Events & Issues

New Delhi, 20 July 2020

Defection Definition

END THE UNCERTAINTY

By Dr. S. Saraswathi

(Former Director, ICSSR, New Delhi)

Raj Bhavans, the official residence of Governors, became the venues for protests by members of the Congress Party in many States on 27 July “to highlight the gravity of the issue and draw people’s attention to violations of the Constitution” in Rajasthan. What is happening in the State in the last few days reveals how complicated is the question of determining defection from political parties and various possibilities of using the law by diverse players.

This case started in the High Court of Rajasthan when the former Deputy Chief Minister Sachin pilot complained against disqualification notices issued by the Speaker to 19 rebel Congress MLAs.  In reply, the Speaker approached the Supreme Court with a special leave petition that a court cannot bar a Speaker from acting on disqualification notice even before a decision is taken. The Speaker later withdrew his petition.

The fault of the rebel members that earned them the disqualification notices from the Speaker was defiance of the whip issued by the Congress and failure to attend Congress Legislative Party meetings on two days. This team of Sachin Pilot challenges the notices and maintains that it is only seeking leadership change in the “most democratic manner.”

The ruling Rajasthan Chief Minister, Ashok Gehlot along with 100 legislators had reason to   stage a dharna on the lawns of Raj Bhavan in Jaipur on 24 July demanding convening of the Legislative Assembly primarily to prove his majority as there was open rebellion within his party. He did not succeed and ended the dharna after about five hours. A list of MLAs numbering 102 was submitted to the Governor as his supporters.

The CM met the Governor the next day and insisted on convening the Legislative Assembly session.  The Cabinet took the stand that the Governor had no discretion in the matter and had to follow its advice. Relying on the number, the CM seemed to be sure of majority support in a house of 200 to save his government and urged Governor Kalraj Mishra to convene the Assembly on 31 July.

Convening the Assembly session, fixing the procedures, and setting the agenda are normally in the domain of the Cabinet. The Governor, it is reported, initially questioned the necessity for floor test when the government was claiming the support of a majority in the House. The revised note of the CM to the Governor mentioned only the need for a special session to discuss the situation on COVID-19 and to introduce six bills and not floor test.

On 27 July, the Governor agreed to convene the Assembly on the condition that 21 days notice should be given to the members as per rules and social distancing norms must be followed. As floor test was not included in the agenda, short notice was not enough.

The legal course, neither in the State nor at the Centre was so far favourable to the Congress Party. The alternative, in keeping with the current trend in Indian party politics, is to take the fight outside the courts and on the roads.

To the BJP, which lost the General election and became the Opposition party in the State, the  matter reflects the internal conflict raging within the Congress and dharna  at the Raj Bhavan is   a “criminal act” under Section 124 of the IPC similar to “assaulting the President/ Governor with intent to compel or restrain the exercise of any lawful power”.

CM’s posture was the immediate response to the Rajasthan High Court direction to the Speaker  on maintaining the status quo on the disqualification notices he had issued to 18  rebel Congress MLAs and Sachin Pilot, under clause 2(1) (a) of the Constitution’s Tenth Schedule. The order itself had come after the Supreme Court refused to restrain the High Court from ruling on the matter on the plea of the Speaker.

The Tenth Schedule including para 2(1)(a) on freedom of speech, vote or conscience of elected members, which was validated by the Supreme Court in 1992, mentions two grounds for disqualification of  a member  – one, when he voluntarily gives up membership of the party; and the other, if he votes or abstains from voting contrary to any direction issued by his party, meaning if he violates whip. Pilot asks for deletion of this provision which is very widely construed and violates freedom of speech and expression and is not necessary to uphold the basic structure of the Constitution.

A judgement of the Supreme Court in 1994 has clarified that voluntarily giving up membership does not require a formal resignation from the party, but may be inferred from certain actions. It paved way for party action against members for having and/or expressing views different from that of the party or party leaders while remaining within the party. Party discipline overtook inner party democracy. 

This judicial interpretation was followed in UP in 2003 when 13 MLAs  of the BSP Party were disqualified for supporting SP chief to form the government as against their leader’s advice to dissolve the Assembly. It was an inference by the court that the action of those MLAs was a proof that they had voluntarily given up their membership of the BSP.

This provision has remained a contentious issue ever since it was written. Even courts have taken varied stand on what constitutes defection. In Karnataka,  the Speaker’s order disqualifying 11 BJP MLAs who approached the Governor for removal of the CM of their own party was set aside by the Supreme Court in 2011 as they had not resigned from the party, but only seeking leadership change.

The High Court of Rajasthan, in the present case, rejected two pleas by the rebels – one, to uphold their status as MLAs, and the other, to declare their boycott of CLP meetings as outside the purview of Anti-Defection law. Another petition to make the Centre a party to the case on the ground that the constitutional validity of Schedule 10 was being challenged was admitted.

Thirty-five years have elapsed since the Anti-Defection Schedule was adopted, but still we are not definite about what actions are to be construed as defection. Like the Reservation policy, defection is a headache to courts.

This Schedule is different from other parts of the Constitution which provide the fundamental law or instrument of government, and various organs of the supreme power in the State – the legislature, the executive and the judiciary and their relations with one another. It was added as a remedy to check frequent movement of members (described as “Aya Ram and Gaya Ram”) between parties thus destabilising governments for the advantage of parties and individuals. Its origin lies in political party behaviour and not in constitutional need. Its use has also been shrouded in the politics of political parties necessitating frequent interpretation by the courts.

Uncertainty over the definition of “Defection” must be ended and the sphere of discretion given to constitutional authorities must be clarified.  Scope for inner- party democracy and freedom of opinion and expression of party members have to be protected as an essential preliminary for democratic freedom and rights for all in the society.—INFA

(Copyright, India News & Feature Alliance)

Open Forum

New Delhi, 29 July 2020

Struggling MSMEs

GROWTH POTENTIAL UNTAPPED

By Dhurjati Mukherjee

The MSMEs sector, regarded as the growth engine of the Indian economy, is contributing 5 per cent of the GDP. But due to the prolonged slowdown and the pandemic, most of the small and micro enterprises are struggling given the recession in demand. Worse, of the over 55 to 58 million Micro, Small & Medium Enterprises only 8 million are registered! The need for reviving this sector has been a big challenge for the government, which has grown manifold within the past over four months.

The promotion scheme announced for these enterprises in the Atmanirbhar Bharat Abhiyan would obviously encourage a number of unregistered units to approach government for enrolment. However, the Prime Minister’s programme to help small businesses back on their feet through $40 billion of government guaranteed loans is being considered too little. It may not be enough to save many companies in the sector. Around 85 per cent of MSMEs depend on informal sources of credit and funding this huge a percentage obviously requires more funds. 

Fortunately, the World Bank has stepping in, giving $750 million package for medium and small enterprises in India, severely impacted by COVID-19 and the lockdown. The MSME Emergency Programme is intended to support incremental flow of finance to MSMEs and address the immediate liquidity and credit needs of some 1.5 million enterprises in the category. “The MSME sector is central to India’s growth and job creation and will be the key to the pace of India’s recovery, post COVID-19”, stated the Bank’s Country Director Junaid Ahmad. This funding will support the government’s initiative to protect the MSME sector by unlocking liquidity, strengthening NBFCs and small finance banks and enabling inclusive access to financing.

However, a major section has been reluctant to go in for new debt and would have preferred the government cutting the goods and service tax (GST) or waive off interest on previous loans. In a letter to the Prime Minister, the Consortium of Indian Associations has stated that nearly 35 per cent of the 650 million small businesses across the country could shut down in the absence of government support. And though government is pressurising to dole out loans, businesses aren’t coming forward as demand remains tepid. Another aspect of the loan scenario is that lenders are either asking for increased paperwork or those in desperate need are being deemed ineligible.

Six out of 10 MSMEs in the creative sector – advertising, publishing, design and performing arts – have stopped functioning due to COVID-19. Over 50% of event management companies have seen 90 per cent of their work cancelled during lockdown. A study titled ‘Taking the Temperature Report’ released on July 7 provided a snapshot of the situation beginning March-end till June-end. The data across found that MSMEs and self-employed groups make up 88 per cent of the sector and have been worst affected.  

Though the lockdown started from March-end, the slowdown, which affected mostly the small and micro enterprises, had started since last August. The revival of these units is a big challenge--primarily due to cost factor, their products are not competitive and cannot compete in most sectors. Besides, they are also lacking in terms of quality and reliability.

Though government has reposed lot of faith in these small enterprises their becoming productive and competitive is in a haze. To start with, there is need for guidance from the government – not just on finance – but possible areas of diversification in manufacturing and providing technology partners. These could include assistance in foreign tie-ups for technology support.

The Ministry of MSMEs had developed around 25 Technology Centres (TCs), of which 15 are expected to be operational shortly, but there is definitely need for more. These Centres play a vital role to assist MSME ventures via access to advanced technologies, technical advisory support and talented labour which offers technical skill development to youth at different levels extending from school dropouts to graduates and engineers. These Technology Centres provide a variety of training in various fields such as Diploma in Tool & Die Making, Advanced Embedded Technology, Artificial Intelligence & Internet of Things, Fragrance & Flavour creation, Footwear Manufacture and Design, etc.

What is a vital development is the government’s resolve to give more orders to these units. Plus, Amazon has reportedly decided to invest $1 billion in digitizing small and medium businesses in India and expected to export Indian made goods worth $10 billion by 2025. These, however, may not be sufficient as units do want to emerge big and strong. What is necessary is to equip them, specially with the right technology, which could be made available from the IITs and other organizations engaged in industrial research and development.

It needs to be noted that manufacturing technologies in each and every sector has to be formulated through an action plan, which should be set up at the national level. Mere slogans of self-reliance by political leaders would be of no value unless effective measures are taken by the government in consultation with the chambers of commerce and experts drawn from industry and research organisations.

The fact that needs to be remembered is that these enterprises account for 33 per cent of merchandise exports and thus technology and financial support at this time is imperative. Foreign-tie-ups are essential to upgrade quality of products and also ensure large-scale marketing in different markets.

However, it can also be said that despite numerous roadblocks, the SME sector has performed well in the country. There are distinct barriers to innovation, the most important of which seems to be government policy. While it does aim to facilitate growth of SMEs by promoting various schemes and programmes to facilitate innovation through its distinct institutions, impetus needs to be given to evolve a realistic action plan in consultation with experts and State governments. The scale of operations in both public labs and private research institutions need to be revamped for greater outreach and support.

Another major aspect which needs attention is that programmes such as Cluster Development, need to be expanded to provide greater access to more individual firms within the cluster. Modernisation and technology upgrading along with innovative methods of capacity building and marketing of products are necessary. Finally, a holistic and separate innovation policy for the SME sector can also be made to promote innovation. The onus lies on the government, which needs to prove its resolve of self-reliance through effective development of the small and micro sector.---INFA

(Copyright, India News & Feature Alliance)

New Delhi

27 July 2020

Political Diary

New Delhi, 28 July 2020

Flooded & Submerged

TOH? KI PHARAK PAINDA HAI!

By Poonam I Kaushish

Ok, fellow countrymen let lose the volley of expletives, curse all you want. Deadly Covid 19 is growing exponentially, China has dug its heels in Ladakh and the Congress-BJP battle it out in  Rajasthan. Alas, if only curses could put an end to our miseries one would have no regrets. But year after year, our annoyance falls on deaf ears. Whoever said when it rains miseries, it pours, was dead on!

In summer many parts of India was in the doleful throes of drought, come monsoon heavy rain changed that to devastating floods in much of north, west and south. Killed over 3,500 people displaced 5.9 million people in Assam, 4.7 million in Bihar with over 300,000 now living in relief camps in both States, affected 150,000 in UP and another 100,000 in Kerala relief camps even as heavy rain lashes through West Bengal, Andhra, Karnataka, Odisha, Gujarat. and Maharashtra. Bringing life to a virtual standstill. 

Millions of words have been written and millions more will continue to be written. But it’s like water off a duck’s back. The basic question is: Does anyone really care?  Not at all, given that cloudbursts, landslides and flash floods are an annual affair wherein thousands die, lakhs are rendered homeless and property worth crores is lost.

Oh, so predictable is our netagan’s response: an annual nautanki, yawn. Everyone goes through the stereotype motions --- deluge and relief are freely bandied about. Prime Minister Modi announces compensation and Chief Ministers follow. The Government sets up a crisis management team. The State Government seeks Central relief. Babudom analyses the flood situation and its aftermath over official lunches. Their ideas and remedies as water-logged as the floods under discussion. Everyone is satisfied that they have done their bit for the nation. This is our India.

Everything is kaam chalao! See the absurdity—food grains and fodder arrive at their destination days after the calamity has struck, thanks to cumbersome bureaucratic procedures. Rations are air dropped. Never mind if half land in water and the remaining spark off food riot and killings.

Funds are doled out from the Calamity Relief Fund. Little realizing that instead of helping the people, most State Governments use this for purposes other than disaster management or to create infrastructure for which money is provided in the regular budget and nor do the State Disaster Boards implement any project properly.  

Why do politicians always measure the problems in monetary terms? How does a problem get solved by the monies sanctioned by them? Why is it assumed that one who sanctions hundreds of crores has done more for floods than another who sends only a couple of crores. Who will be held accountable for the Administration’s ineptitude? And which head will roll?

Moreover, why do our netagan prioritise floods only at crises time? Why is so little done to develop are long-term responses not developed to what is an annual expected problem? Tragically, exposing the political and administrative callousness towards human life Remember, similar floods struck Kerala in 2018, Gujarat 2017, Chennai in 2015, Uttarakhand and Srinagar 2014, Delhi 2013 and Mumbai in 2005. 

According to the National Disaster Management Authority around 40 million hectares of land is exposed to floods (12% of the country’s total land area), 68% is vulnerable to droughts, landslides and avalanches, 58.6% landmass is earthquake-prone, and tsunamis and cyclones are a regular phenomenon for 5,700 km of the 7,516-km long coastal line. Such vulnerable conditions have placed India amongst the top disaster-prone countries.

In fact, India is the 14th most vulnerable country in the world, due to extreme weather-related events states the 2019 Global Climate Risk Index Report with floods being the most frequent disaster accounting for 52% of the total occurrences of calamities, followed by cyclones 30%, landslides 10%, earthquakes 5% and droughts 2% losing around 2,736 lives in 2017. In spite of India being a signatory to the UN’s Sendai Framework for Disaster Risk Reduction, little has changed on the ground.

Primarily because flood policies are based on the assumption that flood disasters result from nature's actions and are not man-made. Whereas, in actual fact the damage and misery are mostly caused by human error. Mainly, poor land management and myopic flood-control strategies.

World Bank analysts aver that though weather forecasts are more accurate now, dam managers, read bureaucrats, are reluctant to authorise advance controlled releases as operating schedules usually specify that dams must be filled up as soon as possible and must be full by the end of the monsoon. While the world has moved to dynamic reservoir operations based on weather forecasts, our dam managers are reluctant to risk their careers and order controlled releases in advance, barring Bhakra dam.

Further, the frenzy of ill thought out development has also worsened the impacts of the intense rainfall. In the western Himalayas, for instance, there has been a massive thrust in building infrastructure that has put enormous pressure on the region’s natural environment. Further, despite warnings of endangering the fragile mountain ecosystem, the Government has embarked on the contentious Char Dham highway project to connect four Hindu shrines in the Uttarakhand.

Alongside, India’s infrastructure for disaster preparedness is deplorable. Worse, the Government seems to be in denial.  Asserted Environment Minister Javadekar, “The climate in various parts of the world is changing, but it would be wrong and unscientific to attribute the current flood situation to climate change.” Environmentalists have cautioned against massive road and tunnel-building projects in Himachal and Uttarakhand.

Shockingly, in a nation natured on short cuts and quick-fix solutions, none is willing to learn the ABC of disaster management or finding lasting solutions.  It’s not that they have to look far. If there are trees, plants and open areas around, rain water will be absorbed by the Earth, but if we continue to build concrete jungles, flooding should not surprise one.

Consequently, in a milieu of criminal casualness by the Government the time has come for a course correction. But first the Government must recognise the problem, implement basic suggestions and developing long-term responses. Robust Central and State coordination and cooperation both pre-and post-disaster, along-with a better disaster management policy, is essential to mitigate disaster fatalities across States.

Two, need for higher public expenditure towards disaster resilient infrastructure: construction of dams and drainages and for protection of river embankment and canals. Three, installation of advanced disaster warning systems, particularly in low lying areas, that are accurate in predicting rainfall in coastal areas.

Four, prioritise buffers, flexibility and adaptability. This includes reviewing safety criteria of dams and canals, re-building these with higher safety factors, creating new intermediate storages, and introducing dynamic reservoir management. Finally, we must reduce the vulnerability of the poor who pay a disproportionately higher cost in calamities.

In the ultimate, our leaders need to pull up their socks and put an end to their reckless drift. There are no short-cuts possible. It is high time no-nonsense Modi ensures his Administration lives up to expectations. Unless our netas shed their inertia and focus on long-term rather than short-term planning to change the way development is carried out, the damage from extreme weather events will only be magnified.

How long will people stand mute testimony to a callous and selfish polity and administration bereft of cure and consolation. And how long will they pray to Lord Indra that disaster doesn’t strike in their region. Remember, life is not about collating numbers, but flesh and blood with beating hearts. Neither is the aam aadmi is not a sterile statistic to be manipulated at will. ----- INFA

(Copyright, India News and Feature Alliance)

Economic Highlight

New Delhi, 27 July 2020

Farming Trade Ordinance 

SCRAP IT, MAKE FARMER KING

 By Shivaji Sarkar

Indian agriculture is a complex mix. It has myriad problems and the solutions suggested are often not practical. Interestingly, the largest beneficiaries of the food dole to 80 crore poor are the producers of the food grains!

It is a dichotomy. Often, in terms of agriculture, privatisation, private investment and handing it over to private hands become the policy plank. More this is being discussed and “reformed” through ordinances, the government is getting enmeshed in it by direct benefit transfers, Rs 6000 pension for farmers and dismantling their mandis (local wholesale markets) under the agriculture produce committees (APMC), easing Essential Commodities Act and facilitating contract farming.

There is apparent policy confusion. The first major agriculture reform was the Green Revolution, creation of mandis and setting up the Food Corporation of India (FCI) for procurement, creating buffer stock and distribution. It has its pluses and some minuses too. Except at purchasing level, the government is not involved.

Farmers still are making their own investments, may be now through bank support extended by the kisan credit card or simply bank loans. Government institutions selling seeds, fertiliser or other support do it at commercial rates and a bogey had been created that the farmers are dependent on the government. The mandis despite many flaws served them well and assured payments. The mahajan (money lender) system popularly enshrined by cinematic character Sukhi of Mother India found their roles limited, but not eliminated.

The Sukhis are still there for smaller tillers who still do not find it easy to have bank support. The new ordinances are euphoric about a pan-India market – a complex and expensive system, “larger” involvement of private sector, a euphemism for multinational involvement in the farm sector, which is operating for almost two decades through various “cash and carry” wholesale trade across the country. Some Indian firms too have entered the scenario. In Kashmir, some companies have monopolised the apple trade through their leased orchards; in other places motley groups manage partially grape, orange, mango and spices trading.

Many have emerged as parallels of FCI. But farmers have concern. They become their pawn and alternative support is difficult once a contract is signed. The ordinances for demolition of this alternative are concern for many farmers’ organisations. Again it is all private investment that most official functionaries take pride in. That is the plus and minus. The plus is “investment”. The minus is it creates a larger chunk of farmers looking for direct government support for their survival.

The COVID-19 lockdown has opened up the chinks. The government is trying to correct it through enormous stock, it built in FCI warehouses through the years of toil. It is distributing food grain worth Rs 1.5 lakh crore for free till at least November 2020, from April onwards for over 60 per cent of the population.

Despite years of deliberations, the nation has got into the same quagmire of government support to farming instead of promoting individual farmer’s capabilities to be self-sustaining. The APMC mandis have flaws though it is a robust system. Since it is still an ordinance, the policy makers need to relook for removing the flaws but prevent its demolition. The ordinance should for now not be enacted into statutory law.

Over the years corporate cartels have created lobbies to control the base of Indian economy – agriculture. It is profit-oriented, not a bad word, but at the cost of sustenance of the farming community. The farmers need monetary support all through the year. They need small credits. This is provided by the buyers at the mandis and adjusted against the final sales. The payments to farmers are assured in the system. Yes, this creates a kind of bondage too. There are instances of it being exploited as well.

The pan-India market is there in the mandis as well. Many farmers have taken their produce from Punjab to sell at Bihar mandis for better price. The present ordinances try to legalise that but creating monolith of large corporate players. Politically it suits various operators as election funding in bulk is assured. Practically, the nation is creating convoluted system, where the involvement of the government at micro level would increase.

Economically and financially it may be populist but certainly not profitable either for the farmers or the nation. There is another apprehension. Sizeable sections of the farmers may be controlled through Vikas Dube-type goons creating severe law and order issues – in short perpetuation of more powerful Sukhis and dumping more costs on the State.

So India neither needs a full corporate system, nor full privatisation nor full government involvement. Agriculture remains complex. Giving it to the corporate may have long-term impact on food security about which the nation has false sense as granaries overflow as per 1960s model.

India has gone far ahead of it. Now the farmer is not just food grain producer. He produces poultry, meet, dairy products, vegetables and fruit. He has yet to grow into nutrition supplier – the next level – to have a healthier nation.

Farmers will need to be supported – through finance or credit, policy interventions that turn them into competitors by increasing their power to sustain. The potato, tomato or onion farmers have none of it. The government needs to set up monitoring systems with able experts from the community, market experts and scientists. The fluctuation in production from high like potato in 2019 to low now or low production of onion in 2019 to high now cause price crash or volatility. A perspective plan in each such crop will remove the need for seeking government support. Crop production needs zone wise planning.

The MNREGA, subsidies, doles cannot be permanent solution – economic, financial or political. The combination has created severe dependence on the government. Indian agriculture has remained in the private sector and will remain so. But through judicious planning, advice and policy intervention, individual farmers have to be empowered to create a national syndrome of independent entrepreneurs.

The NDA-II under Narendra Modi has array of experts and visionaries. It needs to put them together to evolve a farming that would be strong and other sectors dependent on it. The government should remain an observer but not a direct player. And for now let us redo the three June 5 Ordinances for a better future. ---INFA

(Copyright, India News & Feature Alliance)