17-05-2017 (Important News Clippings)
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Date:17-05-17
It’s the System, Not Just Lalu
Indians would welcome a crackdown on corruption. They are also savvy enough to draw the distinction between a crackdown on corruption and a crackdown on the Opposition. Any crackdown will carry conviction as a genuine attack on corruption only when the basic enabler of corruption in the country, the absence of an institutional mechanism to finance politics, is dealt with. We are yet to see any sign of that.
No Nripen Chakraborty NowIn a situation in which politics is financed principally off the books, personal honesty of politicians is just a question of letting someone else do the dirty work of resource mobilisation. Of course, there can be rare exceptions. Nripen Chakraborty, who was chief minister of Tripura from 1978 till the Left Front’s defeat in1988, famously vacated the chief minister’s official house packing his belongings, all of them, into a steel trunk, which he carried out in a cycle rick- shaw. And the politics of his party in those times depended on voluntary work and small, willing donations.
There are no Nripen Chakrabortys around in the world’s fastest-growing economy, although his Communist successor Manik Sarkar is also a man with a Spartan lifestyle.Even if a leader himself did not insist on having all the creature comforts of high office every waking moment, air conditioners and sofas are likely to be thrust upon him, even when he makes a condolence visit to a home bereft of such things.No one would seriously question the personal honesty of a leader like Manmohan Singh or A K Antony. But do they contribute to their party’s war chest, from which their own political expenses are met?
Political expenses are real and immense. Take a rally of one lakh people. Organisers spend anything from .Rs 500 to .Rs 1,500 per head, apart from the expense on the travel of the leader who addresses the rally. Such a rally can cost .Rs 10 crore, on average. National and regional parties together hold hundreds of such rallies in one state in an election. Do the math.
Then there is publicity. Posters, hoardings, banners, television spots, newspaper advertisements, publications, other propaganda material, including masks, caps, flags and T-shirts. Chartered planes and helicopters that fly for extended periods. Sensible parties do not pack senior leaders into the same aircraft — one crash would eliminate the entire leadership. Many peripatetic leaders mean many planes/choppers.It is not just the star campaigners who travel. On the ground, cars, jeeps and two-wheelers cover thousands of dusty kilometres. These days, every party conducts election surveys, several times over.Parties need offices and staff. They need to be paid for. This is all valid expenditure, even if the ridiculously low spending limits prescribed by the Representation of the People Act make much of it illegitimate. Then, there is the kind of spending that is not valid, the money spent on buying off politicians, bribing voters with cash, liquor and drugs, hiring goons and musclemen.
Democracy is Expensive
All told, Indian democracy calls for tens of thousands of crores to be spent. But the declared expenditure of all political parties typically adds up to less than .Rs 1,000 crore. Which means, the bulk of their actual income and expenditure is off the books.Does this mean that political parties keep two sets of books, one for their own internal use and the other to show the Election Commission? It’s a little more complex. It is not the party HQ that finances all expenditure. Individual leaders raise money and spend, on their own campaigns and on those of some others, these numbers rising with their seniority.
This means that political leaders raise money off the books, maintain a war chest and spend from it when required. Since most of the funds so raised and kept ready for spending is off the books, most leaders sit on quantities of black money. If a serious enough effort is made by an investigating agency, almost any leader can be caught with assets disproportionate to his or her known means of income, except those senior enough or smart enough to leave no trail.
Traders and businessmen fund not parties but individual leaders. They give money as token of respect, out of gratitude for work done or because they are forced to (the last kind of tribute leads to a backlash). Politicians wax rich. Without this columnist naming names and risking a charge of libel, anyone can identify, eyes shut, politicians in their state who have become abnormally rich for no apparent reason other than being in politics.
Change, this system must. But the starting point has to be institutionalising transparent funding of politics, not raids on individual leaders chosen by expedience.
Date:17-05-17
WannaCry can actually be a boon rather than a curse for India’s cybersecurity
To begin with, the government must defend itself. If America’s National Security Agency could be hacked, presumably, India’s Registrar of Companies and the demat account database are vulnerable, too. Imagine the havoc an enemy state can wreak by destroying or scrambling data on ownership of assets.The government must coordinate with other governments, to establish a protocol to share key vulnerabilities any government discovers with other governments, before such information reaches savvy criminals. The government must create a legal framework that mandates any and every company that suffers a breach of cyber security to report the incident to a designated agency that would investigate and keep identities confidential, but alert other potential targets and cyber security agencies.
India does have some cyber security capability. This must be scaled up, with adequate funding for training and research, from government grants and private sector projects, in universities and specialised institutions. Ethical hacking must be encouraged among bright youngsters, who should be rewarded for their discoveries of vulnerabilities.India Inc must get its act together. Security is not just about the latest update or patch but also about employee discipline on following the recommended safety protocol. Smaller firms must upgrade to licensed software and keep security up to date. Online security is not a luxury in a country with a billion phones. It is do or die. Literally.
बाजार से अनाज गायब न कर दें नए सुधार
Date:17-05-17
साइबर सुरक्षा
गत शुक्रवार को शुरू हुए रैन्समवेयर हमले ने यह बता दिया है कि अगर पूरी साइबर जंग छिड़ी तो किस कदर नुकसान और अफरातफरी मच सकती है। वानाक्राई नामक प्रोग्राम ने 150 देशों के दो लाख से अधिक कंप्यूटरों को संक्रमित किया। हालांकि अब इस पर काबू पा लिया गया है लेकिन कहा जा रहा है कि इसके नए और अधिक घातक संस्करण जारी किए जा चुके हैं। अप्रैल में खुद को शैडोब्रोकर्स कहने वाले एक समूह ने अमेरिका के एनएसएस से कुछ प्रोग्राम चुराकर उनके कोड जारी किए थे। उन प्रोग्राम्स में से एक एटर्नलब्ल्यू साइबर जंग का एक हथियार था जिसकी मदद से माइक्रोसॉफ्ट विंडोज ऑपरेटिंग सिस्टम की कमियों का फायदा उठाया जा सकता था। हालांकि माइक्रोसॉफ्ट ने मार्च में उस कमी से निपटने का तरीका जारी किया लेकिन विंडोज एक्सपी और विंडोज 8 जैसे पुराने संस्करणों पर वह लागू नहीं था। माइक्रोसॉफ्ट ने शनिवार को इन संस्करणों के लिए भी सुधार जारी किया।
चीन का सपना
जैसा कि पहले से तय था, भारत ने बेजिंग में हुए ओबीओआर शिखर सम्मेलन में हिस्सा नहीं लिया। ओबीओआर यानी वन बेल्ट वन रोड चीन की एक अति महत्त्वाकांक्षी परियोजना है और इसी पर व्यापक सहमति बनाने के मकसद से उसने यह सम्मेलन आयोजित किया था। प्रस्तावित परियोजना कितनी विशाल है इसका अंदाजा इसी से लगाया जा सकता है कि दुनिया की आधी से अधिक आबादी, तीन चौथाई ऊर्जा-स्रोत और चालीस फीसद जीडीपी इसके दायरे में आएंगे। इस परियोजना के तहत सड़कों, रेलवे और बंदरगाहों का ऐसा जाल बिछाया जाएगा जो एशिया, अफ्रीका और यूरोप के बीच संपर्क और आवाजाही को आसान बना देंगे। तीनों महाद्वीपों के पैंसठ देशों को जोड़ने की इस महा परियोजना पर चीन 2013 से साठ अरब डॉलर खर्च कर चुका है और अगले पांच साल में इस पर छह सौ से आठ सौ अरब डॉलर निवेश करने की उसकी योजना है। चीन का मानना है कि यह दुनिया का सबसे बड़ा ‘सिल्क रूट’ होगा और वैश्विक अर्थव्यवस्था की सुस्ती को तोड़ने का कारगर उपाय साबित होगा।
प्रस्तावित परियोजना के दायरे और संभावित असर ने स्वाभाविक ही दुनिया भर की दिलचस्पी इसमें जगाई है, जो कि बीआरआई यानी बेल्ट एंड रोड इनीशिएटिव शिखर सम्मेलन में अनेक देशों के राष्ट्राध्यक्षों समेत बहुत-से देशों के राजनीतिक नेताओं और प्रतिनिधिमंडलों की भागीदारी से भी जाहिर है। लेकिन अपने तय रुख के मुताबिक भारत ने इस सम्मेलन में हिस्सा नहीं लिया। दरअसल, भारत का एतराज सीपीईसी की वजह है। चीन सीपीईसी यानी चाइना पाकिस्तान इकोनॉमिक कॉरीडोर का निर्माण पाकिस्तान अधिकृत कश्मीर में कर रहा है, जिस भूभाग को भारत अपना हिस्सा मानता है। सीपीईसी ओआरओबी का हिस्सा है। इसलिए सीपीईसी से भारत के विरोध की परिणति ओआरओबी से अलग रहने के रूप में हुई है। जाहिर है, भारत का एतराज संप्रभुता से संबंधित है, न कि परियोजना के आर्थिक या व्यापारिक पक्ष को लेकर। अलबत्ता उसने कुछ दूसरे सवाल भी उठाए हैं। मसलन, परियोजना के तहत दिए जाने ऋण की अदायगी आसान हो। क्या यह मुद््दा उठा कर भारत ने ओआरओबी के दायरे में आने वाले छोटे देशों तथा बलूचिस्तान की दुखती रग पर हाथ रखना चाहा है! गौरतलब है कि गिलगित-बल्तिस्तान के बहुत सारे लोग सीपीईसी को शक की नजर से देखते हैं; उन्हें लगता है कि सीपीईसी उनके लिए किसी दिन नई गुलामी का सबब बन जाएगा। एक तरफ पाकिस्तान की अर्थव्यवस्था में चीनी कंपनियों का दखल बढ़ता गया है और दूसरी तरफ चीन से ऊंची ब्याज दरों पर कर्ज लेने की पाकिस्तान की मजबूरी भी बढ़ती गई है।
यही नियति ओआरओबी के दायरे में आने वाले अन्य छोटे देशों की भी हो सकती है। एक तरफ उनके बाजार चीन के सस्ते उत्पादों से पट जाएंगे, और दूसरी तरफ वहां की सरकारें चीन से महंगे ऋण लेने को विवश होंगी। लेकिन तब हो सकता है वहां का राजनीतिक नेतृत्व कुछ ढांचागत परियोजनाओं का हवाला देकर, चीन के आगे झुकते जाने की विवशता को भी विकास के रूप में पेश करे। ओआरओबी चीन के राष्ट्रपति शी जिनफिंग का सपना है और उनके सत्ता की कमान संभालने के कुछ समय बाद ही इसकी चर्चा शुरू हो गई थी। पर चीन की महा तैयारी के बावजूद ओआरओबी की राह आसान नहीं होगी। कहीं दुर्गम इलाके आड़े आएंगे, तो कहीं दो देशों के बीच स्थायी रूप से बनी रहने वाली तकरार। कई देशों का चीन के प्रति संदेह-भाव भी बाधा बन सकता है। अमेरिका से चीन की प्रतिस्पर्धा और दक्षिण चीन सागर के विवाद का भी असर पड़ सकता है। लिहाजा, ओआरओबी के भविष्य को लेकर अभी कुछ कहना जल्दबाजी होगी।
Date:16-05-17
The politics of territory
China’s Belt and Road Initiative is a wake-up call for India: Geography is tied to economics and strategy
If Delhi was conspicuous by its absence at China’s Belt and Road Forum this week in Beijing, it cited a number of reasons for staying away. None of them was more important than the question of India’s sovereignty over Pakistan occupied Kashmir (PoK), through which an important part of China’s Silk Road Industrial Belt runs. In a statement late on Saturday, hours before President Xi Jinping opened the forum in Beijing, the foreign office in Delhi referred to the China-Pakistan Economic Corridor (CPEC) and affirmed that “no country can accept a project that ignores its core concerns on sovereignty and territorial integrity.”
Contrary to the warnings of some in Beijing and the fears of many in Delhi, international isolation is not India’s biggest problem as China’s connectivity projects under Xi’s Belt and Road Initiative gather momentum. India is too large an economic and political entity to be isolated by another power. Occupying a critical geographic location, India can contribute to the success of China’s Belt and Road Initiative or create needless complications. India’s real challenge is to match its claims on territorial sovereignty with effective action on the ground.
India’s arguments with China on the BRI have had one important effect. It has helped bring the triangular dynamic between India, Pakistan and China in Jammu and Kashmir into sharp focus. Although the popular discourse in India sees Kashmir as a bilateral issue with Pakistan, China has always made it a three-body problem. Unlike the Anglo-Americans who fancied mediation between India and Pakistan in the past, and the Hurriyat separatists who now pretend to be the third party, it is China that is the real third force in Kashmir.
Beijing is in occupation of a large part of Ladakh in the north-eastern part of J&K. To the west, Pakistan had ceded part of the territory controlled by it to Beijing after the Sino-Indian border conflict of 1962. China’s first trans-border infrastructure project in Kashmir — the Karakoram Highway — dates back to the late 1960s. Since then, China’s presence in Pak-occupied Kashmir has steadily grown. As the CPEC deepens the integration between Pakistan occupied Kashmir and China, Beijing looms larger than ever before over J&K.Although Delhi did often object at the bureaucratic level to China’s role in PoK, India was continually tempted to sweep the problem under the carpet in the name of larger political solidarity with China. Thanks to Xi’s huge political investment in the BRI, the special importance that Beijing attaches to the China-Pakistan Economic Corridor, and the intensity of India’s opposition to the CPEC, the triangular nature of the Kashmir question can no longer be masked.
In the last few days, Beijing seemed eager to address India’s sovereignty concerns about CPEC. Delhi was not impressed though, for the pickings seemed meagre. Nevertheless, the effort by the two countries to address the tricky issue of territorial sovereignty in Kashmir are welcome and must continue. While it may be prepared to talk, Beijing is unlikely to suspend work on its economic and strategic projects in Pakistan occupied Kashmir.
Even as it engages in a necessary and patient dialogue with China, Delhi needs to take a number of steps of its own. For one, Delhi must step up the effort to modernise and deepen J&K’s connectivity with the rest of India. Second, Delhi must test the sincerity of the Pakistani and Chinese statements that CPEC is open for Indian participation. Delhi has not been averse to cross-border infrastructure cooperation in Kashmir and it has made specific proposals to both Pakistan and China in the past. Delhi must now articulate a political framework for economic and commercial cooperation across the contested frontiers of Kashmir in all directions.
Third, the Sino-Indian argument on CPEC in Kashmir is deeply connected to the question of Arunachal Pradesh. While China asks India to downplay the sovereignty argument in Pakistan occupied Kashmir, Beijing objects to all Indian activity, political or economic, in Arunachal Pradesh. The state is part of the Indian Union, but is claimed in entirety by China. In Arunachal, Delhi needs to raise its game on accelerating the state’s economic development and its connectivity to the rest of India.
Fourth, Delhi must devote high-level political attention to the long-neglected Andaman and Nicobar islands that sit across China’s planned maritime silk routes in the eastern Indian Ocean. It is only by realising the full strategic potential of the island chain that Delhi can cope with the maritime dimension of China’s Belt and Road Initiative.
Fifth, in opting out of the Belt and Road Initiative for now, Delhi has renewed its strong commitment to promoting connectivity with neighbours in the Subcontinent, South East Asia and the Gulf. On Saturday, the foreign office identified a number of projects currently under implementation. There is no doubt that the Modi government has imparted new energy to these projects, some of which date back to the Vajpayee era. Completing these projects quickly is critical for lending credibility to Delhi’s tough posture on the BRI.
Whether it is in Kashmir, Arunachal, the Andamans or the neighbourhood, India’s neglect of its frontier regions has weakened its regional position. Beijing’s Belt and Road Initiative promises to worsen that disadvantage, unless Delhi presses ahead with its own connectivity initiatives within and across its frontiers. While the geographic imperative has driven modern China’s strategic policies, it has not been one of independent India’s strengths. But President Xi appears to have shaken India out of its geopolitical stupor.India’s belated rediscovery of the relationship between geography, economics and strategy is probably one of the more interesting but unintended consequences of China’s Belt and Road Initiative.
Timely refresh: on the growth of industrial output
The data set revision for the IIP and WPI reflects a macroeconomic resilience
Date:16-05-17
The Modi paradigm
The force multiplier will come from embracing cooperative and competitive federalism
This month, Prime Minister Narendra Modi’s government completes three years in office. There will, no doubt, be a flurry of report cards from experts and from the media. Most of them will focus on the nitty-gritty of what has or has not been accomplished. Not many will paint the big picture. However, the larger canvas or the underlying philosophy of governance matters because all the nitty-gritty flows from it. The fact is that Mr. Modi’s economic policies are based on a radically different paradigm than that of previous governments.
The new canvas is brushed with two broad strokes: a new federalism (cooperative and competitive) and minimum government, maximum governance. Put together, the unambiguous messages are as follows. First, New Delhi alone cannot transform India — it needs a partnership of the Union and States, a point the Prime Minister reiterated by invoking the spirit of Team India at the third meeting of the Governing Council of the NITI Aayog on April 23.
Second, the government will have to do things very differently (less activity in some spheres, much more activity in others) if India is to advance rapidly, a point that the PM made at the Civil Services Day on April 21 when he exhorted bureaucrats to be enablers rather than regulators.
‘Minimum government’
This paradigm shift doesn’t lend itself to the kind of easy categorisation of ‘Right’ or ‘Left’ economists and commentators are used to. Minimum government, when understood as the kind practised by Margaret Thatcher in the U.K. or Ronald Reagan in the U.S., meant a complete retreat of the state from spheres of economic activity. Mr. Modi’s version means that the state retreats from spheres where it plays an obviously counterproductive role, like in making it difficult to do business through over-regulation (there is a commitment to improve India’s ranking in the World Bank’s Ease of Doing Business Survey from 130 to 50) or by overspending and busting the fiscal deficit, particularly on careless populism, with the end results being a crowding out of the productive private sector — which could use the same resources more efficiently — and the unleashing of inflationary pressures on the economy.
On the public sector, there is an attempt to weed out the underperforming enterprises which cannot survive without government dole while strengthening and giving autonomy to those which can thrive.
But it’s important to remember that minimum government is suffixed by maximum governance. At India’s level of per capita income, the state cannot retreat altogether. However, it has to be more efficient in carrying out its activities, whether it is the essential task of providing security/law and order or the provision of public goods like sanitation, primary education and primary health care or in the building of critical infrastructure like roads, ports and railways, all areas where private sector participation is bound to be limited.
The government must also, in a targeted and sustainable way, invest in the poorest — and this it has done through schemes like subsidised (but not free) insurance (life, accident and crop failure) and the Ujjwala scheme for giving LPG connections to the poorest households. The entire emphasis on maximum governance is to ensure that more transparent and accountable methods are found to effectively deliver these goods, services and interventions. Hence the emphasis on Aadhaar and on direct benefits transfer on the one hand and transparent auctions and bidding for large projects on the other.
Ultimately, for India as a whole, the force multiplier for maximum governance will come from embracing cooperative and competitive federalism. The long history of independent India has mostly been about an unequal relationship between the ‘Centre’ (the correct constitutional reference is Union) and States. The centralised planning paradigm cemented the idea of New Delhi controlling the development trajectory of every State. A one-size-fits-all approach was deemed to be the best way forward despite obvious differences between States.
Mr. Modi’s long experience as Chief Minister (unusual for an Indian Prime Minister) gave him a different lens. The abolition of the Planning Commission, rationalisation of centrally-sponsored schemes and greater devolution of finances to the States by the 14th Finance Commission laid the platform for the new paradigm. For the first time, States have a say in Union policy — subcommittees of CMs have studied Skill India, Swachh Bharat, centrally sponsored schemes and digital payments. The implementation of the Goods and Services Tax is another excellent example of cooperative federalism. Also, for the first time, New Delhi is not creating or forcing down giant spending schemes where the States must implement the Union’s diktat.
The complement to cooperative federalism is competitive federalism. Competition should not and cannot be about a race to the bottom. What is envisaged is a race to the top as States compete with one another on various parameters, some explicitly measured, some not.
Constitutionally, several critical policy subjects are in the domain of States (either in the State list or concurrent list) including land and labour policies, education and health. On land and labour, which are in the concurrent list, the Union government is encouraging States to legislate liberal laws. Some States have begun working on these.
The NITI Aayog is facilitating the work on land through providing model land-leasing laws. There is now a ranking of States on the Ease of Doing Business. There will soon be indices for health, education and water outcomes. New Delhi’s role is limited to conceptualising the indices and monitoring their integrity and, of course, sharing best practices and model laws. The rest is in the domain of States. A demanding electorate across India will hold State leaders accountable for their performance just as they hold to account the Union government’s performance. Eventually, the transformation of India requires a transformation in each of its 29 States. It cannot be achieved without a partnership between New Delhi and each of the State capitals.This philosophy of governance is radically different from the previous “Centre at the centre” and “maximum government” approach. Rarely do transformations happen overnight but in the right environment they can happen reasonably quickly. Critics will quibble about the nitty-gritty but the big picture is this: Mr. Modi has provided a unique opening for transformation.
Dhiraj Nayyar is Officer on Special Duty and Head, Economics, Finance and Commerce, NITI Aayog. Views are personal and do not reflect the views of NITI Aayog