📰 India and Japan sign logistics agreement
Armed forces of both sides will coordinate closely in services and supplies
•India and Japan signed a logistics agreement that will allow the Armed Forces of both sides to coordinate closely in services and supplies. Prime Minister Narendra Modi and his outgoing Japanese counterpart Shinzo Abe, who held a telephone discussion on Thursday, welcomed the pact that was signed by Defence Secretary Dr. Ajay Kumar and Ambassador of Japan Suzuki Satoshi.
Closer cooperation
•A statement from the government informed that the agreement on ‘Reciprocal Provision Supplies and Services’ will “increase interoperability between the Armed Forces of India and Japan” and assist in maintaining regional security.
•“The agreement establishes the enabling framework for closer cooperation between the Armed Forces of India and Japan in reciprocal provision of supplies and services while engaged in bilateral training activities, United Nations Peacekeeping Operations, Humanitarian International Relief and other mutually agreed activities,” the statement said.
•The Prime Ministers of Japan and India welcomed the signing of the agreement, which will help both sides coordinate on medical requirements, supplies, maintenance, airlifting and communication.
Naval exercises
•Significantly, the agreement signed on Wednesday is mainly aimed at greater maritime cooperation and can dramatically upgrade India-Japan naval exercises as the participants are expected to share maritime facilities for mutual benefit.
The crisis in agriculture demands that the government announce a strong fiscal stimulus for the rural economy
•A rather confident statement heard in the midst of India’s COVID-19-induced economic slowdown is this: “Agriculture will lead India’s economic revival”. But how valid is this claim put forward by government spokespersons and some observers?
•Four major arguments are offered. First, India’s food grain production in 2019-20 was 3.7% higher than in 2018-19. The procurement of rabi wheat in 2020-21 was 12.6% higher than in 2019-20. These indicate, it is argued, resilience in the agricultural sector. Second, food inflation in the Q1 of 2020-21, at 9.2%, was higher than in the previous year due to “sustained demand for food”. This shows a shift of terms of trade in favour of agriculture. Third, the area under kharif sowing in 2020-21 was 14% higher than in 2019-20. Higher kharif sowing was accompanied by higher tractor and fertilizer sales, which bodes well for economic recovery. Fourth, the government’s economic package for agriculture — as part of the Rs. 20-lakh crore Atmanirbhar Bharat package — will further position agriculture as the engine of revival.
•Let us now consider each of the above claims.
Rabi procurement
•During the lockdown, State governments in many northern States put in considerable efforts to ensure that procurement did not suffer. As a result, procurement of rabi wheat was higher in 2020-21. However, this claim hides more than it reveals. As per official data, only 13.5% of paddy farmers and 16.2% of wheat farmers in India sell their harvest to a procurement agency at an assured Minimum Support Price (MSP). The rest sell their output to private traders at prices lower than MSP.
•One should, then, be looking not at procurement but market arrivals. I compared total market arrivals of 15 major crops in India between March 15 and June 30 in 2019 and 2020. The market arrivals of all the 15 crops were lower in 2020 than in 2019. It was only in paddy, lentil, tomato and banana that market arrivals in 2020 constituted more than 75% of market arrivals in 2019. In wheat, barley, potato, cauliflower, cabbage and lady’s finger, market arrivals in 2020 were between 50% and 75% of market arrivals in 2019. For gram, pigeon pea, onion, peas and mango, market arrivals in 2020 were less than half of market arrivals in 2019. In wheat, the most important rabi crop, only 61.6% of the arrivals in 2019 was recorded in 2020.
•Thus, the most important problem faced by farmers during the lockdown was the loss of markets, stemming from the disruption in supply chains, closure of mandis and a fall in consumer food demand. Farmers suffered major loss of incomes, and higher procurement was hardly alleviating. In addition, there were major losses in the milk, meat and poultry sectors; industry associations estimate the total loss for the poultry industry at Rs. 25,000 crore.
Inflation and prices
•Inflation rates estimated using consumer price indices are not representative of farmer’s prices. Inflation was largely due to disruptions in supply chains and rise in trader margins. I examined the wholesale market prices for 15 agricultural commodities between March 15 and June 30, 2020. Prices of most crops declined. For example, average paddy prices were about Rs. 1,730 per quintal on March 23, but Rs. 1,691 per quintal on June 30. Average wheat prices were Rs. 2,045 per quintal on April 1, but Rs. 1,865 per quintal on June 30. A moderate uptick in prices was visible in a few vegetables, but not before June 2020.
•The dark side of higher rural inflation in India is that small and marginal farmers are not net sellers, but net buyers of food. So, it was not just that farmer’s prices fell; most were also forced to pay more for food purchases. There is also strong evidence from small sample surveys that rural households reduced food purchases during the lockdown. Thus, the claims that higher rural inflation benefited farmers, and that it was due to higher food demand, are misplaced.
Higher kharif sowing
•There is no surprise in the growth of kharif sowings in 2020. Given that rabi incomes fell during the lockdown, many rural households may have returned to farming or intensified farming for food- and income-security. Lakhs of migrant workers returned to their villages from urban areas. They may have taken up agriculture in previously fallow or uncultivated lands. Data on monthly employment released by the Centre for Monitoring Indian Economy (CMIE) show that the number of persons employed as “farmers” in June and July 2019 were 11.2 crore and 11.4 crore, respectively. But in June and July 2020, these numbers rose to 13 crore and 12.6 crore, respectively.
•These are indicators of distress, not prosperity. It is no cause for celebration also because the rural unemployment rates rose sharply in 2020, to 22.8% (April), 21.1% (May) and 9.5% (June). Even in August 2020, rural unemployment rates were higher than in February 2020 or August 2019.
Trickle from package
•Agriculture contributes only about 15% to India’s Gross Value Added (GVA). Thus, even if agriculture grows by 4%, it is likely to contribute only 0.6 percentage points to GVA growth. To contribute a full one percentage point to GVA growth, agriculture will have to grow by 6%, which is unlikely in 2020-21. This is not to deny a potential rise in demand from higher rabi procurement, higher kharif sowing and flow of cheap credit, which together appear to have resulted in higher purchase of tractors and fertilizers. But the counteracting tendencies in rural areas — i.e., lower crop prices, lower market arrivals and higher unemployment — would overwhelm these “green shoots”.
•Rural expectations were high when the Atmanirbhar Bharat package was announced. However, the details were disappointing. Total fresh spending for agriculture in the package is a trickle: less than Rs. 5,000 crore. The rest are schemes already included in the past Budgets, announcements with no financial outgo or liquidity/loan measures routed through banks.
•The package also failed to provide financial support to farmers. PM-KISAN, or Pradhan Mantri Kisan Samman Nidhi, is hardly an ideal scheme. But instead of frontloading the instalments of PM-KISAN, the government should have doubled the payments to farmers from Rs. 6,000 a year to Rs. 12,000 a year. Instead of raising the minimum support price (MSP) for kharif paddy by Rs. 53 per quintal (which, actually, was the lowest rise in over a decade), or cotton by Rs. 260 per quintal, the government should have set all MSPs at 150% of the C2 cost (comprehensive cost) of production.
•Instead of a moratorium on loan repayments, the government should have waived the interest on loans taken by farmers in 2019 and 2020. Instead of vague loan-based schemes in animal husbandry, the government should have announced a package of direct assistance for the crisis-ridden poultry and meat sectors amounting to at least Rs. 20,000 crore. Instead of loan-based schemes to support private investment in dairy, the government should have arranged direct financial assistance to small milk producers, for whom milk prices have literally plummeted.
•In all, the government’s strategy appears to be to squeeze farmers without investing in agriculture or rural employment. Such an approach would not just fail; it would also be counterproductive. Rural incomes will remain depressed, and push the economy further into a vicious cycle of poor demand, low prices and low growth. The government should discard its role as a passive observer, and decisively intervene in rural India with a substantial fiscal stimulus. The earlier the better as delays would only compound mistakes.
📰 How much is too much when collecting data for planning?
It is useful in delivering development outcomes, but technology has to be deployed carefully
•On Independence Day, Prime Minister Narendra Modi announced the launch of the National Digital Health Mission (NDHM) under which “every Indian will get a Health ID card.” He said: “Every time you visit a doctor or a pharmacy, everything will be logged in this card.” The NDMH seeks to create an ecosystem under which health records will be digitised. The government has clarified that this would be voluntary, data will be stored locally, and only anonymised data will be shared upwards. In a conversation moderated by Varghese K. George , A.R. Nanda and Venkat Srinivasan discuss whether real-time capturing of demographic data and broad health indicators of the population will lead to benefits that outweigh the perceived and real risks of erosion of privacy. Edited excerpts:
Mr. Srinivasan, how can technology transform data collection and analysis?
•Venkat Srinivasan:You can’t think of data without technology. This is digital data. And of course, it is important to recognise privacy issues. But the only way, I think, we need to think about this is [how it can] transform health outcomes, access and care, and not [in terms of] separate data alone. Use of this data with technology, I think, is the real intent of this policy. As you know, in the U.S., we’ve had this electronic health records initiative for a while. So, technology can, if used properly, dramatically transform healthcare at all levels. Technology can’t work without data. So, it can be at the population level, it can be at the individual health level. At the population level, it can be used effectively to control the outbreak of a pandemic. At the individual level, you have several levels of benefits. In India, millions of people don’t have access to quality healthcare. The silver lining is that the government has allowed for digital health, which allows a lot more people access. I’m sure that will happen over time.
Mr. Nanda, what problems do we face when it comes to demographic and health data? In terms of sampling, frequency, accuracy, range...
•A.R. Nanda:We face problems in all these areas. Sampling size, sampling errors, non-sampling errors, how frequently we collect data. Cost is a big factor in addressing these questions. The use of technology is the cheapest and easiest way forward, in collection of data, monitoring the quality. The problems are daunting, but nothing that cannot be solved.
In your career as a demographer and a planner, did you ever wish the technology had been better?
•ARN:Yes. I have been associated with the Indian Census since the 1970s. It used to take years before Census data and family health survey data could be tabulated. By the 1990s technology came to our help, starting with early mainframe models. Now it is far smoother.
Mr. Srinivasan what can technology do for collecting data, keeping it safe, and using it for the public good, which was impossible a decade ago?
•VS:You have nicely framed it in those three buckets. Technology is the only solution. It is an excellent solution on the collection side. We can expand the sample [size] at low cost. Computing devices that can use ‘store and forward’ type architecture [can overcome] connectivity challenges. But the quality of the data is where I think the biggest advances will be felt because you can control it through many methods such as pattern matching and looking for trends, all real-time. On the privacy and security side you hear daily reports of hacking. There are several ways of making technology more robust — create levels of anonymisation, make it much harder for somebody to figure out who you are. AI algorithms can protect data and prevent theft. But [that] has to be complemented with a legal framework that acts as a deterrent for anybody who is caught stealing or misusing personal health data. It must be independent of any political machinery. So, possibly, create an independent commission, like the Election Commission.
Mr. Nanda, the Personal Data Protection Bill is currently before Parliament but it has been criticised for the sweeping powers it gives to state agencies. Are we still a long way from a reassuring legal framework?
•ARN:We have some legal framework for protecting Census and other survey data, but the problem is that organisations that handle these are not strictly independent regulatory authorities. For example, the Census Commissioner of India has the power under the Indian Census Act to say no — I had said no to governments — but I also think an independent commission is needed.
Do you fear vindictive action by state agencies or other private agencies who might be able to access data for political, economic or ideological reasons?
•ARN:That’s a risk. But at the same time, you have to see what you call the public good. You have a law, may be put it in the Constitution.
You’re suggesting that we go beyond a mere law and have a constitutionally empowered regulatory authority?
•ARN:Yes.
How is this conflict between privacy and public good handled in the U.S. with regard to data, Mr. Srinivasan?
•VS:We have the Health Information Protection Act (HIPA), which is being enforced quite effectively. We have similar concerns across the spectrum. Recently, there was a very controversial idea of declaring your citizenship in the Census. The data are also encrypted, but nothing is hack-proof. But the regulatory framework is very important.
How is private data used for analysis and policymaking?
•VS:In policymaking, the use of data is increasing but it is not extensive. For instance, the response to the pandemic. We use electronic health records at the population level and individual level all of a sudden now. A much greater amount of information sharing has happened. All of a sudden, hospitals are talking to each other. And they’re all sharing information not only on individual patients but on incidents. With anonymised data, people have less of an issue but in some cases it may not be anonymised — for instance, in contact tracing. When you go beyond health, we have other interesting issues in this public health crisis, policy issues — pensions, loans that were given to businesses. The issue is these policy interventions are all based on data that are not real-time. There is a 10-year interval between two Censuses.
The decennial Census has been around for more than 130 years now. This time it is being disrupted by the pandemic. Can’t we have a real-time capture of demographic data?
•ARN:That is a distinct possibility. Some countries, such as Germany, have already gone into that. To get there, we have to improve the system of our birth and death and marriage registration and registration of other statistics. This has improved, but only in urban areas, and not to the level where you can say that you can make the data usable and also won’t have to go for the same data to the Census. But we must also remember that there are other types of data which are also collected in the Census regarding culture, language, economy, but yes, we don’t need that every 10 years. That could be collected at longer intervals.
Mr. Srinivasan, is it possible and desirable to collect at least basic demographic data on a real-time basis rather than wait for 10 years?
•VS:Totally. In fact, it is not going to be very expensive. Technology costs have come down so dramatically, and you have such a large penetration of mobile phones in India. Individuals will have to be willing to report and that’s really where I suspect India’s challenge might lie. For this, it is important that they see a personal benefit. You can introduce a lot of intelligent algorithms that detect the quality at the source. When you think about intelligent algorithms, I’m a total proponent of traceable technologies. And traceability here implies that you should be able to understand exactly what happened at the individual level in the use of the technology. If you can afford to do that, that will get the game more acceptability. It may seem trivial, but I think it’s critical.
We are discussing finding a balance between individual privacy and promoting innovation and efficiency. Now, at what level of specificity and granularity in data could that balance be optimally achieved? How much is too much and how much is too little when it comes to data?
•ARN:That’s a real problem. In a census as well as in the big demographic surveys, health surveys, we have this compromise. The smallest area level is the village. More sensitive data and what involves the question of quality are shared only at the broader units such as the State or district level. Technology could make data capture and analysis possible in smaller units but at the same time, one has to be very judicious doing that. We need an independent agency outside of the government to take these decisions.
Consent and anonymisation are the key words often used to reassure sceptics. Is it all good as long we adhere to these two principles?
•VS:Both are very important, though, to me, they are elementary. You must have that, but you do need a stronger, autonomous regulatory framework. It is also potentially possible that you separate this into two categories. One is census. And your question is relevant on how granular you get, how you protect data, and again, you can use technology to separate different layers as necessary. There are things you need to be more sensitive about, more judicious, and so maybe you have layers, maybe three layers of access. You have one layer that many people can access; that’s completely at a population level. Another layer is only some people that you know, and so on. And their informed consent and anonymisation are important. The ability of an individual to have their health records to be stored digitally at a centralised location and access it across the country could be separate from this. But I think you can have a different set of protocols and permit. For that, all that is technologically possible, but I think you need a strong set of laws like this HIPA compliance.
•VKG:We do have a consensus that technology can do a world of good in delivering health, education and other development outcomes, but one has to be very careful and judicious in its deployment, and there should be an independent and robust regulatory mechanism to oversee that process.
