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Record Diwali Sales: EXPORTS TO GERMANY RISE, By Shivaji Sarkar, 20 November 2023 Print E-mail

Economic Highlights

New Delhi, 20 November 2023

Record Diwali Sales

EXPORTS TO GERMANY RISE

By Shivaji Sarkar 

India’s imports are growing, exports are slowing but domestic sales during Deepavali touched a record Rs 3.75 trillion, according to the Confederation of Association of Traders (CAIT). Besides, with some more regional festivities such as chhathpuja it may add another Rs 50000 crore sales. The All-India Jewellers and Goldsmiths Federation National says that on Dhanteras, about 41 tonnes of gold and about 400 tonnes of silver jewellery and coins were sold in the country. In value terms, the total turnover of gold, silver and other items was Rs 30,000 crore. 

Even passenger vehicle sales have gone up by about 21 percent on the back of deregistration of fine working personal cars though these don’t add to pollution. Maruti alone is stated to have sold over 55,000 vehicles. So did the tractors, suggesting a new-look agriculture.This is despite the rising food prices, posing threat to the Reserve Bank of India’s (RBI) commitment to align headline inflation with the 4 percent target as state in its‘State of the Economy’ report. 

Rising food prices pose the sole threat to the RBI’s commitment to align headline inflation with the 4 per cent target, according to the central bank’s report. One particular aspectwhich is troublesome is the vegetable inflation averaging 5.7 percent from fiscal year 2020 till now (2023) compared to a virtual zero between 2016 to 2019. Occasional rises have been much higher. 

While this phenomenon along with some external developments are pushing the rupee down vis a vis the dollar, it has added to another problem of shrinking goods exports for the seventh time in August while imports surged to hit the highest level since March this year. At $58.6 billion imports were 5.2 percent below last year’s level but exports fell higher by 6.9 percent leading to $24.2 billion trade deficit, the widest since October 2022. In September, imports at $68.75 billion, less than $79.64 billion a year back and were again higher than exports at $ 63.84 billion against $64.61 billion the previous year. 

But India may be doing better in individual country terms. A German government report says, a rapidly growing India became more important for Germany. Goods to the value of 8.7 billion euros, 1.7 percent higher were imported from India to Germany from January to July 2023. Accounting for 1.1 percent of total imports, India ranked 23rd among Germany’s major suppliers of goods. Among the non-EU countries, India ranked ninth. 

Goods exports are down 11.9 percent and imports dipped by 12.1 percent. In short, it affects foreign currency earning, which remains at a level of Rs 83 or below. This makes imports more expensive and that pushes up the inflation RBI struggles to keep in check. 

Services exports and imports too were hit. In September, services exports witnessed a year-on-year decline of 2.7 percent at $ 28.42 billion, Simultaneously, services imports decreased by a sharper 10.3 percent at $ 14.59 billion. This is an indication of the economy at the domestic front. It means the overall activities in the economic sector is coming down. Shrinking services exports imply that their ability to bridge the goods trade deficits that were significant last year, will be restricted. This could lead to wider current account deficits. 

It can impinge on the budgetary process that begins at this point of time. This will be significant for an election year provisional central budget. The 2023-24 budget allocated, like the previous year, higher infrastructure expenditure hoping faster growth. It will be challenging for the economy. Not all expenses may be justified like demolitions of many office buildings, which could have stood the test of time. World over traditionally such buildings are refurbished and maintained instead of demolitions. Iconic structures like the National Museum are also being axed. These add antiquity value to historic cities.

 It appears that the domestic purchasers would be greasing the economy instead of external sales. This year’s domestic figure at Rs 3.75 trillion is far higher that the retail business of Deepavali 2022 at Rs 1.5 trillion. Gold sales spiked by 20 percent almost like the last year.

The peculiar factors of the economy need to be decoded. Festivity sales are rising every year despite the rise in inflation and moderate job scenario. This year overall many farmers dealing in potato and other vegetables had less income even as onion, tomatoes, cereals, and pulses prices surged. The RBI is watching keenly the November and December market trends. 

Despite inflationary situation the rise of sales of goods and commodities suggest that even the not so affluent keep the wheels of economy moving. Festive sales are seasonal but whether such trends would sustain the economy or not is yet to be proven. This definitely gives a boost to the entire economic sector, including travel, transport and hotels. Large movements generate enormous opportunities. 

An increase in inflation rate leads to a decrease in the household consumption as per the traditional theory. How the festive sales surge remains to be unfolded. The credit card sales have also gone up 17 percent in October and a bit more in November. Overall estimates show credit card sales of Rs 29,000 crore. There is a catch. It may be part of the total purchases by the consumers. But the sales surge also has another blue. It has been observed that credit card defaults too increased. 

It has been observed that from around 70 percent as a share of GDP, the share of private consumption expenditure (PFCE) has gone down to 58.5 percent. Aniket Dani, director, research, CRISIL Market Intelligence says the self-employed witnessed degrowth of 3 percent in their income during the last one year. Inflation during this period remained at 6 percent, suggesting loss in income. The low-income group bore the brunt. 

The growth in sales may not encompass all sections. At the macro level slowdown is evident. Chief Economist, Motiwal Oswal Financial Services Nikhil Gupta says that when saving continue to fall, income growth lags consumption growth. So, all that glitters may not be gold. Diwali sales may have boosted a large part of the market but its general impact on the economy is yet to be observed.---INFA 

(Copyright, India News & Feature Alliance)

 

TN Governor-Govt Rift: BILLS RETURNED, GETS WORSE, By Insaf, 18 November 2023 Print E-mail

Round The States

New Delhi, 18 November 2023 

TN Governor-Govt Rift

BILLS RETURNED, GETS WORSE

By Insaf 

Governor-government tussle in Tamil Nadu’s is getting worse. On Thursday last, Governor RN Ravi returned 10 pending bills to the ruling DMK government. Within hours, a special session of the Assembly has been called on Saturday (today) and according to Speaker M Appavu these Bills, including the power of the state government to appoint university VCs, one on anti-corruption measures and early release of prisoners would be taken up. Apparently, the Raj Bhavan has chosen to ignore the Supreme Court’s ‘serious concern’ a few days ago about Governors not acting on Bills. Or would it argue, it hasn’t sat on these and acted promptly by returning them? Whatever inferences are made, the big question is Ravi’s action triggersa constitutionaldilemma. Once the Assembly passes these Bills again, Ravi will be bound to approve them, says Appavu. However, recently at an even at Raj Bhavan, Ravi had said if a bill doesn’t get his assent, it means that the bill is dead.While that needs to be watched, the sheer returning of the Bills en masse puts the spotlight about his role and powers. Is he over stretching it? For while, a Governor is expected to approve Bills passed by Assembly, returning these, raise questions about the balance of power between the state and the Central authorities. In this case, there is need to set that glaring imbalance right. Enough is enough.

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Muscle & Money Power

The Election Commission has a long way to go before it can rein in ‘money and muscle power’ in elections. Details of candidates in Madhya Pradesh and Chhattisgarh Assembly polls are the recent most examples to confirm the misgivings of the democratic system being ‘free and fair’. As per Association for Democratic Reforms data, of the 2,534 candidates in MP, where polling took place on Friday last, 472 candidates have declared ‘criminal cases’ against them: Congress (291), BJP (65), AAP (26), SP (23), BSP (22) and Independents (215). Worse, 291 have declared ‘serious criminal cases’: Congress (61), BJP (23), AAP (18) and BSP and SP both 16 each, Ind (157). In Chhattisgarh, which too wrapped up its 2nd phase of polling it’s no different: of 958 candidates, 100 declared criminal cases: 13 of Congress, 12 each of BJP and AAP, JCC-J, 12, BSP 2 and Ind 50. Of the 56 ‘serious criminal cases, Congress has 7, BJP and JCC-J 4 each, AAP, 6, BSP 1 and Ind 34. Next is the ‘crorepati’ list in MP which reveals 727 are in the fray: 200 fielded by BJP, 196 by Congress and rest belong to other political parties. In Chhattisgarh 253 crorepati candidates are contesting: 60 candidates by Congress, 57 by BJP, the rest from other parties. People’s representatives, is what they are known as?

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Now Bureaucratic Scam

All eyes are on the latest rift between the Delhi government and the Centre. On Thursday last, Delhi vigilance minister Atishi wrote to the ED and CBI, seeking a probe into Chief Secretary Naresh Kumar viz alleged financial irregularities in the acquisition of land for the Dwarka expressway. The scam has led to Chief Minister Arvind Kejriwal writing to LG Saxena recommending Naresh’s immediate removal and sending the 670-page to CBI or ED for further investigation.Atishi has said the investigation found that the Chief Secretary benefited a company linked to his son with over R.850 crore of “illicit profits”. “A clear nexus has been found between Naresh Kumar, his son Karan Chauhan and the beneficiary land owners who were provided a windfall gain of Rs.897.1 crores at the cost of public exchequer...” it read. She also recommended removal of Divisional Commissioner Ashwani Kumar to ensure a fair investigation. Expectedly, Naresh has denied all charges, claiming he was being targeted for ordering probes into several cases, including Kejriwal’s home renovation and alleged excise policy scam. Be that as it may, the truth must come out and not be pushed under the carpet as one of the ongoing brawls the ruling AAP has with the Centre over control of the bureaucracy.

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Tunnel Tragedy & Warning

The Silkyara tunnel tragedy in Uttarakhand, trapping 40 labourers sadly reinforces the government brazenly ignoring the eco-warning time and again. The tunnel near Uttarkashi, whose portions caved in on Sunday last is part of the controversial Rs 12,000-crore Char Dham all-weather road project involving four-laning of hillside highways. These mountains said Minister of State of Road Transport and Highways V K Singh ‘are young and fragile…according to data, it (tunnel) was stable for four-and-a-half years. But for some reason, the cave-in occurred.” Absurd, to say the least as the government and National Highways & Infrastructure Development Corporation Ltd failed to heed to environmentalists and scientists’ warning that excavating such highways and building many tunnels in the name of development of backward regions is a recipe for engineering disaster at high altitudes. ‘For the future, we will review wherever such tunnels are being constructed,” was Chief Minister Pushkar Singh Dhami response to not heeding to warnings and playing around with the fragile ecosystem in the Himalayas. No solace for the families of the labourers.

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Southern States Firm

Five southern States have forced the National Medical Commission to put on hold its decision to limit number of MBBS seats to 100 per 10 lakh population in every State.On Wednesday last, the apex medical education regulator announced that these “Guidelines for undergraduate courses under the establishment of new medical institutions, starting new medical courses, increase of seats for existing courses, and assessment and rating Regulation 2023” will now be implemented for 2025-26 academic year, only after there’s consensus following further stakeholder consultations. While the restriction would have allowed 40,000 more MBBS seats in states such as Bihar and Jharkhand, where there’s over 70% deficiency as per new seats-to-population ratio norm, the States of Andhra Pradesh, Tamil Nadu, Karnataka, Telangana and Kerala, would have been barred from raising their medical seat capacity, which they all plan, for the next academic session (2024-25), as these have already exceeded the ratio. The Commission must tread carefully for not only States, but students too mustn’t be penalised!

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Curbing Female Student Dropouts

Three cheers to the Supreme Court! It has sought to ensure that adolescent females between 11-18 years, hailing from poor families, don’t drop out of schools because of lack of basic facilities such as toilets and sanitary towels. It has asked the Centre to put down a “national model for ratio of number of girls’ toilets per female student population across government-aided and residential schools in the country”, before finalising the draft National Menstrual Hygiene Policy, 2023. Besides, it must bring about uniformity in modalities to be followed for distribution of sanitary napkins by considering practices followed in States. The top court was dealing with a PIL seeking free sanitary pads to every female student in classes 6-12, separate toilets for females in all government-aided and residential schools and awareness programmes on maintenance of toilets and spread of awareness. Earlier, it asked the Centre to engage with all State governments and UTs to ensure a uniform national policy is formulated with sufficient leeway for them to adjust based on prevailing conditions. This would aid the National Health Mission steering group to reevaluate national guidelines. Sooner the better.---INFA 

(Copyright, India News & Feature Alliance)

 

 

 

India-China Relations: THE INTERNATIONAL CONTEXT, By Dr DK Giri, 17 November 2023 Print E-mail

Round The World

New Delhi, 17 November 2023

India-China Relations

THE INTERNATIONAL CONTEXT

By Dr DK Giri

(Secretary General, Assn for Democratic Socialism) 

Like many other countries, mainly the world powers and the aspiring ones, India’s foreign policy is presumably undergoing intense engagement in current international issues. Two surprising and shocking developments – the war in Ukraine over a year and the fighting in Gaza Strip over a month – have caused realignment in international politics. Foreign policy in India does not draw enormous public attention which it should as the Prime Minister wants to play the world role and wishes India to become ‘Viswa Guru’(world leader). Public response currently is even less as the whole political leadership is engaged in elections in five States. 

Interestingly, what is missing in the current debates on the wars between Israel and Hamas and Russia and Ukraine is the attitude and alliances of China which have undoubtedly a strong impact on India. On the Ukrainian war, India has sought to be neutral whereas China tacitly supports Russia. On the war on Gaza Strip, India has clearly sided with Israel on the issue of terrorism and with Palestine on humanism as the civilians continues to die and suffer. In the conflicts in the Middle East including the ongoing war, Iran is the villain of the piece. Israel has been openly calling out Tehran for instigating jihadist attacks on Israel for quite some time, not just on 7 October. Tehran has been patronising and instigating Hezbollah based in Lebanon, Hamas in Gaza, Houthis in Yemen, ISIS in Iraq and Syria and so on. 

Around these ongoing wars, the changing configuration of world powers is being increasingly evident. Iran is snuggling up into the axis of China and Russia. Iran has just signed a 25-year Cooperation Programme or Comprehensive Strategic Partnership with China since 2021. This agreement puts a spoke in the wheels of India-Iran relations, which was already largely derailed by sanctions imposed on Tehran by the United States. The much-awaited Chahbahar Port which was linking India to Central Asia through Iran is on logjam. Iran will not easily reconcile to India being a part of I2U2 – the partnership involving India, Israel, UAE and the United States. 

Obviously, it will be naïve to assume that Beijing is indifferent to the serious developments in the Middle East if not instigating it through Iran. It is an open secret that Iran was perturbed by the prospect of Saudi Arabia and Egypt having formal relations with Israel like other Middle-Eastern countries have done. The 7 October terrorist attack was launched to derail the process of formalisation of Saudi Arabia and Israel bilateralism. 

Where does the China angle in the current international politics place India? New Delhi cannot be indifferent to Chinese moves on the chess board of international politics as New Delhi is the prime target of Beijing. Indian foreign policy makers cannot ignore China’s ‘art of war’ against India. Let us remember that ‘The Art of War’is China’s hallowed strategic manual which steers China’s relationship with India, written by Sun Tzu, a military General of the Wu nation of mainland China about 2500 years ago. ‘The Art of War’ is a manual of how to deceive and defeat an enemy in a planned way. Beijing has been applying the strategies from this book in its bilateral relationship with India. 

Seven decades ago, Chou En-lai deceived Prime Minister Nehru before launching a full-scale war against India in 1962 on the border question. Beijing manipulated Nehru while annexing Tibet in 1950, got the better of Nehru’s insipid approach during the India-China negotiations on Tibet between 1951-54, he declined the US offer to India to become a Permanent Member of the UNSC and instead gave it away to China, and his disastrous presentation at the India-China Summit in 1960, New Delhi on the border question. 

From that Summit, Chou En-lai inferred that Nehru did not know where exactly India’s border in the Himalaya’s lay. He went back to Beijing and sent his army to incrementally occupy Indian Territory quietly all along the 3,225 kms long Himalayan border which culminated in India-China war in 1962. By the time China panicked hearing on 20 November 1962 that the British and US air forces were going to pound China in support of India, China declared a unilateral ceasefire on 21 November 1962. Alas! By that time China had already annexed about 45000 sq kms of Indian Territory, all along the border from Ladakh to Assam, including the strategically important Aksai Chin, in Ladakh, which itself was about 38000 sq kms. That was the time when the Indian Army was totally unprepared for a war with China. 

Fast forward, if Chou En-lai took ten years to ‘know’ Nehru, the current Chinese President Xi Jinping took only five years to “know” Prime Minister Modi in the sense of Sun Tzu’s The Art of War. Recall that Xi Jinping chose to call at Modi’s private home in Gujarat, met his aged mother and went to the extent of swinging with Modi at latter’s home. Later on, they were strolling in a lighter and relaxed mood in Mahabalipuram and Wuhan; I call it ‘swing and stroll’ diplomacy. But sadly, while President Xi was dining and swinging with Modi, Chinese troops were occupying at tri-junction point in Doklam. Furthermore, Xi Jinping was fostering anti-India feeling among India’s neighbours --Pakistan, Nepal, Sri Lanka, Bangladesh and Maldives. China helped Pakistan to build up nuclear weapons against India. 

It appears that the Chinese leadership has deceived Modi again as is evident from their aggressive incursion into Indian Territory in the Galwan Valley, Pangong Lake and around, in violation of the agreement to preserve tranquillity in the Line of Actual Control (LAC) in the Himalayan border. Modi made it worse for India by asserting that, “No one has intruded into Indian soil” which also implied legitimation of all 45000 sq kms of Indian Territory which is under the Chinese occupation. 

It appears that the record of bilateralism between India and China since 1954 India has accommodated Chinese incursions. This amounted to India’s appeasement policy towards China. For instance, accepting China’s annexation of Tibet without making any reference to the McMohan Line border between India and Tibet; and in 1962, China occupied 45000 sq kms of Indian Territory. China has been coercing India to forget the McMohan Line and accept the LAC to legitimise 45000 sq kms of Indian Territory. 

In the international context, as China acquires more power in economic, military and territorial terms, Beijing’s belligerence would pose a menace to world’s peace as Hitler’s Germany had posed in Europe in 1940s. The added factor is that a dictatorial President Xi Jinping has now installed himself as a life-long President of China. History tells us that whenever China became strong, it practiced unabashed expansionism. India will certainly bear the brunt of China’s aggressive postures. 

To prevent such a disastrous situation developing in Asia and the world on account of China’s belligerence, it is imperative for the international community to pay timely attention to China and curb its expansionist aspirations. New Delhi has to do all it can to make the international community take cognizance of China’s belligerence and expansionism which constitute a threat to world peace and security. ---INFA 

(Copyright, India News & Feature Alliance)

 

COMPANY DONATIONS NOT ENOUGH, By Inder Jit, 16 November 2023 Print E-mail

REWIND

New Delhi, 16 November 2023

COMPANY DONATIONS NOT ENOUGH

By Inder Jit

(Released on 26 March 1985) 

Opinion on the latest Union Budget continues to be sharply divided, as reflected in some refreshingly candid comments and analyses on Doordarshan. Many people are inclined to go along with Mr Nani Palkhivala and his view that the latest budget is “the finest for the last three decades.” One of India’s leading thinkers and analysts, Mr Palkhivala described it last Wednesday as an epoch-making budget for “redesigning India” and said: “It bids fair to make the biggest economic story of South Asia in the current year.” Many people, especially housewives and those with fixed incomes, disagree. They describe the budget as “anti-people” and support the view expressed by Mr H.M. Patel, formerly Union Finance Minister in the Janata Government, on Doordarshan that the levy on petroleum products together with the hike in rail freight has already led to an increase in prices. They concede that the budget has offered many reliefs. But they quote Mr Patel to assert that massive deficit financing is going to hit them harder. What has been given by one hand is being taken away by the other! 

Some critics have even been angry with me for praising the budget and complementing Mr V.P. Singh on Doordarshan a day after it was presented asserting: “You were good when you analysed the poll outcome (on March 6) and described Rama Krishna Hegde as the man of the match. But how could you, an independent journalist, praise the budget?” Alas, independence is no longer viewed as it should be: objective and non-aligned. Instead, it has come to imply total opposition to Government, right or wrong. Anyway, I still agree with Mr Palkhivala. The latest budget may be a gamble in the monsoon. But then budgets in India have all along been a gamble in monsoons, as eloquently stated first by Jeremy Raisman, Finance Member in the Viceroy’s Executive Council some four decades ago. Undoubtedly, a good monsoon still makes all the difference. However, New Delhi is confident of facing a bad monsoon with the help of its buffer stocks and in keeping prices under control. Not unexpectedly, the critics have their view. 

All are, however, agreed on one point: Mr Rajiv Gandhi deserves a big hand for his decision to hark back to the Nehru times and again permit companies to donate funds to political parties. This single act on the part of the Government, as announced by Mr V.P. Singh in his budget, should help in two ways. First, make our elections a little less unfair. Second, eliminate one major stimulus or excuse for evading tax and generating black money. Company donations enabled all the political parties during Nehru’s rule to get funds across the table -- some more, some less. Expectedly, industrial houses and shrewd businessmen took out what may be described as political insurance covers with all the parties. But New Delhi under Indira Gandhi began to have second thoughts when Big Business started backing the Swatantra Party, which stood for free enterprise, in a big way. Unexpected support for a fresh look at company donations came from the Socialists, who were no less annoyed by the pro-Swatantra attitude of big money. 

In fact, Mr Madhu Limaye, if my memory serves me right, even came forward with an unofficial bill in the Lok Sabha to demand a ban on company donations -- a demand which received a favourable response from Mrs Gandhi’s Government. He and other critics argued as follows: “The profits of any Company belong to the shareholders -- the public. Company donations come out of these profits. A part of these profits would normally come into the Government’s coffers if company donations were disallowed and taxed. Thus, a part of the contributions from the companies in effect comes from the Government exchequer and the people at large. Why then should those who head various companies be allowed to distribute patronage and exploit this privilege to personal advantage. Let them do so personally out of their own pockets.” The argument had its points. Logically, it should have taken India towards direct and full Government funding of elections. Instead, it gave Mrs Gandhi’s Government just the excuse it needed to ban company donations and block the flow of funds to the Opposition. 

Under the new dispensation, the ruling party alone got funds -- of course under the table. But the decision played havoc with the system as also with business ethics and morality. In one fell stroke, it opened the flood gates of corruption. Funds were still required for fighting elections. Since these could not be got lawfully, thoughts turned to other ways. The late Lalit Narain Mishra and a few others showed Mrs Gandhi the way and became her fund raisers. India then entered the era of political quid pro quo and kickbacks. Licences, permits and what have you were unabashedly hawked -- like chaat and peanuts on the pavements. Leading industrial houses known for impeccable business morality refused to join the now cult. However, before they were left with no choice. A top industrialist then told me: “It is a question of survival.” Individual Ministers and their men also made big money in the process. Worse, however, the electoral system itself got heavily debased and corrupted. All ceilings on poll expenses were rendered meaningless. The sky became the limit. 

The Government’s decision to lift the ban on company donations will undoubtedly help the system. But it would be folly to think that it would eliminate the scourge of black money or the requirement of the political parties for unaccounted funds. Once having tasted blood, the political parties are not going to easily give up the privilege unless several reforms are undertaken. Today, the ceiling on poll expenses has become meaningless. Candidates are, no doubt, required to file returns of election expenses. But the Commission has no power to see whether the returns are accurate. It is only empowered to see that the returns were filed in time and were in the prescribed manner. What is more, the ceiling per candidate does not include the expenses incurred by a political party following an amendment of the Representation of the People Act in 1975 -- under Indira Gandhi. In 1980, the Election Commission recommended that the Act be reamended to restore the earlier position. But nothing was done. This alone has made nonsense of any ceiling on expenses. 

Costs of elections have continued to increase. Yet, little has been done to determine the sources that should be legally tapped for campaign expenses. Unless this is done, there is little hope of minimising the evil influence of unaccounted money power and vested interests. Company donations will at best be a few drops in the electoral bucket. At the same time, we have to see that deserving candidates are encouraged to stand for election even though they do not possess the minimum money to conduct their campaign. The reader may be tempted to say: This is left to the parties. However, this will not help so long as we are unable to get the political parties to function on democratic lines through a law, as in West Germany. The answer lies in one direction, as recommended by the former Chief Election Commissioner, Mr S.L. Shakdher, in 1980. The State, according to him, should be made responsible for financing the candidates’ election expenses. In fact, he believes that it is not difficult to lay down norms for identifying the areas and the quantum of financial assistance on the basis of the poll performance at an election. 

Not only that. Mr Shakdher went one step further and in the Election Commission’s report on the General Elections to the Lok Sabha (1980) and Legislative Assemblies (1979-80) specifically recommended state funding of elections. The report said: “The Commission is of the view that there should be an election fund from which amounts could be drawn as and when required under orders the Election Commission for the following purposes: (1) Revision of electoral rolls; (2) Conduct of elections; (3) Storage of election materials and records; (4) Payment of subvention to political parties; and (5) Issue of photographed identity cards.” The Commission also went into the size of the fund and proposed that “the fund should initially be of the order of Rs 100 crores for a period of five years. The share of the Central Government on the one hand and various State Governments and Union Territory Administrations on the other may be on 50:50 basis. The Central Government and state Governments each may contribute Rs 10 crores every year so that over a period of five years the proposed fund of Rs 100 crores may be made up.” 

A fund of Rs 100 crores may appear to be small in the context of astronomical figures purportedly spent by the Congress-I and other parties on the recent elections to the Lok Sabha and the State Assemblies. But Mr Shakdher maintains that the amount is adequate even today to take care not only of Government expenses but also the expenses incurred by the candidates and political parties. Assistance could be provided in the following forms: supply of paper and electoral rolls, printing of a limited number of posters, supply of petrol and diesel coupons for a restricted number of vehicles, provision of posters and payments to polling agents and other personnel. It should not be difficult for the Centre to manage by itself an amount twice as large, namely Rs.200 crores over a five-year period. A contribution of Rs 40 crores every year out of an annual Union budget of some Rs 50,000 crores is insignificant indeed. We should surely not grudge this amount for sustaining and strengthening our young democracy -- and in enabling our MPs to enter Parliament with a clear conscience. Government funding of elections, as in West Germany, is bound to come some day. The earlier this happens, the better for India and its democratic health --- and prosperity. --- INFA

(Copyright, India News and Feature Alliance)

Climate Goals: CAN INDIA MEET CHALLENGE?, By Dhurjati Mukherjee, 15 November 2023 Print E-mail

Open Forum

New Delhi, 15 November 2023

Climate Goals

CAN INDIA MEET CHALLENGE?

By Dhurjati Mukherjee 

With the UN Climate Change Conference (COP28) scheduled to begin on 30 November in the UAE, meeting climate goals would be in the forefront. Moreover, as usual, the developing countries will pressurise the developed nations to grant more resources to the former to switch to green technologies. But again though per capita emission of countries such as India, Brazil or even China are much less compared to the Western world, the total emissions of these countries are a cause for concern and would be a bone of contention. 

The Presidency outlined four key goals this year, alongside the negotiations process which includes fast-tracking a just, orderly and equitable energy transition, fixing climate finance, putting nature, lives and livelihoods at the heart of climate action and mobilising for the most inclusive COP so far. Speeding up the energy transition is set to be the main issue, as countries remain divided over how to tackle the world’s unsustainable use of fossil fuels. Clearly, western nations would be pushing for a world to first phase out the ‘unabated’ global use of coal, oil and gas. Other negotiating blocks and countries are likely to push back on this, including major fossil fuel producers like Saudi Arabia and developing countries, which are relying on fossil fuels to grow their economies. 

The need for an ambitious agreement will be underscored by the first-ever global stock taking at the very start of the summit. This ‘report card’ on climate progress will show how far countries are from meeting their commitments under the Paris Agreement to limit global warming. 

Meanwhile, in spite of the multiple challenges faced by countries, a recently released report of the Climate Vulnerable Forum (CVF) -- an international coalition of 58 countries highly vulnerable to a warming planet -- revealed that India, Indonesia, the UK and Switzerland are among many economies currently on track to meet the Paris agreement goals based on their pledged targets for 2030. Of the major economies, India, home to almost a fifth of the world’s population, produces just 2.9 tonne of CO2 per person compared to the G7 average of 11.7 tonne per capita emission (2022 data). Against the global per capita emission of 6.4 tonne of CO2 in 2021, EU’s (27 nations) per capita emission is just 8.1 tonne and the US’s per capita emission stands at 17.5 tonne – six times more than India. 

Flagging the gaps, the CVF’s study titled ‘Traffic Light Assessment Report: Fair Share Pathways to Combat Global Climate Breakdown’ aims to hold nations accountable by assessing their alignment with the “Paris Agreement’s temperature and equity in principles.” Though the report is quite hopeful for India, delving into the matter and considering the increasing energy needs in the coming one or two decades, the scenario may not be all that encouraging. 

As far as New Delhi is concerned, the energy sector needs to adopt new technologies. The country imports around $160 billion worth of fossil fuel energy and this is likely to double in next 15 years or so. Over 75% requirements are met by fossil fuels like oil, gas and coal. Thus, there is need to develop green hydrogen as it will help India to decarbonise sectors such as steel, cement, fertilizer, copper, oil refining etc, the steep reduction in solar and wind power rates makes green hydrogen an ideal production route. 

At CO26, India pledged to net zero carbon emissions by 2070 with commitments to half its energy from renewables and lower the carbon intensity of the economy by at least 45% from 2006 levels within 2030. Carbon-related industrial processes must shift to cleaner technologies which have already started but more needs to be done to achieve the target. Similarly, buses and transport vehicles will have to give way to electric vehicles, which are being used in metros but must be spread faster across the country. 

The transformation of the automobile sector will span from primary to component manufacturing as EVs are capital intensive, require batteries but few components. These changes would be aided by information and communication technology, AI etc. Experts are unanimous in their opinion about green hydrogen being the best option in our quest to reduce carbon intensity. It is believed this will leverage the country’s abundant solar and wind resources and substantially reduce energy imports in the long run.  

India is estimated to consume 11.7 million tonnes of carbon-intensive grey hydrogen by 2030 primarily in the refinery and fertilizer sectors, two-fold of the 5.5 million tonnes as of present times. This needs to be checked as global warming can’t be allowed to aggravate. The new hydrogen capacity must be green that could help bring down pollution to a great extent. 

Meanwhile, 15 global health leaders, including three from India, demanded that fossil fuel industry interests be kept out of climate negotiations. “Fossil fuel interests have no place at climate negotiations”, health experts stated in an open letter to Sultan Al-Jaber, President designate of COP28and UAE minister. The signatories called on him and leaders of all countries to commit to an accelerated just and equitable phase-out of fossil fuels to limit global warming and protect health from the devastating impacts of climate change, including extreme weather events. 

India is committed to steadily phase out fossil fuel and has declared the National Green Hydrogen Mission pledging a capital outlay of Rs 19,744 crore targeting 5 million metric tonnes by 2030 which will be zero carbon. Hydrogen can be utilised for long-duration storage of renewable energy, replacement of fossil fuels in industry, clean transportation and potentially also for decentralised power generation, aviation and marine transport. Experts believe his would bring down the price of hydrogen from the present $4 per kg to around Rs $1 by 2030. 

Indigenisation of electrolyser manufacturing will be the key for India to accelerate the green hydrogen ecosystem. To address the low supply in the world, the country is building capacities to produce 20GW of long-lasting electrolysers in the present decade. Though this is a big challenge, it is expected that technical knowhow as also investments would be forthcoming. Besides, the country’s electrolyser manufacturing costs are expected to be 30% lower than western nations and comparable to China. 

Reports indicate that 70% of the electrolyser manufacturing components can be indigenised and domestic production can go up further with right partnerships for technology and manufacturing knowhow of critical components.                  

Obviously, the green transition brings unique challenges, new opportunities with some risks as well. The change in mining technology and the vast coal economy of the country are vital challenges in India’s quest for a green economy. Though both China and India have consistently refused to phase out coal-fired power, not just at COP26 and even later, innovative solutions need to be found to reduce emissions from such plants. With steady mechanisation of these plants, employment is steadily getting reduced which is a problem for our country and may be for others too. 

The long road to 2070 is quite far off but there is a need to think and evolve right strategies. The public sector must take the lead and develop cooperation with foreign countries for joint ventures and/or technology transfer.  If green hydrogen production can be boosted – and already BPCL is collaborating with Bhabha Atomic Research Centre – India would be much ahead in controlling carbon intensity and shifting to green energy.  ---INFA 

(Copyright, India News & Feature Alliance)

 

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