Daily Current Affairs 04.08.2022 (Understanding the provisions for foreign visits of State government Ministers, India to host UNSC meet on counterterrorism, Cabinet nod for climate pledges, Teaching the Taliban the wrong lessons, Public assets sale and the concern of ‘fiduciary duty’, Trade worries, Crossing the line, Reaping the demographic dividend)

Daily Current Affairs 04.08.2022 (Understanding the provisions for foreign visits of State government Ministers, India to host UNSC meet on counterterrorism, Cabinet nod for climate pledges, Teaching the Taliban the wrong lessons, Public assets sale and the concern of ‘fiduciary duty’, Trade worries, Crossing the line, Reaping the demographic dividend)


1. Understanding the provisions for foreign visits of State government Ministers

Why was Delhi Chief Minister Arvind Kejriwal denied clearance to attend the World Cities Summit in Singapore?

Delhi State Transport Minister Kailash Gahlot has moved court with a plea to set aside the need for travel clearances by the Centre for private foreign visits of State Ministers. 

In 1982, the Cabinet Secretariat issued the first memorandum which stated that foreign visits by members of the State governments in their official capacity would require clearances from the Centre. In 2010, political clearances became mandatory before private visits of Ministers in State governments.

Mr. Gahlot’s petition argues that the need for political clearances for personal foreign visits of State government Ministers violates their right to privacy.

Devesh K Pandey

The story so far: Delhi Lieutenant-Governor (LG) Vinai Kumar Saxena recently advised Chief Minister Arvind Kejriwal against attending the World Cities Summit in Singapore as it was for “mayors of cities”. Now, State Transport Minister Kailash Gahlot — who had also sought political clearance for an official visit to London — has moved the Delhi High Court with a plea to set aside the need for travel clearances by the Centre for private foreign visits of State government Ministers. He has also asked for the framing of appropriate guidelines with respect to the clearances for official foreign tours of Chief Ministers and other State government members.

When did Chief Minister Arvind Kejriwal seek approval for Singapore visit?

According to the petition, on April 5, the Chief Minister received an invitation from the Minister in the Prime Minister’s Office and Second Minister of Finance and Development Singapore, to participate in the World Cities Summit scheduled from July 31 to August 3. The State government’s Deputy Security (Protocol), through a letter dated June 3, requested that all necessary clearances and arrangements for the visit be made. On June 7, the file was submitted for sign-off to the LG office. On June 3, the petitioner had applied for political clearance for his official visit to London from June 12 to 19.

Additionally, the petition also mentioned another instance wherein political clearance for the Delhi Chief Minister’s proposed visit to Copenhagen for attending the 7th C-40 World Mayors Summit in October 2019 was rejected by the MEA “without providing any reasons”.

Under which provisions are approvals required?

On August 16, 1982, the Cabinet Secretariat had issued an office memorandum titled “‘Guidelines regarding foreign travel of Ministers of State government and Union Territories and State government officials”, stating that foreign visits by members of the State governments in their official capacity would require clearances from the Ministry of External Affairs (MEA), Ministry of Home Affairs, Finance Ministry, and the Central Administrative Ministry. It issued another order on March 30, 1995, reiterating the same.

The Secretariat circulated another order on September 3, 2004, modifying the provisions to the extent that the final orders were to be issued by the Finance Ministry. The following directive dated November 2, 2004, stipulated that Chief Ministers required further approval from the Prime Minister’s Office before an official visit. On August 26, 2010, yet another office memorandum made political clearances mandatory before private visits of Ministers in State governments, which was reiterated through an order on May 6, 2015.

The petition seeks a quashing of the 2010 and 2015 office memoranda which require State government Ministers to ask for political clearances for personal visits abroad.

What followed after the approvals were sought?

As no decision on his application was received from the MEA, the petitioner wrote to the Ministry on June 27 raising concerns. He also sought data on the number of such clearances rejected in the past five years. Another letter was sent on July 4, asking for the statutory and constitutional grounds for denial of travel clearances.

Since the LG office had not yet responded on the Singapore visit, the Chief Minister on July 17 wrote a letter addressed to the Prime Minister requesting expedited clearances for the Singapore visit. On July 20, the LG wrote back stating that the visit to Singapore was “not advisable”, pointing out that it was primarily attended by mayoral heads and that, in any case, urban governance in Delhi was not the exclusive domain of the State government. The next day, the State government requested political clearance from the Centre directly. However, no communication on the decision has yet been received from the relevant Central government authorities, the petition said.

On what grounds has the petition been filed?

The petition argues that the need for political clearances from the MEA for personal foreign visits of State government Ministers violates their right to privacy and dignity of their constitutional office; that the “undated” LG letter advising against the proposed Singapore visit is beyond the jurisdiction of his office’s authority; that the use of “gross delay” to effectively deny clearances for official foreign visits, including the Chief Minister’s Singapore visit, is an “arbitrary non-exercise of power”; and that the manner of implementation of the relevant office memoranda on clearances for official visits “suffer from the vice of arbitrariness and un-channeled discretion”. It also states that the “arbitrary and capricious implementation” of the travel clearance Office Memoranda is against national interest and good governance, and impinges upon the right to travel abroad as guaranteed under Article 21.

2. India to host UNSC meet on counterterrorism

Meeting in October to bring representatives of 15 countries, including China and Russia, for talks on emerging threats

In a first, India will host diplomats and officials from all 15 countries of the United Nations Security Council, including China, Russia and the U.S., for a special meeting on terrorism, in Delhi and Mumbai in October.

The meeting of the Counter-Terrorism Committee (CTC), which India is chairing for 2022 as a member of the UNSC, will focus particularly on challenges such as terrorism financing, cyberthreats and the use of drones, said officials.

New Delhi is expected to highlight cross-border threats from Pakistan and Afghanistan at the meeting, which will come two months before India completes its tenure as an elected member of the UNSC (2021-22). In addition, India has been pushing for the UN members to adopt a Comprehensive Convention on International Terrorism (first proposed in 1996), which is likely to be raised during the meeting.

“The event will showcase India’s role as a victim of terrorism as well as a country at the forefront of global counter-terrorism efforts,” said an official involved in the planning.

New challenges

Sources said that while terror financing was now recognised and dealt with through mechanisms such as the Financial Action Task Force (FATF), it was necessary to build templates and “codes of conduct” for newer threats, including financing through cryptocurrency and the use of drones for terror attacks. They said the CTC meeting in India could also pave the way for a possible visit to New York by Prime Minister Narendra Modi in December, when India will be the President of the UNSC for the entire month.

In August 2021, due to the COVID-19 pandemic, Mr. Modi had chaired a UNSC special session on Enhancing Maritime Security virtually, in which several leaders, including Russian President Vladimir Putin, had attended. Officials said India’s UN Mission, where Permanent Representative Ruchira Khamboj presented her credentials on Tuesday, would be working on ensuring maximum participation at the event, in case the Prime Minister decides to travel.

An earlier plan to travel to Washington in December for the Democracy Summit to be convened by U.S. President Joe Biden may be put off, as the summit is likely to be postponed.

Announcing the visit of the delegates, the United Nations said that the special meeting had been convened on October 29 in India, in view of “the increasing threat posed by the misuse of new and emerging technologies”. “The special meeting will specifically focus on three significant areas where emerging technologies are experiencing rapid development, growing use by Member States (including for security and counter-terrorism purposes), and increasing threat of abuse for terrorism purposes, namely (a) the Internet and social media, (b) terrorism financing, and (c) unmanned aerial systems,” the UN said.

Officials told The Hindu that the details of the visit were still being finalised, including whether the visiting delegates would include Permanent Representatives or Ministers at the respective missions of the member states. The meeting, which is normally held in New York, had been discussed and planned since early this year, said sources, as part of the events to mark the 75th anniversary of Independence.

United Nations Security Council (UNSC)

Established in 1945, the United Nations Security Council (UNSC) is one of the five principal organs of the United Nations, charged with the maintenance of international peace and security as well as accepting new members to the United Nations and approving any changes to UN Charter. 

Its powers include the establishment of peacekeeping operations, the establishment of international sanctions, and the authorization of military action through Security Council resolutions; it is the only UN body with the authority to issue binding resolutions to member states.

Role of the United Nations Security Council

The UNSC’s role in international collective security is defined by the UN Charter, which authorizes the Security Council to investigate any situation threatening international peace; recommend procedures for peaceful resolution of a dispute; call upon other member nations to completely or partially interrupt economic relations as well as sea, air, postal, and radio communications.

The UNSC was established keeping in mind certain key features and powers. Given below are the functions and powers of the United Nations Security Council:

  1. The most important function of the UNSC is maintaining peace and security at the international level. It takes the lead in determining the existence of a threat to peace or act of aggression.
  2. Apart from maintaining peace, the Security Council can also deploy UN peacekeeping operations and impose sanctions on states.
  3. The UNSC can also impose diplomatic relations severance, financial restrictions and penalties, blockades and even collective military action if required.

UNSC Members

There are permanent and non-permanent members of the United Nations Security Council.

  • A total of 15 members are there in the Council, out of which 5 are permanent and 10 are not permanent.
  • The five permanent members include China, France, the Russian Federation, the United Kingdom, and the United States.
  • The 10 non-permanent members are:
  • Estonia
  • India
  • Ireland
  • Kenya
  • Mexico
  • Niger
  • Norway
  • Saint Vincent and the Grenadines
  • Tunisia
  • Viet Nam
  • The non-permanent members are elected for two-year terms by the United Nations General Assembly (UNGA).
  • Five members of the UNSC are replaced every year.
  • The members are selected from all the regions of the world. Three members are from Africa, while Asia, Western Europe, Latin America and the Caribbean have two members each. Three members are from African group, 2 members are from Asia-Pacific group, 2 members from Latin America and Caribbean group,  2 members from Western Europe group and 1 from Eastern Europe group.

The First Session of the UN Council was held in London on 17th January 1947. The five permanent members are given ‘great power unanimity’ referred to as the veto power, which means if any of these countries veto a resolution it can’t be passed even if it has the 9 votes needed.

India Elected as Non-Permanent Member of UNSC

In June 2020, India was elected to the UNSC as a non-permanent member, winning 184 out of the 193 votes at the UNGA. This membership is for 2021-22. India was the only candidate from the Asia-Pacific category for the year 2021-22. This is India’s eighth stint at the UNSC. Previously, India had been a member in the years 1950-1951, 1967-1968, 1972-1973, 1977-1978, 1984-1985, 1991-1992 and 2011-12.

Few Important Points related to India being Non-Permanent Member of UNSC – 

India through this non -permanent membership is committed to promoting responsible & inclusive solutions to international peace & security and multilateralism.

5S approach of India – 

  • Samman – Respect
  • Samvad – Dialogue
  • Sahyog – Cooperation
  • Shanti – Peace
  • Samriddhi – Prosperity

Associated Opportunities-

  1. India calls for greater involvement of women and youth to shape a new paradigm.
  2. India will work constructively with partners to bring innovative and inclusive solutions to foster the development
  3. A rapidly shifting global security landscape, the persistence of traditional security challenges, and the emergence of new and complicated challenges, all demand a coherent, pragmatic, nimble, and effective platform for collaboration to ensure sustainable peace.
  4. India will effectively respond to International Terrorism and will combat this menace in all its forms and manifestations. India will pursue concrete and result-oriented action by the Council aimed at:
  1. Addressing the abuse of ICT by terrorists;
  2. Disrupting their nexus with sponsors and transnational organized criminal entities;
  3. Stemming the flow of terror finance;
  4. Strengthening normative and operative frameworks for greater coordination with other multilateral forums
  5. Reforming Multilateral System –
    • Reformed multilateralism: a must for the post-COVID19 era.
    • Promote greater cooperation in multilateral institutions.
    • Widespread concern at the inadequacy of the existing multilateral institutions to deliver results or meet new challenges.
    • A first and vital step is the reform of the Security Council. It must reflect contemporary realities to be more effective.
  6. comprehensive approach to International Peace and Security –
    • To harmonize national choice and international priorities, India’s vision for international peace and security is guided by –
  1. Dialogue and cooperation
  2. Mutual Respect
  3. Commitment to International Law
  4. Innovative uses of technology offer promising opportunities to address humanitarian challenges. India will encourage partnerships to harness the benefits of technological innovation to –
    • Reduce Human suffering
    • Enhance ease of living
    • Build Resilient Communities

India and UNSC

India has been trying to make its way into the list of permanent members of the UNSC but has not been successful. Despite India being a country with a huge population, a growing economy, and nuclear power, it is not a permanent member of the UNSC. 

India is one among the G4 countries (India, Germany, Japan, Brazil), which gives it an edge at becoming one of the permanent members of the UNSC. Given below is a list of claims raised by India to ensure its place as one of UNSC’s permanent members:

  1. India is the fastest-growing economy in the world.
  2. India has recently acquired the status of a Nuclear Weapons State.
  3. India is the second-largest in terms of population and the largest liberal democracy in the world.
  4. The country ranks high in purchasing power parity and is a huge contributor to UN Peacekeeping Missions. 

For India to become a permanent member, apart from garnering the minimum required votes from the other United Nations members, India would need to mend its way with all the UN countries in order to get the required votes. 

Roadblocks in Getting a Permanent Seat at UNSC

  • Although it may seem like a simple process, it is made difficult by the objections of certain permanent members of the Security Council. China, in particular, has been blocking India’s push for a permanent seat at the Council. China believes that granting India a permanent seat at the UNSC will lead to Indian interests being of paramount importance in the geopolitics of the subcontinent, a sentiment echoed by its ally, Pakistan.
  • In addition to this, India is also seen as a proliferating nuclear power. Analysts believe that this is the single most factor that is being a roadblock for India’s UNSC dreams.
  • To grant it a permanent seat without asking for any steps to cap its nuclear capabilities is an exercise in futility. As of late 2019, France has become the latest to join other nations in pushing for India’s permanent UNSC seat, but with the permanent 5 members obstinate about India having to give up its nuclear capabilities to join, India being a permanent member of the UNSC seem like a distant dream.

3. Cabinet nod for climate pledges

However, India’s updated NDC does not include all the promises made at COP26

India ratified pledges made by Prime Minister Narendra Modi in Glasgow last November to accelerate the country’s reliance on renewable energy to power the economy and be effectively free from use of fossil fuels by 2070. However, the approved pledges were fewer than those Mr. Modi committed to.

The Union Cabinet, chaired by Mr. Modi, on Wednesday approved an update to India’s Nationally Determined Contribution (NDC). Mr. Modi had laid out five commitments, or Panchamrit, as the government references it, namely: India will increase its non-fossil energy capacity to 500 GW (gigawatt) by 2030; will meet 50% of its energy requirements from “renewable energy” by 2030; will reduce the total projected carbon emissions by one billion tonnes from now till 2030; will reduce the carbon intensity of its economy by more than 45%; and will achieve the target of “net zero” by the year 2070, when there will be no net carbon dioxide emitted from energy sources. A press statement, following the Cabinet approval, only mentions two of these promises, namely that India is committed to reduce emissions intensity of its GDP by 45% by 2030, from the 2005 level and achieving 50% cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030.

Independent experts said that while the NDCs reflected India’s commitment to sustainable development they were a climbdown from the ambition India had expressed at Glasgow.

“India’s updated NDC does not include all the promises made at COP26 in Glasgow,” Vibhuti Garg, Energy Economist & India Lead, Institute for Energy Economics and Financial Analysis, said in a statement.

Madhura Joshi, Senior Associate, India Energy Transition Lead, E3G, said: “A reiteration of the renewables focus would have provided a fresh impetus for the renewables sector.”

UNFCCC COP26 – Climate Change Conference

The 26th UN Climate Change Conference of the Parties (COP26) was held in Glasgow.

The 26th session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) was initially scheduled to take place between November 9 and 19, 2020, but due to the COVID-19 pandemic, it was rescheduled. It started on October 31, 2021.

Climate change and its implications:

  • The Sixth Assessment Report (AR6) of the Intergovernmental Panel on Climate Change released in August 2021 had sounded an alert for the nations of the world over global temperature rise and associated risks.
  • The report notes how human influence has warmed the atmosphere, ocean and land which is in turn leading to widespread and rapid changes in the atmosphere, ocean, cryosphere and biosphere. This is contributing to the increasing intensity and frequency of extreme climate events like droughts, extreme rainfall, rising sea levels and heatwaves.

Insufficient climate action:

  • Despite the signs of impending planetary emergency, most nations of the world have not shown signs of seriousness with respect to climate action.
  • Global GHG emissions have continued unabated. The climate action envisaged seems inadequate to arrest the rising global temperatures. The 12th Emissions Gap Report released by the UN Environment Programme notes huge gap between the updated emissions reduction pledges made by countries for 2030 and what is needed to keep the rise in global temperature to 1.5 degrees C or even 2 degrees C. This could lead to a rise in temperature by 2.7 degrees C by the end of the century. There is an increasingly narrowing window for the world to taper down emissions before the temperature rises beyond 2 degrees C.

Renewed efforts for global climate action:

  • In this regard, major preparatory conferences and bilateral meetings had been held ahead of the COP26 to persuade countries to raise their emission reduction commitments from the Nationally Determined Contributions (NDC) under the Paris Agreement. There had been a growing call for net-zero emissions by 2050.

Pre-summit goals set for the COP26:

  • The COP26 had set itself four goals even before the start of the climate summit.
  • To achieve global net-zero by the middle of the century and keep 1.5 degrees within reach.
  • To adapt to protect communities as well as natural habitats from the impact of climate change.
  • Mobilisation of finances for the stated goals.
  • To work together so that the rules could be listed out in detail and help in the fulfilment of the Paris Agreement.

Major initiatives announced at the Glasgow summit

Ending deforestation:

  • In the COP26 climate summit’s first major deal, leaders at the COP26 global climate conference have pledged to stop deforestation by 2030 to help slow climate change.
  • According to the Global Forest Watch, in 2020 the world lost 2,58,000 sq. km of forests.
  • Felling trees contributes to climate change because it depletes forests that absorb vast amounts of the warming gas CO2.
  • This agreement expands a commitment by 40 countries as part of the 2014 New York Declaration of Forests.
  • The New York Declaration on Forests is a voluntary and non-legally binding political declaration adopted in 2014. The Declaration pledges to halve the rate of deforestation by 2020, end it by 2030, and restore hundreds of millions of acres of degraded land.
  • Over 100 national leaders have pledged to halt and reverse deforestation and land degradation by the end of the decade. Brazil – where stretches of the Amazon rainforest have been cut down – was also among the signatories.
  • The pledge includes almost £14bn ($19.2bn) of public and private funds to invest in protecting and restoring forests. Some of the funding will go to developing countries to restore damaged land, tackle wildfires and support indigenous communities.
  • Under the agreement, 12 countries pledged to provide $12 billion of public funding between 2021 and 2025 for developing countries to restore degraded land and tackle wildfires.
  • Governments of 28 countries also committed to removing deforestation from the global trade of food including animal husbandry and other agricultural products such as palm oil, soya and cocoa. These industries drive forest loss by cutting down trees to make space for animals to graze or crops to grow.
  • More than 30 of the world’s biggest financial companies have also promised to end investment in activities linked to deforestation.
  • Though the environmental experts have welcomed the move, they have also warned on how a previous deal in 2014 had failed to slow deforestation at all.

Reducing methane emissions:

  • While the main focus of efforts to curb global warming has been on carbon dioxide, experts point out that cutting methane emissions could be one of the most effective interventions to reduce near-term global warming. Although there’s more CO2 in the atmosphere and it sticks around for longer, individual methane molecules have a more powerful warming effect on the atmosphere than single CO2 molecules given their higher global warming potential (GWP).
  • The Global Warming Potential (GWP) of greenhouse gas is its ability to trap extra heat in the atmosphere over time relative to carbon dioxide (CO2).
  • Methane is one of the most potent greenhouse gases and is responsible for a third of current warming from human activities. Some of the major sources of methane emissions include animal husbandry, landfill waste and oil and gas production.
  • The US and the EU have announced a global partnership to cut emissions of the greenhouse gas methane by 2030. The Global Methane Pledge aims to slash methane emissions by 30% by 2030 compared with 2020 levels.
  • Nearly 90 countries have pledged support to this U.S. and EU-led effort. The Global Methane Pledge, first announced in September, now covers emissions from two-thirds of the global economy. While Brazil, one of the five biggest emitters of methane, has signed up, three other large emitter nations — China, Russia and India — have not signed up.

Infrastructure for Resilient Island States:

  • India has launched the Infrastructure for Resilient Island States (IRIS) initiative for developing the infrastructure of small island nations.
  • IRIS initiative becomes critical given that these small island nations remain the most vulnerable countries facing the biggest threat from climate change. They face an existential threat due to climate change.
  • The IRIS is a part of the Coalition for Disaster Resilient Infrastructure (CDRI) initiative.
  • CDRI is a multi-stakeholder global partnership of national governments, UN agencies and programmes, multilateral development banks and financing mechanisms, the private sector, and knowledge institutions, launched at the UN Climate Action Summit of 2019. It aims to promote the resilience of new and existing infrastructure systems to climate and disaster risks in support of sustainable development.
  • The new initiative is the result of cooperation between India, the U.K. and Australia and included the participation of leaders of small island nations such as Fiji, Jamaica and Mauritius.
  • The initiative would involve setting up norms and standards for resilient infrastructure in small island states and coastal areas. IRIS would focus on building capacity, having pilot projects in small island developing states. Promotion of quality infrastructure in the Small Island States will benefit both lives and livelihoods in such states.
  • India’s space agency ISRO will build a special data window for the small island nations to provide them timely information about cyclones, coral-reef monitoring, coast-line monitoring through satellite.
  • The initiative will make it easy for SIDS to mobilise technology, finance and necessary information faster and more effectively.

One Sun, One World, One Grid:

  • The new Global Green Grids Initiative One Sun One World One Grid (GGI-OSOWOG) has been announced at the ongoing COP26.
  • The new GGI-OSOWOG is an evolution of the International Solar Alliance‘s OSOWOG multilateral drive to foster interconnected solar energy infrastructure at a global scale.
  • This initiative aims to tap solar energy and have it travel seamlessly across borders. The initiative will work towards accelerating the making of large solar power stations and wind farms in the best locations, linked together by continental-scale grids crossing national borders.
  • The sun offers a huge source of energy for mankind. All the energy humanity uses in a year is equal to the energy that reaches the earth from the sun in a single hour. Given that the sun never sets and that half the planet is always receiving sunlight, there is the potential to harness solar energy continuously across the globe and trade this energy across borders to ensure adequate energy supply to meet the needs of everyone on earth.
  • Over 80 countries have endorsed the One Sun Declaration.
  • This initiative will bring together an international coalition of national governments, financial organizations, and power system operators.
  • Realizing One Sun One World One Grid through interconnected green grids can be transformational, enabling all the nations of the world to meet the targets of the Paris Agreement to prevent dangerous climate change, to accelerate the clean energy transition, and to achieve the Sustainable Development Goals. These efforts can stimulate green investments and create millions of good jobs. By sharing the sun’s energy, the nations can help build a more peaceful and prosperous world.

India’s New Climate Action Goals

  • India will achieve net-zero emissions latest by 2070. This is notable given that so far India was the only major emitter that had not committed to a timeline to achieve net-zero carbon dioxide emissions and has also argued against the concept of net-zero carbon targets.
  • Renewable energy would be tapped in a big way in India. By 2030, India will ensure 50% of its energy will be sourced from renewable sources. India plans to generate 500 GW of renewable energy by 2030. This marks a 50 GW increase from its current target of 450 GW.
  • India also committed to reducing its carbon emissions until 2030 by a billion tonnes. By 2030, India will reduce the carbon intensity of its economy to less than 45 per cent. India is largely on track to meet, and even exceed, its Paris Agreement targets: reduce emissions’ intensity of its gross domestic product (GDP) by 33 to 35 percent from 2005 levels by 2030.

India’s GHG Emission

Current status:

  • India is the third-largest emitter of GHGs in the world. India accounts for about 7% of today’s global emissions. However, India has extremely low per-capita emissions that are far below the global average.
  • According to the World Bank data, in 2018, India had per capita emissions of 1.8 tonnes. This is projected to expand to 2.4 tonnes in 2030 as per the Paris Agreement obligations of India.
  • In terms of sectoral GHG emissions, data from 2016 shows that electricity and heat account for the highest share of GHG emissions, followed by agriculture, manufacturing and construction, transport sector, industry and land-use change and forestry.

Future outlook:

  • With India’s GDP per capita projected to rise, a rise in carbon emissions in the short term, primarily from energy is expected given that the Indian economy relies heavily on coal and other fossil fuel use.
  • The larger share of services in Indian GDP augurs well for India’s low carbon development path.
  • Though the population growth is slowing, the absolute increase in population and rising consumption behaviour will result in pressure on carbon emissions in the coming years.

India’s Climate Performance

  • India had pledged to cut the emissions intensity of its growth by 33-35% of GDP from 2005 levels by 2030. India has declared that it has so far achieved a 24% reduction on this metric.
  • India has also announced that it would scale up its renewable power target to 450 GW by the end of 2030, in addition to the target of 40% of energy capacity based on renewable energy sources as pledged under the Paris climate agreement.
  • India is also expanding forest cover to create a 2.5 to 3 billion tonne carbon sink.
  • India has recently unveiled a national hydrogen policy to produce hydrogen through green methods, aiming for its deployment in industrial sectors as well as transport, and also for export. This would help India decarbonize its energy sector.

Challenges for India with respect to the new target

Stiff targets:

  • Some environmental experts have expressed doubts over India’s stiff climate action targets.
  • Achieving net zero by 2070 would require India to peak emissions by 2040, following which emissions will have to start to reduce. Available studies suggest that for a 2070 net zero year and peaking year of 2040, India would have to reduce the emissions intensity (emissions per unit GDP) by 85%. This appears a stiff target as notably, India has so far only been able to reduce its emission intensity by 24% from the 2005 levels.
  • To enable such a steep reduction, the share of non-hydro renewable energy has to increase to 65% from the current 11% and the share of electric cars in passenger sales has to go from current 0.1% to 75% by 2040 while the share of fossil energy in primary energy has to decrease from 73% to 40%. These appear too steep a target given India’s financial and technical resources at present.

Implications for India’s developmental process:

  • A study by the think tank Council for Energy Environment and Water said that for India to achieve the net-zero target even by 2070, usage of coal, especially for power generation, will need to peak by 2040 and drop by 99% between 2040 and 2060.
  • This could hurt India’s developmental aspirations.

Finance shortage:

  • The decarbonization of the Indian economy and adoption of renewable energy sources will require huge upfront capital investment. India currently lacks this level of capital and hence will be reliant on external funding as well.
  • The failure of the developed countries to arrange for a $100 billion climate fund annually from 2020 onwards has not materialised as yet.

Lacunae in the Global Climate Action Efforts

Insufficient climate action:

  • The Sixth Assessment Report (AR6) had emphasised that to keep the temperature rising within 1.5°C, global emissions should be reduced by 45% from 2010 levels by 2030, on the way to net-zero 2050.
  • However many high-emitter countries are short of the emissions reductions required by 2030 to restrict global temperature rise to well below 2°C or even the goal of 1.5°C above pre-industrial levels.
  • Global emissions in 2030 are expected to be 16.3% above the 2010 level, as against the call for 2030 emissions to be 45% less from 2010 levels for the 1.5°C goal. Thus there is a need for a significant increase in the level of ambition of NDCs till 2030.
  • The updated NDCs submitted by the parties too would not be sufficient to meet the IPCC recommendations. While several large emitters like the U.K., European Union, China and the U.S. have raised their emission targets, this is still grossly insufficient to meet the temperature goals. At the current rate of emissions even with the updated NDCs, much of the carbon budget would be used up fast.
  • Carbon budgets represent the quantum of CO2 the atmosphere can hold for a given global temperature, best assessed through cumulative emissions and not annual flows.

Overlooking the need for immediate action:

  • The net zero 2050 target is too distant a goal and this might divert attention away from the urgent 2030 target that COP26 should focus on.

Contradictory to the CBDR principle:

  • The net-zero target also seems to be contradictory to the foundational principle of the UN Framework Convention on Climate Change (UNFCCC), which is common but differentiated responsibilities (CBDR). Instead of a common goal, the article argues for a differentiated target year. Developed countries should reach net zero earlier while the developing countries should get more time. The article calls on the developed countries to take up more responsibility for climate action given their legacy emissions. The developing countries should also do what they can, with technological and financial assistance from the developed countries

4. Editorial-1: Teaching the Taliban the wrong lessons

The world appears to have highlighted that short-sighted tactics, and not strategic vision, will decide the future

At a recent Track-2 meeting for Afghan and regional delegates, a senior Taliban official was more than confident that the militant group was well on its way to global acceptance. The “Emirate” had “almost completed” the official recognition process from the international community, the official said, citing the number of countries that now operate diplomatic missions in Kabul, the number of bilateral visits Taliban delegations have made and received, the number of multilateral meetings the Taliban have been invited to in Russia and China, as well as the most recent one in Uzbekistan, where as many as 30 countries including India sent senior envoys to meet around a table with a large Taliban delegation to discuss “Afghanistan: Security and Economic Development” in Tashkent in July.

Conditions and result

The statement by the Taliban official is a sign of the confidence that the Taliban feels that their takeover of Kabul by force one year ago is a “done deal” for the world. It is also a sign of all the wrong lessons the Taliban have taken from the reactions of the international community. Al-Qaeda chief Ayman al-Zawahiri’s killing in a recent U.S. drone strike on a home in Kabul’s posh Sherpur area is proof that the Taliban, including the Haqqanis who reportedly hosted Zawahiri, feel little pressure to keep their end of the Faustian bargain the world made with them in August 2021. Part of that bargain was the Doha agreement signed between the United States and the Taliban on February 29, 2020, which was endorsed by the UN Security Council, and premised on four conditions: Taliban guarantees that they would prevent the use of Afghan soil by international terrorist groups against the security of the U.S. and its allies; the U.S. and Coalition forces would provide a “timeline” for the withdrawal of forces; a political settlement for Afghanistan would arise from Taliban talks with the Afghan (Ghani) government, and that the Taliban would announce a ceasefire. It is fairly clear that only one of those conditions was met, i.e., the U.S. and others withdrew all foreign troops from Afghanistan by August 31, 2021.

As a result, the first lesson the Taliban learnt was that they did not need to keep any promises to the U.S. or to the international community. Apart from the three in the Doha agreement that the group disregarded before the ink on the agreement was even dry, the Taliban went on to make and break several others: taking Kabul and the rest of the country by force; giving key portfolios to those still on the United Nation’s designated terrorist list (for example, Sirajuddin Haqqani is Afghanistan’s Acting Interior Minister), and refusing to form an inclusive government that brought in women, minorities, or even members of non-Taliban groups.

Broken word on rights

Perhaps the most egregious example of their broken word is the one given to Afghanistan’s young girls — female teenage students between Classes 6 and 12 are still not allowed to go to school. Instead, each week brings one more Taliban diktat aimed at keeping women out of an education, out of jobs, and out of sight in particular, with even female television anchors being forced to cover their faces. Other new restrictions mandate that women must be “escorted” in public at all times, ensuring that Afghan women, who are known for their vibrant contributions over the past two decades in every field, are being effaced from society, without a pushback from any quarter.

The second lesson the Taliban have learnt is that stability and the lack of violence beget international complacency. As the chief insurgent force in Afghanistan, the Taliban wielded the “violence veto” in all talks post 2001. As the default power in Kabul now, they have found that stopping the violence helps other countries forget what they have suffered in the past. Proof comes from the number of countries now operating diplomatic missions in Kabul, despite the fact that no country recognises the Taliban. While China, Russia, Iran and Pakistan never shut their missions when the Taliban took over, those who have reopened missions subsequently include most Central Asian countries, the Gulf states including Saudi Arabia, Qatar and the United Arab Emirates, Turkey, Indonesia, and now India.

America has other problems

The next lesson the Taliban have learned is that the U.S. and its allies have bigger problems to deal with now, and interest in Afghanistan, much like in the 1990s, has ground to a trickle. It is clear that as the U.S. squares up to face its “twin challenges” from Russia and China, made more difficult by the war in Ukraine and the stand-off in Taiwan, it has little “bandwidth” for other issues. A case in point is Myanmar, where the military junta overthrew the elected government in February 2021, imprisoned most of the political leadership including Nobel Laureate Aung San Suu Kyi, and is now executing opposition activists at will despite entreaties from the world. It is clear that concerns about human rights, democracy and the will of the people hold diminishing sway, even as global leaders pay lip service to democracy summits, religious freedom conferences and UN Security Council resolutions.

India’s record

Even by such poor global standards, India’s record on the Taliban government has been disappointing. In 1996, the government in New Delhi — a weak and fractious coalition in New Delhi — had formulated a three-pronged policy that was fairly clear: India would have no truck with the Taliban, would support the Northern Alliance forces led by Ahmad Shah Massoud by allowing their leadership to come to India with their families, and extended shelter to more than 12,000 Afghan refugees who were able to flee Taliban rule. This policy held India in good stead for the post-Taliban period 2001-2021, when India was able to build a strong relationship with Afghanistan, became its first strategic partner, crafted a series of important infrastructure initiatives including Parliament, the Afghan-India Friendship (Salma) dam and the Zaranj-Delaram highway, and educated thousands of Afghan students, doctors and military cadets.

The relationship India has held with Afghans since August 15, 2021, however, has been hard to define or fathom. Addressing a Cabinet Committee on Security two days after the Taliban takeover, Prime Minister Narendra Modi ratified the decision to shut down the Indian Embassy in Kabul, but said that along with Indian citizens and needy Sikh and Hindu minority community members, India must provide “all possible help to our Afghan brothers and sisters who are looking towards India for assistance”.

That promise, unfortunately, was high on rhetoric but hollow in reality. India has allowed only citizens and minorities with pre-existing long term visas to enter India, while closing the door to all others. By cancelling all visas that had been issued earlier to Afghan citizens, including government officials, journalists and other frequent visitors, India has turned friends into unwanted entrants. While a total of 60,000 visa applications were received by the Ministry of External Affairs and the Ministry of Home Affairs under the newly created “e-Emergency X-Misc” visa, only a paltry 200 were disbursed by December 2021, and a few dozen more in 2022.

Rather than a consistent stand on ties with the Taliban, the Modi government has now opened talks at the highest levels, with senior Indian officials even meeting Sirajuddin Haqqani, the man leading the group responsible for multiple attacks on Indian establishments, including the deadly bombing of the Indian embassy in Kabul. It is particularly perplexing that India has taken this stand, given its refusal for talks with Pakistan over the terror issue. Even more puzzling, that when India chose to negotiate with Pakistan, it was to send wheat aid to Afghanistan, ignoring the well-established route via Chabahar that it had used in the past.

Significantly, India has joined the list of countries opening missions under the Taliban regime, but has yet to post a diplomat who can restart the process of consular and visa operations. The “technical team” in Kabul is, therefore, essentially a security outpost; a halfway house that deals with the Taliban leadership, but not the people. If the purpose of this mission was to prove itself as a friend to the Afghan people by re-establishing the embassy, then it falls short of the needs of thousands of students waiting to return to India for their studies, patients needing medical care, or a political leadership needing a platform to fight the Taliban’s vision. New Delhi’s moves, like those of the international community, have in fact allowed the Taliban to learn the worst lesson of all, one year after they entered Kabul: that in a world where principles are in short supply, short-sighted tactics, not strategic vision will decide the future.

5. Editorial-2: Public assets sale and the concern of ‘fiduciary duty’

The Air India asset sale sets a dangerous precedent as it could result in liabilities being left on citizens

The sale of the loss-making national carrier Air India to the Tata Group is a move that evoked a mixed response. While some hailed it on the assumption that it would no longer spell a further loss to the exchequer, its opponents felt that a national asset was being sold at a throwaway price without transparency by the Union government.

On October 8, 2021, the Union government announced that Tata Sons was the winner of the bid for the airline for a consideration of ₹18,000 crore; the Tatas would retain ₹15,300 crore of Air India’s debt and pay ₹2,700 crore in cash to the Government. The seller, the Government of India, would retain a liability of ₹46,262 crore that was transferred to a special purpose vehicle, the Air India Asset Holding Ltd (AIAHL) — thereby passing on the liability to individual tax-payer citizens. Thus, what was technically sold was just aircraft routes/landing rights and some core assets of Air India, and not Air India per se.

The sale of an enterprise is different from the sale of its assets (otherwise known as ‘asset sale’), where in order to unlock the value of assets, liabilities are retained by the seller either by himself or through a special purpose vehicle, and assets are sold for a competitive price, as otherwise, the liabilities will surpass the value of the assets, rendering the enterprise value to negative. This is the norm in many corporate transactions.

It appears that this is the logic that was the driving force behind the Air India sale, where some assets (aircraft and a 50% stake in an airport services division) were sold to the Tatas and a major portion of the liabilities retained by the Union government through the AIAHL.

Asset sale, some differences

While an asset sale is normal in a corporate private transaction, the Government needs to exercise caution when selling a national asset to a private player. In a private asset sale, there are independent checks and balances, such as regulatory approvals, and the consent of the secured creditors (mostly banks) who will give their consent to park the liability only when they are satisfied that the promoters or the shareholders of the private enterprise would be able to satisfy the liabilities either from the proceeds of the sale or otherwise.

In a typical asset sale by the Government, these approvals are a mere formality. When the debt is assumed by the sovereign government, no banks that are directly or indirectly controlled by the government can conduct due diligence independently on the nature of the sale and report fairly on whether the proceeds of sale are sufficient to satisfy the debt because the government has given an undertaking to repay the debt or the government may even force banks into a settlement with lesser repayment or even a write-off. Thus, it is citizens who will end up repaying the debts of Air India.

It is prudent to extend the doctrine of ‘public trust’ to the management of public sector enterprises by the government. There is fiduciary duty cast upon the government to act fairly and in a transparent manner while dealing in public assets. Unlike a private asset sale, a government selling public assets and assuming the liabilities without proper planning will impose an enormous debt burden on citizens.

The Air India asset sale needs scrutiny in light of the Government’s new National Monetisation Pipeline (NMP), where public assets will be monetised either as lease or outright sale. Air India’s asset sale and retention of liabilities sets a dangerous precedent as it could result in the selling of public assets to government faithfuls and leaving the liabilities on citizens.

The privatisation of loss-making public sector enterprises may prevent the state from incurring further losses. However, unless the sale proceeds are substantial, genuine and transparent, a crisis of legitimacy may arise.

Electoral bonds

One has the example of the anonymous electoral bonds scheme which taps corporate funding to help any political party and where the details are known only to the ruling party, which could fuel mistrust of such asset sales. A Right to Information filing by the Association for Democratic Reforms showed that with the State Bank of India as the sole authorised dealer of electoral bonds, out of ₹3,429 crore of the total value of electoral bonds generated by the bank (FY19-20), the ruling party at the Centre alone devoured a whopping ₹2,606 crore, or 76% of the total bonds issued so far. This is also the period which saw instances of some major privatisation of public sector enterprises.

The recent award of a contract worth ₹1,126 crore to a Chinese firm (Shanghai Tunnel Engineering Co. Ltd.) to construct an underground rail stretch in Delhi and a contract worth ₹170 crore to another Chinese firm, Taizhong Hong Kong International Ltd., for the supply of wheels to Vande Bharat trains cannot be seen in isolation. It is important to remember that China is an aggressor at the Line of Actual Control. Here, the role of discreet political funding through anonymous electoral bonds needs to be assessed more closely.

Consult States

It is vital to recognise the role of States in establishing a public asset such as Air India, They have actively participated in the growth of the airline in the form of land and other infrastructure to its offices. States were not consulted in the whole process which is a breach of the spirit of ‘cooperative federalism’.

According to Article 1 of the Constitution, India is a Union of States, i.e., the idea of India as a Union lies with the States, which are the owners of land and responsible for the maintenance of other infrastructure. Hence, any unilateral sale of assets by the Union without consulting States would only deepen the mistrust between the Union and the States.

India follows a mixed economy model, where the state negotiates a free market capitalist economy with social welfare principles. The economists, Andrew Glyn, the author of Capitalism Unleashed and John Maynard Keynes, the propounder of ‘Keynesian economics’ argue that ‘unleashed’ capitalism leads to widening inequality, diminishing social welfare, lowering demand, and thus slower economic progress. The devastating effect of the 1930s Great Depression is a case in hand. Thus, Keynes, while recognising a profit-driven market place, advocated social welfare policy interventions such as social uplift, full employment, to ‘leash’ capitalism, and public sector enterprises (with their social obligation) play a constructive role in achieving it.

In a mixed economy, private participation is encouraged in areas where government finds it difficult to perform, without making compromises on the social obligation of the state which is as important as a commercial viability. The role Air India played in the repatriation of Indians stranded abroad during the COVID-19 pandemic, its evacuation flights during wars and connecting remote areas to the mainland are some examples of social intervention that have to be kept in mind. By divesting the assets of Air India, the Government has stripped the assets and nationalised the debts to be serviced by citizens. If this logic and process is extended to the proposed National Monetisation Pipeline with discreet electoral bonds and without consulting States, no privatisation exercise by the Union will ever have any legitimacy.

6. Editorial-3: Trade worries

The burgeoning trade deficit is set to swell the current account deficit

July’s provisional trade data should trigger early warning signals among policymakers, as the first year-on-year contraction in exports in 17 months, albeit marginal, and a 44% jump in imports, sharply widened the trade deficit to a third successive monthly record. The export performance is of concern, reflecting a slowdown in overseas demand for Indian merchandise, the competitive advantage gained by the rupee’s sizeable depreciation against the U.S. dollar notwithstanding. While the Commerce Ministry has sought to explain away the 0.8% slide in last month’s exports as largely being a result of inflation-control curbs, the Ministry’s preliminary disaggregated data suggest several key sectors including engineering goods, gems and jewellery, garments and yarn and textiles, and drugs and pharmaceuticals, which were mostly outside the purview of those measures, also suffered contractions. And viewed on a sequential basis, the slide in exports from June’s level is a disconcerting 12.2%. Engineering goods, which at more than 26% represented the largest share of merchandise shipped overseas in July, contracted 2.5% from a year earlier and also shrank 2.9% sequentially. Even granting that the Government’s introduction in late May of a stiff export tax on a range of steel products, with a view to boosting their domestic availability and cooling price gains, was likely to have constrained exports of this segment of engineering goods, the contraction in the broad category points to a clear slowdown in demand in the advanced economies.

The latest S&P Global PMI data from the U.S. and the eurozone for economic activity in July is also far from reassuring. As per the PMI data, output across Europe’s major economies sharing the euro as common currency shrank for the first time since February 2021 as a worsening manufacturing downturn combined with a slowdown in the service sector to drag the composite index into contraction territory. The U.S. economy, which has now contracted for two successive quarters putting it on the edge of a recession, saw manufacturing PMI post its lowest reading in two years as output and new orders declined in July. Given that the U.S. and the eurozone combined consumed almost a third of India’s goods exports in the last fiscal year, the prospect of July’s export slowdown deepening as demand in these markets weakens appears increasingly more likely. Imports continued to expand at a robust clip, driven largely by the expanding domestic demand for essentials including crude oil, coal, edible oils and electronic items. Coal and coke alone exceeded $5.1 billion. The augury from the trade data is that the external sector faces increasing vulnerability as the burgeoning trade deficit is set to swell the current account deficit, adding pressure on the rupee at a time when portfolio investments from overseas have been negative, and foreign direct investment has been significantly weaker.

7. Editorial-4: Crossing the line

B.S. Koshyari seems intent on exceeding his brief as Maharashtra Governor

Maharashtra Governor Bhagat Singh Koshyari was tactless in his tasteless comment at a public event recently, where he brought up the tensions between Marathi speakers and people from other parts of the country who have made the State their home. The Governor, inappropriately for the position that he occupies, taunted Marathi speakers by saying that if Gujaratis and Rajasthanis are removed from Maharashtra, especially from Mumbai and Thane, no money would be left there, and Mumbai would lose its status as India’s financial capital. The statement triggered a storm in the State that has a strong stream of regionalism in its politics, forcing even the BJP to distance itself from him. Maharashtra is a growth centre of the country and attracts talent and investments. Ethnic tensions, and the questions regarding the character and status of Mumbai, which were extremely volatile topics in State politics at one point, are now dormant. The Shiv Sena and the Nationalist Congress Party have a distinct regional character, while the Congress and the BJP vie for the support of linguistic minorities too. But no party frames its politics as an ethnic face-off. In this context, Mr. Koshyari’s statement was unwise. He has since recanted his statement, and apologised.

The long list of transgressions by Mr. Koshyari, and his latest gaffe, should serve as a reminder to all Governors to be judicious, and mindful of the borders of proper conduct. In November 2019, Mr. Koshyari had sworn in a government after a night of political intrigues, in a hushed manner, and it did not last even to test its majority in the Assembly. Once the Maha Vikas Aghadi (MVA) government was formed under the leadership of Uddhav Thackeray, Mr. Koshyari turned blatantly hostile towards it. In October 2020, he taunted the Chief Minister for keeping places of worship closed to contain the spread of COVID-19, asking him whether he had turned secular. Protests erupted and the Union Home Minister, Amit Shah, was disapproving of the taunt. He refused to accept the list of 12 people that the State cabinet had recommended for nomination to the legislative council. Mr. Koshyari did not allow the election of a new Speaker of the Assembly for more than a year after the resignation of the previous Speaker, citing excuses. He suddenly decided to bury all that to allow the election of a new Speaker immediately after the formation of a new government of the breakaway faction of the Shiv Sena and the BJP, following the fall of the MVA government. He made thoughtless remarks about Chhatrapati Shivaji and Savitribai Phule, icons of Maharashtra’s cultural pride and social progress. The Centre, which appoints Governors, must make sure that such conduct is not rewarded or tolerated.

8. Editorial-5: Reaping the demographic dividend

India needs to invest in quality school and higher education as well as healthcare

The UN report, World Population Prospects 2022, forecasts that the world’s population will touch eight billion this year and rise to 9.8 billion in 2050. What is of immediate interest to India is that its population will surpass China’s by 2023 and continue to surge.

A long-time critic of China’s population policy and author of Big Country with An Empty Nest, Yi Fuxian, believes that without its one child policy, China’s population, too, would have naturally risen and peaked at 1.6 billion in 2040, allowing the world’s second-largest economy to enjoy a much longer “demographic dividend.” Instead, China is enduring an ongoing population implosion, which by 2050, will leave it with only 1.3 billion people, of whom 500 million will be past the age of 60. India’s population, by contrast, would have peaked at 1.7 billion, of whom only 330 million will be 60 years or older.

Simply put, India is getting a demographic dividend that will last nearly 30 years. How it handles this windfall will determine if it will rise to the top of the economic league table by the end of this century or continue to eddy at lower middle-income levels. A sceptical world is watching.

India’s potential workforce

Most optimistic about India’s future rise are major consulting firms. Deloitte’s Deloitte Insights (September 2017) expects “India’s potential workforce to rise from 885 million to “1.08 billion people over the next two decades from today”, and “remain above a billion people for half a century,” betting that “these new workers will be much better trained and educated,” than their existing counterparts. It contends that “the next 50 years will, therefore, be an Indian summer that redraws the face of global economic power.”

McKinsey & Company’s report, ‘India at Turning Point’ (August 2020), believes the “trends such as digitisation and automation, shifting supply chains, urbanisation, rising incomes and demographic shifts, and a greater focus on sustainability, health, and safety are accelerating” to “create $2.5 trillion of economic value in 2030 and support 112 million jobs, or about 30% of the non-farm workforce in 2030.”

The Economist is optimistic about India’s future too. In its May 14, 2022 issue, it had this to say about India, “As the pandemic recedes, four pillars are clearly visible that will support growth in the next decade; the forging of a single national market, an expansion of industry owing to the renewable-energy shift and a move in supply chains away from China, continued pre-eminence in IT, and a high-tech welfare safety-net for the hundreds of millions left behind by all this.” But not all are so bullish about India.

The Financial Times in an article, ‘Demographics: Indian workers are not ready to seize the baton’, believes that India’s bad infrastructure and poorly skilled workforce will impede its growth.

RAND Corporation’s report, ‘China and India, 2025, A Comparative Assessment,’ commissioned by the U.S. Secretary of Defense endorses this view as does the 2018 report, ‘An Indian Economic Strategy to 2035’, released by the Australian government and another on India from the Organisation for Economic Co-operation and Development (OECD) titled, “Going for Growth’‘. Their pessimism may be overstated and even outdated today. It is possible that McKinsey & Company and Deloitte are seeing something many others are missing out on.

‘India: an open society’

There is so much going on for India today compared to China, the only country it can be reasonably compared to. It is still a young country and in a much better position to transform itself compared to China of the 1970s. It is still an open society where mass protest matters and produces results. Indians have not been traumatised as Chinese were at the time of Mao Zedong’s death and in the aftermath of two events he set off and which roiled China for decades — The Great Leap Forward and the Cultural Revolution.

The IT technologies now available in India, and most importantly the Internet they run on have matured exponentially. Many things right from video conferencing to instantaneous payments and satellite imaging are getting better and cheaper by the day.

Thanks to the COVID-19 pandemic, we know these can revolutionise learning and transform Indian society at an astonishingly low cost, unimaginable through much of China’s economic liberalisation.

Creaky and inadequate as they are, India’s administrative systems manage to deliver and its infrastructure is in far better shape today than it was for China at the start of its reforms. Nor did India impose the equivalent of China’s one child policy that has seen China suffer the consequences of a prematurely ageing society with a skewed gender ratio.

Deep divide in China

India does not have a Hukou system which in China tethers rural folk to rural parts creating a deep divide between a small and prosperous urban China and a much larger, very deprived rural China about which the world knows so little about.

As Scott Rozelle at Stanford University’s Centre on China’s Economy and Institutions, writes in his book co-authored with Natalie Hell, Invisible China – How the Urban Rural Divide Threatens China’s Rise, “Thanks to the Hukou system disincentivising migration to urban areas, only about 36% of China’s overall population is urban and fully 64% is rural (some 800 to 900 million people).” The huge divide between urban and rural China is, according to Rozelle, almost unbridgeable.

To wring the best out of its demographic dividend, India needs to invest massively in quality school and higher education as well as healthcare — sectors it has neglected for decades — across India on an unprecedented scale, literally in trillions of rupees between now and 2050 when it would have reached the apogee of its population growth.

India must seize the moment and not be incremental in its approach. Given the will it can initiate and see through a transformation that will stun the world, even more than China’s has so far.

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