📰 Union Cabinet approves ₹76,000-crore push for semiconductor makers
It will extend fiscal support of up to 50% of project cost to set up fabrication units.
•The Union Cabinet on Wednesday approved a ₹76,000 crore scheme to boost semiconductor and display manufacturing in the country, taking the total amount of incentives announced for the electronics sector to ₹2.30 lakh crore, a government statement said.
•The comprehensive programme for the “development of sustainable semiconductor and display ecosystem in the country” was aimed at making India a global hub of electronic system design and manufacturing, the statement noted.
•“The programme will usher in a new era in electronics manufacturing by providing a globally competitive incentive package to companies in semiconductors and display manufacturing as well as design,” the government stated.
•The scheme would provide fiscal support of up to 50% of the project cost for setting up semiconductor and display fabrication units. In addition, the Centre would work with the States to set up high-tech clusters with the necessary infrastructure such as land and semiconductor-grade water, the government clarified.
‘India Semiconductor Mission’
•“In order to drive the long-term strategies for developing a sustainable semiconductors and display ecosystem, a specialised and independent ‘India Semiconductor Mission’ will be set up. The India Semiconductor Mission will be led by global experts in semiconductor and display industry. It will act as the nodal agency for efficient and smooth implementation of the schemes on semiconductors and display ecosystem,” the statement read.
•Trusted sources of semiconductors and displays had strategic importance in the current geopolitical scenario and were “key to the security of critical information infrastructure”. “The approved programme will propel innovation and build domestic capacities to ensure the digital sovereignty of India. It will also create highly skilled employment opportunities to harness the demographic dividend of the country,” the statement said.
‘Chips to start-ups’ programme
•While announcing the scheme at a press briefing, Electronics and Information Technology Minister Ashwini Vaishnaw said electronics manufacturing in the country had increased to $75 billion over the past seven years and was expected to reach $300 billion in the next six years. The “chips to start-ups” programme would develop 85,000 well-trained engineers, he claimed. Semiconductor designers would be given the opportunity to launch start-ups. The government would bear 50% of the expense under the design-linked incentive scheme. The entire programme would lead to 35,000 high-quality direct jobs and 1 lakh indirect employment.
•Information and Broadcasting Minister Anurag Thakur said the decision was expected to attract an investment of ₹1.67 lakh crore and lead to production worth ₹9.50 lakh crore.
Pandemic imperatives require diversification of supplies but protectionism is no answer
•At a time that India is looking to impress upon the world that it is strongly positioned as well as willing and able to become a more reliable supply chain partner for them than China has been proven in recent times, External Affairs Minister S. Jaishankar’s remarks on Tuesday about globalisation are worth taking note of. The pandemic experience creates a case for ‘shorter’ supply chains with more ‘national’ capacities, he said, before chiding globalisation ‘Gurus’ for advocating open markets without acknowledging geopolitical motivations. That he cited the example of India’s health-care supply chain vulnerabilities being exposed after the onset of COVID-19 makes it clear his broader message was aimed at China on whom India relied too much for critical pharma and health-care imports, and continues to run up large trade deficits with. Tapping the receding global sentiment for China, and the dangers about depending on limited, even if hugely efficient, supply chains, is a sensible ploy gaining resonance. Earlier this month, Australia’s Special Envoy to India Tony Abbott accused China of ‘weaponising trade’, losing its credibility and blocking trade flows. That Mr. Abbott, a former Australian Prime Minister, who had himself signed a free trade pact with China, is now pushing hard for a trade deal with India as an ‘obvious trustworthy substitute’ for global supply chains, is an admirable endorsement of official tact.
•However, Mr. Jaishankar also went on to term the idea that ‘other people can ... operate in your economy on terms which are advantageous to them’ as ‘ridiculous’ and argued that there was no need to be defensive about ‘protectionism’. Perhaps, he was addressing the reiterated discontent about some of India’s broader market access reluctance, based on recent supply chain shocks in sectors ranging from semiconductors to commodities. But this broad-brush messaging against globalisation is troublesome, particularly when other Cabinet members are taking pains to convey to investors and potential FTA partners that the Atmanirbhar Bharat campaign is not a protectionist platform. Such mixed signalling may also unnerve negotiating counterparts and stakeholders for similar deals with the UAE, Canada, the EU and those involved in the revived India-U.S. Trade dialogue. There is no denying that the world is yet to get a fair global trade order through the WTO, or the immediate pandemic imperatives require diversification of supplies and scaling up of domestic capacities to build some resilience. But protectionism is not the answer as India itself will argue with countries where it seeks market access; and globalisation per se cannot be pooh-poohed even as India continues to gain from it through rising exports. Just because of the pandemic, the world will not become less interdependent as it is simply not possible for everyone to make everything. As former Chinese Premier Wen Jiabao said, citing China and Singapore’s examples: ‘... a nation that shuts its door to the world is bound to fall behind.’ India would be well-served if the focus is on grabbing the opportunities the world is throwing up, while holding back lamentations for private conversations.
📰 Securing the young: On COVID-19 vaccines for children and booster shots
India must accelerate efforts to increase vaccine supply for boosters and for children
•The Pune-based Serum Institute of India (SII) has said that it will be ready with vaccines for children in the next six months. This follows claims earlier this year that it will be ready with the vaccine, Covovax, for adults by October; but, so far, no approval has been forthcoming from the Drugs Controller General of India. Covovax is SII’s brand name for Novavax, the recombinant nanoparticle protein-based vaccine developed by the U.S.-based Novavax Inc., and this will be an important vaccine to watch out for because it will roll out from the SII stable, which as of today, has made at least 90% of the 1.3 billion vaccines that have found their way into the arms of Indians. While Covaxin by Bharat Biotech was hurriedly approved by Indian authorities, it has unfortunately not been able to scale up rapidly enough to make a substantial contribution to India’s vaccination programme. India has now inoculated 80% of its adults with at least one dose and given that many have already been exposed to the virus, this number, in itself, is a fairly creditable achievement even though it is short of the Government’s initial claim of fully inoculating all adults by the year-end.
•However, Omicron has complicated matters. Said to be the most infectious of all variants, health experts in several countries are warning of a ‘tidal wave’ of infections over the year-end as well as in the first quarter of 2022. Because the variant contains several mutations that allow the virus to escape antibodies, the forecast is that several — in spite of being vaccinated — may likely experience breakthrough infections or re-infections. Seen this way, this also bodes harm for children as many have resumed schooling in person and the inevitable congregations make them targets for infections. India is yet to approve vaccines for children and is reportedly deliberating on trial data submitted by Bharat Biotech on tests done on children. The technical committee also has not authorised boosters and the argument ostensibly is that doses must be prioritised for adults who have not yet been inoculated. Several new vaccines, ZycoV-D, Gennova, Sputnik V, Corbevax were to have been available by now as per the Centre’s estimates in September and some of them are also testing versions in children but, as the experience with Covaxin shows, it is one thing to test and develop a vaccine and quite another to scale up quickly. The Government must accelerate efforts to coax supply.
📰 A false conflation between duties and rights
Allowing the language of fundamental duties to subsume political debates would hit the moral principles of the republic
•Should our rights coalesce with our duties? In recent times, it has been something of a constant refrain of the governing class to advocate an integration of duty with right. By duty here they do not mean the concomitant obligations that spring out of constitutional promises, but a set of ideals that were written into the Constitution during the acme of the Indira Gandhi-imposed Emergency. In their belief, these otherwise non-binding obligations — the “fundamental duties” as Article 51A describes them — ought to be treated on a par with, if not superior to, the various fundamental rights that the Constitution guarantees. In an inversion of the well-known dictum, they see duties, and not rights, as trumps.
Voices and opinion
•On Constitution Day last month, many Union Ministers used the occasion to underline this proposal. The Minister of Law and Justice, Kiren Rijiju, claimed that our country can be made great only “if we create a balance between fundamental duties and fundamental rights.” The Minister for Culture, G. Kishan Reddy, took this thought further still. “Today, on Constitution Day, it is important that we emphasise our fundamental duties for the growth and progress of our country,” he wrote in the Hindustan Times. “If deeper roots have to be established in a diverse and democratic country such as India, citizens will have to converge their inalienable fundamental rights with their fundamental duties.” What is more, the link between fundamental rights and duties, according to him, was not merely a constitutional debate but a “civilisation discussion” — whatever that might mean.
•To be sure, it is a basic proposition that all rights come with duties. But those duties are quite distinct from the meaning ascribed to them in the popular discourse. When a person holds a right, she is owed an obligation by a duty-bearer. For example, when citizens are promised a right against discrimination, the government is obliged to ensure that it treats everybody with equal care and concern. Similarly, the guarantee of a right to freedom of speech enjoins the state to refrain from interfering with that liberty.
•It is only in this sense that rights and duties go together. But the government’s position proposes something rather more ominous. It puts forward an idea that our rights ought to be made conditional on the performance of a set of extraneous obligations. This suggestion is plainly in the teeth of the Constitution’s text, language, and history.
Rights, limitations
•The Constituent Assembly was clear in its belief that the Constitution’s emphasis must always rest on individual dignity. That is, the Constitution’s chief purpose must be to preserve and guarantee basic human rights, to equality, to autonomy, and to liberty, among others. To the framers, the very idea of deliberating over whether these rights ought to be provisional, and on whether these rights ought to be made subject to the performance of some alien duty, was repugnant to the republic’s vision.
•But the importance placed on every person’s ethical independence did not mean that rights were seen as absolute warrants. After all, Part III of the Constitution, in which our fundamental rights are nestled, contains within it a set of limitations. However, none of those restrictions places a burden on citizens to perform duties as a condition for the enforcement of rights.
•The Constitution’s framers saw the placing of mandates on individual responsibilities as nothing more than a legislative prerogative. Any such imposition would have to conform to the language of fundamental rights, but Parliament was otherwise free to dictate personal behaviour. For example, the legislature could impose a duty on individuals to pay a tax on their income, and this duty could be enforced in a variety of ways. If the tax imposed and the sanctions prescribed were reasonable, the obligations placed on the citizen will be constitutionally valid.
Many duties
•In this manner, Parliament and the State legislatures have imposed a plethora of duties — duties to care for the elderly and for children; duties to pay tolls and levies; duties against causing harm to others; duties to treat the environment with care, the list is endless. What is critical, though, is that these laws cannot make a person’s fundamental right contingent on the performance of a duty that they impose. A legislation that does so will violate the Constitution.
•Now, no sensible person is arguing that duties of this kind are unimportant. To sustain our society, to live peacefully together, we must take seriously our civic responsibilities. But any talk aimed at making these obligations central, and at melding our rights with duties, is aimed only at undermining the Constitution. That this is so is clear from the history of fundamental duties in India.
•In its original form, the Constitution did not enlist any obligations that an individual was bound to follow. The fundamental duties that are now contained in Article 51A were introduced through the infamous 42nd constitutional amendment. The Swaran Singh Committee, which was set up during the Emergency, and which recommended the insertion of the clause, also suggested that a failure to comply with a duty ought to result in punishment. Ultimately, the amendment was introduced after the binding nature of the clause was removed, but its intention was clearly expressed in the then Law Minister H.R. Gokhale’s assertions that the provision would have “a sobering effect” on the “anti-national” and “subversive” sections of society.
•In its finally adopted form, Article 51A encouraged citizens to perform several duties: among others, to cherish and follow the noble ideals that inspired the national struggle for freedom; to uphold and protect the sovereignty, unity and integrity of India; to defend the country and render national service when called upon to do so; to protect and improve the natural environment; and to safeguard public property.
•When the Emergency came to pass, these directives were largely seen in innocuous terms — for one, they were considered too vague to make any meaningful difference. But today, when our popular discourse veers towards a need to place an emphasis on duty over right, the Constitution’s basic ethos once again comes under threat. What these demands overlook is that the social revolution that the Constitution was meant to herald was underpinned by a belief that it is only a guarantee of rights — unimpeded by duty — that could help usher India into a free and egalitarian future.
Questions to ask
•This is not to suggest that human rights are by themselves sufficient. The philosopher Onora O’Neill has argued with some force that we would do well to discuss the precise nature of duties that rights create. Unless we do so, our charters of human rights may not by themselves be enough.
•For example, we may want to ask ourselves if the promise of a right to free expression imposes on the state something more than a duty to forebear from making an unwarranted restriction on that liberty. Does it require the state to also work towards creating an equal society where each person finds herself in a position to express herself freely? Similarly, does the right to life include within it a positive obligation on the state to provide shelter, livelihood, and health care?
•When we speak about the importance of obligations, it is these questions that must animate our discussions. Should we instead allow the language of fundamental duties — as contained in Article 51A — to subsume our political debates, we would only be placing in jeopardy the moral principles at the heart of India’s republic.
📰 The Speaker who stifled debate
The Speaker has ample power to quell disorderly behaviour, but thereafter, the House is the master
•November 29, 2021, will be remembered as a black day in the history of India’s parliamentary democracy. On that day, by a fell blow, the custodian of the Lok Sabha’s rights, its Speaker Om Birla, struck at the very raison d’etre of the House. Historically and constitutionally Parliament is no legislature machine. It is the grand inquest of the nation.
•In Britain and in India, debates long preceded legislation. What is particularly repulsive is that the outrage was orchestrated. Hours before the House met, Prime Minister Narendra Modi laid down the law in the very terms that the Speaker used in his ruling. At the Business Advisory Committee, which met shortly before the House, BJP members dutifully said ditto.
Holding the House to ransom
•The Farm Laws Repeal Bill, 2021, sought to repeal three contentious farm laws. The Agriculture Minister, Narendra Singh Tomar, introduced the Bill for “consideration” and adoption, which implies after debate. This was fortified by his attacks on the Opposition’s “hypocritical attitude”. The Opposition had a right to rebut this but this right was denied to it.
•The Speaker ruled, “I will allow the discussion only when the House is in order”. The Rules of Procedure and Conduct of Business in Lok Sabha give him no right or power to hold the House to ransom unless such assurances are given in advice. No self-respecting Opposition will submit to this. The Rules give him ample power to enforce order after it has been disrupted.
•The Minister arrogated to himself the right to decide that there was no need for a debate because there was a consensus on the repeal of the three Acts. This is disingenuous. The Acts remained to be discussed. As the All India Kisan Sabha pointed out, the three Acts did not include safeguards to prevent profiteering and monopoly by corporates and private entities. The Opposition was denied the right to move amendments to the repealing Bill. The Minister went further still. He said that a debate would have no tangible results. Why then hold debates on foreign policy, for instance? Was the House not entitled to move an amendment to legal guarantees for Minimum Support Price?
•The Rules of Procedure are drafted to ensure a free debate, not to stifle it. There is not a single Rule or Standing Order which empowers the Speaker to act as Mr. Birla did. Consider Rule 362(1) to begin with: “At any time after a motion has been made, any member may move that the question be now put, and unless it appears to the Speaker that the motion is an abuse of these rules or an infringement of the right of reasonable debate, the Speaker shall then put the motion that the question be now put.” Closure cannot be imposed without a prior debate.
•Rule 363(1) says: “Whenever the debate on any motion in connection with a Bill or on any other motion becomes unduly protracted, the Speaker may, after taking the sense of the House, fix a time limit for the conclusion of discussion on any stage or all stages of the Bill or the motion, as the case may be”. It is the “sense of the House”, not the Speaker’s opinion, which governs.
The Speaker’s powers
•The Speaker has ample power to quell disorderly behaviour. But thereafter, the House is the master. It can overrule the Speaker (Rule 374A). The Speaker can adjourn the House or suspend a sitting. The Speaker has no power to refuse a debate unless an undertaking is given for good conduct in future.
•Debates are meant for the edification of the people and are, in turn, influenced by public opinion. As Ivor Jennings wrote in his classic on Parliament, “It is not the control of the Government by the House but the fact that its dislikes are often a representation of electoral dislikes that makes debate important.”
•Jennings wrote, “Obstruction is an ordinary part of parliamentary procedure”. The Rules of Procedure provide precisely what Erskine May’s Parliamentary Practice prescribes. In the event of grave disorder, the Speaker may adjourn the House or suspend the sittings. He cannot stipulate good behaviour as condition for debate.
•What happens in our Parliament is nothing compared to the “rowdyism” in the House of Commons which Philip Norton specified in The Times of July 7, 1990. Yet, he warned that “to limit the capacity of the House to debate is to frustrate the very purpose of the institution, and so undermine support for the system of government.”
•MPs must draw up a documented statement on the matter, based on India’s Rules of Procedure and those of the U.K., Canada and Australia, in assertion of their rights and those of the people they represent. In fairness, the Speaker should be invited, most respectfully, to indicate the Rule under which he acted on November 29, 2021.
📰 The price of food must figure in the policy
An agricultural policy must ensure that farming is profitable but not at the cost of a high price of food
•The showdown between the farmers and the Modi government may have ended, but the essential challenge of public policy for agriculture remains. This is the high price of food. For decades now, the price of food has not figured much in agricultural policy, when, actually, it should be the central focus in the presence of poor households. Successive governments have instead showcased the minimum support price (MSP) they have offered to the farmers and the subsidy they have incurred in making a limited complement of food available to the consumer though the public distribution system (PDS). The now-repealed farm laws themselves were projected as a means of raising farm revenues via higher prices. But what was left unsaid was that a higher price of food increases poverty, especially as the rice and wheat supplied through the PDS constitute only a part of the total expenditure on food of the average Indian household.
The rising price of food in India
•That a high price of food can trigger economic insecurity for the individual is widely understood but what is not immediately apparent is its economy-wide ramification. For the household, a high price of food crowds out expenditure on other items ranging from health and education to non-agricultural goods. This prevents the market for non-agricultural goods from expanding. The expansion of this market is necessary for the non-agricultural economy to grow.
•This was one of the first discoveries in economics, made by the English economist David Ricardo about two centuries ago. Ricardo had prophesied that due to the scarcity of good quality land, the cost of production of corn, that is wheat, in England was set to rise, leading in turn to its rising price. The consequence of this was to be not only a certain worsening living standard for the working class but also a thwarted industrialisation, as the market for industrial goods could not grow. What he failed to predict was the tremendous increase in agricultural yield that was to come about in the country with the Industrial Revolution. The rising yield ensured that the price of food was kept in check and the demand for industrial goods was not cramped. In fact, the price of food in England was not merely kept in check, its price relative to that of other goods actually declined. This pattern of a declining trend in the relative price of food has been the experience of all economies that have grown richer.
•An indication of the elevation of the price of food in an economy is the share of food in a household’s budget. In a global comparison we would find that this share is very large for India. Data from the U.S. Department of Agriculture (2016) show that this share ranges from over 30% for India to less than 10% for the U.S. and the U.K. The figure for China is around 20%. More interestingly, we find that countries with higher per capita income have a lower share of food in consumption expenditure. This is in line with Ricardo’s understanding of how economies progress i.e., as food gets cheaper, growth in the non-agricultural economy is stimulated. The fact that the richest countries of the world have been able to produce food cheaper over time suggest that such a mechanism has been at work. It is something that we have paid scant regard to in India. Indeed, agricultural policy in India has remained quite unaccountable in the face of a rising relative price of food. For instance, the relative price of food has risen over 50% since 1991. The experience of food becoming more expensive over time is out of line with the global experience of development. When the success of the 1991 economic reforms is recounted, this contrasting experience in India never makes the news. Sections of the media too appear to prefer sensationalising a small rise in the administered price of cooking gas while remaining silent on the rising price of food. Arguably, the high price of food has been a factor in the disappointing lack of expansion of the manufacturing sector in India despite repeated efforts to bring it about.
•Both from the point of view of food security for low-income households and the dynamism of the non-agricultural sector, agricultural policy cannot ignore the price at which food is produced. This is not to ignore the role of factors across the supply chain beyond production. We know of the wastage due to the lack of proper transportation and cold storage facilities, both of which lower the effective supply and keep prices high. But the fact of low agricultural yield in India by comparison with the rest of the world has been known for long, and little is done about it. India has had an effective MSP policy for the major crops for over 50 years; how giving it a statutory status now can change this feature is not obvious. A superior management of soil nutrients and moisture, assured water supply and knowledge inputs made available via an extension service would be crucial.
•As agriculture is, unlike industrial production, an activity that is affected by fluctuation in the weather, it is risky. Given the importance of food for our survival, this justifies public intervention in agriculture. The issue is the design and scale of this intervention. In the mid-sixties, when India was facing food shortage that could not be solved through trade, a concerted effort was made to raise domestic agricultural production. The intervention succeeded in raising food production but it came with collateral damage. It introduced the strategy of ensuring farm profitability though favourable prices assured by the state. Further, it entrenched the belief that it is the farmer’s right to have the state purchase as much grain as the farmer wishes to sell to the state agency. This has resulted in grain stockpiles far greater than the officially announced buffer-stocking norm. Rising public stocks suggests that the intervention has succeeded in raising the price beyond what would have been generated by the market. These stocks have often rotted, resulting in deadweight loss, paid for by the public though taxes or public borrowing. Finally, with all costs of production reimbursable and all of output finding an assured outlet, supply has outstripped demand. This has led to an unimaginable pressure on the natural environment, especially water supply. There has been a prediction from credible sources that Punjab faces the prospect of desertification fairly soon.
Protect the interests of the poor
•India needs an agricultural policy that ensures that farming is profitable but this cannot be at the cost of a high price of food. The ‘food problem’ should no longer be seen only in terms of the availability of food from domestic sources. Too high a price of food, reflected in a high share of food in household expenditure, is another dimension of the problem. This has not received the attention that it deserves, with governments pointing to the existence of a PDS. But a PDS is a roundabout and costly way of delivering food security. Raising yields will ensure profitability without raising producer prices, which will inflate the food subsidy bill. When negotiating with the farmers, the government must protect the interests of the poor of India.
