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  • India’s Farming Progress Lies In Adoption Of Smart Agriculture

    India’s Farming Progress Lies In Adoption Of Smart Agriculture

    From being a country that was a food importer till the early 1970s, India’s green revolution transformed the country into becoming self-sufficient in food production and a significant exporter of agricultural products. However, Indian agriculture, hampered by marginal farm holdings suffered from poor technology and lack of modernisation, resulting in production that is far below its potential. With a population of 1.24 billion, Indian agriculture is already challenged.
    The Railway versus Irrigation controversy during the early years of the 20th century was evidence that the British undervalued the significance of improving irrigation in an agrarian economy such as India. R C Dutt, in his famous book ‘The Economic History of India in the Victorian Age’, shows the disparity in funds allocated for railways and that for irrigation purposes. The glaring disparity is believed to be one of the reasons for the 1890 famines. Akin to the pre-independence time, the Economic Survey 2019-20 shows static growth in agriculture from 2014 to the present day. The growth rate in agriculture was a negative 0.2% in 2014-15. Inadequate fund allocation, illiteracy of the farmers, deficient safety nets, lack of microcredit organizations and low incentive for the farmers to adopt climate-smart and efficient technology are some of the reasons for prolonged sluggishness in Indian agriculture. India’s prosperous neighbour, China, however, has managed accelerated growth in both agricultural and industrial sectors. The reason is the proactive nature of the Chinese and the ability to make the most out of little. Since the 1990s China has left India far behind in the field of revamping farming techniques. A leader of innovation, China has turned its weaknesses into strength- rooftop agriculture to compensate for the lack of adequate farming land, AI sensing smart robots to store data and supplement human labour, automated water management schemes that led to rice becoming one of Chinas staple food grains. China has surpassed India in rice production, despite India having more available freshwater for crop production. This indicates the need for India to improve its learning curve as far as international agricultural policies are concerned.
    China has surpassed India in rice production, despite India having more available freshwater for crop production.

    Smart Techniques and Precision Farming

    In this vein, the identification of the techniques of smart farming that can give a boost to the decaying agricultural sector of India is critical. Using smarter techniques like Precision farming, efficient water management techniques and Artificial intelligence are sure-shot methods to increase productivity per acre of land. Precision Agriculture avoids the improper and excess application of pesticides and fertilizers and enables the farmer to use land according to its quality and nature. This leads to a reduction in cost, increase in output and climate-friendly agriculture. ‘Big data’ in Precision farming provides the farmer with data regarding soil quality, raw material requirements and weather changes, which can be stored for a later date. This is a massive game-changer for a sector which substantially depends on weather conditions and faces the brunt of climate change. China has been using automated ‘driverless’ tractors, mowers, AI drones to spray pesticides, and smart robotic sensors to analyse environmental conditions. This increases the speed of farming at an exceptional rate. Precision Farming is a potential salvager at a time when the water tables in India are diminishing at a rapid rate due to unprecedented demand by the agricultural and industrial sectors. Smart farming can potentially break the nexus between outmoded agriculture, climate change and hunger. The longer we delay the implementation of such techniques, the closer we move towards an impasse, which even modernisation might not be able to fix.
    ‘Big data’ in Precision farming provides the farmer with data regarding soil quality, raw material requirements and weather changes, which can be stored for a later date. This is a massive game-changer for a sector which substantially depends on weather conditions and faces the brunt of climate change.

    Predicament of Marginal Holdings

    The Indian predicament can be traced back to decades of neglect towards the agricultural sector. Even with plans like ‘doubling farmer’s income by 2022’, most states except Punjab, Haryana and Karnataka have not even envisaged a plan for smart farming. A plethora of structural barriers impedes the coveted modernization required by our agricultural sector. The average size of landholding by an Indian rural household is a marginal 1.1 hectare. This restricts the use of modern equipment like large tractors and robot sensors as a smart substitute for manual labour. The digital illiteracy of the farmers also presents a hurdle owing to the absence of local experts to impart training and information to the farmers. The connectivity and problem of unstable internet is also a cause of roadblock. Government policies historically have adopted a ‘one-size-fits-all’ approach, thus excluding approximately 86% of small and marginal farmers. For schemes like PM-Fasal Bima Yojana, the small farmers have to pay balance of the premium for crop insurance, which is almost impossible for a debt-strapped farmer. The newly extended PM-KISAN scheme requires farmers in a digitally primitive nation to check their balance by registering themselves on a web-portal page. With basic crop insurance schemes not living up to the expectation, we naturally question the efficacy of schemes to promote smart agriculture. The evaluation of the NMMI scheme for Micro Irrigation recorded that the benefit from the scheme did not reach almost half of the intended beneficiaries, even after they applied for it. The PMKSY scheme simply reached a meagre 1/10th of the farming population targeted.
    A plethora of structural barriers impedes the coveted modernization required by our agricultural sector. The average size of landholding by an Indian rural household is a marginal 1.1 hectare.

    Policy Focus for Smart Agriculture

    A dedicated approach to developing smart agriculture with mass disbursements of benefits, education and economic incentives to our farmers will eventually translate into long-run economies of scale for the agricultural community at large. The US government extensively aids research and development in agricultural technology, along with training given to farmers to understand the new technology. The British government, besides allocating 20 million dollars for sustainable agriculture, also incentivizes private aggrotech firms to invest in smart technology. South Korean government has already created 4,300 jobs in the smart agricultural sector through timely action and aid. India, although lagging in several fields, is endowed with cheap rural labour, the second largest arable land area after the US, a leader in global trade in raw agricultural products and a massive potential growth trajectory in agriculture. Extension services and R&D are at a nascent stage in India and only within reach of large farmers. To expand the scale of the programme it is necessary to ease the transition of small and marginal farmers into the ambit of smart farming. Institutional setups, adequate support and building a steady architecture to execute smart farming should be focus areas for the Indian government in the face of dwindling food production.

    References:

    https://www.smart-akis.com/index.php/network/what-is-smart-farming/
    https://www.smartindianagriculture.com/https://www.changemakers.com/discussions/entries/smart-agriculture-helping-structure-new-industry-chinahttps://www.basf.com/cn/en/media/BASF-Information/Food-nutrition/future-farming.htmlhttps://www.youtube.com/watch?v=PdIr6pP-Rec&list=PLTeiJVqL7DL6yhlOMh4lPv_BCQ5KKMgBd&index=2&t=0shttps://www.downtoearth.org.in/coverage/natural-disasters/climate-smart-agriculture-54437https://www.futurefarming.com/Smart-farmers/Articles/2018/5/South-Korea-creates-4300-jobs-in-smart-farm-industry-283765E/https://krishijagran.com/agriculture-world/amazing-how-smart-farming-techniques-by-south-korea-can-future-proof-agriculture/Image Credit: Adobe Stock

  • Value Of Everything: Making And Taking In The Global Economy

    Value Of Everything: Making And Taking In The Global Economy

    Title : Value of Everything: Making and Taking in the Global Economy

    Winner of the 2018 Leontief prize for advancing the frontiers of economic thought ─ “Value of Everything: Making and Taking in the Global Economy” by Mariana Mazzucato is an extremely important addition to the contemporary debates in development economics. Fundamental ideas presented in the book are very relevant in the current pandemic environment as it gives us an opportunity to reframe approach to policy making. Limitations in the state’s capacity to handle a crisis of this scale might be true but the larger objective to ensure an economic and social value based ecosystem is the main idea that emerges from this book.
    The core focus of the book is on the ‘understanding of value’, as Mariana states – “much of what is passing for value creation is just value extraction in disguise”. By examining what is value the book leads us to understanding who creates value.
    Initial chapters set out to explain the core interpretation of ‘value’ adopting a historical framework by discussing influential economists. Beginning with Mercantilists in an inchoate system that was not linked with any theories to explain the creation of wealth, they believed trade creates wealth and hence, ‘value’ lies within trade. A group of 18th century French economists developed a formal economic theory ‘physiocracy’ that prioritized agriculture and land to be the ultimate source of value. There was a clear production boundary that was developed during the time of physiocrats with agriculture being productive and household, government, service, industry packed together as unproductive. Countering the Mercantilists, Adam Smith theories became prominent to understand the idea of value where wealth creation lies in an optimal economic policy encouraging surplus revenue to be reinvested in production for the nation to become richer. The author points to the theories put forth by Smith to be ambiguous yet made progress in building the concept of wealth creation. David Ricardo– a British political economist extensively wrote about rent and assumed land to be a fixed factor. As opposed to Physiocrats, Ricardo’s theory on value was beyond the production boundary and placed emphasis on financing the surplus into productive spending. The author briefly evaluates the classical theories including Marx’s labour value theory and the recent development of Marginalists under the neoclassical economics. It is worth contesting the idea of value in the marginalist approach where the price is equated to value and individual utility is studied over collective public utility . Although the theories in principle might not be relevant today but the evolution of value in the history of economic thought is a prerequisite to identify the flaws in our structure.
    A key focal point that grabs attention of the reader is the ambiguity present in determining the value of products and services. Reluctance to debate the idea of value with the current system has caused trouble in various sectors and the book reflects Mazzucato’s effort to place value in the centre-stage. She begins to make her case by lucidly explaining the fundamental shortcomings in finance deregulation. In the context of the 2008 financial crisis, much of the blame is on the finance market with excessive mortgaging strategy. Although finance is not a categorical reason for the crisis, the real estate bubble was artificially inflated by the short term objectives of finance companies and clearly proved to be unsuccessful. There are two relevant points that the author notes that will hold relevance across the waves of industrialization. First, economic value added by a finance sector largely remains disproportionate to the value added by other sectors. As a resource facilitator, she asserts, banking corporations are required to invest in productive business that adds further economic value in the society. Mere exchange of financial instruments does not guarantee increased output or welfare in an economy. It has taken a crisis for us to understand the need for steering the discussion on ‘Value Creation’. Second, financial markets bolstering private businesses model prioritizes immediate gains with limited attention paid to the long-run sustainability of the business.
    The book is a scathing indictment of the current global financial system. In the authors view the finance entrepreneurs are overrated, and contrary to popular perception they are not ‘value creaters’ but are ruthless ‘value extractors’ and parasitic. Professor Mazzucato finds the shareholder driven model to be problematic for business innovation and proposes a wider concept of stakeholder based operations. An unequivocal argument is presented to question ‘value extraction’ in the 21 century economy- in public choice theory it would mean rent seeking, a concept of increasing existing share of one’s wealth without creating more wealth. Although the author did not specifically mention the Asian countries, in Indian context, value extraction is much difficult to identify given the informality in credit market, labour market and commodities. But the unsustainable mode of executing business is evident in a corporate company that is motivated to spend on company image than Research and Development. Most importantly, the government bears the cost to repair the system with social tension and inequality that follows the failure of excess financialization. The author’s discussion on development and welfare throughout the chapters encourages readers to view the economy beyond numbers and growth rate– a propensity stemming from modern heterodox economics school of thought
    Mariana Mazucatto, founder of the Institute for Innovation and Public Purpose, draws attention to value extraction prevailing in the innovation economy. She illustrates three sources of innovation; cumulative innovation, uncertain innovation and collective innovation. She clearly articulates the engaging role of the public sector in facilitating innovation. Where most experts talk about innovation as an exclusive achievement of the private sector– Mariana challenges that notion and argues the risks of the innovation are borne by the public but the rewards are monopolized by the private business. It is impossible to deny the role of public sector in the process of innovation but it seems the author tends to credit the government more. All innovation need not create value- an extensive literature is presented to understand the way patents can be used to gain economically yet not create value. Highlighting the case of pharmaceuticals, she argues that most of the drug companies are monopolies that use the patent strategy and the rigid demand to inflate the prices for enormous profit although the production cost is a small percentage of the price. This process explains the high priced medicines in the USA and rekindles the fundamental flaw in pricing of a drug. An extreme private model with little clarity and transparency on value of the service has collapsed the healthcare system in the US, which is starkly evident in the current COVID-19 pandemic. To extend this idea, American healthcare contributes more to the Gross Domestic Product compared to the Japanese, yet citizens of the latter have higher life expectancy than of the former. The illusion of GDP contribution is more apparent when the system fails to serve the purpose it was designed for, like in the case of healthcare. Innovations in any industry can turn out to be unproductive; dismissing any single command approach from the government– the chapter ends by propounding a contract between public and private to adopt innovation as a means to achieve public value.
    In contemporary discourse, the author is concerned about the narrow definition of public sector as simply a saviour or a disturbance to private operations. A powerful narrative set to describe government to be inefficient and just an institution fixing market failure will deter the collective process of value creation. The recent economic stimulus announced by India is founded on the logic that public debt is bad, slashing interest rates would enhance business and privatization would lead to better economic growth. As Mazucatto argues, during an economic crisis public sector must seize the opportunity to invest in value creation simply because interest rates are neither market phenomena nor make firms sensitive to the change. The underrated value of the Keynesian ‘Multiplier Effect’ of public investment and considering the return on public investment to be zero are flaws in defining the role of government in contributing to growth of the economy.
    Prevailing public choice theorists’ fear of government failure over and above the threat posed by market failure runs the risk of ignoring the value created by the state. The author makes a compelling case to view government as an investor rather than spender and as a risk taker rather than a facilitator. She highlights the importance of the state’s part in the collective value creation process by disputing the marginalists definition of individual value in obtaining market value. Knitting back to the initial problem stated regarding price equal to value– identifying profit and rent becomes confusing thereby encouraging private players to extract or destroy value. The mainstream metrics used to assess the value also discourages actual value creators like the government to imitate the private sector. The government as a facilitator also faces the risk of lobbying from the private individuals and companies that hamper the process of development. The last chapter – ‘Economics of Hope’– summarizes the main ideas presented throughout the book and emphasises that the ultimate goal of the economy is to serve the people and ensure welfare along with sustainable and equitable development. The real challenge still lies in estimating the precise amount of government intervention in the process of value creation. Value of everything remains a convincing genesis of the debate on the central idea of value that could possibly be a dynamic tool to achieve the goals of an economic system.
    As Mariana Mazucato argues in this penetrating and passionate book, if we are to reform capitalism to radically transforman increasingly sick system rather than continue feeding it we urgently need to rethink where wealth comes from; who is creating it, who is extracting it, and who is destroying it. Answers to these questions are key if we want to replace the current parasitic system with atype of capitalism that is more sustainable, more symbiotic, that works for all.

  • Coronavirus: Fighting The Invisible Enemy

    Coronavirus: Fighting The Invisible Enemy

    The coronavirus pandemic is the biggest disruptive global health threat in more than a century. The economic, political, and social life of people in all countries has been adversely affected as never before. This new strain of the coronavirus has posed significant challenges to people, researchers, medical fraternity, and governments across the world. It poses serious health risk to the elderly and has stressed national health systems significantly. The development of a vaccine, despite global efforts, is not likely to be available any time before mid 2021. The Peninsula Foundation, through two doctors Ms Keerthika Gnanasegaran and Ms Vishnupriya Rajasegaran have put together complete information on the Coronavirus in simple and easy to understand details. Ms Avanti A Srinivasan, a high school student describes her experience and opinion of the crisis.

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  • Vocal about Local: Empowering local Governance Structures to deal with the Pandemic

    Vocal about Local: Empowering local Governance Structures to deal with the Pandemic

    Urban centres in times of the Pandemic 

    India is a rapidly urbanizing state. The 2011 census estimates that 31% of Indians live in urban areas. It counts 4041 statutory towns, 3892 census towns and 474 urban agglomerations as urban areas. These numbers however are quite outdated in 2020 and also there is considerable consensus among experts that there is an underestimation of urban spaces owing to the outdated definition of ‘urban’ in India. For example, the Joint Research Centre (JRC) of the European Commission, based on satellite data, reports that at least 54% of India’s population lived in cities or large urban areas in 2015 and the World bank using the Agglomeration Index finds out that 55.3% of India’s population lived in urban-like spaces in 2010. Regardless, the fact remains that these urban spaces should be governed democratically with the spirit of the 74th amendment. The COVID-19 situation further reasserts the importance of such governments and their role in Indian society.

    Cities and urban spaces have emerged as hotspots of the Coronavirus. It is from the cities that the coronavirus subsequently spread to other rural areas.

    Cities and urban spaces have emerged as hotspots of the Coronavirus. It is from the cities that the coronavirus subsequently spread to other rural areas. Throughout history, pandemics have originated and perpetuated from cities, therefore it is not irrational to predict another pandemic perpetuated from cities in today’s close-knit global village. This warrants a greater need to safeguard the cities which are the essential links that connect nation states to the globalized world. The first step in this direction would be to empower urban governments for efficient crisis management and prevention of communicable diseases by assuring basic public goods.

    Subsidiarity

    The principle of subsidiarity advises that the Central authority should have a subsidiary function, performing only those tasks which cannot be performed at a more local level. The principle therefore asserts the sovereignty of the citizen in a democracy and places her at the center of decision making.

    In line with the principle, everything that can be done better locally, including providing basic services like safe drinking water and ensuring public goods like clean air, should be done by the local governments. The rationale being that, one, it increases efficiency and promotes self-reliance; two, it provides legitimacy to democracy and three, it creates awareness among people and develops responsible citizens. And another obvious reason is that it is most effective in understanding the local problems and in ensuring a pragmatic feedback loop.

    All these reasons become much more clearer in times of crisis such as the Covid-19 pandemic when local assessment and rapid service delivery become difficult. Urban Local Bodies (ULBs) neither have properly delineated functions to perform nor do they have the finances to do so. The 12th schedule of the Indian Constitution lists a group of 18 subjects on which the local governments can act upon, but only if the States ‘may’ wish to assign those functions by virtue of another State legislation. Even when legislated, States usually encroach into the domain of the purview of the local governments.

    The Veerappa Moily commission’s sixth report dealing with local governance sums it up perfectly.
    “Confusion, unnecessary duplication, inefficiency, wastage of funds, poor outputs and outcomes are the result of this organisational jungle. The local organisations which should be the ones most directly and fully concerned are at best treated as a small part of the implementation, occasionally consulted but, in most cases, by-passed and ignored”.

    Furthermore, the establishment of parastatals has reduced the functions of the local governments. The Parastatals perform specific functions which are supposed to be performed by ULBs and are accountable only to the State government thereby circumventing the ULBs. In addition, the Union government also takes a share of the implementation space with centrally sponsored schemes thereby making proper delineation of powers impossible for ULBs.

    The Veerappa Moily commission’s sixth report dealing with local governance sums it up perfectly.
    “Confusion, unnecessary duplication, inefficiency, wastage of funds, poor outputs and outcomes are the result of this organisational jungle. The local organisations which should be the ones most directly and fully concerned are at best treated as a small part of the implementation, occasionally consulted but, in most cases, by-passed and ignored”.

    Now, when experts ask for decentralized governance to efficiently deal with the pandemic and to decentralize decision-making regarding lockdown measures, all they get is a dysfunctional organisation jungle where local governments do not have the wherewithal to function as self-governing institutions.

    Disaster Risk Reduction

    Strong local governments are of great importance, especially during disasters and pandemics. Experts suggest that a sound bottom-up governance approach has been more successful in the wake of disaster response. For instance, in a UNDP study on disaster risk reduction in Bangladesh, they point out the importance of local governance.

    The report suggests that local governments are crucial because they ‘play the greatest role in sustaining ongoing, participatory disaster risk reduction at local community level’. The report goes on to summarize that the key lesson learnt from the study is that decentralization of authority and decision making is essential to effectively deal with the disaster.
    “Decentralization of authority to local governments is vital to ensure local ownership of disaster risk reduction and the local implementation of the Hyogo Framework for Action. Local authorities should have the responsibility of implementing disaster risk reduction, and be accountable to the community they represent in doing so”.

    Much has been written about why governments closer to the people are more effective but what is equally important is that when decision making is decentralized, citizen satisfaction and responsibility is increased (for example, see this study done in Indonesia). This becomes important in times of the Covid-19 pandemic where individual responsibility is necessary to stop the spread of the virus. Also with lives and livelihoods pitted against each other, citizen satisfaction is important to make hard decisions which might deter personal freedom in the short term.

    Considering all this, the National Disaster Management Act, 2005, which was used by the Union government to impose lockdown measures, seems to lack the involvement of local governments in disaster risk reduction. V N Alok in his article for the Financial Express, deals with this complaint. He argues that there is only a passing reference to local government in the Act and even when referenced, functions are mostly subsidiary to the District authority headed by the Collector/Magistrate which is controlled by the State government. On the other hand, there is no ambiguity in assigning functions to the State and Union governments.

    India is often referred to as the ‘flailing state’, which is strong and sound in the centre, with no reliability at the grass-roots. Local governments can provide the missing link that could hinge the State to the people.

    This again echoes Veerappa Moily Commission’s concern that there is no proper delineation of powers for the local governments. Article 243 N and 243 ZF mandated that all laws inconsistent with parts IX and X of the Indian constitution shall be changed accordingly within a year of passing the 73rd and 74th Amendments. But most States have still not identified and changed all statutes conforming to the idea that local governments are self-governing institutions. This shows India’s hesitation to look at local governments as self-governing institutions capable of dealing with problems.

    India is often referred to as the ‘flailing state’, which is strong and sound in the centre, with no reliability at the grass-roots. Local governments can provide the missing link that could hinge the State to the people.

    Its importance is felt during the pandemic more so than ever, especially in cities where the institution is weak compared to rural India. An integrated approach, with involvement from the local government, would prove to be more effective than centralized decision making. But before relying on ULBs and locally elected leaders, they have to be empowered-politically, functionally and financially. The first step towards such empowerment could be by including local governments in conversations regarding governance and decision making; to be more vocal about local governments.

  • Daulet Beg Oldi: Operating from the World’s Highest Airfield

    Daulet Beg Oldi: Operating from the World’s Highest Airfield

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    Daulet Beg Oldi (DBO) is a historic campsite in Ladakh on an ancient trade route connecting Ladakh to the Tarim Basin. It is named after Sultan Said Khan (Daulet Beg), who died here on his return journey after the invasion of Ladakh and Kashmir. DBO is strategically significant as it is close to the Siachen Glacier, the Karakoram Pass, and China’s Xinjiang-Karakoram highway. The Chip Chap river flows just to the south of DBO from east to west. It has an airstrip at an altitude of 5064 meters (16,614 ft), the world’s highest airstrip. India activated DBO as a military base and Advanced Landing Ground (ALG) following the border dispute with the PRC in the late 1950s. The IAF activated DBO airfield in 1962 and it became a crucial ALG since then. DBO continued to be in use till 1966. The airfield was damaged following an earthquake in 1966, which put a stop to its further use. The IAF maintains many of the forward posts and villages in the himalayan regions through airdrops using a string of ALGs. Following increased belligerence from China, DBO was reactivated in 2008. The completion of the Darbuk-Shyok-DBO road added immense logistical strength to the Indian military in the region. Since 2013, China has intensified its probing incursions in this region. The recent clash in the Galwan valley is a high point of increasing tensions along the borders.

    Operations from the DBO have been a huge challenge, given its high altitude, mountainous terrain, and loose soil conditions. Group Captain A G Bewoor VM (Retd), an air force veteran with immense transport flying experience, describes the challenges overcome by the IAF in activating the DBO through first landings spaced out by 46 years.

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  • China’s support to Syria: In Conflict and Redevelopment

    China’s support to Syria: In Conflict and Redevelopment

    China is looking to ramp up relations with Syria both as part of its strategic Belt and Road Initiative (BRI) but also to take advantage of the multi-billion dollar reconstruction effort that is expected to materialise following the gradual winding down of the war.

     

    Syria is an ancient civilisation and also an important part of the ancient silk route, with cities such as Palmyra, Aleppo and Damascus playing an important role in trade and travel between the East and the West. While the discovery of a maritime route between Europe and Asia has to some extent diminished its importance in this regard, Syria is still strategically important. China is looking to ramp up relations with Syria both as part of its strategic Belt and Road Initiative (BRI) but also to take advantage of the multi-billion dollar reconstruction effort that is expected to materialise following the gradual winding down of the war.

    China’s non-interference policy is an integral aspect of its involvement and role in the Middle East. During the course of the Syrian war, China has consistently supported the Bashar Al Assad government on the diplomatic front – through the exercise of the veto power against the resolutions introduced in the United Nations Security Council either condemning the Syrian government, calling for ceasefire or for imposing sanctions on suspected war criminals. While negotiating the renewal of border crossings for aid, China agreed on the need for humanitarian assistance but emphasised on state sovereignty. China’s policy of non-interference has served it well in strengthening bilateral relations and advancing its interests.

    One of the reasons for the diplomatic support extended by China to the Syrian government is also the involvement of the Uighur fighters in the Syrian conflict which has greatly bothered China. While it has never got directly involved militarily in the Syrian conflict there are unconfirmed media reports which suggested that China was sharing military intelligence with the Syrian government and also sent its military advisors to Syria to help it in its fight against the rebels. In this sense, it saw Syria as a key player in its fight against religious extremism thereby preventing its export to its own volatile Xinjiang province.

    With the Syrian conflict slowly winding down and Bashar Al Assad’s hold on Syria greatly strengthened more than at any other time since the beginning of the civil war, China is ramping up its diplomatic efforts in Syria  using trade as an important policy tool to ramp up the relations between the two great civilisations.

    Based on Chinese government’s invitation Syria has participated in the second BRI summit held in Beijing in April 2019. Previously in 2018, China held a Trade Fair on Syrian reconstruction projects which was attended by nearly one thousand Chinese companies and which saw investment proposals of nearly USD two billion. The collapse of most of the industry in Syria due to the war has also resulted in a significant increase of cost-effective Chinese imports into Syria ranging from toys to car parts and industrial machinery and equipment.

    China is also leveraging its economic strength fully by using aid as a foreign policy tool. In 2019,  Xinhua reported on the  that an economic cooperation agreement was signed between Syria’s Planning and International Cooperation Commission (PICC) and the Chinese embassy in Damascus. As part of this agreement, a donation will be set aside to fund a series of humanitarian projects as agreed upon by both sides.

    The collapse of most of the industry in Syria due to the war has also resulted in a significant increase of cost-effective Chinese imports into Syria ranging from toys to car parts and industrial machinery and equipment.

    China is expected to be a key player in the international reconstruction and development effort that is expected to take place in Syria due to its strong bilateral ties with not only Syria but also its alignment with Russian and Iranian position on Syria , these two players being the major supporters of Bashar Al Assad’s government in the civil war. While Russia and Iran are surely expected to carve out a large part of the reconstruction contracts between themselves, their capacity to make the huge investments in these projects, estimated to be worth anywhere between USD 200 million to USD 1  trillion is doubtful. This creates the ripe opportunity for China to enter the reconstruction business effort either by themselves or, as is more likely, in partnership with Russian and Iranian governments or businesses.

    Beyond the business opportunities provided by the potential reconstruction of Syria, China is also strategically interested in Syria. China was always interested in securing access to the Ports of Tartus and Latakia on Syria’s Mediterranean coast. Such an access is expected to complement Beijing’s interests in the Greek port Piraeus (COSCO shipping, the Chinese state-owned shipping and logistics services supplier company in the Port authority) and the Israeli port of Haifa, in securing a trade route to Europe. In alignment with these strategic interests, Chinese companies’ area also exploring the possibility of upgrading the deep seaport of Tripoli, Lebanon to allow it to accommodate larger vessels and also the possibility of building a railroad that would connect Beirut and Tripoli in Lebanon to Homs and Aleppo in Syria.

    Beyond the business opportunities provided by the potential reconstruction of Syria, China is also strategically interested in Syria. China was always interested in securing access to the Ports of Tartus and Latakia on Syria’s Mediterranean coast.

    Chinese investments into and trade ties with Syria however, risk the attraction of US sanctions on Syria. The arrest of Meng Wanzhou, Chief Financial Officer of Huawei, , in Canada, based on a request by the United States highlights the extent of these risks. “The Caesar Syria Civilian Protection Act”, also known as “The Caesar Act”, a United States legislation that sanctions the Syrian government, including Syrian president Bashar al-Assad, for war crimes against the Syrian population, parts of which  are now incorporated  in the “National Defense Authorization Act for Fiscal Year 2020” greatly tightened the sanctions environment against the Syrian government and a number of its industries potentially impacting the Chinese investments and trade ties. While China has called for an end to sanctions stating they were “inhuman,” they have been wary of being targeted by sanctions and further straining their relations with the US. However, it is unlikely that the sanctions would have a significant effect on China given the size of China’s economy and its ability to circumvent sanctions while dealing with Iran and North Korea. China, as part of its ‘mask diplomacy,’ is increasingly providing aid to the Syrian government in their efforts against Covid-19. This serves the dual purpose of strengthening China-Syria relations and strengthening China’s narrative of Covid-19.

    To conclude, China has been a staunch supporter of the incumbent Syrian government of Bashar Al Assad during the almost decade long Syrian civil war and is set to reap the benefits from the post-war Syrian reconstruction effort in conjunction with the Russians and the Iranians to advance its interests.

    Image: Middle East Institute

     

  • Sanitation & Hygiene Concerns in Government Schools in Tamilnadu: Need for Digital Intervention

    Sanitation & Hygiene Concerns in Government Schools in Tamilnadu: Need for Digital Intervention

    Ensuring that there are proper health and hygiene facilities and awareness for girls at the school level is an extremely important building block for quality education. 

    Introduction

    Achieving quality education at school level is a dynamic process that needs to revise the elements according to the needs of the social setting. One such element is a  policy that promises an education system to promote gender equality from the grassroots. The problem needs an intervention with an enhanced infrastructure for maintaining sanitation and hygiene for girl students and a holistic understanding of gender issues through awareness that leads to organic social change. The state, undoubtedly, is responsible to ensure quality education and resolve the gaps in education using innovative methods. Tamil Nadu is one of the best performing states as far as literacy rate is concerned. However, realistic social barriers still exist that need intervention and customized strategy. According to the 2011 census, Tamil Nadu stood third after Kerala and Maharashtra. The male literacy rate was around 87% and the female literacy rate was around 73%. 

    This article attempts to decode the most important factors,sanitation and hygiene, in ensuring ‘quality’ of education for girls. This particular aspect encompasses three main Sustainable Development Goals (SDG) of the UN; Quality Education, Gender Equality and Water & Sanitation. The last goal of providing access to clean water, sanitation and hygiene (WASH) particularly in rural areas is the means to achieve the former two goals of gender equality and quality education. 

    Need to prioritize WASH for quality education

    Tamil Nadu employs more than 50% of its women in remunerative labour. Girls tend to drop out of schools either because of customary practices or because of the demand for labour. In some cases The lack of awareness and knowledge on menstruation and menstrual practices are also major factors contributing to this drop out. Despite several initiatives and attempts at establishing proper sanitation and hygiene practices particularly in schools, most of these initiatives fail to gain attention across social barriers, especially those initiatives surrounding menstruation and their importance. This exposes the limitation of community-based initiatives and their impact. Specifically Water, Sanitation and Hygiene practices, commonly known as WASH. Tamil Nadu is estimated to have 6.1 million adolescent girls and yet around 7837 schools have either dysfunctional toilets or no toilet facilities at all. The implication of such poor infrastructure is an adverse impact on learning and results in drop out from schools in most of the cases. Ensuring that there are proper health and hygiene facilities and awareness for girls at the school level is an extremely important building block for quality education. 

    The lack of awareness and knowledge on menstruation and menstrual practices are also major factors contributing to this drop out. Despite several initiatives and attempts at establishing proper sanitation and hygiene practices particularly in schools, most of these initiatives fail to gain attention across social barriers, especially those initiatives surrounding menstruation and their importance.

    Access to toilets and sanitation facilities is a privilege that only a few have access to particularly in rural areas where people practice open defecation owing to the lack of toilets. Tamil Nadu has performed brilliantly in this respect since the implementation of Swachh Bharat Abhiyan Scheme in 2014. Over 48 lakh toilets were built in rural areas since 2014, with Tamil Nadu becoming an open-defecation free state. 

    The Government of India recognized the role played by sanitation and hygiene in ensuring that quality education is delivered. In 2014, the MHRD had launched the ‘Swachh Bharat Swachh Vidyalay’ initiative. The scheme was implemented to ensure that there were separate functional toilets for girls and boys. In addition to ensuring separate toilets, the scheme also focuses on maintaining a certain level of hygiene and sanitation. While it is not enough that this initiative  has been implemented in schools across the country, it is also important that parents, teachers and children are aware of the same. Proper hygiene and sanitation does not end in school,  it is imperative that this awareness is spread in local communities and villages as well. As a part of the scheme, government schools in rural and urban areas are eligible to nominate themselves for the ‘Swachh Vidyalay Puraskar’. This acts as an incentive for schools across the country to improve their WASH standards. 

    Capitalizing the Digital Wave

    With Tamil Nadu’s rural internet penetration through mobile phones at 41.98%, there is a significant potential that can be tapped in the state’s ICT usage. While creating awareness is one side of the coin, spreading awareness is another. This is where the potential of ICT can be harnessed, in spreading awareness. The government of Tamil Nadu has made available textbooks, lessons and other educational material on their ‘DIKSHA’ portal which is essentially a YouTube channel. On this channel, students from different classes can access their study material. This could be one of the possible means through which awareness can be created across districts and villages on the importance of sanitation and hygiene. 

    Some of the government schools in Tamil Nadu have demonstrated an exceptional WASH record, thereby proving the fact that if the administration is focused the results can be excellent as shown by Thiruvallur and Vellore districts. Schools in these districts have maintained excellent sanitation and hygiene standards and have been recipients of the SVP.  The initiatives taken by these schools to spread awareness on the importance of sanitation and hygiene have largely been behaviour oriented. By involving parents and the larger community, these initiatives have been successful and effective as well. Community-based initiatives are to create and spread awareness on various social welfare schemes. Apart from creating awareness, such initiatives also tend to bring communities together. The implementation of the SBSV scheme has facilitated the use of ICT as well. While the integration of ICT in the process is a welcome change, there is a lack of clarity on what exactly it is being used for. 

    Importance of awareness on Menstrual Hygiene 

    It has been established that several initiatives were taken in the past and are being taken to improve ‘WASH’ practices in the country, particularly in schools to improve enrollment rates as well as reduce dropout rates. Educational institutions in the country, particularly schools have an inherent responsibility to educate adolescent girls on menstruation, talk about the changes it brings about in a girl’s body. A 2014 report by Dasra foundation posits that close to 23 million girls drop out of school annually due to a lack of awareness. 79% of girls and women in Tamil Nadu were not aware of menstrual hygiene and practices that are followed at the time of menstruation. Lack of awareness of menstrual hygiene and the practices that are required to be followed at the time of menstruation makes a girl/woman extremely susceptible to infections. This is largely attributed to the stigma that is created around menstruation and the notion that it is an ‘impure’ phenomena. A study conducted in 2015, in Padappai, points out that only 43.33% of girls were aware of menstruation when they experienced it the first time. The source of information in most of these cases was the mother while the teachers and schools had a very small part to play in the process. Therefore,  a layer of stigma surrounding the issue is apparent that is far from being institutionalized. Institutionalizing the issue would lead to it being discussed in schools, which in turn would normalize it and break the stigma around it. There are a plethora of possibilities that ICT brings about. Schools could tap into this potential and make use of it to communicate effectively to their students. In rural India particularly, simply creating awareness and breaking the stigma around menstruation will not suffice. Often, this stigma is reinforced by  women in the family. In order to move beyond this, schools must ensure that lessons on menstruation are conducted for both girls and boys alike. Not only does this induce awareness among boys but it also makes them more sensitive to the issue. 

    A 2014 report by Dasra foundation posits that close to 23 million girls drop out of school annually due to a lack of awareness. 79% of girls and women in Tamil Nadu were not aware of menstrual hygiene and practices that are followed at the time of menstruation.

    Awareness through Digital Platform

    Tried and tested methods of spreading awareness in a community has generated results but is not enough. Improving sanitation and hygiene standards in learning institutions requires the participation of all the stakeholders involved in the process. While this may be an initial attempt at de-stigmatizing the issue, undoing centuries of discrimination and oppression requires a systemic approach. Tamil Nadu government’s ‘DIKSHA’ portal is a good place to start. In addition to developing online resources, there must also be some sort of portal that mandates uploading information related to the sanitation and hygiene measures that are being taken in schools. Additionally, it is important to use digital interventions to create awareness and reinforce the message in a timely manner. While infrastructure creation is a part of the goal, it is equally important to establish the need for it and educate people. This is where the digital intervention comes into the picture. One of the goals in Tamil Nadu’s Vision 2023 Project is to encourage PPP as a mechanism for infrastructure creation. This could be one of the potential means through which awareness is spread by introducing digital interventions in rural areas. It could either include installing a TV in Gram Panchayat offices which could display campaigns on the importance of sanitation and hygiene/menstrual hygiene, etc. With respect to creating awareness on menstrual hygiene which is a systemic issue because of the stigma attached to it – the solution needs to be systemic as well. For starters, creating conversation around menstruation is extremely important. Something called the ‘culture of silence’ exists in Kenya particularly in rural areas where girls refrain from speaking about menstruation and puberty. Identifying practices like this is a start when it comes to de-stigmatizing menstruation. While removing GST on sanitary napkins is one way to make the product more accessible, it is important to make people realize why there is a need for using one in the first place and the consequences of not using it. This brings us to the question of whether it is enough for the state to build infrastructure alone and if its responsibility ends there as opposed to also creating awareness on how to go about using the said infrastructure as well as educating people on its importance. 

    Ensuring  Effective Policies

    Some of the government schools in Tamil Nadu have demonstrated an exceptional WASH record, thereby proving the fact that if the administration is focused the results can be excellent as shown by Thiruvallur and Vellore districts. Schools in these districts have maintained excellent sanitation and hygiene standards and have been recipients of the SVP. 

    Initiatives like the SBA, SBSV and SVP are focussed around creating infrastructure and incentivizing schools to implement hygiene practices. Sanitation happens to be a state subject, and each state faces its own challenges with respect to addressing the problem. For instance in a state like Tamil Nadu where there is decent infrastructure, the drop-out rate for girls is still on the higher side. A lack of awareness on menstrual hygiene has also contributed to the drop-out rates in the state. Evidence suggests that not all government schools in Tamil Nadu have toilets and the ones that have toilets, do not maintain them well. Perhaps now the state must implement initiatives that focus on capacity building and behavioural change in order to ensure that the results are more impactful and also long-lasting. The initiatives that the state implements in the future must focus on intrinsically motivating people to implement sanitation and hygiene practices in their lives. Apart from that, the state must also conduct follow-up workshops that engage with people and communities and teach them how to use toilets, etc. In addition, whenever a new initiative/scheme is launched, state governments must also make sure that there are bodies/committees in place in every district that happens to be a beneficiary of the scheme. As communication becomes easier and more efficient in the digital age, initiatives that are implemented in the future must focus on knowledge creation. 

     

    References 

    https://www.orfonline.org/expert-speak/gender-dimensions-of-school-closures-in-india-during-covid19-lessons-from-ebola-66643/

    https://poshan.outlookindia.com/story/poshan-news-strong-connect-between-sanitation-and-health/348492

    https://swachhindia.ndtv.com/23-million-women-drop-out-of-school-every-year-when-they-start-menstruating-in-india-17838/

    https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6286883/

    http://sujal-swachhsangraha.gov.in/sites/default/files/Five%20schools-%20WASH%20in%20School%20-%20practices%2C%20Tamil%20Nadu-%20Clean%20school%20.pdf

    https://mhrd.gov.in/sites/upload_files/mhrd/files/upload_document/Swachh_Vidyalay_Puraskar_Guidelines.pdf

    https://www.researchgate.net/publication/294638502_Awareness_about_menstrual_hygiene_among_adolescent_girls_in_rural_area_of_Kancheepuram_district_-_Tamilnadu

    https://timesofindia.indiatimes.com/city/chennai/tn-second-in-rural-smartphone-use/articleshow/67291628.cms

    https://www.researchgate.net/publication/333561228_Availability_and_Utilization_of_Sanitation_Facilities_A_Micro_Study_from_Rural_Tamil_Nadu

    https://swachhindia.ndtv.com/swachh-bharat-abhiyan-tamil-nadu-to-go-open-defecation-free-on-october-2-25278/#:~:text=Tamil%20Nadu’s%20Swachh%20Bharat%20Abhiyan%20Journey&text=The%20state%20has%20a%20total,declared%20free%20from%20open%20defecation.&text=Tamil%20Nadu%20has%20improved%20its,per%20cent%20in%20four%20years.&text=Over%2048%20lakh%20toilets%20(48,since%202014%20in%20rural%20areas.

    https://www.wsscc.org/2016/08/10/wsscc-menstrual-hygiene-management-training-kenya-breaks-silence-menstruation/

  • India-China Trade in ancient times: Southern Silk Route

    India-China Trade in ancient times: Southern Silk Route

    To follow the Silk Road is to follow a ghost. It flows through the heart of Asia, but it has officially vanished leaving behind the pattern of its restlessness: counterfeit borders, unmapped peoples. The road forks and wanders wherever you are. It is not a single way, but many: a web of choices.

     Colin Thubron, Shadow of the Silk Road.

     

    Introduction

    India and China, two Asian giants, share a lot of similarities in terms of history and culture. Both countries represent age old civilizations and unique history. Cultural and economic ties between the two countries date back to about 2000 years ago. The Silk Route, which is an ancient network of trade routes, formally established by the Han Dynasty, served as a connection between the two countries. It was also through this route that Buddhism spread to China and East Asia from India. The routes were more than just trade routes; it was the carrier of ideas, innovations, inventions, discoveries, myths and many more.

    The earliest mention of China can be found in the Indian text “Arthashastra” which was written by Kautilya in the fourth century BC. Kautilya made a remark about Cinapattasca Cinabhumjia (Cinapatta is a product of China)[1]. Whereas, the earliest mention of India in Chinese records dates between 130 and 125 BC.  Zhang Qian, a Chinese envoy to Central Asia, referred to India as Shendu, in his report about India to Emperor Wu of the Han dynasty.

    This article will look into the ancient trade route that existed between South Western China and India’s North East region via Myanmar and the future of the trade route.

    Ancient trade links between India and China

    Shiji, which is the first Chinese dynastic history, compiled between 104 and 87 BCE talks about the existence of a trading route between India and South West China. According to Chinese records, Emperor Wu of the Han dynasty, tried to establish a trade route from Changan, the Chinese capital to North East India through Yunnan and adjoining areas. However, the rulers of Yunnan were against the idea of establishing a direct trade between India and China and Emperor Wu failed to establish the trade route. Even though the trade route failed to take off, the trade in Cinapatta and Chinese square bamboo continued without any hindrance.

    Political Geography of the Southern Silk Route

    The Southern Silk route (SSR), one of the least studied overland route, is a trade route which is about 2000 km long and linked East and North East India with Yunnan Province of China via Myanmar. This is a relatively unknown, ancient trade route that is considered a part of the larger web of Silk Roads. This route existed before the Central Asian Silk route became popular. This trade route between Eastern India and China came to be known during the early 3rd century BCE, and it became popular by the 2nd century BCE. By 7th century AD various other branches of the SSR emerged to create web of trading routes.

    Traders carried silk from Yunnan through Myanmar, across India and joined the main silk route in Afghanistan. In addition, silk was also transported from South West China through the Shan states and North Myanmar into East India and then down to the Coromandel Coast.

    The Qing dynasty which ruled China from 1644-1912, recorded the cross cultural exchanges that took place across SSR. This route contributed to cultural exchanges between China and the West. It also promoted interactions among different nationalities.

    Indian sources have failed to provide abundant evidence about the SSR and the interaction that took place across this route but there is enough evidence that indicates that trade and migration did take place in the Eastern India-Upper Myanmar-Yunnan region. For example, modern scholars believed that the Tai Ahoms were originally from Yunnan but they migrated to North East India and founded a small kingdom around 13th century, which grew to become the powerful Ahom Kingdom of Assam.

    The areas through which the SSR passed were inhabited by various ethnic groups whose political, social and economic organizations were primitive and backward. As a result, the safety of the route was often questioned. Archeological evidences have been found along the Southern banks of Brahmaputra up to Myanmar border, which shows that trade did exist along this route.

    The main items that were exported from China via this route included Silk, Sichuan cloth, Bamboo walking sticks, ironware and other handicrafts items.  Sichuan, a South Western province was the main source of silk. Glass beads, jewels, emeralds etc were some of the items that were imported to China.

    Another important trade route is the South West Silk route or the Sikkim Silk route, which connected Yunnan, and India through Tibet. A section of the route from Lhasa crossing Chumbi Valley, Nathu La Pass connected to the Tamralipta Port (present day Tamluk in West Bengal). From the Tamralipta port, this trade route took to the sea to traverse to Sri Lanka, Bali, Java and other parts of the Far East.  Another section of the route crossed Myanmar and entered India through Kamrup (Assam) and connected the ports of Bengal and present day Bangladesh.

    Over time, the Southern Silk Route lost its prominence and it was in 1885 that it re- emerged as a strategic link as the British tried to control some parts of the route in order to access and gain control over Southern China.

    The strategic importance of the route increased during World War II. In 1945, Ledo Road or Stilwell Road was constructed from Ledo, Assam to Kunming, Yunnan to supply aid and troops to China for the war with Japan. Ledo Road is the shortest land route between North East India and South West China. However, after the war the road was left unused and in 2010, BBC reported that much of the Ledo road has been swallowed up by jungle.

    The Assam-Myanmar-Yunnan road is very difficult to traverse not only in the present times but also during the ancient times. However, despite the hard conditions, it is through this route that a golden triangle of drug trafficking, movement of terrorist and smuggling functions today.

    Future Potential: Reviving the Southern Silk Route Economy

    North-East India and the Yunnan province share many similarities. Both are landlocked as well as under developed regions. Both are home to a large number of ethnic groups and have witnessed secessionist movement from time to time. Apart from this, Yunnan and North East India are geographically isolated from their political capitals.

    Yunnan and North East India, home to rich varieties of subtropical fruits with high nutritional values and medicinal plants, can cooperate and transform the hills of North East India and South West China into plantations, factories, laboratories to produce processed food products and lifesaving drugs that can find a huge market in developing and developed countries.

    In a bid to revive the Southern Silk route, Bangladesh, China, India and Myanmar, signed the Kunming Initiative, a sub-regional organization, in 1999. This initiative was replaced by the Bangladesh-China-India-Myanmar Economic Corridor (BCIM-EC) in 2015. The BCIM-EC was announced by China as a part of its Belt-Road Initiative, which has been boycotted by India since the beginning. In 2019, the BCIM-EC was dropped from the list of 35 projects that are to be undertaken under BRI, indicating that China has disreagrded the project. However, in the same year India has sought to keep the BCIM-EC project alive.

    If the BCIM-EC project does take place, it will reduce the travel time, cut transportation cost, open up markets, provide way for joint exploration and development of natural resources and create production bases along the way. Before the BCIM-EC takes off, it is important to develop the roadways infrastructure of India’s North East region.

    Even though the BCIM-EC promises to elevate the economic conditions of the backward North-East region of India, it has not gained sufficient steam as both China and India have different apprehensions. China sees India’s reluctance to support BRI as the barrier for any progress in the project. Given the current stand-off in Ladakh, India’s apprehensions about China seeking to exploit the insurgent groups operating in the region gains significance. Either way realizing the Southern Silk Road as a viable project in the form of BCIM-Economic Corridor looks distant now.

     

    [1]Haraprasad Ray, “Southern Silk Route: A Perspective,” in The Southern Silk Route : Historical Links and Contemporary Convergences (Routledge, 2019).

    References

    Ray, Haraprasad. “Southern Silk Route: A Perspective.” Essay. In The Southern Silk Route: Historical Links and Contemporary Convergences. Routledge, 2019.

    “Continental and Maritime Silk Routes: Prospects of India- China Co-operations.” In Proceedings of the 1st ORF-ROII Symposium. Kunming, 2015.

    Mukherjee, Rila. “Routes into the Present.” Essay. In Narratives, Routes and Intersections in Pre-Modern Asia, 37–40. Routledge, 2017.

    UNESCO. Accessed June 20, 2020. https://en.unesco.org/silkroad/content/did-you-know-great-silk-roads.

    “The Silk Route.” Accessed June 21, 2020. http://www.sikkimsilkroute.com/about-silk-route/.

    Ray, Haraprasad. Introduction. In North East India’s Place in India-China Relations and Its Future Role in India’s Economy, n.d.

    Chowdhury, Debasish Roy. “’Southern Silk Road’ Linking China and India Seen as Key to Boosting Ties.” South China Morning Post, October 23, 2013.

    “China Wants to Revive ‘Southern Silk Road’ with India.” The Times of India, June 9, 2013.

     

    Image: Stilwel Road from Ledo in Northeast India to Kunming in Yunnan province, China

     

  • India’s Agriculture: The Failure of the Success

    India’s Agriculture: The Failure of the Success

    It was around the mid-1960s when the Paddock brothers, Paul and William, the ‘prophets of doom’, predicted that in another decade, recurring famines and an acute shortage of food grains would push India towards disaster. Stanford University Professor Paul R. Ehrlich in his 1968 best selling book The Population Bomb warned of the mass starvation of humans in the 1970s and 1980s in countries like India due to over population.

    Their prophecies were based on a rising shortage of food because of droughts, which forced India to import 10 million tonnes of grain in 1965-66 and a similar amount a year before. Little did they know that thanks to quick adoption of a new technology by Indian farmers, the country would more than double its annual wheat production from 11.28 million tonnes in 1962-63 to more than twice that within ten years to 24.99 million tonnes. It was 71.26 million tonnes in 2007. Similarly rice production also grew spectacularly from 34.48 million tonnes to almost 90 million tonnes in 2007.

    Total food grains production in India reached an all-time high of 251.12 million tonnes (MT) in FY15. Rice and wheat production in the country stood at 102.54 MT and 90.78 MT, respectively. India is among the 15 leading exporters of agricultural products in the world. The value of which was Rs.1.31 lakh crores in FY15.

    India is among the 15 leading exporters of agricultural products in the world. The value of which was Rs.1.31 lakh crores in FY15.

    Despite its falling share of GDP, agriculture plays a vital role in India’s economy. Over 58 per cent of the rural households depend on agriculture as their principal means of livelihood. Census 2011 says there are 118.9 million cultivators across the country or 24.6 per cent of the total workforce of over 481 million. In addition there are 144 million persons employed as agricultural laborers. If we add the number of cultivators and agricultural laborers, it would be around 263 million or 22 percent of the population. As per estimates by the Central Statistics Office (CSO), the share of agriculture and allied sectors (including agriculture, livestock, forestry and fishery) was 16.1 per cent of the Gross Value Added (GVA) during 2014–15 at 2011–12 prices. This about sums up what ails our Agriculture- its contribution to the GDP is fast dwindling, now about 13.7 per cent, and it still sustains almost 60 per cent of the population.

    If we add the number of cultivators and agricultural laborers, it would be around 263 million or 22 percent of the population. As per estimates by the Central Statistics Office (CSO), the share of agriculture and allied sectors (including agriculture, livestock, forestry and fishery) was 16.1 per cent of the Gross Value Added (GVA) during 2014–15 at 2011–12 prices.

    With 157.35 million hectares, India holds the world’s second largest agricultural land area. India has about 20 agro-climatic regions, and all 15 major climates in the world exist here. Consequently it is a large producer of a wide variety of foods. India is the world’s largest producer of spices, pulses, milk, tea, cashew and jute; and the second largest producer of wheat, rice, fruits and vegetables, sugarcane, cotton and oilseeds. Further, India is 2nd in global production of fruits and vegetables, and is the largest producer of mango and banana. It also has the highest productivity of grapes in the world. Agricultural export constitutes 10 per cent of the country’s exports and is the fourth-largest exported principal commodity.
    According to the Agriculture Census, only 58.1 million hectares of land was actually irrigated in India. Of this 38 percent was from surface water and 62 per cent was from groundwater. India has the world’s largest groundwater well equipped irrigation system.

    There is a flipside to this great Indian agriculture story.The Indian subcontinent boasts nearly half the world’s hungry people. Half of all children under five years of age in South Asia are malnourished, which is more than even sub-Saharan Africa.

    More than 65 per cent of the farmland consists of marginal and small farms less than one hectare in size. Moreover, because of population growth, the average farm size has been decreasing. The average size of operational holdings has almost halved since 1970 to 1.05 ha. Approximately 92 million households or 490 million people are dependent on marginal or small farm holdings as per the 2001 census. This translates into 60 per cent of rural population or 42 per cent of total population.

    Approximately 92 million households or 490 million people are dependent on marginal or small farm holdings as per the 2001 census.

    About 70 per cent of India lives in rural areas and all-weather roads do not connect about 40 per cent of rural habitations. Lack of proper transport facility and inadequate post harvesting methods, food processing and transportation of foodstuffs has meant an annual wastage of Rs. 50,000 crores, out of an out of about Rs.370, 000 crores.

    There is a pronounced bias in the government’s procurement policy, with Punjab, Haryana, coastal AP and western UP accounting for the bulk (83.51 per cent) of the procurement. The food subsidy bill has increased from Rs. 24500 crores in 1990-91 to Rs. 1.75 lakh crores in 2001-02 to Rs. 2.31 lakh crores in 2016. Instead of being the buyer of last resort FCI has become the preferred buyer for the farmers. The government policy has resulted in mountains of food-grains coinciding with starvation deaths. A few regions of concentrated rural prosperity.

    The total subsidy provided to agricultural consumers by way of fertilizers and free power has quadrupled from Rs. 73000 crores in 1992-93, to Rs. 3.04 lakh crores now. While the subsidy was launched to reach the lower rung farmers, it has mostly benefited the well-off farmers. Free power has also meant a huge pressure on depleting groundwater resources.
    These huge subsidies come at a cost. Thus, public investment in agriculture, in real terms, had witnessed a steady decline from the Sixth Five-Year Plan onwards. With the exception of the Tenth Plan, public investment has consistently declined in real terms (at 1999-2000 prices) from Rs.64, 012 crores during the Sixth Plan (1980-85) to Rs 52,107 crores during the Seventh Plan (1985-90), Rs 45,565 crores during the Eighth Plan (1992-97) and about Rs 42,226 crores during Ninth Plan (1997-2002).

    With the exception of the Tenth Plan, public investment has consistently declined in real terms (at 1999-2000 prices) from Rs.64, 012 crores during the Sixth Plan (1980-85) to Rs 52,107 crores during the Seventh Plan (1985-90), Rs 45,565 crores during the Eighth Plan (1992-97) and about Rs 42,226 crores during Ninth Plan (1997-2002).

    Share of agriculture in total Gross Capital Formation (GCF) at 93-94 prices has halved from 15.44 per cent to 7.0 per cent in 2000-01. In 2001-02 almost half of the amount allocated to irrigation was actually spent on power generation. While it makes more economic sense to focus on minor irrigation schemes, major and medium irrigation projects have accounted for more than three fourth of the planned funds
    By 2050, India’s population is expected to reach 1.7 billion, which will then be equivalent to nearly that of China and the US combined. A fundamental question then is can India feed 1.7 billion people properly? In the four decades starting 1965-66, wheat production in Punjab and Haryana has risen nine-fold, while rice production increased by more than 30 times. These two states and parts of Andhra Pradesh and Uttar Pradesh now not only produce enough to feed the country but to leave a significant surplus for export.

    Since food production is no longer the issue, putting economic power into the hands of the vast rural poor becomes the issue. The first focus should be on separating them from their smallholdings by offering more gainful vocations.

    Farm outputs in India in recent years have been setting new records. It has gone up from 208 MT in 2005-06 to an estimated 251 MT in 2014-15. Even accounting for population growth during this period, the country would need probably around 225 to 230 MT to feed its people. There is one huge paradox implicit in this. Record food production is depressing prices. No wonder farmers with marketable surpluses are restive.

    India is producing enough food to feed its people, now and in the foreseeable future. Since food production is no longer the issue, putting economic power into the hands of the vast rural poor becomes the issue. The first focus should be on separating them from their smallholdings by offering more gainful vocations. With the level of skills prevailing, only the construction sector can immediately absorb the tens of millions that will be released. Government must step up its expenditures for infrastructure and habitations to create a demand for labor. The land released can be consolidated into larger holdings by easy credit to facilitate accumulation of smaller holdings to create more productive farms.

    Finally the entire government machinery geared to controlling food prices to satisfy the urban population should be dismantled. If a farmer has to buy a motorcycle or even a tractor he pays globally comparative prices, why should he make food available to the modern and industrial sector at the worlds lowest prices?
    Why should Bharat have to feed India at its cost?

    Image: Kanyakumari farm lands during onset of monsoon. 

     

  • Covid 19: India uses Crisis to bring-in Economic Reforms as Package

    Covid 19: India uses Crisis to bring-in Economic Reforms as Package

    India’s four-phase lockdown of 68 days to deal with the Covid-19 threat has, while slowing the spread of the virus, come at huge economic costs. The lockdown for a vast majority of the people is, undoubtedly, the harshest in the world.

    The coronavirus triggered lockdown and its ensuing series of extensions have disrupted more than 60 percent of economic activities in the country, posing a huge threat to the  economy. The crisis was underway when the global economy was slowing down and India, in particular, had to deal with a poor health care system and an economy already under distress. Unemployment rate is estimated to be around 27 percent post lockdown and has resulted in nearly 12.2 crore people losing their jobs. In addition, a  severe slump in consumer demand is expected to persist for the next few quarters. Almost 85 percent of India’s workforce is engaged in the informal sector – quite naturally the government is under stress to implement effective policy reforms to counter the downturn. 

    In response to the contraction in the economy, the Prime Minister has announced a second round of economic package that stands at roughly around 10 percent of the Gross Domestic Product. The USA and Japan have announced relief packages of 13 and 21 percent of their GDP respectively. In comparison, India has seemingly provided a substantial Rs 20 lakh crore stimulus- highlighting the concept of ‘self-reliance’ as a way forward to deal with the economy post the pandemic. The stimulus package includes previous steps taken by RBI such as moratorium on loan repayments, interest rate cut, etc. In the five tranches of the stimulus package, the Finance Minister has announced a slew of measures to address the structural issues of Indian economy. However, it is estimated that the immediate fiscal boost will be only around 1 percent of GDP and most of the fiscal and monetary policies will attract long term capital with medium run  stabilization of the economy.

     

    Micro Medium and Small Scale Enterprises 

    Focusing on reviving the small businesses and micro enterprises, under this tranche Rs 3 lakh crore is allocated for collateral free loans for business enterprises. This package is estimated to be around Rs 5.94 lakh crore including RBI measures to improve liquidity in the economy. However, the direct fiscal cost for the government is around Rs 16,500 crore. For the stressed MSME units, the central government is planning to facilitate Rs 20,000 crore as subordinate debt and Rs 50,000 crore through equity infusion. Non Banking Finance Companies (NBFC) that serve the MSMEs will receive Rs 30,000 crore under investment guarantee scheme. While the six broad measures look attractive, the MSME sector in India is dominated by micro enterprises that are largely unregistered. However, these measures will not immediately benefit the micro business units with necessary working capital. Most of the enterprises and small business units are cash strapped and are on the verge of disappearing. Ninety-nine percent of the sector comprises micro enterprises – businesses with less than 10 working employees.

    Most of the enterprises and small business units are cash strapped and are on the verge of disappearing. Ninety-nine percent of the sector comprises micro enterprises – businesses with less than 10 working employees. 

    While the government has taken supply side measures to incentivize businesses, two important challenges remain intact. One, the large number of unregistered micro businesses might not benefit from the credit line offered by the government. Two, if the demand recovers slowly, it is likely the business sector especially small enterprises will suffer despite credit being infused. It is important to note that the supply and demand side has to be revived at the same rate to ensure sustainability of the MSME business. 

     

     

    Migrant labourers and Farmers: 

    Second stimulus of the Finance minister’s announcement was focused on migrant labourers and farmers. Close to 150 million internal migrants are present in India according to the latest census report.  Rs 3500 crores is to be spent on migrant labourers not covered under the Public Distribution System (PDS). Rs 5000 crore is set aside to facilitate easy access to street vendors. Funds worth Rs 6000 crore is planned for enhancing employment among adivasis and tribal groups. For the next two months, around 8 crore migrant labourers not covered under PDS will be provided 5kgs of grains per person and 1 kg chana per family in a month. ‘One Nation One Ration Card’ is a welcome move given the leakages present in the PDS, but the national coverage of this scheme is expected only by March 2021.  Additionally, in the National Food Security Act, 2013 , based on the 2011 census data, it is estimated that around 100 million people do not fall under this safety net accounting for growth in population over the past decade. The initiative to record and track the data on unregistered labourers is important for fiscal stimulus response to a COVID hit economy. National portability of ration cards is important but the execution is time consuming and does not address the problem of people being excluded from the ration card system. Universalizing PDS and decentralizing decisions to achieve food security with an efficient supply chain should be an immediate intervention. States with higher migrant labourers and people with less access to PDS should be targeted to universalise food distribution.  Acknowledging the shortcomings of the PDS and food supply channel, an emergency plan to ensure food supply to people below poverty line for the next six months needs to be prioritised.

     

    ‘One Nation One Ration Card’ is a welcome move given the leakages present in the PDS, but the national coverage of this scheme is expected only by March 2021. 

     

    Agriculture and Allied activities:

    Under the third tranche of the economic stimulus package, the government has taken bold measures to invest in agriculture and allied activities. Total package announced was worth Rs 1.63 lakh crores – relatively less compared to earlier stimulus packages. The main focus was on enhancing agriculture infrastructure, financing farm gate produce and improving post harvest supply.  A series of other funds were allocated for disease control for animal husbandry, promotion of herbal products and fisheries. Rs 10,000 crore was unveiled to support 2 lakh Micro Food Enterprises on a cluster based approach. 

    Lack of cold storage and supply chain was identified by the government to create an Agriculture Infrastructure Fund of Rs 1 lakh crore. A big push for agriculture reforms was spelled out by the decision to deregulate six commodities including cereals, pulses, oil and vegetables by amending  the Essential Commodity Act, 1955.

    Many experts believe the reforms undertaken were long due for India to enhance productivity of the agriculture  sector. But deregulation of essential products during the time of lockdown with poor food supply chains might not be beneficial especially for marginal farmers.  Almost 92 percent of the Food Supply Chain is controlled by the private sector and most of the farmers are not informed about Minimum Support Price and adopt unscientific farming practices. With liquidity constraint in the economy, demand for essential food is substantial. Factoring the drawbacks of PDS in supplying food items to the bottom section – a high probability of market failure is underway potentially hurting both farmers and consumers. Except for concessional credit for farmers and agriculture loans, the package has  limited scope to reduce the distress faced by the agrarian sector in near future. As far as the reforms are concerned, there was a clear bias towards post harvest investment. However, the productivity and scale of production has been the biggest problem in India that requires effective land reforms. India’s agriculture sector also suffers without adequate investment in Technology and Research & Development. During an unprecedented crisis, Indian government is pushing for big reforms but the structural issues of marginal-land farming are largely ignored. Even as a reform package─it is evident that it is likely to benefit primarily large farmers in the medium term.

    Except for concessional credit for farmers and agriculture loans, the package has  limited scope to reduce the distress faced by the agrarian sector in near future.

     Infrastructure, Defence  & Aerospace 

    Under this package, eight key sectors: coal, minerals, defence production, aerospace management, airports, power distribution, space and atomic energy were in the spotlight. In an effort to boost employment, a proclamation of structural reforms was stated in the fourth  tranche. The coal and mining industry is expected to receive an infrastructure development fund – making the sector self-reliant in production. The Foreign Direct Investment limit in defence has been increased from 49 percent to 74 percent to encourage foreign investment in production. In the aviation industry, India decided to open up 6 airports for auction. Additionally, three airports are to be operated under the Public Private Partnership model. Optimization of air space, building a hub for aircraft maintenance and overhaul are some of the important measures covered under this package. 

    Privatization and Globalization (New Economic Policy, 1991)- COVID-19 crisis has offered a space for the government to initiate certain radical measures to privatise a few industries.

    Private partnerships in the areas of space exploration and atomic energy offers an immense potential for private companies to get incubated for research and development. Sharing an economic pressure similar to the 1991 Balance of Payment crisis that resulted in Liberalization, Privatization and Globalization (New Economic Policy, 1991)- COVID-19 crisis has offered a space for the government to initiate certain radical measures to privatise a few industries. The measures will undoubtedly help the business ecosystem in India to develop in the medium term.  Though there seems to be a claim about substantial job creation this is not likely to happen immediately. 

    Rural Employment & Public Health

    In the final announcement, Rs 40,000 crore was allotted to Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) to replace direct transfer from central government to migrant workers. Inadequate data about inter state informal labourers has placed limitations on policy formulation during the time of crisis. Under the Pradhan Mantri Garib Kalyan Yojna, Rs 50 lakh per person insurance cover will be applicable for health professionals. To ensure ease of doing business, non adherence to the Companies’ Act will be decriminalised. The government also committed to increasing health expenditure to face pandemics in the future. The finance minister also encouraged companies to entertain the idea of digital India to conduct meetings and businesses online. 

    The last two announcements together accounted for Rs 48,500 crore and experts criticize that most of them do not provide immediate relief for the people in distress. 

    Conclusion

    India has evidently seized the opportunity during the crisis to introduce reforms to boost the economy in the long run. The reform package undoubtedly is impressive on paper but in terms of immediate support to various sectors in distress it offers little. For example, a large part of the package – Rs 8.04 lakh crore- is additional liquidity injected by monetary policy in the last three months.  An investment bank has predicted that India will face a deeper recession in the short term but the economic stimulus would help the economy after a few quarters. As a consequence the real growth rate is to drop down by 5 percent year-on-year in 2020. Even after a massive package, the situation of poor and middle-class people remains bleak. The reforms might bear fruits in future but deferring the policy response to address current challenges will manifest into huge burden on vulnerable sections of the people. Current economic crisis has undoubtedly offered the central government to take advantage of the weak bargaining power of the stakeholders to push reforms but low attention is paid to immediate distress.

    The author was supported by Ms S P Bharani, on summer internship at TPF.

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