BIS) standards are allowed.
•The poll assumes significance as it comes amid ongoing negotiations for a mega-regional Free Trade Agreement (FTA) among 16 Asia-Pacific nations, including China and India. Known as the Regional Comprehensive Economic Partnership (RCEP), the proposed FTA, aims to boost goods trade by eliminating most tariff and non-tariff barriers — a move that is expected to provide the region’s consumers greater choice of quality products at affordable rates. It also seeks to liberalise investment norms and do away with services trade restrictions.
•The RCEP is billed as an FTA between the 10-member ASEAN bloc and its six FTA partners — India, China, Japan, South Korea, Australia and New Zealand. When inked, it would become the world’s biggest free trade pact. This is because the 16 nations account for a total GDP (Purchasing Power Parity, or PPP basis) of about $50 trillion (or about 40% of the global GDP) and house close to 3.5 billion people (about half the world’s population). India (GDP-PPP worth $9.5 trillion and population of 1.3 billion) and China (GDP-PPP of $23.2 trillion and population of 1.4 billion) together comprise the RCEP’s biggest component in terms of market size.
•The RCEP ‘guiding principles and objectives’ state that the “negotiations on trade in goods, trade in services, investment and other areas will be conducted in parallel to ensure a comprehensive and balanced outcome.” However, it is learnt that China, using its influence as the global leader in goods exports, has been deploying quiet diplomacy to ensure consistent focus on attempts to obtain commitments on elimination of tariffs on most traded goods.
•China is keen on an agreement on a ‘high level’ of tariff liberalisation — eliminating duties on as much as 92% of traded products. However, India’s offer is to do away with duties on only 80% of the lines and that too, with a longer phase-out period for Chinese imports (ie, about 20 years, against 15 for other RCEP nations).
Duty impact on India
•A highly ambitious level of tariff elimination without enough flexibility would affect India the most on the goods side. This is because in the RCEP group (except Myanmar, Cambodia and Lao PDR), India has the highest average ‘Most Favoured Nation (MFN) tariff’ level at 13.5%. MFN tariff, as per the WTO, refers to normal, non-discriminatory tariff charged on imports — excluding preferential tariffs under FTAs and other schemes or tariffs charged inside quotas.
•A March 2017 discussion paper on RCEP by the think tank RIS also said, “India is the only participant that has a high level of merchandise trade deficit … Its trade deficit with RCEP countries is also more than half its global trade deficit.” The paper, by V.S. Seshadri, also showed that India’s trade deficit with China “is over three times its exports to China (in 2014), a situation not matched by any other RCEP member except Cambodia…” It further said, “considering India’s vulnerabilities and large bilateral trade deficits, India will need substantial flexibilities to deal with China… A longer phase out period with backloading of concessions, particularly on sensitive products, will be essential.”
•On the sidelines of the recently held RCEP talks in Hyderabad, representatives from the Indian industry laid out their apprehensions before the industry bodies of other RCEP nations and the trade negotiators. Their main worry was that the proposed FTA, owing to the possibility of elimination of duties across most sectors, could lead to a surge in inflow of low-priced goods, mainly from China. This, India Inc. feared, would result in their share in the domestic market contracting, and consequent downsizing/closure of operations, as well as job losses. This could lead to lower incomes and reduced consumer spending.
•Also, since India already has separate FTAs with the 10-member ASEAN bloc, Japan and Korea, India Inc. feels that on account of the RCEP, India may not gain much on the goods side with existing FTA partners. India is also negotiating separate FTAs with Australia and New Zealand. However, be it through a separate FTA or via RCEP, India’s gains on the goods segment from Australia and New Zealand will be limited as MFN tariff levels of those two countries are already low. China is the only RCEP country with which India neither has an FTA, nor is in talks for one. Therefore, Indian industry sees RCEP as an indirect FTA with China, especially since, given sensitivities involved, there could be a hue and cry if the India opts for a direct FTA with that country.
Trade deficit woes
•Ajit Ranade, chief economist, Aditya Birla Group, said even without a bilateral FTA, India was already affected by China’s overhang of excess capacity in sectors including metals, chemicals and textiles. Goods imports from China have been far outpacing India’s shipments to that country (India’s exports are mainly troubled by China’s non-tariff barriers). This has led to goods trade deficit with China widening from just $1.1 billion in 2003-04 to a whopping $52.7 billion in 2015-16, though easing slightly to $51.1 billion in 2016-17. Mr. Ranade said India’s FTA strategy has to be guided by the ‘Make In India’ initiative that aims to boost domestic manufacturing and job creation within India.
•In return for greater market access in goods, India, with its large pool of skilled workers and professionals, might be trying to use the RCEP to gain on the services side, by securing commitments from the other nations to mutually ease norms on movement of such people across borders for short-term work.
•However, the RCEP is just one element of China’s grander plans for global dominance. In February, its foreign minister Wang Yi said, “We hope to … speed up the RCEP negotiation process and strive for an early agreement, so as to contribute to realising the greater common goal of building the Free Trade Area of the Asia-Pacific (FTAAP).” The FTAAP spans 21 Asia-Pacific Economic Cooperation countries, including the U.S. and China, but does not cover India (though it has sought to be an APEC member). With the U.S. withdrawing from the Trans Pacific Partnership — a mega-regional FTA not involving India and China — that similarly aimed to help establish the FTAAP, the path is clear for China to push ahead with this strategic initiative to its advantage through the RCEP.
•In May, Chinese Commerce Minister Zhong Shan said the RCEP “highly echoes the Silk Road spirit.” The Silk Road Economic Belt (on land) and the Maritime Silk Road (via the ocean) comprise China’s Belt and Road Initiative, that India had opposed on strategic grounds.
•Joshua P. Meltzer of the think-tank Brookings said in an article that the impact of the BRI — to which China has committed $1.4 trillion — “on regional trade integration should also be seen in light of trade agreements such as the RCEP.”
•“Once completed, RCEP will also provide preferential access to each country’s markets. BRI could help China address some of its excess capacity in industries such as steel and cement, since infrastructure projects supported by the initiative would boost external demand for Chinese exports. The initiative could provide a means for Chinese industries with excess capacity to export equipment that is currently idle.” It is pertinent for India to note this larger picture even as it sees the RCEP as “a beacon of hope for free trade” and a pact offering “a positive and forward-looking alternative in the face of growing protectionism across the world.”
📰 Jaguar jets still flying without autopilot: CAG
IAF is undertaking a major modernisation of the fleet
•One of the frontline fighters of the Indian Air Force, the Jaguars, are still flying without autopilots, an essential flying aid, the Comptroller and Auditor-General has said.
•In a report presented in Parliament on July 28, the CAG said, “The flying aid capability envisaged by the IAF for the Jaguar aircraft in 1997 remains largely unrealised even after 20 years … Meanwhile, the IAF had lost three Jaguar aircraft and one pilot since April 2008 due to pilot disorientation/human error whereas loss of another four Jaguar aircraft was under investigation as of October 2016.”
•An autopilot reduces the pilot’s workload, enhances safety of aircraft and cuts aircraft accidents. Jaguars acquired in the 1980s are of older vintage and lack autopilots.
•In 1997, the IAF had projected a requirement of 108 autopilots for 108 aircraft but only 35 autopilots were contracted in August 1999 due to “resource crunch” at a cost of Rs. 37.42 crore which were delivered between 2006 and 2008. A repeat contract for 95 autopilots was concluded only by March 2014.
Sub-optimal function
•“Out of 35 autopilots procured earlier, only 18 could be integrated on the Jaguar aircraft as of March 2017. The integrated autopilots were also functioning sub-optimally due to malfunctioning of their vital component i.e. Auto Pilot Electronic Unit (APEU),” the report said.
•In addition, 30 autopilots received through the repeat contract are yet to be integrated. Thus, as on October 2016, the IAF had a holding of 117 Jaguars, but only 18 could be upgraded with autopilot capability. Even these autopilots were working sub-optimally due to malfunctioning of their APEUs, the report added.
•In addition to autopilots, the IAF is undertaking a major modernisation of the Jaguar fleet, which also carry nuclear weapons, with new avionics and sensors to keep them flying for another two decades. The Jaguars have an underpowered engine. However, efforts to equip them with a more powerful engine have been dragging on for several years.
