1. ‘India, Bangladesh should work on river management’
Ready to extend assistance in managing flood: Jaishankar
India and Bangladesh should work together for comprehensive management of rivers, External Affairs Minister S. Jaishankar said here on Sunday. Delivering opening remarks at the seventh round of India-Bangladesh Joint Consultative Commission, Mr. Jaishankar welcomed his counterpart A.K. Abdul Momen and extended India’s assistance in management of the annual flood in Bangladesh. He said the Indian side wished to work with Bangladesh on Artificial Intelligence, start-ups, fintech and cybersecurity.
“We would also like to convey our support and solidarity at the unprecedented flooding that we have had in northern Bangladesh. We have also had in the north-east. We are now sharing flood management data for an extended period. I would like to take the opportunity to convey that if in any concrete way, we can be of assistance to you in the management of flood and relief efforts, we would be very glad to be supportive,” said Mr. Jaishankar.
The Minister took up the riparian dimension of bilateral relations with Bangladesh, which is the largest trade partner of India in south Asia, and said the two sides shared 54 rivers that required Delhi and Dhaka to work together and share “environmental responsibility” in areas such as the Sundarbans.
India and Bangladesh have resolved border problems through the Land Boundary Agreement of 2015, but have been in dialogue over the sharing of multiple rivers that define the borders and impact lives and livelihoods on both sides. Bangladesh, however, has been particularly keen on receiving a fair share of the waters of the Teesta that flows through the northern part of West Bengal.
A joint statement issued after the meeting said the two teams remain focused on the “importance of safe, speedy, and sustainable return of forcibly displaced persons from Rakhine State to Myanmar, currently being sheltered by Bangladesh”. Bangladesh has been hosting more than a million displaced persons from Rakhine, the Rohingya. 2022 marks the fifth year of the exile of this community.
The visit of Mr. Momen came weeks after an international controversy broke out with two BJP leaders making derogatory comments on the Prophet. Bangladesh, however, has avoided issuing a direct condemnation of the remarks unlike several other countries of the Organisation of Islamic Cooperation (OIC). Officials in Dhaka had earlier told The Hindu that Bangladesh did not want to “trigger” an issue by raising the controversy at the bilateral level.
TRANS-BOUNDARY WATER CONFLICTS
- With about 4% of the water resources of the world, India should have been a water-adequate nation. However, in 2011 India turned into a water-stressed nation.
- India is currently ranked 120 among 122 countries on the Water Quality Index, as per a report by NITI Aayog.
- It uses the largest amount of groundwater – 24% of the global total, more than that of China and the US combined.
- UN reports estimates that by 2030, water demand in India will grow to almost 1.5 trillion cubic metres from approximately 740 billion cubic metres (2010 estimate).
- This situation is further aggravated by the India’s water disputes with its neighbours and inter-state river water disputes in India.
India’s Water Disputes with its Neighbours
- Water remains a politically contested issue in much of South Asia. The region is facing water shortage and agrarian difficulties, and it will continue to face increasing demands on energy and water with rapid industrialisation.
- Over-extraction of groundwater is of particular concern, with an estimated 23 million pumps in use across Bangladesh, India, Nepal and Pakistan.
- Moreover, salinity and arsenic contamination affects over 60% of groundwater in the Indo-Gangetic plain.
- Combine these factors with the impact of climate change that’s reducing the amount of water in the Brahmaputra basin and changing the patterns of water flow.
- Under such circumstances, the increasing need for power and stable water levels could prompt reconsideration in bilateral water-sharing treaties in future.
India-China Water Dispute
- Both Brahmaputra and the glaciers that feed Ganga originate in China. As an upstream riparian region, China maintains an advantageous position and can build infrastructure to intentionally prevent water from flowing downstream.
- Owing to previous tendencies where the Chinese have been reluctant to provide details of its hydro-power projects, there is a trust deficit between the two neighbours.
- China’s dam-building and water division plans along the Brahmaputra (called Yarlung Zangbo in China) is a source of tension between the two neighbours, despite the two having signed several MoUs on strengthening communication and strategic trust.
- As lower riparian countries, India and Bangladesh rely on the Brahmaputra’s water for agriculture.
- China has now plans to build four more dams on the Brahmaputra in Tibet. Both India and Bangladesh worry that these dams will give Beijing the ability to divert or store water in times of political crisis.
- India, for its part, has built dams on the Teesta River, a tributary of the Brahmaputra, to utilise the flow of the Teesta during the dry season.
- Sharing the waters of the Teesta river, which originates in the Himalayas and flows through Sikkim and West Bengal to merge with the Brahmaputra in Assam and (Jamuna in Bangladesh), is perhaps the most contentious issue between two friendly neighbours, India and Bangladesh.
- The river covers nearly the entire floodplains of Sikkim, while draining 2,800 sq km of Bangladesh, governing the lives of hundreds of thousands of people.
- For West Bengal, Teesta is equally important, considered the lifeline of half-a-dozen districts in North Bengal.
- Bangladesh has sought an “equitable” distribution of Teesta waters from India, on the lines of the Ganga Water Treaty of 1996 (an agreement to share surface waters at the Farakka Barrage near their mutual border), but to no avail.
- In 2015, Prime Minister Narendra Modi’s visit to Dhaka has generated some expectations to take forward the previous issues on fair and equitable water sharing agreement.
- But Teesta remains an unfinished project, as in India individual states have significant influence over transboundary agreements. This arrangement sometimes impedes the policymaking process. For example, one of the key stakeholders of the Teesta agreement, West Bengal is yet to endorse the deal.
- Water cooperation between Nepal and India have been agreements signed on major rivers like Kosi, Gandaki, Karnali or Mahakali, essentially for large hydroelectric and irrigation projects by building dams or barrages.
- No project except the Kosi barrage has been completed yet. Smaller rivers have also been ignored.
- Since 1954, when the Kosi Agreement was signed between India and Nepal, talks between the two governments have stalled and water rights issues have not been addressed.
- There have been various disputes over this agreement fuelled by floods in the Kosi region.
- India and Nepal have also had disputes over the issue of compensation of the Kosi dam.
- Moreover, Nepal had considered India’s construction as an encroachment on Nepal’s territorial sovereignty.
- The problem with the Kosi River is its high level of sedimentation and embankments have proven to be ineffective to tackle the sedimentation.
- The only available option in this case is storage tanks and these cannot be set up without the cooperation of Nepal.
- India and Nepal have traditionally disagreed over the interpretation of the Sugauli Treaty signed in 1816 between the British East India Company and Nepal, which delimited the boundary along the Maha Kali River in Nepal.
- India and Nepal differ as to which stream constitutes the source of the river.
- The dispute between India and Nepal might seem minor but it gains strategic importance, because the disputed area lies near the Sino‐Indian border.
India–Pakistan Water Dispute
- Both India and Pakistan since partition have experienced friction over various water conflicts.
- The countries early leaders anticipated this fierce rivalry over the waters that connect their volatile border.
- As a result, after numerous dialogues and through careful negotiations, both countries signed an accord called the Indus Waters Treaty in 1960, which clearly determined how the region’s rivers are to be divided.
- In this treaty, control over three eastern rivers of the Beas, Ravi and Sutlej was given to India, while Pakistan got the control over western rivers of the Indus, Chenab and Jhelum.
- The Indus Waters Treaty has been widely hailed as a success, having survived three post-independence wars between the two hostile neighbours.
- However, the situation for Pakistan has changed significantly from 1960s till the present moment, as it is now on the brink of water scarcity.
- The source or flow of all of the Pakistan’s rivers pass through India first, so this naturally provides India with an upper hand in controlling the outflow of these rivers.
- The Indian Government has more than 40 projects that are either already completed or in the proposal stage on the western rivers. The carrying of such activities within the western rivers has irked Pakistan.
- On the other hand, India keeps dismissing these accusations of Pakistan as baseless and without any scientific backing.
- In 2005, Pakistan challenged India’s 450 MW Baglihar dam project on the Chenab river before the World Bank, but lost the case in the end.
- In 2011, both countries went head to head again at the International Court of Arbitration (ICA) over India’s 330 MW project in Kishanganga project in Jammu and Kashmir.
- The latest dispute is over hydroelectric projects that India is building along the Chenab River. According to Pakistan, these projects violate the treaty and will impact its water supply.
- India and Bhutan hydro-electric power cooperation started more than five decades ago.
- Initially, the cooperation was based on the development of small-scale hydro projects such as Tala, Chukha and Kurichu.
- Bhutan has the potential to generate 30,000 MW of hydro-power.
- In 2006, both countries inked a Power Purchase Agreement for thirty five years that would allow India to generate and import 5000 MW of hydro-power from Bhutan, the quantum of which increased to 10,000 MW in 2008.
- On the other hand, the people of Bhutan raised objections to such projects on their long run effects in the country.
- For instance, if Bhutan ever decides to construct storage projects, issues will get intense and more problematic when it comes to dealing with India.
- The internal challenge in Bhutan is water accessibility.
2. Gear up for more headwinds
Investors must be well-prepared to grab bargain opportunities in the coming future
Over the past two years, the world has seen phenomenal monetary and fiscal intervention to forestall the economic effects of a COVID-19 recession.
After continuous easy monetary and fiscal policy, central banks and governments worldwide are tightening their belts.
The U.S. has promised several rate hikes over the next few quarters, setting the trend for the rest of the countries. The U.S. dollar acts as the reserve currency, which means that a hike in the U.S. interest rate will lead to the depreciation of most other currencies while the dollar swells in strength.
The swelling dollar is especially detrimental to India on two accounts: 1) The price of imports, namely oil and food imports, will become much more expensive, and 2) Money will flow out of our capital markets chasing the dollar. This scenario is reminiscent of the famous speculator George Soros’s Reagan’s imperial circle, wherein the U.S. Budget deficit increased while interest rates rose. This meant that the U.S. economy recovered while making its currency stronger.
Consumption, as well as growth, was funded by foreign goods and capital. However, the circle was vicious for other countries.
High inflation, low growth
India will face high inflation and low growth due to a multitude of factors. The inflation from import prices will surely hurt the economy, and accounts of both industries and ordinary consumers.
A higher interest rate regime would mean that the government’s fiscal deficit increases further due to a higher borrowing rate on G-Secs. The government will have to cut down on fuel taxes to account for the rise in oil prices, further decreasing revenue. As Warren Buffet had stated, interest rates act as gravity for stock prices.
The stock market should ideally correct accordingly to a rate hike by the RBI. Moreover, current G-sec holders might also face a haircut due to rising rates depending on their yield and coupon rate.
Principle of shrinkflation
Additionally, the FMCG industry (and others) will find it difficult due to narrowing margins from high inflation and the inability to raise prices. However, they deal with rising costs and stagnant prices by utilising the principle known as shrinkflation. One reduces the quantity of the goods sold while keeping the price constant (you might have noticed your biscuit packets getting lighter).
Although FMCG companies could try to sustain their profit margins, it is hard to imagine a world where they can support growth in sales and earnings.
The two big export industries which India boasts of are IT and Pharma. On the one hand, a depreciating rupee is a positive factor for these companies as they make their money in dollars. Therefore, at least in the short run, they gain from changes in the exchange rate.
However, rising rates in the U.S. would signal a recession leading to a reduction in consumption. Lower business activity levels would transition into problems for the IT industry especially. Moreover, domestic business activity is also set to face hurdles due to rising rates and tightening fiscal expenditure. These factors have a double-whammy effect in hurting the IT industry, which had weathered the COVID-19 storm relatively well. Additionally, export duties and bans play a significant role in harming metal exports. The metal industry, which had done well, now faces growing pressures from trade restrictions imposed on it. Therefore, it will be challenging to benefit from the depreciating exchange rate.
The increase in exports due to depreciation acts as a stabilising factor for the currency, without which the depreciation could be more potent. Furthermore, higher interest rates also affect the cement industry, which thrives in a low-interest rate regime. Cement companies will face muted demand due to higher rates and higher costs due to rising fuel prices.
The automobile industry is another sector that benefits from a low-interest rate regime. Higher import costs combined with a high interest rate act as headwinds in the automobile industry.
These factors, however, are excellent indicators for the investor as they signal lower prices ahead.
Investors should currently sit tight and wait for further developments in the next few months, avoiding any bouts of investment while passively indexing.
In times like these, it is essential to remember a quote by Baron Rothschild (a formidable 18th-century banker), “buy when there is blood in the streets”.
- Shrinkflation is the practice of reducing the size of a product while maintaining its sticker price.
- It is a form of hidden inflation.
- Raising the price per given amount is a strategy employed by companies, mainly in the food and beverage industries, to stealthily boost profit margins or maintain them in the face of rising input costs.
- Shrinkflation is also referred to as package downsizing in business and academic research.
- A less common usage of this term may refer to a macroeconomic situation where the economy is contracting while also experiencing a rising price level.
- Macroeconomics is the study of the behaviour of a national or regional economy as a whole.
- It is concerned with understanding economy-wide events such as the total amount of goods and services produced, the level of unemployment, and the general behaviour of prices.
- Nowadays, shrinkflation is a common practice among producers. The number of products that undergo downsizing increases every year.
- Large producers in the European and North American markets rely on this strategy to maintain the competitive prices of their products without significantly reducing their profits.
- At the same time, shrinkflation can frequently lead to customer frustration and deteriorating consumer sentiment regarding the producer’s brand.
Major Causes of Shrinkflation
- Higher Production Costs: Rising production costs are generally the primary cause of shrinkflation.
- Increases in the cost of ingredients or raw materials, energy commodities, and labour increase production costs and subsequently diminish producers’ profit margins.
- Reducing the products’ weight, volume, or quantity while keeping the same retail price tag can improve the producer’s profit margin.
- At the same time, the average consumer will not notice a small reduction in quantity. Thus, sales volume will not be affected.
- Intense Market Competition: Fierce competition in the marketplace may also cause shrinkflation.
- The food and beverage industry is generally an extremely competitive one, as consumers are able to access a variety of available substitutes.
- Therefore, producers look for options that will enable them to keep the favour of their customers and maintain their profit margins at the same time.
3. Editorial-1: The EPI may rankle but India can recast policies
The country ought to adopt a dashboard approach to indicators, modelled on the Stiglitz-Sen-Fitoussi proposal
For a government acutely sensitive to global rankings, the latest Environmental Performance Index (EPI) placing India last among all 180 assessed countries has naturally touched a raw nerve. The assessment, carried out by Yale and Columbia Universities with an emphasis on climate change mitigation, has become controversial for prioritising the flow of greenhouse gases from countries while reducing the emphasis on the stock of carbon dioxide from industrialised countries that is warming the globe.
Evidently, if countries were assigned a penalty for the stock of CO2 in the atmosphere, rather than measure their mitigation actions over a decade, India would fare much better. Less controversially, the EPI dwells on performance on air quality, waste management and ecological conservation measures.
Unsurprisingly, the EPI ranking and scores have been rejected by the Union Government as based on “unfounded assumptions”, “surmises” and “unscientific methods.” The national rank of 165 on Climate Policy and score of 21.7 in this category — which overall has a 38% weightage in the calculations along with 42% for Ecosystem Vitality and 20% for Environmental Health — has particular significance. India is under pressure to raise its ambition and commitment towards the more ambitious 1.5° Centigrade goal for temperature rise under the Paris Agreement, going beyond the less rigorous target of well below 2°C.
Within the overall climate score, India does better in sub-metrics such as growth rates for black carbon, methane and fluorinated gases, and greenhouse gas emissions based on their intensity and per capita volumes. The Index rates the country low on projected green house gas (GHG) emissions for mid-century, a target for Net Zero emissions. The EPI report estimates that China, India, the United States, and Russia are expected to account for over 50% of global residual greenhouse gas emissions by 2050.
This projection has met with strong protest from India, which has faulted the EPI for introducing a new metric on climate with increased weight in the calculation compared to the 2020 assessment. It stands accused of ignoring the important tenet of equity in global climate policy within the United Nations framework: that India has low per capita GHG emissions, reduced intensity of GHG emissions in its economy, made big strides achieving 40% renewable power generation, supported electric vehicles, launched a major carbon sink initiative, and done a lot for wetland conservation.
Claims and low PARI score
The country has protested that the new India State of Forest Report (ISFR) 2021 was not factored in as part of the biodiversity metric. On the face of it, India scores abysmally low on some of the Ecosystem Vitality variables, such as Marine Protected Areas (0.3 of a possible 100) and Protected Areas Representativeness Index, or PARI (0.5), Terrestrial Biome Protection (TBM) – National (1.2) and TBM – Global (2.1). Wetland loss prevention is among the best scores for India, at 62. Given the many biomes that exist in the country, the low PARI score puts pressure on the Government to defend its claim that the EPI scores for biodiversity health are faulty due to weaknesses in collecting species and habitat data.
The ISFR, on which the Union government relies, ran into trouble for making spectacular claims, because of perceived methodological weaknesses. It is faulted for relying on a relaxed definition of forest and claiming expansion of forests when satellite imagery of the same areas showed a decline. Ecologist and co-founder of the Nature Conservation Foundation M.D. Madhusudan pointed out that palm trees in private plantations in Tamil Nadu, tea estates in several States and even urban tree agglomerations were found added as forest. Researchers have been demanding that the actual maps used for the ISFR estimates be released publicly, not just the report making claims of expansion.
Biome protection, air quality
The EPI-assigned rating for India in protecting biomes has led to sharp differences too. The Index assigns a ‘laggard’ rank on tropical and subtropical dry broadleaf and coniferous forests, montane grasslands and shrublands and the worst performance on deserts and xeric shrublands. The Government’s defence is that national and legal boundaries for protected areas may not match geographical boundaries of biomes, and international classifications may not be optimal to measure conservation.
A second sensitive area in which India brings up the rear in the EPI is air quality. With a score of 7.8 and a rank of 179, the familiar dispute over data and reliability of several parameters has reopened. The Government faults the dataset on pollutant concentration data — covering mainly Particulate Matter (PM2.5), Oxides of Nitrogen, Sulphur Dioxide and Volatile Organic Compounds, because of “higher uncertainty in regions with less extensive monitoring networks and emissions inventories”.
Although the scores and rank could be contested, there is little doubt that India’s air is widely seen as among the foulest. Data for 2019, when economic activity was unfettered by COVID-19, attribute 1.67 million deaths during the year from air pollution.
This has been reiterated by recent literature with commentary in The Lancet Planetary Health pointing out that “India has developed instruments and regulatory powers to mitigate pollution sources but there is no centralised system to drive pollution control efforts and achieve substantial improvements. In 93% of India, the amount of pollution remains well above WHO [World Health Organization] guidelines.”
There are some aspects of the EPI that the Union government has rejected, blaming the ranking agencies for not “engaging” with India on the climate change mitigation programme, and for not providing a handicap under the United Nations principle of Common But Differentiated Responsibilities and Respective Capabilities (CBDR-RC), which forms the basis of the Paris Agreement.
India’s defence has always been that its current emissions profile may be high, but it has to raise living standards of hundreds of millions with cheap energy. It seeks a significant share of the remaining global carbon budget and climate funds for mitigation actions.
The national case would be stronger if policies on luxury urban emissions are aimed at helping poorer Indians. On transport (about 13% of emissions), prevailing high fuel and vehicular taxes could exclusively drive change and raise a green commons such as clean public transport, cycling and pedestrianisation. The national policy of achieving Net Zero emissions by 2070 provides a longer timeline for a coal phaseout, but other areas can benefit from policies that prevent a carbon lock-in effect. Emissions from buildings, including embedded carbon in construction materials such as cement and steel, provide scope for reduction.
India has also not expanded disaggregated rooftop solar power across residential deployments and commercial structures. There cannot also be excessive reliance on carbon sinks in the short term, since tree cover of the right kind takes time to store carbon. Stronger protection for biomes (protected areas represent about 5% of the land) can generate wide-ranging benefits and biodiversity can recover.
What India needs to adopt is a rigorous dashboard approach to indicators, assigning high weight to the environment, modelled on the proposal made by Amartya Sen, Joseph Stiglitz and Jean-Paul Fitoussi in their exploration of development beyond GDP. This can generate good data, identify the real beneficiaries of policies, avoid serious environmental deficits and ensure inter-generational equity in the use of natural resources. It can also curb pollution. Distorted rankings from external assessments would matter little.
4. Editorial-2: Revisiting social justice under the Dravidian model
The Tamil Nadu government should release a white paper on reservations and pursue quota in the private sector
Dravidian politics in Tamil Nadu has played a significant role in democratising the public space for wider participation. As emphasised by the Chief Minister of Tamil Nadu, M.K. Stalin recently, social justice has been the integral part of the Dravidian development model.
Social justice principles in Tamil Nadu were initially emphasised and propagated by Periyar, who fought for community-based representation while fighting the evils of the caste system. Even though the Dravidian social justice model was able to democratise the public sphere by opening the space in education and employment, there is a need to revisit many aspects of social justice to reach out and benefit more people.
First BC commission report
The report of the first Backward Classes (BC) Commission, headed by A.N. Sattanathan, appointed by then Chief Minister M. Karunanidhi, in its report submitted in 1970 highlighted the unequal distribution of reservation benefits in favour of certain communities within backward castes. It further stated that around nine castes (that accounted for 11.3% of the total backward castes) held 48% of gazetted posts and 37% of non-gazetted posts. In the education sector, it was 47% of medical seats, 44% of engineering seats and 34% of scholarships denying an opportunity for the remaining 88.7% of backward castes in Tamil Nadu. Even though the Sattanathan commission had recommended economic criteria and taking out certain castes out of reservation benefits, due to political and electoral reasons, the government increased the quota for Other Backward Classes (OBC) from 25% to 31% and for Scheduled Castes (SC)/Scheduled Tribes (ST) from 16% to 18%.
Data from second commission
In 1979, then Chief Minister M.G. Ramachandran, based on the Sattanathan Commission report, introduced the creamy layer concept (ceiling limit of ₹9,000 per annum to be eligible for reservation benefits), which was politically resisted and the All India Anna Dravida Munnetra Kazhagam (AIADMK) was forced to withdraw it after electoral defeat in 1980. The AIADMK government increased the Other Backward Classes quota from 31% to 50%, which made the Supreme Court of India direct the Tamil Nadu government to set up a second Backward Classes’ Commission in the year 1982 to assess the ground reality. The commission, under J.A. Ambasankar, reiterated the unequal distribution of benefits among backward classes as stated by Sattanathan in the first Backward Classes Commission. The Ambasankar report stated that around 11 castes, which is around 34.8% of backward castes, held 50.7% of posts in the public service commission, 62.7% of seats in professional courses and 53.4% of government scholarships. The remaining 211 backward castes, which is around 65.2%, was poorly represented in government services and the educational system. The government added another 29 communities to backward classes without addressing the skewed representation.
In 1989, the Dravida Munnetra Kazhagam government under M. Karunanidhi divided the 50% OBC reservation into 30% for backward classes and 20% for Most Backward Classes (MBCs) and de-notified communities (DNC) due to agitations led by Dr. S. Ramadoss of the Pattali Makkal Katchi, demanding more representation for the Vanniyar caste. Later, the AIADMK government under then Chief Minister Jayalalitha enacted the Tamil Nadu Backward Classes, Scheduled Castes and Scheduled Tribes (Reservation of Seats in Educational Institutions and of Appointments or Posts in the Services under the State) Act, 1993, and got it under the Ninth Schedule of the Constitution to protect it against judicial scrutiny.
In 2000, then Chief Minister Karunanidhi released a white paper on the ‘Reservation in Government Employment for the Adi Dravidars, Scheduled Tribes, Backward Classes, Most Backward Classes and De-Notified Communities. In 96 government departments, the SC representation in Group A, B and C was par below their constitutionally mandated quota. The MBCs, who were allocated 20%, had only around 8% in the group ‘A’ category. The BC had more than majority representation. It was only in the Group D category that SC/STs and MBC/DNCs had noticeable representation. In public sector undertakings, apex cooperative institutions, universities, corporations and statutory bodies, SC representation was only around 3% and for MBC/DNCs, only around 7% in the Group ‘A’ category. BCs had more than a majority in this category also.
Neoliberal state, social justice
The neoliberal phase after the 1990s has expanded the scope of the private sector in key sectors of the Tamil Nadu economy which included social sectors such as education and health.
According to the All India Survey on Higher Education (AISHE) 2019-20 report, 86% of colleges and 44% of universities in Tamil Nadu are owned by the private sector. With reservation not being applicable in the private sector, there is only 11% of the faculty from the SC community in Tamil Nadu according to this report. Even though OBC (no data for MBCs are available in the AISHE report) represent more than 70% of teaching positions in Tamil Nadu, SC/STs and the minorities are under-represented. Only 2.9% of faculty belong to Muslim community.
It is imperative for the Tamil Nadu government to release a white paper on reservations in Tamil Nadu to take stock of changes that have happened in the social composition of employees in the government sector after the year 2000. Apart from filling the SC/ST backlog vacancies, the government should increase the SC/ST reservations as their population according to the 2011 census is 21.1%. Further, the State government should pursue the policy of reservations in the private sector, which the DMK principally supported in its election manifesto. Reservation in private educational institutions has a constitutional mandate in Article 15(5), which came through 93rd Constitution Amendment Act in 2005. Such proactive measures are needed to add meaning to social justice principles under the Dravidian model.
5. Editorial-3: Monsoon jitters
Episodes of drought in India happen when the monsoon fails in July and August
The monsoon landed early in Kerala, three days ahead of the normal date of June 1. The journey upward of its western branch has since then been timely but lacking in vigour. The latest IMD figures suggest that the monsoon is running an 8% deficit. Central India, which has the largest swathe of land dependent on rainfed agriculture, has only got 52% of the rain that is due; the southern peninsula has a 22% deficit. Only India’s east and north-eastern parts are battling the diametrically opposite problem of too much rain, with floods in Assam and Meghalaya submerging entire villages. The northwest of India, where the monsoon is yet to arrive, and reeling under a series of heatwaves, is battling a rainfall deficit of 33%. The monsoon rainfall is critical to kharif sowing and so a faltering June has raised concerns in several quarters. However, there is little to be worried about at this juncture. June rainfall, particularly in the first fortnight, is historically patchy and contributes less than 18% of the monsoon rainfall. Meteorologists maintain that there is no correlation of the timing and advent of the monsoon rainfall with its eventual performance. Because of the large variance inherent in June rainfall, the IMD has historically chosen not to issue forecasts for the month, unlike for July and August. The latter two are considered the key monsoon months and responsible for supplying nearly two-thirds of the monsoon rains. Episodes of drought in India and those that are linked to agricultural failures are when the monsoon fails in these two months.
In fact, the real worry that lingers over the horizon is rainfall in July and August. On May 31, as part of its updated forecast, the IMD gave an optimistic picture. The June to September rainfall over the country was likely to be 103% of the Long Period Average, and central India was likely to get “above normal” rainfall as was the southern peninsula. The monsoon core zone, which consists of most of the rainfed agriculture regions, too is expected to receive “above normal” rain. In previous years, there has been a pattern of ‘normal’ and ‘above normal’ rains being forecast only for them to dry up for large periods in July and August, followed by a sudden surge in September. This pattern may help deliver the numbers but is not always beneficial for kharif sowing. The expectations of a good monsoon are premised on the persistence of a La Niña, the converse of the El Niño and characterised by a cooling of the Central Pacific waters. However, the Indian Ocean Dipole (IOD), another index of significance to the monsoon, is expected to be negative. Whether the La Niña can compensate for the dampening of the IOD remains to be seen.
6. Editorial-4: Recognising the ‘compulsory’ woman worker
There is an urgent need for widespread surveys of poor rural women and how they spend their time
The Centre for Monitoring Indian Economy (CMIE) reported that the labour participation rate of rural women was 9.92% in March 2022 compared to 67.24% for men. This is a cause for concern. According to CMIE, millions who left the labour market stopped looking for employment “possibly [because they were] too disappointed with their failure to get a job and under the belief that there were no jobs available”. In countries like the U.S., Canada and Australia, such workers who are willing to work but give up searching for work for various reasons are called ‘discouraged workers’ and they are included in the unemployed category. This phenomenon, not captured in India by any official labour force surveys, is wrongly described as women “dropping out” or “leaving the labour market” giving the impression that this was a choice made by them, whereas, actually, women are pushed out of employment. The CMIE provides valuable inputs for urgently required government intervention in rural India.
Ground-level realities are worse than what the CMIE suggests and what the government denies. Women who belong to landless households or with meagre landholdings cannot afford the luxury of being “discouraged.” These are the “compulsory” workers.
The depths of distress
The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) sites are probably the best places to understand the compulsions of millions of women to work. One particular project in Kalaburagi district focuses on creating more than 200 percolation ponds, which are designed to address the declining levels of ground water and to help recharge wells. This project provides a few workdays to an estimated 300 workers from four villages. The soil is hard and dry and the project stretches over several kilometres. The women, who outnumber the men, work in women-only pairs. They dig and lift the mud. In the searing heat, they have to dig a 10X10X1 tank in a day. An assistant to the officer-in-charge estimated that because the soil is hard and stony, this would mean digging and lifting about 3,000 kg of mud a day. Since most of these women are unable to complete this task, they do not get the piece rate of ₹309; they get only ₹280 to ₹285. There was no crèche at the site. There was no water, so women took turns to walk a kilometre to a water source to fill their two-litre bottles. They said their limbs ached. Many said they felt dizzy.
But despite the difficult conditions, every worker on the site complained about getting only about 40 days of work in a year. They wanted more as they regard MGNREGA work as their savior. The fact that they want to do more of this punishing work reveals the depths of the distress of poor rural households.
During the agricultural season, all the women worked on the lands of others, earning around the same as on the MGNREGA site. But the mechanisation of agricultural operations has drastically decreased workdays to less than three months a year. Many women therefore become part-time construction workers. They are hired by a network of “mistries” working for contractors. They migrate to construction sites for a few months, with their families or with other women from the village. Not one of them I had met had registered as a construction worker. They were therefore ineligible for any legal benefits accruing to them from the Construction Workers’ Welfare Board. At a construction site, each of them carried a minimum of 1,000 bricks a day, weighing two kilos each, or other heavy construction material, often climbing to the first or second floor with this load. They were being paid ₹300 a day, less than the men.
When manual or construction work is unavailable, the women find other work. Some of them make twig baskets and brooms. They walk from village to village, often 25 km a day, to sell the baskets. It takes two days to make 10 baskets for which they make ₹10 per basket. Some women provide services such as cleaning or do odd jobs for landholding families for an average of three or four days a month. Some do tailoring work. They also do their own housework. So, going by the anecdotal evidence of women at a MGNREGA site, an individual woman in the course of a year is a MGNREGA worker, an agricultural worker, a construction worker, a migrant worker, a self-employed street vendor, a tailor, an odd job domestic worker, and a home-maker doing multiple domestic chores.
The ‘compulsory’ woman worker’s work never ends. Siddhama, a 45-year-old mother of four from Yadgiri district, stretched out her arms and said: “My arms that labour… this is the property I have, to earn money for my family to survive. When I work, they eat.”
The high prices of essential commodities have led to a huge cut in women’s consumption of vegetables and pulses. To prove their point, some of the women at the worksite brought out their lunch boxes, which contained rice or rotis and a chilli chutney. Two sisters, Sheelawati and Chandramma, said, “We drink water after having the chilli chutney. Then we don’t feel hungry.” Others nodded in agreement. They said that the 10 kg of grain per head from the Central and State governments’ free foodgrains programme was of great help and were afraid it would end. The deprivation of nourishment that women face due to high prices and low incomes is another dimension of the ‘compulsory’ woman worker’s life.
Providing minimum wage
Almost every woman spoke of being trapped in debt. What the women earn from multiple tasks for which there are no fixed piece rates is in no way equal to the amount of labour they do. The dismantling of labour laws in urban areas has weakened labour departments. Implementation of minimum wage in rural India is conceivable only with strong movements of agricultural workers’ unions. While there should be strict implementation of minimum wages with piece rates fixed for different types of women’s labour, it is unfair that landless manual labourers in rural India are denied the pitiful government annual cash transfer of ₹6,000 given to land-owning farmers. While rural labourers should also be entitled to a similar cash transfer, the schedule of rates for women at MGNREGA projects based on impossibly high productivity rates must be lowered and the work sites made more worker-friendly.
With the deep penetration of capitalist processes in rural India, there is a crisis of livelihood options. Poor women adopt various strategies to deal with it. To make a correct analysis of this crisis requires a sensitive lens. The invisibility of women’s work can be addressed through time use surveys. The village-level time use surveys done by the Foundation for Agrarian Studies, for instance, revealed the extent of women’s work. In fact, widespread surveys of poor rural women and how they spend their time are an urgent necessity. The ‘compulsory’ woman worker must be recognised and protected by laws and policies that address her issues, while India celebrates the 75th year of Independence.
7. Indian interests at the WTO Ministerial Conference
What is the Geneva package? How did India present and push its interests especially with regard to the fisheries and agriculture sectors?
On June 17, member countries of the WTO wrapped up the Ministerial Conference’s twelfth outing (MC12) securing agreements on relaxing patent regulations to achieve global vaccine equity; ensuring food security, according subsidies to the fisheries sector and continuing moratoriums relevant to e-commerce, among others. Together they constitute the “Geneva Package.”
Negotiators could not reach agreements on issues such as permissible public stockholding threshold for domestic food security, domestic support to agriculture, cotton, and market access.
Within the next six months, members are expected to decide on increasing the scope of the agreement to cover the production and supply of COVID-19 diagnostics and therapeutics as well.
The story so far: On June 17, member countries of the World Trade Organization (WTO) wrapped up the Ministerial Conference’s twelfth outing (MC12) securing agreements on relaxing patent regulations to achieve global vaccine equity; ensuring food security, according subsidies to the fisheries sector and continuing moratoriums relevant to e-commerce, among others. Together they constitute what WTO’s Director-General Ngozi Okonjo-Iweala referred to as the “Geneva Package.” India saw some successes at the MC12 with respect to the above mentioned sectors.
What is the WTO’s Ministerial Conference?
The MC is at the very top of WTO’s organisational chart. It meets once every two years and can take decisions on all matters under any multilateral trade agreement. Unlike other organisations, such as the International Monetary Fund or World Bank, WTO does not delegate power to a board of directors or an organisational chief. All decisions at the WTO are made collectively and through consensus among member countries at varied councils and committees. This year’s conference took place in Geneva, Switzerland.
What were the debates around agriculture at the MC?
The agreements on the subject are of particular significance to India. Referring to its status as a significant contributor to the World Food Programme (WFP), India had earlier stated that it had never imposed export restrictions for procurement under the programme. It put forth that a blanket exemption could constrain its work in ensuring food security back home. In such a situation, it would have to keep its WFP commitments irrespective of its domestic needs. Negotiators agreed that member countries would not impose export prohibitions or restrictions on foodstuffs purchased for humanitarian purposes of the WFP. The decision would however not prevent member countries from adopting measures for ensuring domestic food security.
Negotiators could not reach agreements on issues such as permissible public stockholding threshold for domestic food security, domestic support to agriculture, cotton, and market access. The central premise of the agreements was to ensure availability, accessibility and affordability of food to those in need, especially in humanitarian emergencies. It encouraged member countries with available surplus to release them on international markets in compliance with WTO regulations. Moreover, it instituted a work programme to come up with measures to help LDCs (least-developed countries) and NFIDCs (Not Food Importing Developing Countries) enhance their domestic food security and bolster agricultural production.
What about fisheries related agreements?
India successfully managed to carve out an agreement on eliminating subsidies to those engaged in illegal, unreported and unregulated fishing. The only exception for continuing subsidies for overfished stock is when they are deemed essential to rebuild them to a biologically sustainable level. Overfishing refers to exploiting fishes at a pace faster than they could replenish themselves — currently standing at 34% as per the UN Food and Agriculture Organization (FAO). Declining fish stocks threaten to worsen poverty and endanger communities that rely on aquatic creatures for their livelihood and food security.
Further, the agreements hold that there would be no limitation on subsidies granted or maintained by developing or least-developed countries for fishing within their exclusive economic zones (EEZ).
Have the current moratoriums on electronic transmissions been extended?
Member countries agreed to extend the current moratorium on not imposing customs duties on electronic transmission (ET) until MC13 — scheduled to take place in December 2023. 105 countries which includes the U.S. , the U.K., Australia, China and Japan among others , had sought an extension of the moratorium, with India and South Africa being in opposition.
Broadly, ETs consist of online deliveries such as music, e-books, films, software and video games. They differ from other cross-border e-commerce since they are ordered online but not delivered physically.
Proponents had put forth that the moratorium would help maintain certainty and predictability for businesses and consumers particularly in the context of the pandemic. On the other hand, India and South Africa, citing data from the UN Conference on Trade and Development (which calculates the amount of printed matter, music and video downloads, software and video games), submitted that extending duty-free market access due to the moratorium resulted in a loss of $10 billion per annum globally — 95% of which was borne by developing countries. Additionally, they had also sought more clarity on what constitutes electronic transmission.
Customs duties have been traditionally used to avert an undesired surge in imports, allowing nascent domestic industries to remain competitive. Developing countries would need to import sizeable equipment and services for upscaling their digital capabilities. Customs duties provide the necessary capital infusion for capacity building and in turn, attempt to address the digital divide — particularly high in low-income and developing countries, further exacerbated by the COVID-19 pandemic. It is in this context that India and South Africa had sought to preserve policy space for the digital advancement of developing countries by letting them generate more revenues from customs and thereby facilitate more investment.
What were the discussions on patent relaxations?
Member countries agreed on authorising the use of the subject matter of a patent for producing COVID-19 vaccines by a member country, without the consent of the rights holder. Further, it asks member countries to waive requirements, including export restrictions, set forth by WTO regulations to supply domestic markets and member countries with any number of vaccines. The agreement, however, comes too little, too late for economically poorer countries.
Several LDCs have suffered in their efforts to combat the now nearly three-year-old pandemic, owing to factors such as a stressed balance of payments situation , different levels of development, financial capabilities and varying degrees of import dependence on those products.
Within the next six months, members are expected to decide on increasing the scope of the agreement to cover the production and supply of COVID-19 diagnostics and therapeutics as well.