📰 E-toll lane on all national highways from Sept. 1
Tagged vehicles need not stop at counters for fee payment
•All toll plazas on national highways will have electronic toll collection facility with at least one lane dedicated to vehicles with electronic tag device, known as FASTags, beginning September 1. FASTags is a device that can be installed on the windshield of any vehicle, and toll payments can be made directly from the pre-paid account linked to it. Hence such vehicles do not have to stop at toll plazas for payment of fees.
•“The dedicated FASTag lanes will become operational at all 371 national highway toll plazas from September 1,” National Highways Authority of India (NHAI) Chairman Deepak Kumar said here on Thursday, “One lane in every toll plaza will be a dedicated FASTag lane where no other form of payment will be accepted.”
Tag sale from today
•From Friday, FASTags can be purchased online from the websites of banks, the National Highways Authority of India and Indian Highways Management Company Limited and it will be delivered at the customer’s doorsteps, the Ministry of Road Transport and Highways said in a statement. FASTags are valid for five years and can be recharged online through debit or credit card and internet banking.
•The government said the installation and integration of Radio-frequency identification (RFID) tags at all toll plaza lanes was under progress and was likely be completed by October 31.
📰 Army to get six Apache helicopters
•The Indian Army on Thursday got a step closer to having its own dedicated fleet of attack helicopters, with the Defence Ministry approving the purchase of six AH-64 Apache attack helicopters from the U.S.
•“The Defence Acquisition Council (DAC), chaired by Defence Minister Arun Jaitley, cleared total capital acquisitions worth about Rs. 4,700 crore. It also took stock of various proposals in the pipeline and insisted on expeditious clearance of proposals in final stages,” a Ministry source said.
Another deal
•In another deal, the DAC gave approval for procuring two gas turbine engines from Ukraine, to be fitted on the two stealth frigates under construction in Russia. They will cost over Rs. 490 crore.
•The cost of Apaches, including associated equipment, spares, training, weapons and armaments, is about Rs. 4,168 crore.
Optional clause
•For this, India will exercise the optional clause in the original deal signed with the U.S. in November 2015. Under a $3 bn deal, India has contracted 22 Apache attack helicopters and 15 Chinook heavy-lift helicopters through the Foreign Military Sales programme. The optional clause has a provision for 11 helicopters and the Army was hoping to get all of them, but the Government has limited it to six, at least for now.
📰 Ancient species of giant sloth discovered
Fossil lay in a sinkhole in Mexico
•Mexican scientists have discovered the fossilised remains of a previously unknown species of giant sloth that lived 10,000 years ago and died at the bottom of a sinkhole.
•The Pleistocene-era remains were found in 2010, but were so deep inside the water-filled sinkhole that researchers were only gradually able to piece together what they were, the National Institute of Anthropology and History (INAH) said.
•Scientists have so far hauled up the skull, jawbone, and a mixed bag of vertebrae, ribs, claws and other bones, but the rest of the skeleton remains some 50 metres under water, the INAH said.
•Researchers are planning to bring up the rest by next year to continue studying the find — including to estimate how big the animal was.
•The skeleton is nearly complete, leading scientists to believe the sloth “fell into the sinkhole when it was dry or had only a little water at the bottom,” the researchers said.
•They have named the new species Xibalbaonyx oviceps . An initial analysis suggests the sloth lived between 10,647 and 10,305 years ago, an era when giant creatures of all kinds roamed the earth.
📰 ‘Pangong scuffle a routine affair’
It drew attention only because of Doklam and Independence Day, says expert
•A local flag meeting between military commanders of India and China in Eastern Ladakh on Wednesday has agreed to maintain peace in the area. The meeting came in the wake of incidents of scuffle and stone-throwing between the two sides at Pangong lake on Tuesday.
•“At these meetings, each side tells the other their side of the story. Both sides agreed to ensure that such incidents do not occur and resolve them as per the existing agreements and mechanisms,” a defence source said on Thursday.
•The Border Personnel Meeting (BPM) was held at Chushul in Eastern Ladakh. It was chaired by Brigadier-level officers and lasted about two hours and half.
Flag meetings
•The source said these incidents happened at regular intervals and were resolved through flag meetings. “This time it drew attention only because of the Doklam standoff and Independence Day,” he said.
•The developments come as the standoff at Doklam entered the third month. Military observers believe the Pangong lake incident would not have a bearing on the standoff. A section within the military believed that a better communication strategy was needed to avoid unwanted speculation.
•Lt. Gen. D.S. Hooda, former Commander of the Northern Army which oversees the Ladakh region, said the faceoff at Pangong lake was “something fairly routine.” “We patrol till our claims and then we do the banner drills in case of a faceoff. In summer it happens even more,” he told The Hindu .
A one-off incident
•These incidents were resolved at local flag meetings, Lt. Gen. Hooda said. “The peace along the Line of Actual Control (LAC) has held because both sides have actually respected the status quo. Every time there is an attempt to disrupt the status quo there is a problem.”
•However, he cautioned that the longer the problem continued, the greater the chance of something going wrong.
•“If they want to do something they won’t do it in Doklam. They will do it where they have a physical advantage. The bigger risk is they could do something in other areas,” he said.
•China expert Lt. Gen. S.L. Narasimhan (retd) too shared a similar view. “I don’t link it to Doklam. It is a one off incident, which seems to have gone out of control,” he said.
📰 Rights groups urge India to honour duty to Rohingyas
This comes after Centre firmed up plans for deportation
•Days after the United Nations expressed concern over the government’s plans to deport about 40,000 Rohingya immigrants from Myanmar, international human rights agencies Amnesty International and Human Rights Watch called upon India to “abide by international legal obligations” and not force them to return, which they termed an “outrageous” move.
•“While India is not a party to the 1951 Refugee Convention or its 1967 Protocol, it is still bound by customary international law not to forcibly return any refugee to a place where they face a serious risk of persecution or threats to their life or freedom,” Human Rights Watch said in a statement issued in New York on Wednesday, referring to the international principle of “non-refoulement” adopted by the UN.
•“Indian authorities are well aware of the human rights violations Rohingya Muslims have had to face in Myanmar and it would be outrageous to abandon them to their fates,” said an Amnesty International spokesperson, a day after the UN Secretary General’s office had expressed concerns over the Indian Home Ministry statement on identifying and deporting Rohingyas, including about 16,500 who have been registered by the UN High Commission for Refugees in India.
•The Rohingyas who fled to India after violence in the Western Rakhine State were mainly settled in Jammu, Hyderabad, Haryana, Uttar Pradesh, Delhi-NCR and Rajasthan.
•Both the Ministry of External Affairs and Minister of State for Home Kiren Rijiju did not respond to The Hindu ’s request for a comment on the UN Secretary General’s statement of concern.
Ahead with plans
•Despite the appeals, a Home Ministry official said India was going ahead with plans to deport Rohingyas, and is in discussions with the Myanmar and Bangladesh governments on the issue. The official also said that the government was planning to set up “detention centres” for the refugees, and if required “push them back” over the India-Myanmar border, if Myanmar refuses to accept the refugees back.
•Speaking in Parliament last week, Mr. Rijiju had said that the government has directed States to conduct surveys and prepare to deport them in a “continuous manner.” According to the MHA’s advisory (No. 24013/29/Misc./2017-CSR.III(i)) of August 8, all State governments were also told that the “powers to identify and deport the foreign nationals staying illegally in the country” had been delegated to them, and that they should “sensitise all law enforcement and intelligence agencies” to the risk from Rohingyas.
•“Infiltration from Rakhine State of Myanmar into Indian territory…besides being burden on the limited resources of the country also aggravates the security challenges posed to the country,” the advisory warned.
•India’s decision is in step with the government’s decision to “disassociate itself” from a United Nations Human Rights Council resolution in March this year proposed by the European Union and the United States to enquire into human rights abuses in Myanmar against the Muslim minority Rohingya community.
📰 Factories Act: Centre firm on amendment
Panel opposed move to ‘lift’ threshold
•The Centre will go ahead with its proposal to amend the Factories Act of 1948 by giving flexibility to State governments to enhance the threshold limit over which a unit will be considered a factory despite concerns flagged by a Parliamentary Standing Committee.
•The proposal was discussed at a tripartite meeting chaired by Labour Minister Bandaru Dattatreya with representatives of trade unions, industries and State governments.
•The Standing Committee, examining the proposed changes, however, observed in 2014 that “if the amendment is carried out more than 70% of the factory establishments in the country will be out of the coverage of the Factories Act and workers will be at the mercy of employers.”
•The Ministry of Labour and Employment did not agree with the committee’s observations and said that it had only given flexibility to State governments to fix the threshold limit and “all the factories, including the one which employs a single worker may also be brought under the purview of the act thus, in fact, increasing the total number of workers covered under the Act.”
📰 Use coal while economical, says CEA
‘Low tariffs seen in renewables don’t include several implicit costs that are so far being subsidised’
•India should leverage its coal assets while it is still economical to do so before ramping up its renewable energy capacity, Chief Economic Adviser Arvind Subramanian said on Thursday. He added that the low tariffs seen in the renewable sector do not include several implicit costs that are, so far, being subsidised.
•Mr. Subramanian also said that India should not be influenced by ‘coal imperialism’, with developed countries trying to influence developing countries to cut their fossil fuel consumption at a rate not in keeping with historical factors and equity.
‘Properly costed’
•“Renewable energy must be properly costed,” Mr. Subramanian said, delivering the Darbari Seth Memorial Lecture organised by TERI.
•“There are several social costs of moving away from coal. We must be abundantly cautious about claims on behalf of renewables. Properly costed, renewables will achieve true parity in social terms with coal only in the future.”
•“We should maximise the use of natural assets while economics permits it, and then ramp up the free assets such as renewable sources when needed,” he added. “There is a window, perhaps narrow, until renewables become truly viable, for accelerating expansion of coal, and driving up capacity utilisation sharply in thermal power generation.”
•Among the costs of adopting renewable energy that are not factored into the tariff currently, Mr. Subramanian included the cost of intermittent supply of power from solar and wind sources, the land acquisition costs, the upgradation of the grid to support energy from renewable sources, and the cost of stranded coal assets.
‘Implicit subsidies’
•“The proper estimates of the full costs of renewable energy are elusive,” Mr. Subramanian said. “Recent bids are not indicative because of the implicit subsidies and the factor of strategic bidding that has entered the renewable energy space as it did with coal and spectrum auctions.”
•He also added that the costs of moving away from coal are also significant, since it will impact employment, and the regional economies where coal mines are located. He also said that increasingly using renewable sources would further reduce the plant load factors of coal power plants, which, in turn, could further worsen their finances and the non-performing assets problem.
•“If India achieves its target in renewable energy (of 175 GW by 2022), the plant load factor will decline by 13 percentage points, which is significant since the PLF is already so low,” Mr. Subramanian said.
•“The burden of combating climate change should be consistent historically and equitably,” he added.
•Subsidising renewables at a time when the social costs were higher than those of coal “seems a double whammy for the government which then also has to pick up the tab for the resulting stranded assets,” Mr. Subramanian observed.
📰 That sinking feeling
In contrast to its pronouncements, the government’s own data suggest the economy is in a deep hole
•Prime Minister Narendra Modi, in his Independence Day address, spoke triumphantly about how demonetisation drove Rs. 3 lakh crore of unaccounted money into the banking system. The Reserve Bank of India (RBI) is still counting old notes, and unaccounted money cases are ongoing. Thus, this number is at best a guesstimate, and cannot be taken seriously.
Dipping indices
•For the facts, turn to the mid-year Economic Survey II, tabled in Parliament deliberately on the last day of the monsoon session, ensuring no discussion. The Survey states that GDP growth will miss the targeted 6.75% to 7.5%. This is a massive understatement. Examine this quote from the Survey: “A number of indicators — GDP, core GVA (GVA excluding agriculture and government), the Index of Industrial Production (IIP), credit, investment and capacity utilisation — point to a deceleration in real activity since the first quarter of 2016-17, and a further deceleration since the third quarter.” The Survey thus confirms that demonetisation ambushed a slowing economy. Consequently, core GVA, i.e. private business activity, dropped steeply from 11% in March 2016 to 4% in March 2017.
•The Survey shows how demonetisation devastated the informal sector, using two-wheeler sales as a proxy indicator. These dropped steeply for two quarters after demonetisation. Construction, which absorbs migrant labour, was also badly hit. The Survey thus supports the Opposition’s argument that Finance Minister Arun Jaitley’s “record” allocation for MGNREGS merely reflects displaced migrant workers returning to villages and exercising their right to social insurance.
•Demonetisation badly affected farmers’ incomes resulting in a loss of demand, lowering food prices. Consequently, inflation has hit lows below the RBI’s targeted band. Low inflation levels come at a human cost — farmers and those in the informal economy are losing their limited purchasing power.
•Additionally, hasty implementation of the Goods and Services Tax (GST) has paralysed the informal manufacturing sector which lives on the edge, often saddled with debt. Protests in the textile hub of Surat reflect how GST is affecting medium, small and micro-scale enterprises. Formalisation of the economy should not shut down businesses and extinguish livelihoods. Similarly, leather, another labour-intensive sector, is in trouble due to restrictions on cattle slaughter.
•Overall, there is concern that the economy is in a deep hole, the opposite of what the government would have us believe. It has entered the “Modi Slump”. Banks are not lending. In the year ending March 2017, credit growth plunged to 5.1%, lowest in 60 years. The private sector is not borrowing and the manufacturing sector is operating at a historically low capacity utilisation of 70%. The latest IIP shows a contraction of 0.1% in June 2017.
•Neither credit nor investment will increase until the government addresses the “twin balance sheets” problem. Fixing these should have been top priority. Sadly, the Modi government’s early focus was on undoing the 2013 land acquisition law instead of addressing non-performing assets (NPAs). Bank lending is the lifeblood of the economy but government inaction has brought investments to a halt. In March 2014, NPAs were Rs. 1,73,800 crore. Today they are about Rs. 7,79,163 crore. Instead the government talks up foreign investment (only 2-3% of GDP) or aggressively lobbies the RBI to cut interest rates, which is unlikely to achieve much.
•As State governments find their fiscal space narrowing, private investment falters, and demand slows, we are entering a deflationary environment. Still there are fiscal policy measures that the Union government can deploy. It can belatedly share the benefits of low oil prices by cutting excise duties on petroleum to give people and businesses more spending power, boosting demand.
Destroying, not creating
•On the most important indicator — jobs — we are seeing job destruction! The Centre for Monitoring Indian Economy reports that 1.5 million jobs were lost during January-April 2017. Ignoring his own promise of creating two crore jobs a year, Mr. Modi exhorted jobseekers to become job creators. But international experience, for example in developed OECD (Organisation for Economic Co-operation and Development) countries, shows self-employment is only about 15% of total employment. Most Indians are self-employed out of necessity.
•Mr. Modi extolled the job-creating impact of the MUDRA loan scheme. In contrast, MUDRA’s CEO is on record saying that it cannot be verified that the agency has created large numbers of jobs. Another misguided Union minister recently gloated about “job creation” under MGNREGS — not realising that it is a social protection scheme that people turn to when they have no alternative employment and not exactly a reason for cheer.
•Overall, the real state of India’s economy is deeply worrying. The latest RBI surveys of consumer confidence, industrial outlook, and professional forecasters point to pessimism on all fronts except inflation management. Mr. Modi spoke of how a train slows down as it changes tracks. Unfortunately, Economic Survey II’s numbers suggest that the economy has actually been derailed. The sooner the government understands this, the better.
📰 Redrawing the arc of influence
Indian diplomacy needs to display higher levels of sophistication for New Delhi to play a global role
•Prime Minister Narendra Modi’s schedule of foreign visits has been extremely impressive, and he has managed to inject a degree of dynamism into a system accustomed to a more leisurely pace. Estimating outcomes from these visits is, however, more difficult.
•Taking the two most recent visits, for example, one can easily see the contrast in outcomes. The U.S. visit was a carefully calibrated one producing few surprises, despite the U.S. President having a reputation of being highly unpredictable. For his part, the Prime Minister charted a time-tested course, concentrating mainly on counter-terrorism and the defence security partnership, avoiding contentious trade-related issues. The naming of the Hizbul Mujahedeen chief as a “specially designated global terrorist” and a “new consultation mechanism on domestic and international terrorist designations listing proposals” were the high points of the counter-terrorism agenda. Reiteration of India’s position as a major defence partner and confirmation of the sale of the Guardian Unmanned Aerial System to India, reflected the deepening security and defence cooperation.
•In concrete terms, not much else took place during the visit, despite an oblique reference in the joint statement to China’s Belt and Road Initiative (BRI) and reiteration of support for “freedom of navigation” in the Indo-Pacific. What was most obvious was the U.S. tilt towards transactional rather than strategic aspects.
A clear de-hyphenation
•In the case of Israel, this being the first ever visit by an Indian Prime Minister to that country, the euphoria of the standalone visit, de-hyphenating Israel from Palestine, was understandable. It also produced better dividends, including elevation of the India-Israel relationship to the level of a ‘strategic partnership’. Israel achieved a major propaganda scoop by getting the Indian Prime Minister to visit the memorial of Theodor Herzl, founding father of the Zionist movement.
•The main focus of the visit was on defence cooperation, joint development of defence products and transfer of technology. Most of the agreements signed related to transfer of technology and innovative technology-related items and India expects to benefit substantially, considering that Israeli export rules are far more flexible than those of the U.S.
•Both countries also expressed a strong commitment to combat terror. The reality, however, is that when the two countries speak of terrorism, they speak of very different things. Iran and Hezbollah are the main targets for Israel, which has little interest in the Afghan Taliban or Pakistan’s Lashkar-e-Taiba. For India, it is the latter that matters.
•The euphoria of the visit cannot, however, conceal China’s importance for Israel. China is a far bigger investor and trading partner of Israel than India. On this occasion, India and Israel decided to set up a $40 million Innovation Fund to allow Indian and Israeli enterprises to develop innovative technologies and products for commercial applications, but it is clearly dwarfed by the Israel-China comprehensive innovation partnership which has an outlay of $300 million. India and Israel also have differences over China’s BRI: Israel is eager to participate in it, unlike India, and possibly views this as an opportunity to develop a project parallel to the Suez Canal.
It’s the neighbours
•Two countries where India’s diplomacy, despite the impetus given to it, is currently facing heavy odds are China and Pakistan. China in Asia is already exercising some of the political and economic leverages that the U.S. previously possessed. China has a significant presence in East and Southeast Asia, is steadily enlarging its presence in South Asia, and is also beginning to expand into West Asia. For instance, China’s influence in Iran today appears to be at an all-time high, whereas India’s influence seems to be diminishing.
•India has, however, refused to be inveigled by China’s blandishments, including the BRI. Nor has it flinched from standing up to Chinese ‘bullying’, as in the recent instance of the Doklam plateau in Bhutan. Few other countries in Asia are, however, willing or in a position to tangle with China. A divided ASEAN again has provided China with an opportunity to demonstrate its economic and military muscle. Most countries in the region also demonstrate a desire to join China-based initiatives. Even in South Asia, despite India’s commanding presence, China has been successful in winning quite a few friends among India’s neighbours such as Bangladesh, Nepal, Sri Lanka and the Maldives.
•In the case of Pakistan, the implosion of the state arising from its internal stresses and problems, together with the virtual standoff between India and Pakistan (involving a total cessation of talks or any kind of worthwhile contacts), has enabled the Pakistani Deep State to further entrench itself. India has been left with few options and this is leading to a diplomatic gridlock which does not augur well for India.
•As Pakistan becomes still more deeply mired in problems, its dependence on China is growing. This is contributing to a strategic imbalance in the South Asian region. It is a moot point whether India and Indian diplomacy can do something to rectify matters in this context, but for the present it confronts Indian diplomacy with one more serious dilemma.
•Notwithstanding India’s efforts, the diplomatic scene vis-à-vis Russia also could be better. Russia is undergoing a strategic resurgence of sorts, sustained in good measure by the close relations recently established with China. Buoyed by developments in the Ukraine and Crimea, and the uncertainties surrounding U.S. commitment to NATO, the new Russia-China ‘strategic congruence’ is certain to impact Asia. The problem for India and Indian diplomacy is that at this time India-Russia relations appear less robust than at any time in the past half century.
•India’s ‘Act East and Look West’ policies have given a new dimension to Indian diplomacy in both East and West Asia. In both regions, however, but especially in West Asia, Indian diplomacy still lacks the nimbleness required to deal with fast-changing situations. In West Asia, despite its long time presence in the region, a 9-million strong diaspora, and the region being its principal source of oil, India is not a major player today. Both Russia and China have overtaken India in the affairs of the region. This is particularly true of Iran where the Russia-China-Iran relationship has greatly blossomed, almost marginalising India’s influence.
Fadeout in West Asia
•India’s absence from, and its inability to play a role in, West Asia, even as the region confronts a split down the line between the Arab and the non-Arab world is unfortunate. More so, there is the possibility of a series of confrontations between an increasingly powerful Shiite Iran and a weakening Saudi Arabia. The most recent challenge is the one posed by Qatar to the existing order in the West Asian region. The fallout of all this will impact India adversely and Indian diplomacy’s inability to make its presence felt will matter. An additional concern for India would be that growing uncertainties in the region could further fuel radical Islamist terror in the region.
•The ‘Act East’ policy has produced better results. Closer relations with countries in East and South East Asia, especially Japan and Vietnam, are a positive development. However, in the Asia-Pacific, India has to contend with an increasingly assertive China. There is little evidence to show that India’s diplomatic manoeuvres individually, or with allies like Japan, have succeeded in keeping the Chinese juggernaut at bay — or for that matter provide an alternative to China in the Asia-Pacific.
•India’s diplomatic establishment is all too aware of the political history and economics of the Asian region. Under Prime Minister Modi, diplomatic styles have changed but it would seem that the substance has altered little. His recent visit to Israel was, no doubt, a resounding success, but Israel was already one of the very few countries which had shown a complete understanding of India’s defence and security needs, even ignoring the sanctions imposed on India by some countries. Israel’s supply of critical defence items during the Kargil conflict (of 1999) is an excellent example.
•What Indian diplomacy currently needs to do is to find a way to steer amid an assertive China, a hostile Pakistan, an uncertain South Asian and West Asian neighbourhood, and an unstable world. The strategic and security implications of these, individually and severally, need to be carefully validated and pursued. Indian diplomacy may possibly need to display still higher levels of sophistication to overcome the odds.
📰 Monumental legislation
Public works may be allowed within 100m of monuments
•Prohibited areas around monuments and archaeological sites may have to give space for more infrastructure. The Ancient Monuments and Archaeological Sites and Remains (Amendment) Bill, 2017, which is pending in the Lok Sabha, attempts to address the issues confronting construction for public works due to proposed plans running through ‘prohibited’ area (100m around a protected monument or area). The Ancient Monuments and Archaeological Sites and Remains Act of 1958 bars any sort of construction within the prohibited area of these structures.
•The 1958 Act defines ancient monuments to include a structure, erection, monument, any tumulus, place of interment, cave, rock sculpture, inscription or monolith which is of historical, archaeological or artistic interest and which has been in existence for not less than 100 years. Delhi itself is home to several UNESCO world heritage sites.
•The Bill introduces an amendment to Section 2 of the 1958 Act, expanding the definition of public works to construction by any department of the Central government for public purposes. It says the “emergent necessity” of building such infrastructure would be based on a “specific instance of danger to the safety or security of the public at large”. Such public infrastructure would be allowed within the prohibited area of a historic monument or archaeological site only if there is “no reasonable possibility of any other viable alternative to have such a construction beyond the limits of the prohibited area” of the monument.
•The Bill amends Section 20A of the 1958 Act to allow public works in prohibited areas within the monument or archaeological site. Any question as to whether a particular work is of a public nature or not shall be forwarded to a competent authority under the Act, which will make its recommendation and place it before the Centre, whose decision will be final.
•In case any department of the Central government proposes to carry out any public work within a prohibited area, it will make an application to the competent authority. The authority will make its recommendation and hand it over to the Centre, which will take a final decision and communicate it to the applicant office or department within 10 days of the decision.
•The Bill also amends Section 20I of the 1958 Act. This is a note to the competent authority to make its recommendations to the Centre only after conducting an archaeological, visual and heritage impact assessment.
