📰 MoD notifies list of 2500 subsystems barred from imports
This follows two indigenisation lists for platforms and systems
•Following the two positive indigenisation lists barring import of 209 major platforms and systems, the Defence Ministry on Wednesday notified a list of another 2,500 subsystems and components and 351 more imported items to be made locally in the next three years.
•“This Atmanirbhar initiative will save foreign exchange approximately equivalent to ₹3,000 crore every year,” a MoD statement said.
•A positive indigenisation list of subsystems and components had been notified by the Department of Defence Production as part of the MoD’s efforts to achieve self-reliance in manufacturing and minimise imports by the Defence Public Sector Undertakings (DPSUs), Defence Minister Rajnath Singh said on social media. They would only be procured from Indian industry after the timelines indicated in the list.
•“DPSUs will work in close coordination with local industrial supply chain to ensure strict adherence to the stipulated timelines,” the office memorandum dated December 27 said. Necessary certifications/approval of all items included in the list shall be granted on priority by stakeholders concerned, it added.
To reduce imports
•The positive indigenisation list is among a series of measures announced recently to reduce defence imports and give a push to domestic manufacturing.
•Speaking at a recent event, Mr. Singh said that in this decade they would increase the items under the Positive list for indigenisation from current 209 to over 1,000.
•At present, India’s defence and aerospace manufacturing market was worth ₹85,000 crore, of which the present contribution of the private sector was ₹18,000 crore. In 2022, the country’s defence and aerospace manufacturing market would increase to ₹1 lakh crore and could reach ₹5 lakh crore by 2047.
•The Ministry is also expected to put out the final version of the ‘Defence Production and Export Promotion Policy (DPEPP) 2020’, the draft of which has been released for public feedback.
Emerging technologies
•In a separate development, the Army said it had established a quantum lab at the Military College of Telecommunication Engineering (MCTE), Mhow in MP, to spearhead research and training with support from the National Security Council Secretariat (NSCS) as part of focus on emerging technology domains.
•“Army has also established an Artificial Intelligence (AI) Centre at the same institution with over 140 deployments in forward areas and active support of industry and academia. Training on cyberwarfare is being imparted through a state of art cyber range, and cyber security labs,” it said in statement.
•Ideation for the Army’s involvement in Electromagnetic Spectrum Operations was done in a seminar on Electromagnetic Spectrum and National Security organised in October last year, the statement noted and added that since then an impetus had been given to the Army’s technology institutions for investing in AI, quantum and cyber.
📰 Maximising the boost: On mixing COVID-19 vaccines
India must test the feasibility of mixing vaccines to help enable informed choice
•Heralding a new frontier in India’s vaccination programme, the apex drug regulator has approved two more vaccines under emergency use authorisation (EUA), and an antiviral drug. Corbevax, by Biological-E, is a protein sub-unit vaccine as is Covovax, to be made by the Serum Institute of India. Both, however, differ in their manufacturing process. Covovax has already been approved by WHO under its Emergency Use Listing and will be available globally as part of the COVAX initiative to ensure that at least 40% of the world is vaccinated on priority. Molnupiravir, which was approved this month by the U.S. Food and Drug Administration, on the heels of Paxlovid by Pfizer Inc., is said to be a promising drug for those with mild and moderate disease and easily administered as a pill — its key selling point. Thirteen companies in India are set to make this drug. It has been approved for use under EUA for treating adults with COVID-19 “who have high risk of progression to disease”. Having more vaccines in the arsenal bodes well because of the uncertainties that the pandemic brings about. As of today, 90% of India’s adults have been inoculated with one dose and 60% with both doses.
•The experience with the new variant Omicron is that it is so infectious, it does not discriminate among the vaccinated and the unvaccinated, though severe disease and death is disproportionately among the latter. Here too, those who are above 40 years continue to be the most vulnerable. Despite three vaccines being available, India has overwhelmingly been reliant on Covishield and that is a matter of concern as a new chapter in the vaccination programme unfolds. The new directives say that “precaution doses”, which are third doses of the vaccines an individual has already been inoculated with, will be available for health-care and frontline workers and those above 60 with comorbidities. The 15-17 year age group will get only Covaxin from January 3. That several Indians have been exposed to a live infection in the second wave only improves the odds of protection. However, the only study on mixing Covaxin and Covishield — that resulted from a mix-up in Uttar Pradesh — showed that antibody levels were higher than two doses of either vaccine. A combination of Novavax and AstraZeneca (Covishield) was also effective in boosting antibodies, according to the COV-BOOST study in the United Kingdom. India’s top medical institutions must immediately test the feasibility of mixing all available vaccines so that these may be made quickly available if needed giving recipients the option of an informed choice. The second wave revealed a treatment fiasco with remdesivir — sans any therapeutic merit — that saw irrational demand and black marketing. While molnupiravir has many more manufacturers, it is important to ensure against hoarding or indiscriminate use given its potential side-effects.
📰 The efficiency myth of Aadhaar linking
The Government has made several dubious claims to push the Aadhaar project
•The Union Government hastily passed a Bill to link voter IDs with Aadhaar cards. Such arbitrary approaches without sufficient deliberation have become the norm, it seems. The Government claims that the move will prevent frauds and remove duplicate IDs. But as evidenced by a report by journalist Kumar Sambhav, such a move violates an individual’s Right to Privacy, enables voter profiling and excludes genuine voters — perils that have also been outlined in a statement issued by the Rethink Aadhaar campaign and endorsed by many organisations. Aadhaar was, among other things, purportedly meant to improve efficiency in welfare programmes. However, there are important lessons to learn from the dubious claims made by the Government in Aadhaar linking for welfare delivery which have a strong bearing on the new proposal.
Claims on shaky ground
•Cash transfers in many welfare programmes, such as payment of MGNREGA wages, are done using the Aadhaar Payment Bridge System (APBS). For this to work, it is mandatory to link workers’ Aadhaar with their MGNREGA job cards and their bank accounts where the Aadhaar number of the worker becomes their financial address. The Union Government has repeatedly made claims on savings in welfare programmes due to Aadhaar. These have been methodically debunked by Jean Drèze and Reetika Khera, among others. But the Government continues claiming that “the estimated cumulative savings/benefits due to Aadhaar in MGNREGA till March, 2021 is Rs 33,475 crores.” Two Right to Information responses seeking the methodology used to arrive at such savings are relevant. In a recent response, the Government said the “Ministry has been reporting DBT Mission on the estimated DBT savings under the scheme on the assumption that 10% of the wages in the year could be saved.” In an earlier response, it had said: “Savings are in terms of increasing the efficiency and reducing the delay in payments etc.” The savings due to Aadhaar, therefore, appear to be an “assumption” while the other claims are also on shaky grounds.
•Wage payment delays in MGNREGA have been persistent. An analysis of more than 18 lakh wage invoices for the first half of 2021-22 by LibTech India demonstrated that 71% of the payments were delayed (called stage 2 delays) beyond the mandated period by the Union Government. Nearly 7 lakh invoices in our sample were done through the APBS; 11.65 lakh were account-based payments where the workers’ name, account number, and the IFSC code of their bank were used to transfer money. Figure 1 compares the time taken by the Union Government (stage 2) in transferring wages for the two payment methods. The axes represent the number of days taken for two kinds of payments. The 45-degree line shows the percentiles of stage 2 for APBS and the dots represent the percentiles of stage 2 for account-based payments. When dots are below the line, the account-based payments are quicker. Barring a few cases, the dots are practically on or below the line. This is perhaps the first large sample empirical evidence demonstrating that the Government’s claim of Aadhaar having “reduced payment delays” is unfounded. Indeed, there is nothing inherent in the APBS that makes transfers faster.
•The government’s claims on “increasing the efficiency” is also questionable. Efficiency for whom and how is such efficiency related to accountability? Between 2015 and 2019, there was intense pressure on field-level bureaucrats to increase Aadhaar linking. A recently completed study of nearly 3,000 MGNREGA workers by Anjor Bhaskar and Preeti Singh shows that 57% of job cards of genuine workers were deleted in a quest to show 100% linking of Aadhaar with job cards. Doing such plastic surgery on numbers to show efficiency gains is unethical and sets a harmful precedent.
•Another key concern is the opacity surrounding APBS and the consequent dilution of accountability. Cash transfers through both the payment methods can fail. The most common reason for payment failures in account-based payments is when the account number of the worker in the system is incorrect. This can be rectified at the block. However, the most common reason for payment failures through the APBS is enigmatically called “Inactive Aadhaar.” This has nothing to do with an individual’s Aadhaar being inactive but happens when there is a software mapping failure with the centralised National Payments Corporation of India, the clearing house for APBS. Workers and officials alike are clueless on resolving these payment failures.
•Moreover, there are several cases of misdirected payments in APBS when the Aadhaar number of one person gets linked to somebody else’s bank account so her money gets credited to somebody else’s account. These are very hard to detect as these will appear as successful transactions on the dashboard. As per UIDAI, its functions include “setting up of facilitation centres and grievance redressal mechanism for redressal for grievances of individuals.” However, no such mechanisms exist.
Beyond technological alibis
•So, on at least three counts — timely payment of wages, efficiency gains and grievance resolution — there appears no basis to justify APBS in MGNREGA. These prompt us to move beyond technological alibis for good governance and emphasise the need for a push towards constitutional propriety and accountability for technologies. The mathematician Cathy O’Neil cautions us on how some algorithmic models and technologies for social policies can be at odds with fairness. She writes: “Fairness is squishy and hard to quantify. It is a concept. And computers for all their advances in language and logic still struggle with concepts… Programmers don’t know how to code for it...” Indeed, compromising on fairness, people were coerced into using Aadhaar which had no pilot or independent cost-benefit analysis. No feedback has been collected on the user experience of the recipients or from field-level bureaucrats. Further, it is time to overhaul the nomenclature for recipients of welfare measures. Calling them “beneficiaries” subtly transforms the state from being an institution meant to uphold constitutional rights to sounding more like a charitable institution. Instead, people should be referred to as “rights holders”. This will likely help us better interrogate whether technologies have imbibed democratic principles of transparency, accountability and participation.
•When Aadhaar’s use in welfare — for which it was purportedly intended — is itself shrouded in opacity, unreliability, and exclusions, we must be very worried if it is linked to voter IDs as it will further hollow out government accountability. It will fundamentally alter the citizen-State relationship. This must concern everyone as thousands of crores of taxpayers’ money have been spent on it. The Law Minister said that linking Aadhaar with voter id is “voluntary”. But given the prior experience of Aadhaar in other spheres, this will be another example of what Cathy O’Neil refers to as the “authority of the inscrutable.”
📰 A whiff of trouble in the Nord Stream pipeline
What was meant to be an ordinary energy project from Russia to Germany is now a powerful geopolitical tool
•It would be considered an ordinary gas pipeline were it not for the controversial nature of the project. Called the Nord Stream 2, it will spell a direct supply of natural gas under the Baltic Sea from the Russian city of Ust-Luga to the German city of Lubmin, avoiding transit through Ukraine and other European countries. However, the Ukrainian authority has called the project a ‘dangerous geopolitical weapon’. There is also strong opposition from the United States and most of the European countries (except for Austria, Germany, Hungary and the Netherlands). Their concern is that, once operational, the project would render more leverage and bargaining power to Russia while dealing with Europe and its energy market.
•Some political commentators share the view that Russia is trying to use Nord Stream 2 as a political weapon to put pressure on European security and ‘undermine the democratic resilience of European institutions’. At the same time, during the St. Petersburg International Economic Forum 2021, Russian President Vladimir Putin dismissed these concerns, saying that ‘Nordstream 2 is purely a commercial project, which is shorter, cheaper, and economically more viable, compared to the gas transit through multiple European countries’. Mr. Putin even went as far as calling opposing views as ‘foolish propaganda’.
Mounting complexities
•The construction of Nord Stream 2 began in 2015, when Russia’s main energy company Gazprom took ownership of the project’s operator, the Switzerland-based company Nord Stream 2 AG. The project was expected to double the capacity of the existing pipeline, Nord Stream 1, that had been operational around 2011-12. The estimated costs are around €11 billion, with the new pipeline stretching for 1,225 kilometres.
•Throughout its short history, the project has undergone a series of sanctions and controversies, morphing itself into the source of contention and political battleground. At the end of 2019, U.S. President Donald Trump had signed a law that imposed sanctions on any EU company that was involved in completing the Nord Stream 2 pipeline.
•The Trump administration feared that the pipeline would give Russia more influence over Europe’s energy supply and reduce its own share of the lucrative European market for American liquefied natural gas (LNG). Many European politicians, including then German Chancellor Angela Merkel, were opposed to the ‘extraterritorial sanctions’, stating that they were able to decide their own energy policies without an ‘interference in autonomous decisions taken in Europe’.
•In July 2021, the U.S. and Germany reached an agreement to allow completion of the Nord Stream 2 pipeline. Besides, the agreement aimed to invest more than €200 million in energy security in Ukraine, as well as sustainable energy across Europe, according to media reports. Earlier in May 2021, the Joe Biden administration decided to issue a national security waiver for the Nord Stream 2 AG, the major company involved in the construction of the pipeline. The main reason was apparently to restore trust and close cooperation between the U.S. and Germany.
Energy security dilemma
•According to data from 2015, Germany imported about 40% of natural gas from Russia, 29% from the Netherlands, 34% from Norway, with only around 10% from Germany’s own gas fields. According to a media report, about a quarter of Germany’s electricity now comes from coal, about another quarter from renewables, 16% from natural gas and around 11% from nuclear energy.
•The dispute over Nord Stream 2 takes place at a time when Germany has set out a plan to shut down its nuclear and coal power plants, with an objective of gradually moving towards renewable sources of energy. In order to fill the supply gap and diversify the sources, the country plans to build its first LNG terminal to receive gas from Qatar, the U.S., and others.
•This winter, Europe is facing a ‘perfect storm’ in its energy market, whereby wholesale energy prices have more than doubled in 2021, and there is a limited supply of fossil fuels altogether. Russia is blamed for an intentional decrease in gas supplies to Europe, aiming to speed up the controversial Nord Stream 2 gas pipeline by European Union (EU) market regulators. There is a ‘silver lining’ in the current energy crisis in Europe though, since it could provide additional incentives for green energy investments and production of green hydrogen.
Latest developments
•In November this year, Germany’s network regulator (Bundesnetzagentur) suspended the certification procedure for Nord Stream 2. In an official statement it said: ‘it would only be possible to certify an operator of the Nord Stream 2 pipeline, if that operator was organised in a legal form under German law.’ For practical reasons, Nord Stream 2 AG decided not to undergo a complete legal transformation, but establish a subsidiary under German law that would manage only the German part of the pipeline. The involved bureaucracy inevitably means further delays in project commencement as it requires re-submission of paperwork and a renewed certification process. In December, Germany’s energy regulator said it would not make a decision on certifying Nord Stream 2 until, at least, the second half of 2022.
•Meanwhile, tensions have been growing between Russia and the North Atlantic Treaty Organization allies, amidst fears of Russia’s invasion into Ukrainian territories and a replication of 2014 scenario. The new German Chancellor, Olaf Scholz, has inherited the Nord Stream 2 dilemma from his predecessor and will have to make difficult choices going forward. Some EU leaders have called for stronger actions toward the controversial pipeline from the government in Berlin, including its possible termination in the event of further military escalation.
•Thus, what was meant to be an ordinary energy project has transformed itself into a powerful geopolitical tool, available to every stakeholder involved, and even beyond.
