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Daily Current Affairs 07.09.2022 (The Chilean referendum for a new constitution, The controversy over K.K. Shailaja’s nomination for the Ramon Magsaysay Award, SC asks Punjab, Haryana CMs to meet on SYL canal dispute, India, 7% plus annual growth, and the realities, For Vizhinjam business as usual is not an option)

Daily Current Affairs 07.09.2022 (The Chilean referendum for a new constitution, The controversy over K.K. Shailaja’s nomination for the Ramon Magsaysay Award, SC asks Punjab, Haryana CMs to meet on SYL canal dispute, India, 7% plus annual growth, and the realities, For Vizhinjam business as usual is not an option)

5-4

1. The Chilean referendum for a new constitution

What led to the referendum? What were some of the proposed amendments?

The people of Chile resoundingly rejected a new constitution which was set to replace a charter imposed by General Augusto Pinochet 41 years ago.

In 2019, over a million people took to the streets of Chile for greater equality and more social protections. The protests culminated with the then right-wing President Sebastian Piñera approving a referendum on the constitution.

The main changes to the constitution involved reforms to the pension system, mining grants, the nature of property ownership as well as policies with respect to the environment.

Saptaparno Ghosh

The story so far: The people of Chile resoundingly rejected a new constitution which was set to replace a charter imposed by General Augusto Pinochet 41 years ago. Amid heavy turnout for the referendum, 61.9% of the voters rejected the draft document. President Gabriel Boric who had lobbied hard for the new document, said the results made it evident that the Chilean people “were not satisfied with the constitutional proposal that the convention presented to Chile”.

What was the need for a new constitution?

In 2019, over a million people took to the streets of Chile for greater equality and more social protections. According to the World Bank, Chile has been among Latin America’s fastest-growing economies in recent decades. However, more than 30% of the population is economically vulnerable and income inequality remains high. The 2019 protests sought reforms to address this inequality, which was in part spurred by the involvement of private sectors in social realms. The protests culminated with the then right-wing President Sebastian Piñera approving a referendum on the constitution. In October 2020, 78% of Chileans approved a proposal to draft a new constitution.

How was the new constitution drafted?

 In the national plebiscite of 2020, the voters had to tackle two main points: firstly, whether the constitution should be changed at all; and secondly, whether the new constitution would be prepared by a constitutional convention of members elected directly or a mixed constitutional convention —consisting of both members of Parliament and directly elected citizens in equal proportion. Seventy-nine per cent of voters suggested that a directly elected constitutional convention be entrusted with this duty. A second vote conducted between May 15 and 16 in 2021 elected the members of the constitutional convention. The 155-member convention reserved 17 seats exclusively for indigenous people — ensuring representation of the varied communities constituting approximately 12.8% of the country’s total population as per the 2017 census. Further, in order to ensure gender parity, it was mandated that neither gender can have more than 55% representation in the convention. Also, independent members were to be in majority. The constitutional convention in charge of the process commenced work in July 2021.

What changes did the proposed constitution entail?

The main changes to the constitution involved reforms to the pension system, mining grants, the nature of property ownership as well as policies with respect to the environment.

Chile’s 1981 pension system mandated that all wage and salary workers pay a percentage of their gross earnings into a pension fund administered by varied private pension fund administrators (AFPs). In simple words, profit-making national or foreign liability companies managed social security funding. The then-Chilean government stated that the move was motivated by efficiency and fiscal concerns, and a wish to reduce the role of government in economic affairs. The earlier system based on the pay-as-you-go mechanism had ensured that pensions were not subjected to financial market fluctuations. Further, the incumbent Finance Minister of Chile Mario Marcel had pointed out recently that the 1981 system allowed for a lower level of contributions from workers and companies compared to other countries.

President Boric had proposed replacing the private sector-held system with a public one — among the biggest demands during the 2019 protests. Reuters, quoting Mr. Marcel, reported in March this year that the government would send the long-awaited reform bill to Congress next year. According to ratings agency Fitch, the existing pension system’s assets are equal to about 60% of the Chilean GDP. “Changes to the Chilean pension system could affect the ability of Chilean corporates to raise financing in the local market. The existing system encourages national savings and is the primary source of local financing for long-term investment projects used by many companies in the country,” it states.

President Boric has also been a proponent of increasing mining taxes and royalties. During his campaign, he had also proposed setting up a national lithium company. Chile is the world’s second-largest producer of lithium after Australia.

Recent amendments have stipulated that the state has an “absolute, exclusive, inalienable and imprescriptible domain on all mines.” Exploiting natural resources (such as coal and copper, among others) has helped Chile prosper but fostered sizeable social inequality. The text of the amendment permitted certain ‘mining concessions,’ only if they serve the public good as determined by the judiciary. Fitch stated that a change in direction could hinder investments in the sector, especially large long-term investments. It added that potential concerns include the increased role of indigenous people in new project approvals, changes in property and water rights, and unclear terms of compensation if an asset is expropriated.

The new Chilean constitution was to also grant freedom to own all properties and goods, except those which “nature has made common to all men” or which should be collectively owned by the country as a whole. A qualified quorum law would establish requirements for the acquisition of properties to better serve the interests of the nation, including considerations about national security, public health utilities, and preservation of the environment. It recognises that the environment must be preserved and it is the right of the community to live in an environment free of contamination. The erstwhile constitution’s 1981 Water Code let the government grant ‘free water rights’ to private entities. This ended up creating a market for water with the state unable to supply enough for domestic consumption. Bloomberg reported in February that a proposal to annul free water rights for private concerns was approved in an initial vote by the convention’s environmental committee. This effectively meant that mines, agribusiness and utilities would have to seek temporary permits to use water. Additionally, the revised mechanism would prioritise human consumption, stability of water reserves, and indigenous rights.

2. The controversy over K.K. Shailaja’s nomination for the Ramon Magsaysay Award

What is the main reason being given for declining the award? What was the Hukbalahap movement in the Philippines?

The CPI (M) cited the ‘anti-communist’ credentials of the former Philippines President as the reason for declining the offer.

Ramon Magsaysay was the seventh President of the Philippines. He came into prominence with his appointment as the Secretary of National Defence to deal with the communist-led Huks movement.

President Ramon Magsaysay led a massive anti-Huks campaign in 1954 with a reorganised military and intelligence. Through the operation, his government forces captured 88 Huks, killed 43 and burned more than 500 enemy huts.

Sumeda

The story so far: The decision of former Kerala Health Minister K.K. Shailaja to decline an offer to be considered for the prestigious Ramon Magsaysay Award this year has sparked a row following allegations that the CPI(M) (Communist Party of India (Marxist)) restrained her from accepting the honour.

Why did the CPI(M) decline?

The party cited the ‘anti-communist’ credentials of the former Philippines President as the reason for declining the offer. Magsaysay was a “staunch anti-communist” who oversaw the defeat of communists (Hukbalahap) in Philippines in the 1950s, leaders of the Left said. “…this award is in the name of Ramon Magsaysay who has a history of brutal oppression of the communists in the Philippines,” said CPI(M) general secretary Sitaram Yechury to news agency PTI.

Ms. Shailaja told The Hindu that she turned down the award after consulting the central leadership. “The NGOs may not be in favour of the communist ideology. And hence it was not right that I receive it as an individual because I was considered for something which was actually part of a collective effort. So, I decided not to accept the award. I thanked them and politely refused the award saying I was not interested in receiving it in an individual capacity,” Ms. Shailaja said.

Who was Ramon Magsaysay?

Born in 1907, Ramon Magsaysay served as the seventh President of the Philippines from December 1953 to March 1957 before he was killed in a plane crash on Mount Manunggal in Cebu island.During World War II, he served as a guerilla leader against the Japanese as part of the 31st Infantry Division of the Philippines. The U.S. took note of his military leadership during the war and appointed him as the military governor of his home province after the Philippines attained independence in 1946. Ramon Magsaysay started his political journey with his election to the House of Representatives in 1946. He came into prominence with his appointment as the Secretary of National Defence to deal with the communist-led Huks movement. In 1953, Ramon Magsaysay became President of the Philippines. As President, Magsaysay led several agrarian, military and administrative reforms. His three-year tenure is often cited as the ‘golden years’ of the Philippines.

What is the Ramon Magsaysay Award?

Following the death of President Ramon Magsaysay in 1957, the Rockefeller Brothers Fund (RBF) established the Ramon Magsaysay Awards in the President’s honour in agreement with the Philippines government. Later, the Fund set up the Ramon Magsaysay Award Foundation, a non-profit organisation to manage Asia’s biggest honour that recognises selfless work transforming lives. Regarded as Asia’s version of the Nobel Prize, the award was initially given for contributions to government service, public service, community leadership, journalism, literature and creative communication arts, and peace and international understanding. The category of ‘emergent leadership’ was added later.From India, 58 have bagged the international honour. Some of the past awardees include Mother Teresa, Satyajit Ray, Verghese Kurien, Arvind Kejriwal, Mahasweta Devi and Aruna Roy.

What about the campaign against the communist rebellion?

The Hukbalahap was a communist-led, peasant-based movement with its roots in the pre-colonial era of political, economic and social inequalities. It was founded in the 1940s to fight the Japanese Army that had invaded the Philippines. A member of the Communist Party of the Philippines, Luis Taruc, was its first commander. The Hukbalahap emerged as a popular, well-organised, highly-trained force that aimed to seize power once the war ended. However, mistrust grew between the U.S. and the Huks which resulted in serious confrontations between the U.S. Army and the rebels. Backed by U.S. forces, the Philippines government disarmed the rebels and arrested their leaders. During the first elections held in the Philippines after its independence, a few from the Hukbalahap also contested and won including Luis Taruc, but they were unseated. The Huks then retreated to jungles in central Luzon where they began to restructure their organisation and resume plans to overthrow the newly elected Philippines government. They enjoyed massive support from the people who were still waiting for land reforms and were dismayed with corruption within the government.

President Manuel Roxas intended to fulfil his promise of removing the Huks from the island. According to an analysis by the U.S. Army Centre of Military History, “The Philippine Military Police Command, reorganised with the Police Constabulary after the war, joined Civil Guards on indiscriminate “Huk Hunts” wherever they thought Huks or their sympathisers were located. Preying on the people for supplies, food, and information (often obtained through intimidation and torture) they provided opportune and popular targets for Taruc’s forces. They proved the best recruiters for the Huks, who gained new members with each passing day. This was the real start of the insurrection.” Between 1946 and 1950, the Huks took control of large patches of the islands and targeted the Philippine Army and Police Constabulary.

To deal with the threat of an uprising, President Elpidio Quirino appointed Ramon Magsaysay as the Secretary of National Defence — a vocal spokesperson against communism. Using his experience of guerilla warfare, Magsaysay reformed the Armed Forces of the Philippines, let go of ‘corrupt’ officers and built public support. He launched the Economic Development Corps (EDCOR) project to establish resettlement colonies for the Huks, provided ‘cash for guns’ to facilitate their return to mainstream society and pushed for a land reform law. Later as President, Ramon Magsaysay led a massive anti-Huks campaign ‘Operation Thunder-Lightning’ in 1954 with the help of a reorganised military and intelligence. “When it ended in mid-September, government forces had captured 88 Huks, killed 43, accepted the surrender of 54 others, and destroyed 99 production bases, burned more than 500 enemy huts, and captured 99 weapons,” says Major Lawrence M. Greenberg, the author of the U.S. military analysis on the rebellion.

3. SC asks Punjab, Haryana CMs to meet on SYL canal dispute

In the larger interest of the country, you have to sit down and work it out: court

The Supreme Court on Tuesday drew an assurance from the State of Punjab that Chief Minister Bhagwant Mann will meet his Haryana counterpart, Manohar Lal, “within this month” to discuss the construction of the Sutlej-Yamuna Link Canal which has been languishing for two decades.

The court said the canal was meant to address water shortage. “Water is a natural resource and living beings must learn to share it, whether it be individuals, States or countries… There is a shortage. But if you look at it only from the point of view of the State, then somebody will look at it from the point of view of the city… Then what will happen? In the larger interest of the country, you have to sit down and work it out. It cannot be left as a festering wound,” Justice Sanjay Kishan Kaul, heading a three-judge Bench, addressed Punjab and Haryana.

The observations came after the Centre complained that Punjab had “refrained” from coming to the negotiating table to engage in talks with Haryana over the issue. The construction of Punjab’s portion of the canal had led to militant attacks in the 1980s. The issue had also been a political thorn for successive governments in Punjab, so much so that it led to the State’s unilateral enactment of the controversial Punjab Termination of Water Agreements Act of 2004. This law was, however, struck down by a Constitution Bench in 2016, dashing the hopes of Punjab’s farmers to reclaim lands acquired for the SYL canal project.

Assurance from Punjab

The assurance from Punjab came after Attorney-General K.K. Venugopal, for the Centre, placed on record a letter dated September 5 from the Secretary, Ministry of Jal Shakti. Mr. Venugopal, referring to the letter, said that “despite various endeavours, Punjab did not join the negotiating table”. Punjab’s abstention was despite its assurances to meet with the Haryana Chief Minister in an effort to resolve the canal dispute amicably.

On the other hand, Mr. Venugopal said, Haryana had been pressing for the implementation of the Supreme Court’s decree in 2002 to complete the construction of the SYL canal. The Centre had been previously assigned the role of an arbitrator between the two neighbouring States. The Ministry said the construction of the canal and other carrier channels ought to be completed even as discussions on water-sharing could continue for arriving at an agreement.

The court said a negotiated settlement between the States was a matter of security concern, and affected the entire nation. If the States do not meet and resolve their issues, “other forces start to take root”, it said.

Justice Kaul said countries were able to settle international boundary disputes. “Water rights among countries are resolved,” the judge said. The court listed the case after four months, on January 18, 2023.

Sutlej Yamuna Link Canal

  • It is a proposed 214-kilometre-long canal connecting Sutlej and Yamuna rivers
    • Out of which 122 km was to cross Punjab and 92 km in Haryana
  • It was planned in 1966 post the reorganisation of state of Punjab into Haryana and Punjab
  • Punjab had rejected this proposal on the basis of Riparian Principle, which states that the usage rights of the water flowing in rivers rest with that owners of the land beside the river
    • It also points to the lack of ground water availability which negates any possibility of sharing water
  • Haryana is also suffering from water crisis and needs water resources of the proposed link canal to fulfil i’s drinking water requirement
  • Haryana has already built its share of project with almost no action from Punjab side on SYLC.

The Shares

  • Upon meeting and assessment, water flowing in the two rivers was assessed to be 15.85 MAF (Million Acre Feet) per year. This was divided amongst 3 stakeholders
    • 8 MAF per year to Rajasthan,
    • 7.20 MAF to undivided Punjab and
    • 0.65 MAF to J&K
  • Post the reorganisation, Haryana was allocated 3.5 MAF out of 7.2 MAF
  • In a reassessment in 1981, Out of 17.17 MAF,
    • 4.22 MAF was allocated to Punjab,
    • 3.5 MAF to Haryana, and
    • 8.6 MAF to Rajasthan

The Canal

  • In 1982, then PM Indira Gandhi launched the construction of the SYL Canal with a ceremony in Kapoori village in Patiala district.
  • But the Akalis launched an agitation in the form of Kapoori Morcha against the construction of the canal.
  • This was followed by the signing of an accord between then PM Rajiv Gandhi and then Akali Dal chief Sant Harchand Singh Longowal signed for a new tribunal to assess the water.

The Tribunal

  • The Eradi Tribunal recommended an increase in the shares of Punjab and Haryana to 5 MAF and 3.83 MAF, respectively.

The Canal and Militancy

  • Series of violence:
    • In 1985, Longowal was killed by militants, less than a month after signing the accord.
    • In 1990, a chief engineer M L Sekhri and a Superintending Engineer Avtar Singh Aulakh were killed by militants.
    • Labourers were shot dead in Majat village near Chunni and Bharatgarh near Ropar.
    • This led to construction coming to a halt.
  • In the backdrop of these incidents, Punjab leaders have been cautioning the Centre not to rake up the issue again, which could be misutilized by Pakistan and other secessionist groups

Punjab’s argument

  • Issues of water availability:
    • As per Central Ground Water Authority report , many areas in Punjab may go dry after 2029.
  • Overexploitation of groundwater:
    • Punjab produces Rs 70K Cr worth of paddy and wheat every year
    • About 79% of the state’s area is over-exploited.
    • Out of 138 blocks, 109 blocks are “over-exploited”, two blocks are “critical” , five blocks are “semi-critical” and only 22 blocks are in “safe” category. In such a situation, the government says sharing water with any other state is impossible.

Haryana’s claim

  • Contribution to central food pool:
    • Which now will be jeopardised due to inability to provide water through irrigation
  • Overexploitation of groundwater for irrigation:
    • With regions in Southern Haryana having water depleted up to 1700 feet

4. Editorial-1: India, 7% plus annual growth, and the realities

Given the desire to achieve developed country status in the next 25 years, the required rate is in the range of 8% to 9%

The National Statistical Office’s real GDP growth estimate of 13.5% for the first quarter of 2022-23 is 2.7% points lower than the Reserve Bank of India’s earlier assessment of 16.2%. Assuming that the central bank’s estimates of the remaining three quarters of the fiscal year at 6.2% in 2Q, 4.1% in 3Q, and 4% in 4Q are realised, the annual GDP growth using the NSO’s 1Q estimate works out to be 6.7%. Compared to the pre-COVID-19 GDP level of ₹35.5 lakh crore in 1Q of 2019-20, real GDP at ₹36.9 lakh crore shows an increase of only 3.8%. This indicates that the performance of the Indian economy is not fully normalised yet which would be consistent with a growth of 6.5% to 7%. In order at least to reach an annual growth of 7%, GDP may have to grow at about 5% in 3Q and 4Q of 2022-23.

Composition of growth

Out of the eight Gross Value Added (GVA) sectors, the first quarter growth performance is higher than the average of 12.7% in public administration, defence and other services (26.3%), trade, hotels, transport et al. (25.7%), construction (16.8%), and electricity, gas, water supply et al. (14.7%). Agricultural growth has remained robust, showing a growth of 4.5% in 1Q of 2022-23, which is the highest growth over nine consecutive quarters. Growth in manufacturing, at 4.8%, however, is much below the overall average. A more relevant comparison would be to look at the increase with respect to corresponding output levels in the pre-COVID-19 normal year, that is in 1Q of 2019-20.

In this comparison, manufacturing seems to have done better with an increase of 7% in 1Q of 2022-23 while the trade, hotels, transport et al. sector has remained below its pre-COVID-19 level by a margin of minus 15.5%. This was the main contact-intensive sector which suffered the most during COVID-19 and which may show better recovery in succeeding quarters. Construction has also increased by a small margin of 1.2% when compared to its 1Q 2019-20 level.

On the demand side, all major segments showed magnitudes in 1Q of 2022-23 that were higher than their corresponding levels in 1Q of 2019-20. Recovery in domestic demand has been reflected in the growth rates of private final consumption expenditure (PFCE), at 25.9%, and gross fixed capital formation (GFCF) at 20.1% over the corresponding quarter of the previous year. As compared to its 1Q 2019-20 level, the GFCF showed a growth of 6.7%. The ratio of gross fixed capital formation to GDP at current prices is 29.2% in 1Q of 2022-23 which is 1% point higher than the investment rate of 28.2% in the corresponding quarter of the previous year.

The contribution of net exports to real GDP growth is negative at minus 6.2% points in 1Q of 2022-23 since import growth continues to exceed export growth by a tangible margin. Such an adverse contribution of net exports to real GDP growth is an all-time high for the 2011-12 base series. It is likely that import growth will continue to exceed export growth in the next few quarters, both in real and nominal terms, considering prevailing high global prices of petroleum products and other intermediate inputs and India’s growing demand for importing intermediate goods with a view to boosting ‘Make in India’.

On the feasibility

The Indian economy may still show a 7% plus growth in 2022-23 provided it performs better in the subsequent quarters, particularly in the last two. Two important areas of policy support for this purpose would be to further increase the investment rate and to reduce the magnitude of negative contribution of net exports. Available high frequency indicators for the first four to five months of 2022-23 indicate continuing growth momentum.

Headline manufacturing Purchasing Manager’s Index (PMI) was at an eight-month high of 56.4 in July 2022. It remained high at 56.2 in August 2022. PMI services were at 55.5 in July 2022, indicating 12 consecutive months of expansion. Outstanding bank credit by scheduled commercial banks (SCBs) grew by 15.3% in the fortnight ending August 12, 2022. Gross Goods and Services Tax collections have remained high at ₹1.49 lakh crore and ₹1.43 lakh crore in July and August 2022, respectively, although a good part of this may be due to the higher inflation levels of both Wholesale Price Index (WPI) and Consumer Price Index (CPI).

As seen in 1Q of 2022-23, GVA growth has been led by public administration, defence, and other services, with a growth of 26.3%. This has been driven by the central government’s frontloading of capital expenditure. The Centre’s capital expenditure grew by 62.5% during the first four months of 2022-23. This momentum needs to be maintained. This would be facilitated by a buoyant growth in the Centre’s gross tax revenues, which showed a growth of nearly 25% during the first four months of the current fiscal year. The relatively high tax revenue growth is in turn linked to the excess of nominal GDP growth at 26.7% in 1Q of 2022-23 over the real GDP growth of 13.5%. Such a large gap between these two growth measures reflects a high implicit price deflator (IPD)-based inflation which is estimated at 11.6% in 1Q of 2022-23. This in turn is because of the ongoing WPI and CPI inflation trends where the former continues to exceed the latter. With buoyant tax revenue growth, fiscal policy may strongly support GDP growth without making any significant sacrifice on the budgeted fiscal deficit target.

Raise investment rate

In the light of likely development in 2022-23, how confident are we of achieving the growth rate of 6% to 7% over a normal base? Given our desire to achieve developed country status in the next 25 years, the required growth rate is in the range of 8% to 9%. In 2023-24, we must try to achieve a growth rate of 6% to 7%. The key to growth lies in raising the investment rate. Public capital expenditure has shown a rise. In crisis years, it is particularly good. It can crowd in private capital expenditure. But this cannot be the normal. Private capital expenditures, both corporate and non-corporate, must rise. It is pointed out that capacity utilisation in industry has touched 75% in 4Q 2021-22. This should help to attract private investment if demand for goods continues to increase. The output loss because of COVID-19 and the consequent lockdown is greater if we measure it from the trend line rather than the base of 2019-20. Had we maintained growth of 7% since 2019-20 in successive years, the real GDP would have been ₹183.4 lakh crore in 2022-23. Even if we achieve a 7% growth in 2022-23 over 2021-22, there is a shortfall of ₹25.7 lakh crore at 2011-12 prices. The international environment for growth is bleak. Developed countries even fear a recession. India’s growth path in the next few years must depend on domestic investment picking up. Sector-wise growth in investment must be the focus of policymakers in removing bottlenecks and creating a favourable climate.

5. Editorial-2: For Vizhinjam, business as usual is not an option

It is politically hard, but developmentally critical, to run port projects with coastal management sustainably

Revenues from the ₹7,525-crore deep-water port and terminal at Vizhinjam in Kerala will only be justified if the project provides sufficient safeguards against ecological destruction and addresses the rights of households displaced by the project. Nowhere is this socio-environmental imperative bigger than in Thiruvananthapuram because of its precarious ecology and coast-reliant economy. It is politically hard, but developmentally critical, to make a mid-course shift, to put port development with coastal management on a sustainable track.

A false dichotomy

Singapore, Shanghai, and Dubai took advantage of ports to become hubs, earn incomes, and drive economic growth. Vizhinjam’s proximity to east-west shipping routes, its natural undredged draft of some 20 metres, and suitability for large vessels all make it a unique site. But in a lopsided agreement, the Government of Kerala bears 67% of the financing and the Concessionaire (extended to a generous 40 years) 33%, with a low internal rate of return of 3.7% for the Government and 15% for the Concessionaire. Despite the locational advantages, the Adani Vizhinjam Port Pvt. Ltd., finds the deal attractive only with the inclusion of large real estate components in prime port property. The financial picture of the enterprise for Kerala State is dicey at best.

Another crucial issue is that any revenue generation is at the cost of a heavy human toll. Some 350 families that have lost homes to coastal erosion last year, and those living in makeshift schools and camps are just a foretaste of things to come if coastal erosion and extreme cyclones continue unabated. Port projects in China, Kenya, and Vietnam have seen vast resettlement and livelihood outlays by the owners over the life of the project.

A further danger is an irreversibly destroyed ecology, triggering deadlier hazards of nature. Ports without adequate safeguards in a highly delicate ecology unleash destruction on marine life and the livelihoods of the local population. Visakhapatnam and Chennai show how siltation, coastal erosion and accretion can be exacerbated by deepening of harbour channels in ecologically sensitive areas; this risk is just greater for Vizhinjam by an order of magnitude.

Building safeguards could potentially run economic growth and socio-economic sustainability in tandem. A 2017 study warned of the fallout for the shoreline and marine ecosystem from construction of breakwater and dredging. But no funds have been earmarked for maintenance dredging within operational expenses, based on the false premise that siltation would be “negligible”, with “minimum literal drift along the project site”.

Equally, project documents hardly address the effects of the port on the precious marine ecosystem and biodiversity, a huge priority for Kerala. Recent studies have identified the Vizhinjam-Poovar stretch as a biodiversity hotspot and recommended that the region be recognised as a marine protected area. The discussion of flora, fauna, and lakes in the environmental impact assessment (EIA) is purely pro-forma.

The vital shoreline assessment in the EIA, released in May 2013, has come under heavy criticism for factual errors. For example, there is no mention of the ecological consequences of the dismantling of two hills in the Western Ghats to provide rocks for the project, aside from destroying a few promontories at the project site.

A just published study shows that during 2006-20, the sea gobbled some 2.62 square kilometres or close to 650 acres from the Thiruvananthapuram coast alone. The rate of erosion is faster between Pozhikkara and Veli. Also, 0.7 km2 of land was accreted.

The latest shoreline report, based on beach profile and satellite analysis, by the National Institute of Ocean Technology (NIOT), Chennai, appointed by the developer, shows significant erosion on the northern coast of the port (Poonthura, Valiyathura, Shanghumugham, Veli) and accretion in the port area and in the south (Poovar, Adimalathura) from 2015 to 2021 during port construction. Many of the spots themselves were the same during 2015-21 compared to previous periods, but new spots (Kochuveli, Cheriathura) too had emerged, post 2015.

The NIOT report attributes the erosion and accretion to climate change more than port activity, on grounds that construction has been modest in scale. That, in fact, aggravates the risk that stepped-up activity, without safeguards, will see more dire consequences. Anthropogenic climate change is unquestionably raising sea levels along Indian coasts, but the extreme stress north of the port cannot be explained by global warming, something that impacts everywhere.

In fact, a study of shoreline changes in Kerala by the National Centre for Sustainable Coastal Management attributes most of the drastic shoreline changes during 1972-2010 to structures built along its coast. Two-thirds of Kerala’s coasts are eroding, and precautions are a must before constructing structures along its “eroding and vulnerable” coasts. Thiruvananthapuram has the highest percentage of erosion, facts ignored in environment clearances.

With a port, reclamation, dredging and construction of breakwaters further complicate erosion. Breakwaters have exacerbated the drastic shoreline changes in and around its proximity. In almost all these areas, the coast to the north of the breakwaters is heavily eroded.

The polluter is responsible

A bedrock principle of environmental regulation worldwide is that pollution penalties should be high enough and borne by the creators of damages. For large-scale infrastructure projects, the financier and the borrower must implement sufficient safeguards to avoid marine pollution and destruction. On involuntary dislocation of people that society is willing to accept in return for financial gains, the project must allocate funds in recognition of people’s centuries’ old right to the sea and its resources.

There are many examples of projects that unduly harm the environment or society, which can be learnt from. Just to take two in relation to the Vizhinjam venture, the International Finance Corporation (IFC) supported the 4,150-Megawatt Tata Mundra coal plant (Gujarat) — the negligence greatly and unnecessarily exceeded the harm to the local poor people. Tata Mundra is one of the 50 biggest sources of greenhouse gas emissions. And in another more recent case, Bravus Mining and Resources (an Adani unit in Australia) has begun construction of its Carmichael thermal coal mine in Queensland’s Galilee basin to export vast amounts of coal to India — when the world is moving away from fossil fuels in a desperate effort to save the planet.

Whether there were pre-existing health conditions or not, when COVID-19 infection precipitates illness or death, the pandemic is labelled the proximate cause. The same way, when port construction without adequate social and environmental safeguards harms lives and livelihoods, even in the presence of climate change, the project must take full responsibility for compensation. Corrective action by way of hard-engineering solutions such as seawalls and soft responses such as vegetation is in order.

Steps to take

The first order of business, as in infrastructure projects worldwide, is that the project provides compensation to the displaced people and restores their rights. Second, the gross neglect of the damage to invaluable marine biodiversity must be redressed with an acceptable EIA, including inputs from experts in biology, ecology, and oceanography. Third, there needs to be an independent assessment of safeguards that port authorities must put in place as a precondition for any further construction.

A Turkish proverb says, “No matter how far you have gone on a wrong road, turn back.” That, in the context of unanswered financial, social and environment risks, means business as usual is not an option. On the other hand, rejecting the project, having approved it, is politically difficult. The way forward would be for the project management to take to heart, in the spirit of learning from experience, the red alerts, and the Government to allow continuation of the project only with agreement for a mid-course transformation, including a legal covenant to make the venture sustainable for Kerala.

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kurukshetraiasacademy

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