📰 RBI’s focus on liquidity is correct
Rate cut is an option for another day
•The messaging from the press conference of RBI Governor Shaktikanta Das is loud and clear: the central bank has an armoury of weapons and it will not hesitate to deploy them to mitigate the impact of COVID-19 on the economy. The two steps that Mr. Das has outlined now — forex swap and a second long-term repo operation (LTRO) of Rs. 1 lakh crore — are aimed at supporting liquidity in the market. Market rates may incidentally fall as the LTRO is at the repo rate of 5.15%.
•The focus on liquidity is the right thing to do at this point in time. A rate cut, while being a short-term sentiment booster, is not going to help in alleviating the situation as seen by the experience in the U.S., where the Federal Reserve has taken the funds rate to zero, but the markets remain unimpressed.
•The situation is clearly an evolving one and prudent action requires that the central bank keep its powder dry simply because we may not have seen the worst yet in terms of the virus impact, both in human and economic terms. In fact, in economic terms, this is just the start of what’s likely to be a long period of instability and falling growth in the global economy. The falling indices and currencies are only a manifestation of the first order impact. The second, and more severe one, will come when major economies either slow down sharply or tip into recession. The disruption caused to commerce, trade and travel already is so immense that the effects on the world economy will be felt for the rest of this calendar year. The effect will multiply if the virus infection curve does not flatten over the next 2-3 weeks.
•India cannot remain insulated from global economic turbulence and economic growth is sure to slow down in the coming quarters. In such a situation, it is sensible to hold on to the rate cut option for use at a more challenging time, which is bound to follow. With headline inflation and core inflation — both CPI and WPI — trending south, food prices reducing and fuel prices falling (despite the government appropriating some of the benefit in the form of higher excise duty), the environment is indeed favourable for a rate cut, if the monetary policy committee were to decide on one.
•The question is one of timing. The RBI Governor would surely want elbow room in the monetary policy space and not find himself in the position of the Fed or the central banks of other developed countries, where rates have been beaten down to zero or close to zero, leaving no space for action. The focus will be on the next meeting of the monetary policy committee in the first week of April, unless if the situation deteriorates so badly that the RBI is forced to act urgently.
Health budgetary allocation must go up if India is to prepare for an unpredictable epidemic
•It is an incontrovertible truth that material resources are finite. Demand in most sectors will continue to exceed supply in times of a pandemic. With the number of SARS-CoV-2 positive cases on the rise, and the number of deaths going up as well, the question is whether national and state health systems will be able to cope with ever-rising demands — for testing kits, for hospital beds, ventilators, why, even masks and hand sanitisers. This extraordinary demand has traditional production and systems of delivery choking and most often, unable to match supply to demand. Health-care resources, limited to begin with, are even more so when under stress. At a time when the disease did not have a name, and much less by way of character, in mainland China, the rapidly climbing numbers went far beyond the capacity of the country’s renowned industry (where a hospital was built in record time), and the health systems struggled to cope. Reports indicate that in Italy, which has emerged the hub of the epidemic outside of China, the strain on health systems is massive. With India crossing 100 positive cases, it is impossible to ignore the question about whether the health system is robust enough to meet this emergency. What is known, however, does not inspire confidence.
•For years, India’s health expenditure as a percentage of GDP has been abysmal at about 1%. As per the National Health Profile, 2019, collated by the Central Bureau of Health Intelligence unit of the Directorate General of Health Services, there has been no significant change in health-care expenditure since 2009-2010. The highest it has been in the decade is 1.28 % of the GDP, and hit the nadir at 0.98 % in 2014-2015. The report does record that per capita public expenditure on health in nominal terms went up from Rs. 621 in 2009-10 to Rs. 1,112 in 2015-16. A WHO bulletin of 2018 records that out-of-pocket payments remain common in India, which in 2014, was estimated at 62% of total health expenditure. While questioning whether these incremental efforts are sufficient, one needs to factor in the substantial skew in different States in terms of public sector health infrastructure and wherewithal. There is evidence to show that increased public spending on health care has resulted in less financial hardship for communities and better health outcomes. Prime Minister Narendra Modi made a promise to increase public health spending to 2.5 % of GDP by 2025. His government would do well to treat this epidemic as an opportunity to drastically scale up budgetary allocations for health to facilitate expansion of capacity. Epidemics are known to change the course of history; India must steer this one to harness finite resources optimally for the benefit of all.
📰 From virtual conferencing to real leadership
New Delhi has a chance to step up the SAARC video conference — as its assertive expression to stabilise the region
•After lying moribund for years, the South Asian Association for Regional Cooperation (SAARC) has suddenly acquired a new lease of life since last Sunday. Through a dramatic counter-intuitive initiative by Prime Minister Narendra Modi, SAARC, has become the ‘virtual’ platform through which leaders of the eight countries of our troubled region agreed to work together to combat unarguably the greatest immediate threat to the people: the COVID-19 health pandemic.
All eyes on India
•The success of the Modi-SAARC initiative will largely depend on India — the dominant power of the region, in every sense. Once New Delhi demonstrates that it has the capacity, the political willingness to institutionalise and to lead a mutually beneficial cooperative regime in the region, Pakistan’s “churlish” behaviour will become marginal to SAARC. Various international relations theorists view this as a function of “hegemonic stability”.
•What therefore is at test is India’s leadership, not Islamabad’s follies. The initial steps announced by Mr. Modi are laudable, including the proposal to set up the COVID-19 Emergency Fund for SAARC countries, with India making an initial non-trivial offering of $10 million; and the formation of a Rapid Response Team (of doctors, specialists, testing equipment and attendant infrastructure) to be put at the disposal of the SAARC, at this moment of grave peril.
•But much more will need to be done by New Delhi to establish that the video conference was not a mere event, but the assertive expression of its new willingness to stabilise the region through cooperative mechanisms, for our common future, without being distracted by short-sighted disingenuous ploys of a troubled Pakistan or being put off by its grandstanding. This is a moment thus of a rare opportunity for India to establish its firm imprimatur over the region; and to secure an abiding partnership for our shared destiny.
The spark of South Asia
•SAARC was born at a moment of hope in the 1980s; the idea was initiated by one of the most inscrutable leaders of the region, General Zia Ur Rehman of Bangladesh, who, met many of the other leaders personally and dispatched special envoys to the capitals of the countries of the region. Dhaka’s persistence resulted in the first summit of the seven leaders of the region in 1985. Afghanistan joined in 2007. In the nearly 35 years of its existence, even its champions will concede however that SAARC has, to put it euphemistically, not lived up to the promise of its founder.
•South Asia is the world’s least integrated region; less than 5% of the trade of SAARC countries is within. A South Asian Free Trade Zone agreed on, in 2006, remains, in reality, a chimera. The last SAARC summit, scheduled to be held in Islamabad in November 2016, was postponed after the terrorist attacks in Uri; none has been held since then, and until Mr. Modi’s initiative, no major meeting had been planned. A quick look at some of the questions posed in the Lok Sabha and Rajya Sabha on SAARC, in the last years, suggest that Indian MPs seek answers on why India is still a member of SAARC and on the strength of other organisations such as the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) that India is engaged with. Thus SAARC had become almost marginal to our collective consciousness.
Bright spots
•There have been some sunny moments in SAARC’s dismal and dysfunctional history. During the tenure of Prime Minister Inder Kumar Gujral, who had been fed a sumptuous diet of the possibilities of cooperation on the Track II circuit before he became Prime Minister, there was movement. At the Male Summit in 1997, for instance, a Group of Eminent Persons was set up to provide a vision for SAARC 2020. Equally, I.K. Gujral often confided that it was at Male that Pakistan Prime Minister Nawaz Sharif had told him in Punjabi: “I know you cannot give me Kashmir; and you know I cannot grab it from you; but let us just talk and move on.” But these moments of candour that could have injected practical common sense, remained few and far between.
The fadeout and a revival
•The reasons for the failure of SAARC have been enumerated several times as well. Clearly, most of the smaller states and external players believe that the India-Pakistan conflict has undermined SAARC. Bilateral issues cannot be discussed in SAARC but since the organisation relies on the principle of unanimity for all major decisions, Pakistan has often undermined even the most laudable initiative lest it give India an advantage: relative gains by India are more important for Pakistan than the absolute gains it secures for itself. For India, Pakistan’s use of terror as an instrument of foreign policy has made normal business impossible.
•But the world is suddenly being transformed. Not since the influenza pandemic of the Spanish Flu of 1918 has South Asia’s health been more in danger. Laura Spinney’s masterly account of the Spanish Flu reminds us of the memoirs of the great poet, ‘Nirala’, Surya Kant Tripathi, and what a tragedy was inflicted even on ordinary people by the flu.
•Nirala wrote : “I travelled to the riverbank in Dalmau and waited…[t]he Ganga was swollen with dead bodies. At my in-laws’ house, I learned that my wife [too] had passed away. This was the strangest time in my life..[m]y family disappeared in the blink of an eye.”
•There is no doubt that the impact of COVID-19 will be unprecedented, in terms of those it targets and the way we live. It is too early to judge the consequences , but it will take years for the world to return to the old and familiar. Strategies to cope with this new insidious, scheming and diabolic strain of the coronavirus have to be dynamic and ad hoc. In the United Kingdom the idea of letting low-risk residents being infected by the virus as a way of generating immunity (the herding principle) seems to have been misplaced and disastrous . Containment and the possible prevention of community transmission are the only two principles that are firmly tested. If community transmission occurs and cannot be contained, the consequences will be calamitous. This is indeed a time for SAARC and the experts of the region to think and act together and India can lead this effort.
•It is evident that Mr. Modi is an out-of-the box lateral thinker, especially on foreign policy. In 2014, Mr. Modi surprised the world by inviting all the SAARC leaders for his inauguration. In December 2015, he was even more audacious by almost living the dream of Prime Minister Manmohan Singh by spending his morning in Kabul, afternoon in Lahore and evening in Delhi. More important, the tragedy of COVID-19 may provide an opportunity for India to demonstrate its compassionate face to secure a region at peace with itself. India cannot afford to not to harvest this opportunity, after having sowed the seeds of a New South Asia.
📰 Closing the gender gap in science
With few women in the field, the quality of science and advancement of society are both affected
•India celebrates National Science Day on February 28 every year to mark C.V. Raman’s discovery of the scattering of light. For the last 33 years, on this day, research institutes and other academic centres in the country have been holding public outreach programmes or conducting meetings on select topics. This year, the theme was Women in Science. This is a timely and relevant theme, but it is also rather ironic given that Raman himself did not warm up to the idea of women in science. For some time, this prejudice meant that women candidates were refused admission to the Indian Institute of Science in the 1930s, during Raman’s tenure as director.
Lost opportunities
•Despite his progressive political and philosophical convictions, Raman was a traditionalist. Like many others of the time, he imbibed the sexist views that were part of society then. Among his three women students, only Anna Mani was able to choose a scientific career, although she could not get a doctoral degree. Sunanda Bai was not awarded a PhD, and committed suicide for unknown reasons. Lalitha Doraiswamy left her studies and chose to marry Subramanyan Chandrasekhar, who was awarded the Nobel Prize in Physics in 1983. Why did these talented women fail to get their due? It would be interesting to contrast their journeys with the story of Janaki Ammal. Ammal opted to pursue a Masters degree from the Michigan State University in the U.S. and continued her scientific career even after her return to India. The success of Janaki Ammal, who chose to leave India, versus the stories of the other women tells us about lost opportunities. The cultural and gender norms that engendered discrimination even during a renaissance of sorts in India was a major reason why the country lost out on an important opportunity to build a culture of including women in science during the pre-Independence days.
•These stories of gender discrimination help in our understanding of the current discourse on the social and organisational conditions that regulate women’s participation in science education and research. How do male colleagues behave today towards women working in labs today? Have gender attitudes changed? It is true that a resurgent inclusive nationalism propounded by Mahatma Gandhi, Rabindranath Tagore, Jawaharlal Nehru and others during the struggle for Independence encouraged women, at least those who were part of the upper social strata, to break the familial and cultural shackles and enter the public space. But did this social transformation, however incomplete it may have been, help in narrowing the wide gender gap in professional careers? While cultural and social causes are considered the primary reasons for gender discrimination, at least in India, organisational factors have also played a big role in preventing gender parity in science. This can be changed if more women are given leadership positions. Lack of women leaders and women role models may be preventing more women from entering the field.
•Compared to the pre-Independence days, one encouraging fact is that there is an exponential growth in the participation of women in the undergraduate and graduate levels. In the U.K., women account for 40% of undergraduate students who pursue degrees in the physical sciences and mathematical sciences and 14% in engineering and technology. In India, the corresponding figures are about 40% and 18%, respectively. More than 40% of PhD-holders in India are women. These figures, according to various estimates published in Current Science , show that social shackles are loosening.
The ‘leaky pipeline’ problem
•However, the trouble starts after women obtain their educational qualifications. The percentage of women in faculty positions drops to less than 20%; only a few reach the top positions of institutes and universities. This is also the time when many of them become mothers, sometimes because of familial pressure.
•The Indian Science Academies are aware of the problem. But the reform should start from their own backyard. In all the three science academies combined, only about 10% are women Fellows.
•Including more women in science is not only important from the human rights perspective; it also impacts the quality of science and the advancement of society itself. This is not to say that the situation is hopeless. There have been changes that give us hope too. For example, India is seeing more women in engineering today than ever before. This is heartwarming as engineering was once seen as a ‘men only’ domain. The role of women engineers in the launch of the Indian Space Research Organisation’s second moon mission, Chandrayaan-2, is now legendary.
•At the same time some recent reports should worry us. According to the Global Gender Gap Index 2020,a study covering 153 economies, India has slipped to the 112th spot from its 108th position in 2018. The report also says it would take nearly a hundred years to close the gender gap in various fields in India compared to the time it would take in other countries. This prediction should be proved wrong. For this, the Indian scientific community should act as a pressure group to build greater focus on the issue and push for concrete measures to address the problem. As a simple first step, India should relax certain norms for women. The expansion of maternity leave to 26 weeks from the previous 12 weeks shows that the present government is seized of the matter, but how this will affect the hiring of women workers is yet to be seen.
•The history of science shows that many revolutionary discoveries were made by women scientists. The most famously known woman scientist is Marie Curie. But contemporary times are full of examples: Rosalind Franklin, Barbara McClintock, and Jennifer Doudna, to name a few. There are many in India too, whose contributions we must highlight in textbooks.
•Women across the world face the ‘leaky pipeline’ problem. Without supportive institutional structures in place, women, when they are pregnant, worry about gaps in publications, how they will do fieldwork, whether they will get promotions. Productivity concerns are high for women, especially in academia where the number of papers you publish is a marker of productivity. In India, we have many examples of women researchers who are involved in exciting scientific experiments. It is imperative that we understand and remove the sexism and institutional obstacles that prevent more women from entering the scientific field.
