governance, political economy, institutional development and economic regulation

Posts tagged ‘India’

Book Review: Just erratic not deranged

ghosh

Amitav Ghosh’s latest book—The Great Derangement—is an exploration of why contemporary culture, imagination and political systems have failed to prevent global warming, despite its cataclysmic long-term effects and disruptive short-term outcomes.

His choice of the book’s title reflects the conundrum facing poor nations. They are not the ones who benefited from the carbon economy. But to aspire to do this now, when there is no carbon space left, is a one-way ticket to self-annihilation. Hence, the derangement of the modern world, racing towards a future, where consuming itself becomes the only option. Curbing global warming means debunking the fundamental values on which the modern world is built. Central to this artifact is the notion that man is the centre of the universe. Non-human forces, like nature, have no place in this calculus of liberty and modernity.To recognise global warming as a problem, you first have to reject the paradigm that the unconstrained liberty of man is a leitmotif of human progress. Hence the unwillingness and the inability to face or deal with the problem.

Nature’s pawns

This is a cleverly crafted book, as would be expected from a novelist extraordinaire. Divided into three parts, it starts with “Stories”. This segment situates humans as powerless, organic sub-systems of a larger force—restless and dynamic nature. Stories of his family—climate refugees from Bangladesh; of self-doubt after a sudden, destructive tornado in Delhi; of raw beauty and sudden death in the muddy, torpid, densely tangled greenery of the Sundarbans reinforce that we are not masters of the universe.

Inequality and the urge to splurge

The second section on History, draws together three defining strands of the late 17th to the early 20th centuries. First, the availability and use of fossil fuels which were an important precondition for wealth and power. Second—the use of technology to improve productive capacity. Third—the growth of modern empires as the political mechanism for extracting the supply of raw materials; controlling access to technology and keeping overseas markets open for exported manufactured goods. Empires faded in the late 20th century but the extractive process continued. The elite—foreign and domestic—comprise not more than one fourth of the world population, but continue to become wealthy at the expense of the bottom three fourths.

gas-guzzler

The third section is on Politics. Ghosh argues cynically that so little has been done to mitigate climate change because the rich world will be able to insulate itself from the horrific outcomes. The shock will primarily be borne by the poor. Littoral countries like Bangladesh, Seychelles and Vietnam and poor communities, within countries, will be the worst affected.

A captive media

Ghosh believes the deafening silence in the media around climate change is because it has been bought out by the huge corporates who own fossil fuel assets. The silence in literature is because his peers—writers, poets and intellectuals—are bludgeoned into conformity by the formulaic path to success of shunning the unpredictable and situating a story within the predictable activities of everyday life, with the individual as the central character.

Can religion help where politics has failed?

Not much can be expected from politicians either. They are so immersed in “bio-politics”—catering to the short-term interests of a defined population of voters—that they have little appetite for long-term global risks. For what it is worth, differences in economic ideology across parties have become minimal in India. All the political parties which have ruled India since 1991 have adhered to the broad neo-liberal construct of economic development. So, quite possibly, the devil lies in the incentives created by this economic model to produce and consume in larger volumes. He cites the December 2016 Paris Agreement as subterfuge and doublespeak, promising to do much without, in effect, doing anything.

He compares this shallow and evasive, politically negotiated international agreement with the direct and forceful Encyclical Letter of Pope Francis issued at the same time. The latter fingers the ruling “technocratic paradigm” and the objectification of endless growth as the problem rather than the solution. It calls for tempering individualism with the balm of social and ecological justice. Ghosh notes that similar voices are being heard within the Hindu, Muslim and Buddhist faiths. This leads him to believe that greater community activism led by religious leaders could be the answer to mobilize opinion for definitive steps to abate global warming.

naga

Ghosh’s stand is unusual for a secular rationalist. But this is consistent with an approach which absolves religion of its divisive outcomes. He speculates (page 150) that Mahatma Gandhi was assassinated by a former member of a Hindu party because he was perceived as weakening India by opposing industrialisation and consumerism. No references are quoted to support this “economic” explanation. The more usual view is to attribute the killing to Hindu apprehensions that the Mahatma was too politically accommodating of minority interest.Ghosh also seems to step lightly away from the conundrum that using religion for secular purposes is akin to riding a tiger, particularly in India’s surcharged environment, perpetuated by religious faultlines. Indira Gandhi paid the price for doing just that.

The world is increasingly more not less sustainable

 

cyclists

Ghosh’s rhetoric is elegant and elegiac. His reasoning is impeccably logical. But his morbid assessment of where we are today and of our future prospects does not triangulate with reality. The world is becoming less carbon-intensive. Every incremental unit of output requires less energy than the previous one. It is true that explosive economic growth in Asia since 1980 has negated this advantage and the global mean temperature continues to increase. But renewable energy options are being developed for air, road and marine transportation, thereby further diluting the link between the use of fossil energy and economic growth. Similarly, technology developments like LED lighting have vastly improved the efficiency of energy services. Climate risk is increasingly being factored into the cost of insurance and the hurdle rate of return for investors. This will drive smart green investments.

We are winning the war on poverty

International aid agencies, governments—of which China is the exemplar, and communities, all working in tandem, have successfully reduced poverty and are on track to eliminate it by 2030. Yes, inequality is on the rise but at a significantly elevated base income level. The opening up of international trade has diluted the link between political domination and market access. Even small nations like Vietnam or Mauritius have benefited from international markets. International trade has democratised resource endowment by making petroleum, minerals and metals available to resource-poor countries. Three out of the four largest economies today—China, Japan and India—are natural resource-poor. They have grown over the last half century by importing fossil fuel and technology. None of the three tops the charts in military might.

child

Choice and progress

The spread and deepening of democracy has expanded opportunities for the disadvantaged and smashed earlier glass ceilings, including for women. Adoption of the open economy model has expanded imported competition while deregulation has nurtured domestic competition, for the benefit of consumers. There is more choice today than at any point in history.The world is a more peaceful place than a century ago. That this holds true despite growing sectarian violence in India’s near abroad and an increase in the number of nations armed with nuclear weapons, illustrates the high stakes everyone has in an enduring peace.

Plurality rules

Today, plural models for progress exist. These models are not country or culture specific. They are instead domain specific. Of the top 20 corporates in the world which accumulated the maximum value over the period 2009-2015, not a single company was in oil or gas; as many as eight were in technology or health care. All of them excelled at the capacity to innovate, communicate and compete. It’s a new world out there which defies explanation using traditional paradigms.

None of this means that we are on top of the problem of global warming, yet. But just as surely, there is more light visible, at the end of the tunnel, than has ever been seen before.

telescope

Adapted from the authors essay in Swarajya October 7, 2016 http://swarajyamag.com/magazine/its-not-that-scary

 

Small guys always win

Star Wars episode VII tells it like it is, in reel life. The small guys — with fire in the belly and a higher moral purpose as their force — always win in the end.

smallguys

In this universe, big is evil. Thomas Picketty, the celebrated French economist, agrees. The bigger you get the further behind you leave most people. Just a handful hoarding wealth can’t be good and it isn’t.

Government of the underdogs but not for the underdogs

India has a long tradition of the government trying to protect small guys against the big guys. Our post-colonial mindset and our laws pretend to penalise the rich and big business. In actual fact, they work against the middle class and the poor. To make things worse, government has been pretty poor at doing the things rich people and big business could do, like investing in infrastructure and creating jobs.

The government in China manages to do this. But the government there has some advantages: The tight social compact between it and citizens and its credibility based on sustained growth, increasing incomes and improving lifestyles. Higher levels of homogeneity help.

In real life, of course, being big is often an advantage. Teenagers will agree instantly. Older folk may not be so sure. A great body with bulging muscles looks awesome at 19. But as the 40s kick in, things begin to sag and get lumped around as useless weight. Nations are no different. India is a big, old nation with a governance history and systems developed over the last 500 years. It is unsurprising that it is flabby today.

Our options

We can go two ways. Either we can reenergise the existing, highly-centralised system of governance or invent a new, highly-decentralised system celebrating the small guy.

Technology enables efficient centraisation

Technology enables and often induces a higher degree of centralisation today than ever before. In earlier times the bigger an empire became, the more loosely were the far reaches managed. It took the British force, marching up from Calcutta, three months to relieve the siege of the Lucknow Residency in 1857.

Residency

Today a trained and equipped special force can reach a trouble spot anywhere in India within a day. Things can be monitored in real time, across enormous distances, providing early signals of “hot spots” or flashpoints for potential trouble. Social media has created a new, real time, citizen-centric information ecosystem. For every two Indians there is one mobile connection. Of these 20 per cent are smart phones. Within five years there will be as many mobile connections as Indians and 60 per cent of these will be smart phones.

Standardisation is another advantage of centralisation. Education, health, products and services all reflect the “Big Mac” effect — places change but the service remains the same. This is very attractive if you are a fan of robotic life. It also reduces the cost of doing things.

But centralized templates sap innovation

But there are problems which come with big, centralised empi-res. One problem is how to manage the concentration of power at the top. Humans have coped with inequity for generations. But “glass ceilings” sap potential and deaden the desire to innovate and take risks.

Choice is at the heart of efficiency. Old, immigrant nations like the United States retain their mojo because people choose to become citizens; virtually no one is born to a job and everyone has a voice. China is also a meritocracy, though choice is limited there.

But humans are neither robots nor pets. We are honed to express our individuality, search for better alternatives, a better way of doing things.

Inefficient, small, good guys versus efficient, big, bad guys

In Star Wars terms, India is the good guy and China the bad guy. We are the small good guy. We cannot destabilise the world economy. China can. We do not have a history of flexing our muscles. China does. We don’t deliberately infringe human rights. China puts national interest above human rights. But we the inefficient small guy, unlike Singapore, Mauritius or Malaysia, whilst China is the efficient, big guy.

starwars

Competition and choice make decentralized systems efficient

Large, efficient democracies are not born overnight. They are nurtured over six to eight generations. Ours is just three generations old. Our Constitution recognises that one size does not fit all. That is why it establishes state and local governments. Most state governments haven’t empowered local governments, partly because even their own empowerment is very recent. Smaller state governments work better than bigger ones. The shining stars are the five southern states, Punjab and Haryana. Gujarat and Maharashtra are the outlier, efficient, big states. The bigger northern and eastern states illustrate that size is a handicap especially if coupled with antagonistic social diversity.

Choice is embedded in our Constitution. But powerless local governments make choice a redundant option. Our nascent democracy makes us obsessive about potential threats to the unity of India. Destabilising threats from our immediate neighborhood heighten this paranoia.

Consciously dumbing down the Center to the bare essentials of sovereignty is the only way of making the big guy efficient. Empower state governments by transferring human development and social protection functions with the required financial resources. Make the transfers conditional to states empowering their local governments in turn. A cascading stream of resources empowering the smaller guys is the mantra for equity with efficiency. It is only then that India will become an efficient good guy, even as we grow bigger and bigger.

boy

Adapted from the authors article in Asian Age December 26, 2015 http://www.asianage.com/columnists/small-guys-always-win-373

Why no one loves Modi

In sarkari circles, an officer whom no one loves is an outlier — either cruelly termed “sanki” in colloquial Hindi (willful, unreliable) or brutally even-handed since she evenly annoys everyone.

But what does one say about a politician in this predicament? Frankly, whilst it is easy for a politician to be so faceless that s/he is quickly forgotten — think H.D. Deve Gowda, it is really quite difficult for a politician to incur the wrath of everyone. Prime Minister Narendra Modi has managed this miracle.

He has completely browned off 17 per cent of Indians, who are Muslims, by his inability to control the baying packs of Hindu fundamentalists. Ironically, the overwhelming majority of Hindu fundamentalists also suspect him of trying to soften and undermine, by attrition, their over-the-top version of Hindutva. Moderate Hindus are upset because they see the beginnings of unnecessary sectarian conflicts.

Big businesses and their eco sphere — lawyers, consultants, bankers and power-brokers — are unsettled because they are no longer implicitly part of the government machinery. The “Delhi watering holes” are empty. This is unnerving for business which hates changes in the rules of the game. It does not help that we have never had a consistent and predictable environment of governance. This is most visible in the tax regime. If “show me the man and I will show you the rule” principle operates, then those who have their foot in through the government’s door will stand to benefit.

Mr Modi has put off government servants by forcing them to be more effective in their jobs. The armed forces are smarting since they no longer feel cossetted despite the generous settlement of the “One Rank, One Pension” issue. The judiciary suspects him of trying to capture them. Parliamentarians feel neglected by the absence of direct engagement with him. For Mr Modi, inter-party relationships in Parliament are only a distraction, not an opportunity. The poor — 60 per cent of India with an income less than $2 per day— have yet to see and feel the difference that the new government has made.

The faithful

faithful

photo: the guardian.com

Mr Modi and the BJP’s traditional political base of middle class traders, small businessmen and upper-caste Hindus are the faithful who are part of the Rashtriya Swayamsevak Sangh/BJP family. These supporters remain wedded to Mr Modi. But even here, the support is primarily in the “cow belt” and western India. The other community which is deliriously supportive of the Prime Minister is that of expatriate Indians — around 20 million — but they matter only in the politics of their own homes, not in India.

Can the Prime Minister do better and, if so, how?

Play cricket not golf

First, Mr Modi must shed the self-acquired role of the sole, vote gatherer. He needed this image to overcome inner-party contestation and become the Prime Minister. Today, this image is a handicap. Ironically, he could usefully emulate the laidback, apolitical Congress vice-president Rahul Gandhi, who comes across as trying to do something significant — though no one quite knows what — rather than just win political battles. Mr Modi has enough going for him to let his administrative ability and his vision of a “New India” be the metric of his term in office. Others must now step in and become vote gatherers.

Even majority governments need to build consensus

Second, it is conventional wisdom that an India ruled by a brute political parliamentary majority is an outcome of a recent breakdown in true democracy, rather than an illustration of its success. There are two reasons: Coalition governments are inevitable at the Centre due to the firm hold that regional parties have over politics in the states. This trend is likely to strengthen.

In our first-past-the post system of election, members of Parliament get elected simply by getting more votes than the next candidate, never mind that these may not be even a simple majority of the total votes cast. This makes it politically sensible to develop narrow vote banks and to encourage splintering of other votes — a useful tactic, but with highly fractious outcome. The dalit vote bank of Mayawati (Behenji) or the Yadav vote bank of Mulayam Singh and Akhilesh Yadav in Uttar Pradesh are ready examples. Whilst any “ruling party” perforce has a numerical majority, it also needs to gather an “ideological majority” in Parliament — the sense of the House — to rule successfully. Coalition building will be key in the years ahead.

You have time, sir

Third, much like Anne Hathaway in the role of a young CEO of a start-up in the movie “The Intern”, now playing in the capital, Mr Modi has to slow down if he is not to burn out. He cannot be everything, everywhere. Nor should he try and do everything at once.

His energy and enthusiasm is infectious and sorely needed after the “Gulliverian” sloth of the previous United Progressive Alliance government. But it is a pity that Mr Modi is not a family man. Someone needs to prescribe “play time”, get him to chill in the hills he loves, get back in touch with his gut instincts, define narrowly what he wants to achieve by 2024 and work backwards from there.

lake

photo: katfin.com

This cannot be done whilst he remains the de facto chief of the BJP and the de jure chief of the government. Copying the Chinese, or the Congress way of doing things, is not a route to sustainable political heft in “New India”.

Lastly, the Prime Minister needs to agree with big business that competition from foreign and domestic rivals is inevitable and desirable. Trying to pick champions, South Korea style, is incompatible with our fractious democracy. Infrastructure and defence are two areas where foreign investment is conspicuously lacking. And it shows.

Neglected next steps

There are three imperatives Mr Modi must push through:

Sell the public sector. Privatise selectively where there is the least likelihood of noise, as in power, oil and gas. Use efficient instruments like the public-private partnership, as in the privatisation of electricity in Delhi.

old babu

photo: ibnlive.com

Modernise our archaic bureaucracy. Rid it of the stranglehold of the somnambulant but elite All-India Services. Downsize the Union government to its core sovereign areas. Give leadership roles to professionals selected for specific positions.

eagles

photo: amazing chaos.com

Be like Arjun and aim for the eye of the eagle — identified by Mahatma Gandhi as the service of the poor. But choose an eagle which is in the far horizon, not the one preening itself in your garden.

Being loved by all is of no consequence to an effective ruler. Being loved by the “right” people is more important.

Adapted from an article by the author in Asian Age November 6, 2015 http://archivev.asianage.com/columnists/why-no-one-loves-modi-797

Stop being a bully State

beef

Does the proposed national “beef ban” and the rabid intolerance for “beef-eaters” illustrate a new and disturbing trend in Indian politics? Are we squandering away our “secularism”?

India has been a “secular” state in practice all along. All the bells and whistles to ensure equal rights for all citizens, irrespective of religion, have existed in the Indian Constitution. But via the infamous Constitution (Forty-second amendment) Act, 1976, the term “secular” was inserted into the Preamble somewhat superfluously.

This attempt to put a “face” to the “fact”, should have been the first signal that our commitment to treating all Indians as one, was doomed to be only skin deep. Thereafter, it has been open season for most political parties to play strategically with the sentiments of both, the majority Hindus and minorities — Muslims being the largest — for periodic political benefit.

inter faith

photo credit: http://www.jainsamaj.org

Religion and community feeling matters

At an individual level, Indians from all faiths accept the basic proposition that culture and religion, which are closely interwoven, are personally important. They also, generally, accept that the individual has to bow down to community norms. This acceptance of religious and community dominance is not without legal precedent.

Our Constitution via Article 48A of the Directive Principles of State Policy requires that the state take steps to “prohibit the slaughter of cows”. Admittedly, the Directive Principles are not justiciable in a court of law. They are more in the nature of guidance for future action. But, consider that cow protection is clubbed with protecting worker rights; the educational rights of the scheduled castes and scheduled tribes; improving nutrition levels, protecting the environment and promotion of international peace and security!

The Constitution has been amended one hundred times till now. But the primacy for cow protection in our constitutional vision, as enshrined in the Directive Principles, still stands.

calf

photo credit: http://www.pinterest.com

Democracy without development remains backward looking

What this illustrates, is that democracy is a blunt instrument for social inclusion. The incentive to pander to majority votes is too intense. Second, things become worse when the political architecture assumes, like ours does, that all religions have similar social and economic demographics and, hence, proportional representation is not needed for minorities to protect their voting power. Ironically, this is exactly what we are urging Nepal not to do under their new Constitution and to instead protect the voting power of the “minority”, coincidentally Indian-origin, Madhesis and Tharus, who live in the Terai adjoining Uttar Pradesh and Bihar.

The romantic hope of the “Macaulay generation” in 1947 was that as India became richer, it would resemble the West, where churches are empty but the bars are full. India is richer today. But religion and tradition remain deeply embedded. We are unlikely to lose our religious identities any time soon.

Decentralisation: the still born option for enhancing inclusion

Another route to manage a heterogeneous society, like ours, could be to decentralise deeply. This was tentatively envisaged under the Constitution (73rd Amendment) Act and Constitution (74th Amendment) Act, 1992. These amendments sought to transfer the management of local affairs to village panchayats and urban municipalities. But the attempt was stillborn. We remain a fairly centralised polity. State governments get seduced to toe the “Imperial line”, dished out from Delhi along with Central funds, rather than go their own way, which is so much more effort intensive.

Our recent experience with the reorganisation of state governments shows that decentralisation can take the steam out of corrosive identity politics. The creation of five new states out of Assam in the 1960s and ’70s is a good example. The proliferation of state governments in India, since Independence (from 16 to 29) lends further credence to this strategy for dampening identity politics.

To cater to our cultural and religious mosaic, India needs either many more homogenous states or more powers delegated to local governments, particularly large cities. Consider that if Mumbai was a city-state, it was unlikely to have opted for a “beef ban”. But as part of the state of Maharashtra, it has no choice.

Isn’t it time to come clean? Our secularism is limited to being a benign, quasi-Hindu state, where minority religious rights are constitutionally protected. This is very similar to enlightened Muslim-majority states like Jordan or Egypt both of which have significant Christian populations.

Secularism is not a State without religion

Our brand of secularism is too passive for anything but harmful politicking. It is time to make it proactive and more effective. Here are three suggestions.

First, minority rights must be explicitly recognised, but subordinated to the common law rights of workers, children and the differently-abled. These, and the principle of gender parity, should be “core values” cutting across all religious rights.

Second, if we are to ban beef, despite the significant adverse economic impact on those who trade in it, how about being even-handed and also banning pork — meat considered impure in Islam? This removes, at one stroke, the perceived discrimination against Muslims and Christians, both of whom eat beef. After all, India has more Muslims that any other Islamic country, except Indonesia; enough Christians to be notionally the 22nd most populous Christian country in the world — just ahead of Australia — and the second largest in Asia after the Philippines.

In any case there are sound environmental and health grounds for banning both beef and pork. We can live, quite happily, on goat meat, fish and seafood. Breeding pigs is a flourishing micro-business today for Hindu dalits, but there is no gain without some pain.

Third, our Constitution is explicit about helping SCs and STs, all of whom are assumed to be the poor and underprivileged, within the broad umbrella of Hinduism. Isn’t it fair then to also extend specific, targeted facilities to poor Muslims, Christians, Sikhs, Buddhists and Jains who are as helpless as the poor Hindus? Selective benefits for “underprivileged” Hindus look awfully like pandering to the majority community.

A benign and forward-looking ruler must be even-handed. That is raj dharma. Religious appeasement must be uniform not selective. This is difficult since at the root of appeasement is arbitrariness.

But there is a fourth option, if the first three are not practical. Stop being a bully state. We have done very well thus far as a “soft” state, wary of displeasing anyone — except perhaps our neighbours.

Becoming a bully state is the worst option, especially because we have the institutions and the skills to become an inclusive, rational, developmental state. Perception is everything in today’s social media-powered world. Let’s not squander our common future for petty temporal gain.

“Insaaf ki ghanti” is ringing. It must be heard.

jehangir

Adapted from the authors article in the Asian Age October 13, 2015 http://www.asianage.com/columnists/stop-being-bully-state-375

Climate “warriors” head for the December 2015 Paris joust

Paris in December is not quite what it is in springtime. But who cares if someone else is footing the bill! Paris is the venue of the next Conference of Parties (COP), from November 30 to December 11. An annual jamboree that has been trying, since 1992, to limit carbon emissions and save the planet from what scientists predict will be the drastic impact of global warming and associated climate change. They have not succeeded thus far in taming emissions.

The plain truth on climate change

How much carbon space is left before disaster strikes is somewhat iffy and mired in science, negotiating stances and the “precautionary principle” which advocates that if danger lurks it is best to run rather than hang around assessing the extent to which you personally are at risk. Except that there is no place to run to.

Who’s to blame?

The problem is that whilst Americans and others in the rich countries are reducing emissions slowly, China, India and the rest of the developing world are eager to do exactly what the rich did earlier — use energy to grow their economies. This is fair, just and inevitable.

Can climate change be stopped?

The only way this can stop is if money is spent to junk the existing technology for producing and using energy and less carbon intensive and more efficient options are developed.

europe energy

photo credit: http://www.wikipedia.com

But no one has a commercial incentive to do so. Most technology is developed in the rich world, which uses the most energy per capita and is the most heavily invested in traditional inefficient, carbon intensive energy chains.

They — Australia, Russia and the US are good examples — have preferred to milk their past investments in fossil fuel-based technologies rather than switch over rapidly to clean energy technology even though they have been talking about the problem in annual COP meetings since 1992. Thus, 20 of the 100 years available since 1995, to act, have been wasted.

To be fair, the northern European economies, including France, have been more conscientious than the rest of the rich and have reduced carbon emissions significantly by bearing the additional cost of doing so. Singapore is a stellar Asian example. It reduced per capita emissions by 66 per cent of its 1990 level.

But the rest, particularly the poorer, developing countries, have no incentive to divert their meagre fiscal resources to clean energy other than efficiency and local environmental benefits. But with so many competing priorities: stopping mothers and infants from dying due to poor health care; educating the young; creating basic infrastructure for trade and industry, just keeping energy — the life blood of a modern economy — flowing is tough.

India energy

photo credit: http://www.dalberg.com

Existing agreements are insipid and ineffective

The Kyoto Protocol 1997, the framework guiding the interminable Conference of Parties meetings, lacks teeth. It fixed emission targets for rich countries till 2012 which were weak and inadequate because nothing more stringent was acceptable to the rich — a 6 per cent reduction over 1990 levels. But countries can opt out of the agreement. US, Russia and Canada did just that, making COP even more toothless and bureaucratic.

It’s now 2015 and the world has changed. Extremely wealthy people are to be found everywhere, not just in the earlier “rich” countries. Ruling political, industrial and commercial elites in developing countries have incomes and consumption levels which rival those in the “developed” countries. Poor countries often have very rich governments, though fiscal resources do not filter down to the poor. Traditional archetypes have transmuted. A billionaire from the Forbes List could be living on your street rather than in far off London or New York.

emelda

photo credit: www. blogs.artinfo.com

So the continual “fingering” of rich countries as evil carbon emitters is unlikely to resonate. We are all responsible collectively for the mess we have created. To cut through two decades of verbiage and accumulated legal baggage two things must change.

Two options for delinking development from carbon

First, Paris must agree a common aspirational emissions target which all countries buy into. The level of the target, whilst important, is less so than all countries agreeing to shoulder the burden according to their capacity.

Second, till now we have depended on charity — aid from the rich world — to fund the technology transformation. This is degrading for the poor who have a right to access the available carbon space and inefficient, because allocation and priorities get warped when dealing with “free” money.

Next steps

Agree a common emission target

The world per capita carbon emissions were 4.2 metric tons (Mt) in 1990. This increased to 5 Mt per capita by 2011. The 1990 level is an excellent aspirational level to target. Most developed countries are above the 8 Mt per capita level whilst most poor countries are below 2 Mt per capita. Halving emissions in the developed world and allowing space for carbon emissions to grow two to three times in the poor countries seems a fair deal and a realistic target till 2030.

Improve the science of climate change

We also need to establish with greater the nature of the relationship between carbon emissions; global warming; extreme climate events and the distributional impact thereof. This is sorely needed to establish a sustainable aggregate emissions level which is neither unnecessarily restrictive nor ineffective in stabilizing climate. The next 15 years on top of the 20 years which have passed should be sufficient to hone the science.

Find the money: tax international capital transactions

A transactions tax to fund climate mitigation and adaptation is best. In depressed economic times, such as the present, a new generalized tax is abhorrent. But if the incidence of tax is tiny per transaction, individuals and entities may not feel its pinch. If it has a massive tax base on which it is levied the tax collection could be huge despite the low incidence. Mumbai lunch places, serving a simple, low priced, thali are as profitable as an expensive niche restaurant. The miniscule profit earned per thali is more than made up by the massive turnover. Of course the tax must be progressive and tax only the rich, who enjoy a disproportionate share in wealth creating growth-the root cause of climate change.

A tax on outbound international capital transfers from all countries meets all these criteria. A 0.01 per cent tax can net close to $300 billion annually. This is three times the volume of the 2015 replenishment of the Green Climate Fund proposed at US$ 100 billion.

The bulk of capital-outflow happens from rich or newly rich countries (like China). The purpose is to mitigate risk and increase returns. To insulate poor countries from the tax it could be levied only on those countries which are non-compliant with the emissions target. Since all developing countries, but very few rich countries, will be compliant, this leaves the poor countries out but snags the non- compliant rich. The tax collected would be transferred to a fund manager and overseen by an inclusive and representative board.

A tax puts a tangible cost to not meeting emission targets and creates a reasonable financial incentive for the rich countries. For example, it would reward Singapore for its stellar performance, whilst penalizing newly rich countries, like China, for exceeding the agreed level of emission.

Shared benefits follow shared responsibilities

China tellingly, has already announced that it would reduce emissions going forward. By 2030 they would be 60 per cent below their 2005 level. This should reassure all developing countries that it is possible to grow in double digits every year and still beat the carbon ceiling in future.

Developing countries should consider adopting the carbon ceiling volunteered by China. By volunteering a carbon ceiling they would be emboldened to press for a tax on outbound capital from non-compliant countries-mostly the rich. Of course ultimately every tax is paid by the final consumer- which will be the capital deficit poor countries. But a differential tax on capital flows does have advantages- it levels the field for domestic capital providers and dampens the fluctuating flow of destabilizing hot money into emerging markets.

Climate “warriors” headed for Paris should consider this proposition as they savour the Crottin De Chavignol served to them. Sometimes, the cobwebs have to be swept aside to see the light. There is much cleaning to be done at Paris.

Adapted from the author’s article in the Asian Age, September 17, 2015 http://www.asianage.com/columnists/climate-warriors-head-paris-015

1415 words

Male bias: death by a thousand cuts

death

Photo credit: dangerFantastic.BlogSpot.com

To everyone’s relief, the Governing Council (GC) of TERI appointed a new Director General to replace Dr. R. K. Pachauri (RKP). Seemingly, it was moved to act in response to a lower court ruling staying the operation of the findings of the Internal Complaints Committee (ICC).

The law at work…and play

The Committee findings must have damned RKP, which is why he agitated the matter in court. The stay was based on the evidenced argument that principles of natural justice were not followed by the ICC, thereby disadvantaging the respondent (RKP). Hearings on the issue will continue. But the practical outcome was that RKP resumed work. He had voluntarily proceeded on leave, when the criminal complaint was lodged. There was no legal bar on his rejoining albeit, rather awkwardly, having to operate away from the Head Office and the Gwal Pahari campus, where the complainant works.

Corporate honchos call the shots

The GC which includes luminaries from the business word, academia and government had little choice but to end this Kafkaesque comedy by choosing a DG to take operational control of the institution. In doing so they wisely acted in compliance with the highest standards of corporate governance. No employee should even potentially be able to directly or indirectly use her position to compromise the due process of law.

A professional and a gentleman

Their choice of the new DG-Dr. Ajay Mathur, an ex-senior employee of TERI, is impeccable. A multi-talented engineer (like RKP) turned environmental and energy efficiency policy wonk, with a stellar track record- he has the advantage of straddling both the real world of green technology and the more rarified world of economics and global climate finance.

The ongoing case of sexual harassment against RKP will carry on. Given the convoluted judicial process we follow, the “truth” will likely emerge only in the mists of time, long after the media has lost interest. But four home truths bear attention in the meantime.

Shoddy, knee-jerk laws

First, even our most recent laws lack a comprehensive world view. The 2013 amendments to the Indian Penal Code and the new act extending protection from sexual harassment in the workplace, only protect women. As a first step this is unremarkable in a world dominated by men in powerful executive positions.

But powerful men sexually harassing male subordinates is not breaking news. Why a similar avenue for redress in the workplace should not be available for harassed men is unclear. It shows a tendency for legislators to react to populist vigilantism and not from deep conviction that sexual harassment is an infringement of the workplace rights of any employee.

Bad laws result in perverse incentives

Second, draconian laws do not a more caring or equal society make. On the contrary, draconian laws to protect human rights coupled with a judicial process which lacks the advantage of speed and suffers from an excess of procedural compliance, is a sure recipe for gaming.

In such institutional environments- like the US- the advantage is invariably with the unscrupulous; the rich and the wily. The outcome is a high incidence of miscarriage of justice. This is also the argument against irreparable damage imposed by the State, as in the case of the death penalty. India would do well to abolish such arrogant assumptions of judicial infallibility.

That we need to do much more to protect basic human rights, including the specific case of women, goes without saying. But nuance, granularity, comprehensiveness and proportionate disincentives are the corner stones of good law.

Pious intentions but perverse outcomes

Third, bad laws lead to perverse outcomes. Take for instance the outcome of the 2013 laws. Male Chief Executives now implicitly discriminate against hiring women to work in their personal office to guard against inadvertent transgressions of the law. This discrimination can be neutralized if there was similar protection for male subordinates from a harassing boss. The gender preference for male executive assistants would narrow once the risk of inadvertent sexual illegality is equalized. But a narrow legislative view on the sexual harassment of only women, never created the space for such balancing mechanisms.

Advancing gender parity in the real world

Fourth, is it time that India prescribes quotas for women in power? Moving to a more gender equal world should be a priority.

(A) All government quotas for jobs, promotion or education should have a gender component. This will address the incentive for discriminatory resource allocation to males per the traditional gender roles within the family.

(B) Political parties should be legally bound to field an equal number of women candidates for elections as men.

(C) Government budgets should be gender responsive.

(D) All state owned enterprises and banks; Public Private Partnerships and companies in which the government is a significant (26%) shareholder should be required to publish a gender breakdown of employees by levels/grades with the intention of reaching gender parity, unless special circumstances apply.

(E) The July 6, 2015 judgement of Supreme Court Justices Vikramjit Sen and Abhay Mohan Sapre amends Christian personal law to allow an unwed mother to be the guardian of her child and thereby “legalize” the child’s parentage. The SC Justices based their decision on the generalized principle that in a secular country, religious practices can be divorced from law if they transgress human rights.

Similar progressive changes must be made in the personal law of communities to erode the legal dis-advantages women face in exercising their right to family property, inheritance and maintenance.

The legislative approach to gender parity is no more than a flag, signifying that India is responsive to international trends. We need to detox formal and informal Institutions which perpetuate gender discrimination. Death by a thousand cuts is the way to go.

924 words

Prime Minister Modi says Ni Hou

Ni Hou

(photo credit: india.com)

Arun Shourie- minister in the earlier NDA government and senior BJP leader was being strategically alarmist when he went public on May 1 warning Prime Minister Modi against succumbing to the seductive spell, which the Chinese put on Pandit Nehru (India’s first Prime Minister) eagerly accepting his diplomatic largesse and support whilst remaining firm on giving nothing in return, which was not expressly bargained for and agreed.

Mr. Shourie has a flair for the dramatic and an uncanny ability to be evocative in his speech, sweetly hitting hardest, where it hurts the most. The Chinese “betrayal” of Pandit Nehru’s “brotherly” love by invading India in 1962 broke Nehru’s heart and spirit. He succumbed to the body blow two years later. China supporters maintain that unclear messaging from India forced China to retaliate since it perceived India as being bent on unilaterally disturbing the status quo along an un-demarcated Himalayan border between the two countries. Be that as it may, the China-India 1962 war, in which, despite heroic, determined but futile resistance from an ill-equipped and poorly led Indian army, China soundly trounced India, has left an open wound for India, which is still raw more than five decades later.

One doesn’t need to go back to 1962 to be sure that China is not a natural ally for India. We are just too similar with few complementarities and hugely competing priorities.

India-China, twins separated at birth?

Both countries are in a race for fuel, which neither have and both need to grow their economies and feed their people. One out of every three humans is either Chinese or Indian. China is racing to achieve high income economy status (per capita GNI> US$ 12,746) whilst India is striving to be an upper middle income economy-where China is today (per capita GNI> US$ 4,125). Both need to find export markets to fuel their growth. Both are relative “outsiders” to the high table of developed countries and both are jostling for space. Both peoples are hugely entrepreneurial and compulsively competitive. But there the similarity ends.

Even twins grow differently

India is barely at the threshold of being a lower middle income economy but its international, political engagement is larger than its economic heft. China is already an upper middle income economy but traditionally prefers to remain below the international diplomacy radar and boxes well below its weight, except when it perceives its national interest directly at stake.

India is a democracy of long standing, grounded on the compulsion of complex heterogeneity and plurality. China is a largely homogenous, beneficent, authoritarian meritocracy.

India is has been institutionally and ideologically networked into the developed world due to its colonial heritage and the facility with English. But it is a recent and somewhat unwilling, entrant to the international trade and investment value chains. China’s culture and values are unique and somewhat autarkic but its planned tapping of developed country knowledge, innovation, research and technology market has worked well. Its pragmatism, easy adaptation to change and determined implementation of a growth strategy by integrating into trade and investment value chains, sets it apart from even its East Asian neighbours, most certainly India and previously communist countries.

Given the lack of complementarities and the visibly rivalrous character of the relationship why has Prime Minister Modi steadfastly wooed the Chinese?

Why China eyes India

China knows well what it wants from India. It wants to service India’s booming market with cost competitive goods and services. This is why a bilateral trade target of even US$ 100 billion per year is rather limited for China. Given a choice it would rather shoot for US$ 200 billion so that it can buy into India’s growth prospects for adding at least 1% to its GDP growth over the next few years.

Growth is flagging in China. This is worrisome for the leadership which has built its credibility by “filling people’s pockets to shut their mouths”- a snide reference to the grand political bargain in which Chinese citizens agree to trade in individual freedom for material gains.

India has a trade deficit of 50% of US$ 37 billion with China. Bilateral trade is US$70 billion.  This is higher than the aggregate trade deficit which is 20%. Further expansion of trade will likely worsen this deficit, since China is a more efficient mass producer of goods. Trade with China is consequently only a lever for India with which to negotiate alternative benefits in investment; security cooperation and mutually supportive diplomatic stances in multilateral fora.

So what is it about China which should excite India?

China made Indian Gods

Rather than predictably moan about the trade deficit with China Prime Minister Modi should praise the Chinese people for their achievements.

First, thank them for sending affordable goods to India thereby directly benefiting Indian consumers and forcing Indian industry to become competitive through attrition of uncompetitive businesses.

Second, thank China for being a role model for developing countries on the following three counts. (A) Illustrating the virtues of savings and investment led growth, particularly in manufacturing (B) Establishing the necessity of increasing public investment in human development and social protection (C)  Providing to the developing world a model for enhancing employment, jobs and rapid reduction in poverty

Third, invite them to visit India as Tourists, Students, Scholars and Friends so that our great cultures can learn from each other directly.

The gloved fist

Much has been made of the Chinese excursions into India even as President Xi was eating Dhoklas with Prime Minister Modi in September 2014.  Was this part of an elaborate Chinese plan to remind India that sipping green tea together does not mean China will give up its claims on Indian territory? Or were they a Peoples Liberation Army game plan to stab the reformist Xi in the back and undermine his international credibility? We may never find out. But what it does illustrate is that diplomacy is like sleeping with snakes-one has to sleep light, remain vigilant, move slowly but definitively and remain calm and unperturbed by the ensuing rattles.

Chinese cash

Should we fear Chinese investment in India? Clearly they have the cash and we have the need for it. One reason why we need the cash is to generate jobs. This means that the standard Chinese model of project implementation which relies on Chinese expatriates does not suit our needs. Rather they should build Indian skills in project implementation in keeping with their celebrated record in project implementation.

Partnership with Indian companies is the best model for Chinese investment in India so that social benefits and tax revenue flows downwards to the people of India whilst corporate profits flow to China. Other than a very short negative list of investments in sensitive border areas, Chinese investment should be welcomed. In fact co-partnership in international value chain related production can be of mutual benefit in services, engineering and chemicals.

End game

Prime Minister Modi’s China strategy must needs be minimalist. India looms too large in China’s neighbourhood for comfort. China will pull no punches in consciously trying to establish its dominance in South Asia and thereby cramp Indian influence. This is very similar to the effort India spends on cultivating Vietnam now and Taiwan earlier to the chagrin if China.

The best that India can hope to do is to stop China from playing “spoiler” in India’s unfolding growth story. Chinese support for Pakistani Terror or Maoist rebels in east India is an illustration of such proxy efforts. The best way of neutralizing “spoilers” is to co-opt them into the game as active participants. We must encourage China to develop significant investment stakes and trade links with India so that they too benefit from India’s growth. Actively encouraging highway and rail links across borders is a good place to start. India must aim to become “too big” in the Chinese investment portfolio for it to stall Indian growth- this is what “protects” the US.

It is inconceivable that Mr. Shourie is oblivious of this imperative to reach out to China. Could it be then be that his highly publicized “missive” to the PM was just a charade, dreamt up by the BJP “dirty tricks” department, to build up PM Modi as a strong and forceful leader with the reach; the credibility and the strategic depth to ignore inner-party, high level resistance to warming up China-India relations? In other words was Mr. Shourie’s advice given with the full knowledge that it would be ignored?

Similarly, could it be that the recent government action against Greenpeace and the Ford Foundation for crossing red lines by supporting activities against the national interest, were also initiated to project Mr. Modi’s government, ahead of the China visit, as being strongly nationalistic, able and willing to cock a snook at the US, just to illustrate, that India is not wedded to any traditional power block.

Far-fetched or not, PM Modi leaves for Beijing on a stronger wicket, as a friend of China, than he started with in September 2014, in part, thanks to Mr. Shourie.

Shrimatiji awaits achche din

Reposted from The Asian Age May 5, 2015 where it first appeared http://www.asianage.com/columnists/shrimatiji-awaits-achche-din-800

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India is on a roll. The “helicopter-top down” view looks good. Growth is to be 7.5 per cent this fiscal and 8 per cent by 2018 (World Bank’s India Development Update report 2015) outdoing China, which cannot but be a matter of satisfaction. We are now besting China at their home grown “game” of sustained growth.

Home loan rates are also down. Stalled infrastructure projects are being restarted. Government is “intervening” decisively with upfront public investment to reduce the commercial and political risk for private investors. There is more “method” now to the earlier “madness” in the allocation of natural resources like spectrum and coal mining rights. Gas exploration regulations have been “tweaked” to make them more “investor friendly”. On land acquisition, state governments are showing the way though political rhetoric still trumps consensual problem solving.

Overseas, India is stepping up to the plate forcefully. The global narrative on India is changing. Canada is selling us uranium once again. India’s risk-averse nuclear regulatory framework is being applied innovatively to fit with the international risk sharing, contractual norms. India is once again a part of the global and regional public decision-making chain.

A signal of strategic maturity is India turning down the offer to bid for the 2024 Olympic Games. The growth dividend from such mega public events is iffy. More importantly, this is a frank recognition that it is not yet time for India to party.

How do things look bottom up? High expectations but fewer results just about sum it up. The common woman is still waiting.

That inflation is no longer surging is a relief. More importantly, the subtle but unsavory regulatory dispute between the Reserve Bank of India and the ministry of finance is resolved. Both now have bright lines defining their separate roles for growth sustaining, macroeconomic stability. This augurs well for the poor, who suffer the most from inflation and instability.

The average Indian household is not resilient to “shocks” principally because their pockets are so shallow. Food, cooking gas or kerosene and electricity constitute more than 50 per cent of an average Indian’s household budget despite subsidies. All three perch on an unstable stool of administered prices.

There are huge political economy barriers to making food supply fiscally sustainable. But shaping food demand away from the monoculture production of water intensive, risky crops unsuited to the local agro-climatic conditions can drive local jobs and reduce subsidies.

India is trapped in the Green Revolution led productivity enhancement of fine cereals — rice and wheat — which led to south India consuming chapattis and the north wolfing down dosa, thus creating a pan-India balanced, administered market.

Cereals are a staple diet for the price-sensitive poor because of subsidised retail supply prices. But, more worryingly, administered high farm gate prices — used as an inefficient instrument of income assurance for farmers — have led to fine cereal production, crowding out other weather-resilient local crops. Weather-resilient coarse cereals and legumes languish for want of research and fiscal support.

No surprise then that a fine cereal-intensive diet has become the diet of choice even of the middle class (30 per cent of the population) which, whilst not rich, is not desperately poor either. One-third of even the wealthiest children in India are malnourished, not because they don’t eat enough but because they don’t eat healthy.

A second revolution must herald the end of the great Indian tradition of a cereal-intensive diet. The time is ripe for a second revolution in food demand. Six hundred million Indians, who can afford to eat healthy, need to move to a more balanced combination of lentils, milk products, fish, meat, vegetables, fruit and coarse cereals. Doing so could create the demand incentive for food growers to diversify away from the subsidised monoculture of wheat and rice into more weather resilient local food varieties and packaged options.

Prime Minister Narendra Modi is the gold standard for illustrating the ability of positive outreach and communication to shape opinion and events. He should lend his heft to a campaign for revolutionalising food demand away from fine cereals to more sustainable local substitutes. Associating private sector partners in research and NGOs in extension work for developing and mainstreaming these substitute crops would also be a rich source for productive, new jobs for our science graduates.

Energy (transport and cooking) is the second big-ticket spend for households, which is why cooking fuel and road and rail passenger fares are subsidised. But low oil prices are precariously dependent on the continuation of the current US and Saudi strategy to sanction Iran and Russia by bleeding their oil revenues. This is a temporary factor. Similarly, normalisation of world economic growth is likely to boost oil prices in the medium term, upsetting the “happiness” apple cart for both retail consumers and the stability of the foreign exchange balance of the country.

In electricity, the neglected, dominantly state-owned distribution utilities are crying out to be fixed. Some of their angst relates to their own inefficiency — they continue to lose 27 per cent of the electricity they buy due to theft, collusive metering and poor operations. But below-cost tariffs for domestic and agricultural users have resulted in an accumulated loss of Rs 100,000 crore ($16 billion). This is recognised by regulators as due to the utilities but remains parked as a notional asset with no assurance of when or how utilities are to recover it.

Things have now come to a head. Poor utility finances are holding up the conclusion of power purchase agreements with generators, which in turn negatively affects the operationalisation of 20,000 MW of new investment in generation and shall ultimately impact consumers with either poor quality or higher prices.

At the heart of improving the life of the common woman is to drive hard for stability, reduce the risks she faces and move quickly to dilute the inevitable shock. Traditionally the government has focused on the latter — better disaster management is one of them. But the far more fundamental work is to enhance individual risk resilience. Jobs help the most in meeting this objective.

Realty is a jobs-intensive sector. The construction splurge of the previous years — driven by bank loans available at low and mostly negative interest rates — created a two years’ over-supply of “inert economic assets” which generate no jobs post construction because they are empty shells. The challenge is to fill these empty spaces — shops, offices and homes — with people who are willing either to rent or buy and use them.

Intervening administratively — rent control and allocating vacant space, as done in the past, or even worse, caps on the sale price of property — would be a ham handed, extremely leaky approach out of step with the times.

A better way is for municipalities and banks to provide price disincentive — higher property tax and higher interest rates for loans on properties kept vacant. Having to pay more on vacant properties can discourage speculation, drive better utilisation of inert investments and generate social returns — jobs for people and taxes for the government.

A year is a lifetime in an intensely contested, democratic polity. This is why the government must squeeze out the “fat” in the system whilst planning for the future. Over the past decade, we had much more of the latter and very little of the former. Given the head winds building up, it is critical for the government’s longevity to redeem its compact with voters by delivering real, near-term, fiscally neutral improvements in consumer welfare. Think long but act now should be the mantra

The Pachauri saga: why did the dog not bark?

pachauri

(photo credit: article.wn.com)

The case of Dr R. K. Pachauri, Director General, TERI and IPCC Chair, is curious, precisely because the dog never barked.

Odd, because the alleged, continuous, sometimes physical, invasion of privacy with sexual overtones, apparently happened near continuously since 2013 in the heart of the India Habitat Center, one of the public buildings designed by Joseph Stein, the well-known German Architect and India lover just before he died in 2001. This is a popular, cultural hub and hangout for artists, the literati, social activists, gourmets and retired folk, which attracts over 30,000 visitors every month and where TERI, the NGO Pachauri heads, is housed in a five story high standalone office. TERI and Sunita Narain’s Center for Science and Environment are the two premier Delhi think tanks on energy and the environment.

“Quiet” some-times, partly consensual, sexual alliances of varying degrees are not unknown between powerful chief executives and compliant assistants. Indeed, the worst sexual assaults happen within the home away from public scrutiny.

What is strange is that such alleged behavior was possible in TERI over a period of two years (2013 to 2015) with none the wiser. TERI has a staff of 1200 of which around 35% are women. Women are at the helm in 30% of the high level professional positions.

That so many women, including those in high level, authority, positions, either did not know of the plight of the assistant or chose to ignore it sounds odd. Why didn’t some dog bark?

One strand of thinking credits RKP, as Pachauri is known, with Machiavellian might and control over his entire staff. Pachauri has a larger than life persona which feeds this perception. He is also the author of a salacious novel – an act of bravado he will surely come to regret. He is a charismatic figure, who has as many friends as he has enemies. The reason is obvious.

There are two kinds of highly successful people. Those who are content to enjoy their success privately and retain a “humble”, low key, exterior. Pachauri is not one of those.

He conforms more closely to the braggart, Richard Branson variety, He is over-the-top- in his choice of headgear (he wears a toupee); in his selection of ties and cravats and in the flamboyant style of his clothes although abstemious in his habits; a workaholic who needs little sleep and travels constantly as TERIs main outreach resource. He is also a fanatic for workplace ethics; expects total devotion to work from staffers and leads by example.

TERI’s Delhi Sustainable Development Summit (DSDS), just concluded on February 7 was attended by international luminaries, heads of multilateral development institutions and the leading lights in domestic natural resources management, business and government. A fitting tribute to the convening power of TERI, a child that Pachauri grew over 40 long years since 1974, from a one room outfit in Mumbai to an international network of committed professionals with a common concern for sustainable development.

The aggrieved staffer first approached the TERI internal committee for sexual grievances on February 9, the first working day after DSDS ended, in a sequence of events paralleling the earlier Tejpal case in Goa. What is it about huge, international conferences which either emboldens hitherto compliant assistants into “coming out” or conversely, aggravates the ferocity of the pursuit by the aggressor?

The complainant next filed a complaint with the police of February 13, following which the police acted rapidly and impounded what could be “incriminating” evidence” like computers and other communication equipment from Pachauri’s office.

The fear, voiced most vociferously in social media, is that Pachauri, a part of India’s privileged elite, will get away with his alleged indiscretion. This shows how slowly public perception changes. Escaping the law may have been possible till 2013. Among the many legislative initiatives the previous Congress government launched was amendment of the criminal laws to explicitly criminalise sexual harassment; voyeurism and stalking and impose heavily punitive sanctions including imprisonment.

Like all laws seeking to change behavior – in this case the behavior of men versus women- the law is draconian in the belief that it should scare sexual offender off and should be “stringent” enough to extract “judicially intermediated just-deserts” for such offenders.

The machinery of law is already at work. Pachauri is fearful enough of arrest to have sought anticipatory bail which he now has till February 26. The police are investigating and gathering evidence in the meantime and will file a “charge sheet” in court if a prima-facie case is made out. If this happens Pachauri will have to fight the case in court which is likely to be a long haul. RKP is stuck in this imbroglio for now.

The real issue is can TERI survive without its “Banyan tree”? Over the past four decades, RKP and TERI have spawned a large number of professionals, who today, are either in high level positions in TERI; business; multilateral and bilateral entities; NGOs and government. Will this band of professionals pull the “mother ship” out of stormy waters? Or will it be a case of studied silence and hands off a sinking ship? Watch this blog.

(Disclosure: This writer worked in the energy practice of TERI for five years from 1995 to 2000).

Liberals; smell the coffee please

police

(photo credit: http://www.thehindu.com)

Liberals and human rights advocates are a queasy bunch with no stomach to face up to the honest truth that effective governance implies a better informed and more intrusive government.

Light handed regulation” is the mantra of neo-liberal economics. But such regulation fails unless the regulator can monitor compliance with the rule of law by acquiring more and better, real time data on individuals and business entities.

Take the simple case of ensuring that shop workers are not exploited by owners and get at least one weekly holiday and enjoy restricted, daily, working hours. The “heavy handed” manner this is done is by shutting entire markets down on a specific day and prescribing shop opening and closing hours. The “light handed regulation” option could give shop keepers the liberty to set their own working hours. But to protect workers’ rights, effectively, it would need to generate a real time centrally networked, database of cash transactions- to validate shop working hours and a bio-metric clock- doing the same for employees working hours.  How does this square with the Liberal preference for “small government”?

Consider the case of self-assessment by tax payers. Regulation cannot get lighter than that. But to be effective, it has to be coupled with predictable and significant sanctions against deviant behavior. This means generating a database, on each tax payer, comprising an effective audit trail of all financial transactions and a tax agent randomly trawling this data, using “red flags”, so that deviance can be detected and brought to trial.

Tracking phone call, social media, emails and physical movement of individuals all becomes part of “Big data” which needs to be captured to provide the information required for credible sanctions systems. This is especially necessary, in democracies like India, where all sanctions are appealable and hence must be backed by “judicial quality evidence”.

“Big data” does have unintended but positive outcomes. The clamour, amongst the elite,  for the status symbol of publicly provided, security guards can be greatly reduced, if “security” comes with a GPS enabled, real time, tracking of location and real time reporting, via a smart phone app, of whom the VIP is meeting as a routine procedure.

No Liberal would object to the installation of CCTV cameras where they live, to protect their lives and property. But this comes with the potential downside of intrusive government. Taking cameras closer to people generates “Big data”. Its value lies in the ability to constantly trawl it to prevent crime (or even natural disasters), by identifying “hot spots” and patterns of criminal behavior and to bring criminals to book. Constraints on individual privacy are inevitable. Also there is bound to be misuse, despite checks to prevent gaming; for example the illegal use of individual information, acquired for security purposes, to black mail individuals. There will always be “insiders”, who could trade off any inherent inefficiency in keeping “big data” secure.

Is Edward Snowden a traitor or an American hero? His country folk were divided on the fine point of the “tipping point” between an “insiders” duty to guard official secrets versus the citizens moral responsibility to fight “Big Government”. There is a stark choice between ensuring security and preserving individual freedom. Too much individual freedom (say the right to religious beliefs which may even bar or restrict social integration, as is available in India and the US) can be as negative as too little individual freedom (China, Russia) in the name of national security.

But the flash points where security collides with individual freedom are more often due to “entrenched privilege” being threatened, than the high ground of morality being squashed.  Indian Liberals, who willingly submit to racial profiling and body searches at US and UK immigration, are outraged if an Indian security personnel, so much as dares to question them about what they are carrying in their bags, whilst boarding domestic flights, trains or buses.

Of course most Liberals in India belong to the elite. For them the State and its officials are only to be suffered, not recognised. There is an implicit sense of “entitlement” amongst the elite, who expect to be “served”, even if they dodge their taxes. Much of this springs from the unfortunate spectacle, of fawning subordinates around a preening public official, in much the same manner, as courtiers may have supplicated before our erstwhile Maharajas.

Liberals mourn that there is too little reliance on “trust” and too much emphasis on “surveillance”. But isn’t it ironic, that in the US: the birth place of Liberal policy practices and “small government”, it is “legally enforceable contracts”, which are the life blood of social and even personal interaction. A society governed by “contracts” by definition, is a society which does trust anyone, including the State, to do the right thing.

It is the same with the theory of incentives. The fundamental basis of neo-liberal policy practice is to embed the correct “incentives” in regulations, which then elicit the desired behavioural outcomes associated with the desired results. The provision of artificially embedded incentives, as neo-Liberal policy practice seeks to provide, inevitably come with intrusive metrics of measurement because what is not measured can neither be sanctioned nor rewarded. Regulatory intrusion, big data and “big” government are the inevitable consequence.

In direct contrast, are systems which rely on “belief”, “religion” or “spirituality”. These seek to bind people to a higher morality and blind them to the needs of individuality. Communism is one such “belief” which relies on the morality of the State and not contracts. Of course, it also comes with high levels of State control and intrusive oversight by a bureaucracy of the faithful, exactly as any other religion.

The Liberal position becomes even more laughable when we consider the available “best practice” on poverty reduction; a key objective for developing economies. “Tightly targeted, cash transfers” to the poor is the latest mantra. But these have to be preceded by identification of the poor; close monitoring of their locations and current incomes. In fact, what this requires is a national database of the entire population of India so that we can segregate the poor from the non- poor; citizens from non-citizens and similarly along any other targeted classification (gender, caste, religion or spatial location). 25% of the Indian population is migratory. This requires “spatial location” enabled assessment of their current economic status since poverty levels vary across states. You can’t get bigger data than all these demographics on 1.25 billion people.

The loss of individual privacy is embedded in the logic of extensive digitization of information. Think of the benefits from being able to identify people uniquely; record their demographics (age, marital status, gender, health and education metrics) securely; store transactions securely and access the stored information instantly. If it is alright for the government to be intrusive versus the poor, why is it so horrible for the “privacy” of the rest to be invaded? The much touted right of the individual “to be forgotten” can exist versus other individuals (though how even that could be enforced is not known) but it must never exist against the State.

“Big data” and a better informed government are here to stay. Liberals should wake up and smell the coffee.

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