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The Hindu Notes for 8th April 2019

Topic Discussed: The Hindu Notes of 8th April 2019

The governance dashboard

The current regime has failed to deliver on its promises of development and clean government

  • Towards the end of the second term of the United Progressive Alliance government (UPA-II), from 2009 to 2014, the corporate sector (captains of industry) had become thoroughly disappointed with the slow rate of “progress” being made. The reputation of UPA-II had been tarnished by several high-profile corruption scandals. Significant sections of the Indian elite, both urban and rural, were also upset about the government’s modest welfare schemes such as the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) and also rights and entitlements such as the Right to Information, Right to Education and the Land Acquisition Act, 2013.
  • The elites and upper middle-income groups were ready to strike back and found in Narendra Modi an able politician who could spearhead their agenda. He was the vikas purush who would restore high profitability for the corporate sector and provide a clean government. There was also a populist appeal of “development for all”.
  • However, the true meaning and significance of Mr. Modi’s ascent to power was not lost on those who had deep knowledge of India. Writing shortly after the 2014 general election, eminent economist and historian Amiya Kumar Bagchi remarked: “The corporate sector has now secured undisputed control of the commanding heights of the Indian economy and has succeeded in installing a prime minister, of whom they had been vocal supporters.” We are now at the cusp of another national election, so it is pertinent to ask what Mr. Modi has been able to achieve in the last five years.
  • It has become common now in some circles to describe the world that we live in as “post-truth”. Populism and the rise to prominence of leaders such as Donald Trump (U.S.), Jair Bolsonaro (Brazil), and Viktor Orbán (Hungary) have exposed us to a radically new vocabulary consisting of terms like “alternative facts” and “fake news”. It seems like evidence is far less relevant in influencing opinion than factors like sentiments, emotions or beliefs.
  • Backdrop of scarce data

  • While we understand the limits of claims made on behalf of “objectivity”, it is very difficult to imagine how a reasoned debate can occur without adequate evidence. Since Independence, India has carefully built an enviable reputation in terms of the integrity of its statistical organisations and the quality of its economic data. It is perhaps the most remarkable “achievement” of the present government that it has virtually destroyed this reputation by meddling in the work of statistical organisations, changing the methodology of computation of key figures (such as GDP), and by suppressing important data.
  • Given this, it is a major challenge to evaluate the performance of the present government. Of the various attempts that have been made to put together scarce evidence, a notable one is the very well-researched edited volume, A Quantum Leap in the Wrong Direction? It was Nobel laureate Amartya Sen who used the term “quantum leap” to critically describe the current regime, and the volume does justice to this loaded metaphor. It examines important dimensions of the present National Democratic Alliance government (NDA-II) and the past two regimes, UPA-I and -II, grouping them broadly under the subjects ‘Economy’, ‘Socioeconomic Indicators’ and ‘Governance’.
  • Key parameters

  • Two issues that are important in evaluating any regime are economic growth and distribution. India, of course, has been celebrated along with China as the growth engine of the world in recent decades. Has the economy under NDA-II outperformed in comparison to previous governments? Recent changes in methodology by the Central Statistics Office have rendered such comparisons very difficult. From the data in this volume, it is clear that NDA-II has underperformed in comparison with UPA-I and is broadly comparable to UPA-II. Average annual growth rates of GDP under NDA-II are estimated at 7.4% (the corresponding figures for UPA-I and UPA-II are 8.4% and 7.2%, respectively).
  • In terms of distribution, our own research (for the period 1991-2011) indicates that the Indian economy, after economic liberalisation, was largely driven by inequality-heightening rapid urban growth. Farmers and informal workers in the urban areas have faced acute distress and witnessed losses in their income shares. What has happened to inequality under the Narendra Modi government? This question cannot be easily answered because the latest survey data have not been released. Given this, the volume draws upon other sources of data such as income taxes and the Credit Suisse Global Wealth Database to make a persuasive case that Indian inequality has continued to rise.
  • The share of the top 10% of income-tax payers has increased at the expense of the bottom half. The wealthiest group (top 1%) owns more than half the nation’s wealth today and has consolidated itself during 2014-2018. What happened to the economic status of the most marginalised social groups, i.e. Muslims, Scheduled Castes and Scheduled Tribes? Unfortunately, relevant survey data have not been released. However, one gets a harrowing picture from the volume from other data. Crimes against Scheduled Castes have increased during the period 2014-16. What is noteworthy is that both overall crimes and crimes registered under the Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act have increased in the Bharatiya Janata Party-governed States such as Gujarat, and Haryana. The media is rife with accounts of cow-vigilantism; but to give a statistical picture, Muslims comprised 84% of those killed during 2010-17 across the country. Almost all such attacks (97%) occurred under the present government.
  • Impact of signature policies

  • The two major signature policies that the government undertook — demonetisation (ostensibly to root out corruption) and the goods and services tax (GST) — have proved to be colossal disasters for the economy and the vast majority of Indians. Any doubts about the adverse impact of these policies is dispelled by the analysis in the volume. Comparing the periods before and after demonetisation, while the world economy witnessed improved growth (2.6% to 3.1%), the Indian economy suffered a growth decline from 7.8% to 6.8%. We believe that these two policies were launched to serve the long-term interests of the corporate sector at the expense of the vast majority of Indians who reside in cash-dependent informal and agrarian economies. It is unsurprising to read in news reports that the Indian unemployment rate is at a 45-year high (2017-18).
  • While it is amply clear that the current regime has failed to deliver on its promises of development and clean government, its true objective has always been to usher in a different kind of an economy and polity than the one that the UPA espoused — one that is more corporate and rural elite-friendly. The welfare orientation of the UPA-I (although it did not go far enough in our view) was quite unpalatable to the Indian elites.
  • A correction and reversal were asked for, and duly executed. It was also widely expected that the Modi regime would use a majoritarian nationalist mobilisation strategy (especially if economic gains were not forthcoming for the masses). This is exactly what has been delivered during the Modi years — a combination of elite-oriented growth and a majoritarian nationalism/Hindutva. Perhaps, in this sense, Mr. Modi’s government has succeeded exactly in what it set out to do.
  • Several people who voted for Mr. Modi inspired by his promise of development and a corruption-free India must now see the failure of his regime clearly on these fronts. As Rabindranath Tagore reflected, if the choice is between a nation that is fundamentally exclusionary, and a society that stands for basic human values and espouses tolerance among a multiplicity of cultures and identities, the path forward is clear.
  • When a new era dawns, what’s in a name?

    As Japan’s Emperor Akihito prepares to abdicate, the country gears up for the Reiwa era

  • On April 30, Japanese Emperor Akihito will abdicate, literally ending an era. For in Japan the years are counted not just using the internationally standard, Gregorian calendar, but by gengo, or ‘era name’, that counts up from the coronation of a new emperor until his death, or as in the current circumstance, abdication.
  • The Heisei era

  • Akihito’s coronation in January 1989 had marked the beginning of what is known as the Heisei era, and the end of the ‘Showa’ period of his predecessor, Emperor Hirohito. This year, 2019, will be split between Heisei 31, the 31st year of Akihito’s reign until the end of April, after which it will become Reiwa 1, the first year of the Emperor elect, Naruhito’s rule.
  • But gengo are not just ways of counting years. They also encapsulate a national mood, the zeitgeist. A new era name stops the clock for the nation psychologically, allowing an opportunity for taking stock and recalibrating.
  • The Meiji era (literally: enlightened rule), January 1868-July 1912, is best remembered as a period of Western-inspired modernisation, while the Showa gengo (literally: enlightened harmony), December 1926-January 1989, is associated with both Japan’s rapid post-war economic development, but also the militarism of the Second World War.
  • It is Heisei, however, that is on the nation’s mind currently. In the dying days of the era, there is an ongoing attempt to grapple with how best to define the essence of the last three decades. Heisei is composed of two kanji (Chinese characters used in the Japanese language) that taken together mean ‘achieving peace’.
  • On the surface, the gengo would appear apposite. Through the Heisei decades Japan has eschewed war and continued to be among the world’s more pacifist nations. Emperor Akihito himself worked hard to confront Japan’s past military expansionism, including several expressions of remorse and apology for his country’s wartime actions.
  • And yet, Heisei has also been characterised by unfulfilled potential and a spate of natural disasters. In 1989, when the era began, Japan was at the pinnacle of its economic might. That same year, Sony acquired Hollywood’s Columbia Pictures and Mitsubishi Estate bought New York’s iconic Rockefeller Center. Japan appeared poised for global domination.
  • Instead, the ‘bubble economy’ collapsed, leading to ‘lost decades’ of economic stagnation and deflation. And while the meteoric rise of China dwarfed Japan’s regional and international heft, earthquakes and tsunamis ravaged the archipelago. For many, Heisei conjures up the horrors of the 1995 Hanshin earthquake that destroyed Kobe city, and the 2011 East Japan earthquake and tsunami that killed over 20,000 people and triggered one of the world’s worst nuclear disasters.
  • Consequently, the commencement of the new era, recently announced after months of deliberation as Reiwa, is widely seen as a chance to put some of these traumas behind and to define new hopes for a new epoch.
  • Reiwa can be interpreted to mean ‘auspicious’ (rei) ‘harmony’ (wa). But, given that kanji can often be understood in multiple ways, it is also possible to read rei as ‘orderly’ and wa as ‘Japanese’. The latter reading has some Japanese uncomfortable with its authoritative nuance, particularly within the context of the current, right-wing government’s emphasis on nationalism as a cornerstone of policy.
  • Japanese Prime Minister Shinzo Abe was open in disclosing the fact that the choice of era name was made to reflect pride in Japan’s ostensible uniqueness. For the first time in history the two kanji comprising the gengo were taken from Japanese classical literature, rather than Chinese classics, the traditional source for era names.
  • The new gengo is derived from an ancient collection of Japanese poetry called Man’yoshu (Collection of Ten Thousand Leaves) that feature poems composed between 600 CE and 759 CE. Commentators have been quick to draw a link between this decision to distance the gengo from Chinese literature and Japan’s contemporary rivalry with China.
  • Name notwithstanding, Emperor-elect Naruhito’s Reiwa era will face a formidable set of challenges. The country’s rapidly ageing society and declining population mean that economic growth will require either a huge increase in the number of immigrants or a major technological breakthrough. Japan will also need to innovate to ensure it is not left out of the high-tech race for leadership at a time when artificial intelligence and robotics are reshaping the manufacturing ecosystem. Moreover, China’s dominance in both the economic and strategic realms, coupled with the growing unpredictability of the U.S.’s commitment to Japan’s defence will test Tokyo’s strategic thinking, forcing it to seek out new allies and accommodations.
  • Logistical challenges

  • But first, the dawn of Reiwa will necessitate a series of more immediate, logistical changes. Government documents, stamps, newspapers, driving licences, and calendars will all need to switch to the new gengo from the Heisei system that’s been in use for the last three decades. Computer systems across the archipelago are hurriedly being updated for the May 1 handover in what some fear might prove to be Japan’s Y2K moment.
  • In his play Romeo and Juliet, Shakespeare famously asked, “What’s in a Name?” In Japan at least, the answer would appear to be: A Lot.
  • The heat is on

    Local administrations must draw up plans to address heat stress and possible water scarcity

  • A forecast of a below average monsoon in 2019, after last year’s erratic rainfall that flooded Kerala and crippled agriculture in eastern and western States, is a cause for worry. If the assessment from one agency, Skymet, is any indication, there is a prospect of an El Niño, often associated with drought conditions, taking hold. This must, of course, be considered along with other factors that seem to weaken the El Niño link, such as a dipole weather phenomenon in the Indian Ocean. Should the monsoon, which normally sets in between June 1 and July 15 across the country, turn out to be deficient, it will add to the pressures on rural employment and the economy as a whole. Things may become clearer when the India Meteorological Department also issues its forecast, although error margins and the erratic nature of rainfall in different regions render the exercise fraught with uncertainty. Last year, for instance, the realisation of rainfall was 91% of the long-term average, while the prediction was for 97%. More immediately, India will go to the polls in the peak of summer after an intensive campaign. It is the responsibility of State administrations to prepare for the likelihood of a heat spike, particularly during April and May, to prevent loss of life and extreme distress to communities. Official agencies and NGOs should start adopting the drill on this, using the template drawn up by the National Disaster Management Authority.
  • The key elements of protection in a heat wave are avoiding exposure during the hottest part of the day around noon, especially in the case of senior citizens, staying adequately hydrated, wearing suitable clothing including headgear, and creating shade in public places. These messages and weather alerts can be disseminated through television, mobile phone messaging and social media platforms. Urban local bodies in particular have a responsibility to care for the large number of vulnerable city dwellers. Yet, few cities have drawn up proper heat action plans to respond to extreme weather or made them public. During the current year, there is apprehension that the focus of administrators will mainly be on the conduct of the elections, relegating the public health risk of heat waves to the backburner. With the availability of advance weather alerts, there is no reason why local bodies cannot institute remedial measures. Mitigating the effect of heat waves is vital to ensuring a high turnout in the elections by making it safe for voters. India is looking at another uncertain monsoon, bringing into sharp relief the neglected potential of decentralised water-harvesting. It is more than a decade since the National Commission on Farmers suggested the wider adoption of both rainwater harvesting and aquifer recharge, in order to provide irrigation for small farmers. It is time to take measures that will help communities achieve resilience.
  • Capital high

    To retain the confidence of foreign investors, macroeconomic management is key

  • Foreign investors appear to have rediscovered India. The inflow of foreign capital into India’s stock market in the month of March hit a high of $4.89 billion, the biggest foreign inflow into Indian stocks since February 2012. As a result, the stock market rose a solid 8% in March. Foreign investment in Indian equities stood at $2.42 billion in February, as against a net outflow of $4.4 billion during the same month a year earlier, and is expected to be strong in April as well. Both cyclical and structural factors are behind this sudden uptick in foreign investment that has helped the rupee make an impressive comeback. The rupee has appreciated by about 7% since early October, when it was reeling at around 74 against the dollar. Last year, India received more foreign direct investment than China for the first time in two decades. While the Chinese economy has been slowing down considerably in the last one year, India has emerged as the fastest-growing major economy. Doubts over the robustness of the GDP calculation method notwithstanding, it is clear that investors expect India to be a major source of global growth in the coming years. Other short-term reasons may also be behind some of the recent inflow of capital into the country. For one, there is a sense among a section of investors that their fears of political instability are misplaced. More important, there are clear signs that western central banks have turned dovish. Both the Federal Reserve and the European Central Bank, for instance, have promised to keep interest rates low for longer. This has caused investors to turn towards relatively high-yielding emerging market debt. Indian mid-cap stocks, which suffered a deep rout last year, are now too attractive to ignore for many foreign investors.
  • The return of foreign capital is obviously a good sign for the Indian economy. But policymakers need to be careful not to take foreign investors for granted. Other emerging Asian economies will be competing hard to attract foreign capital, which is extremely nimble. Any mistake by policymakers will affect India’s image as an investment destination. To retain investor confidence, whichever government comes to power after the general election this summer will need to increase the pace of structural reforms and also ensure proper macroeconomic management with the help of the Reserve Bank of India. Long-pending reforms to the labour and land markets are the most pressing structural changes that will affect India’s long-term growth trajectory. The high fiscal deficit of both the Centre and the State governments and the disruptive outflow of foreign capital are the other macroeconomic challenges. These are some issues that need to be solved sooner rather than later.
  • If Gandhi were alive today

    Considering his view of politics, he would have privileged civic virtue in elections

  • With the election season getting all the attention, I wonder whether Mahatma Gandhi would have participated in the election had he been alive. One thing is evident today: while Gandhi is hailed as the founding father of the Indian republic and one of the architects of democratic politics in modern India, it is not recognised equally well today that we can draw valuable lessons of political action and democracy from him. However, it goes without saying that Gandhi is perhaps more relevant now than ever before for our understanding of elections, at a time when India finds itself at a crossroads between a hope for civic republicanism and a practice of demagogic populism.
  • The need for moral leaders

  • It is no secret to anyone who lives in India and shares time and passion with Indians from different walks of life that the small cast of politicians and their supporters are not engaged in what Gandhi called “an experiment with Truth”. This is perhaps because politics in contemporary India, as everywhere else in the world, finds itself prisoner of the administrative system and the corporate mindset, both of which suffer from a severe absence of self-examination. Indeed, what India needs most at this time of elections is not mass mobilisers but moral leaders.
  • Considering the profound spiritual nature of Gandhi’s personality and his deep ethical view of politics, we could say that if he was among us today, he would have certainly boycotted the elections. He would have been troubled by the Machiavellian essence of Indian politics and its populist and demagogic end results. Assuredly, it is important to grasp Gandhi’s character above all as a man who remained all through his life as a person truthful to the ethical.
  • In a sense, then, Gandhi’s view of politics starts where party politics ends. What Gandhi understands by politics is the art of organising society, not the technique of power making and party organising. That is why Gandhian politics is at the same time anti-populist and anti-elitist.
  • Democracy and mobocracy

  • Gandhi has always been considered as a charismatic leader, but his unmediated appeal to the citizens was based neither on a Manichaean friend-enemy distinction, nor on the supreme will of the masses. As the history of modern India shows us, while political parties have been subservient to the masses and the masses have followed party leaders without questioning, some political figures like Gandhi or Ambedkar had the courage to turn against mobs. Gandhi considered democracy and mobocracy as opposite forms of conducting politics and organising Indian society. Gandhi affirmed: “Those who claim to lead the masses must resolutely refuse to be led by them, if we want to avoid mob law and desire ordered progress for the country. I believe that mere protestation of one’s opinion and surrender to the mass opinion is not only not enough, but in matters of vital importance, leaders must act contrary to the mass opinion if it does not commend itself to their reason.”
  • In other words, Gandhi considered contempt for civic virtue as a betrayal of the spirit of democracy. For him, democratic governance, unlike party politics, which always tends towards unexamined and obedient masses, was based on the maturity of citizens. Gandhi’s sharp reaction against the Chauri Chaura incident was an expression of his rejection of mobocracy. After this incident, Gandhi revoked his plans for launching mass civil disobedience at Bardoli on the ground that the masses were not morally prepared for a non-violent struggle against the British. But it is also worth mentioning that Gandhi considered masses guilty of what politicians became. As he put it: “We the people make the rulers what they are.” Moreover, Gandhi insisted on the twin concepts of self-transformation and civic maturity. As a matter of fact, he underlined: “If we reform ourselves, the rulers will automatically do so.”
  • Gandhi, therefore, approached pragmatic politics as a form of character-building and not necessarily organising a political party and winning seats in Parliament. He called it “a capacity to regulate national life”. However, inspired by the American Transcendentalist, Henry David Thoreau, he underlined, “If national life becomes so perfect as to become self-regulated, no representation becomes necessary. There is then a state of enlightened anarchy. In such a state everyone is his own ruler. In the ideal state therefore, there is no political power because there is no state. But the ideal is never fully realised in life. Hence the classical statement of Thoreau that the government is best which governs the least.”
  • Undoubtedly, Gandhi, the moral leader, was not a pure idealist. He was a pragmatic practitioner, who wanted to apply ethical values and civilisational criteria to the political organisation of Indian society and beyond. Strangely, the Gandhian common sense is considered as an irrelevant and insignificant matter to the eyes of those who are ruling India and the world today. Unfortunately, in today’s world, political circumstances and temperaments do not allow politicians to concentrate any more on the education and duty of citizens. That is why, while uncritical and utilitarian minds are shaped and formed in universities in India and around the world, originality and exemplarity of future Mahatma Gandhis are killed in the embryo.
  • But what if Gandhi were alive? He would have certainly tried to create awareness in the minds of the younger generation. Let us also agree that he would have had a strong intervention (example, fasting unto death) in relation with the cases of corruption, sexual harassment and populist demagogy in everyday politics.
  • When power politics took over

  • However, this would have been too much for those who are involved today in politics. Frankly, despite the symbolic devotion which is shown to Gandhi by political leaders, there is a feeling of comfort that a stubborn and critical veteran of democratic action like him is no more around.
  • In a more sinister manner, we even find strong reasons of rejecting a national figure like Gandhi in Nathuram Godse’s analysis of his assassination: “I foresaw that I shall be totally ruined and the only thing that I could expect from the people would be nothing but hatred and that I shall have lost all my honour, even more valuable than my life, if I were to kill Gandhiji. But at the same time I felt that Indian politics in the absence of Gandhiji would be more practical, able to retaliate, and would be powerful with armed forces.” Godse was right. Once Gandhi was eliminated, power politics could take over. India has been independent for 71 years based on electoral liberalism in the name of Gandhi. But for more than 71 years, politicians have distanced themselves from Gandhi’s legacy. Unsurprisingly, once again Indians will go to the polls without having the Mahatma on their minds.
  • Cleaning up the mess

    India needs a waste management policy that stresses the need for decentralised garbage disposal practices

  • Hyperconsumption is a curse of our modern times. Humans generate monumental amounts of waste, a sizeable portion of which is disposed in landfills and through waste-to-energy incinerators. However, billions of tonnes of garbage, including microplastics, never make it to landfills or incinerators and end up in the oceans. This garbage chokes marine life and disturbs zooplankton, which are vital to the elimination of carbon dioxide from the atmosphere.
  • Landfills are seedbeds of methane and other greenhouse gases, which contribute to global warming. These toxic chemicals poison the soil and their leached run-off makes its way into the oceans. And while they do generate energy, waste incinerators cause health issues such as cancer. In India, nearly 60% of the household waste is wet organic waste, with low calorific value. This makes options such as waste-to-energy incinerators inefficient. We need to design incinerators that are suited to Indian conditions.
  • It does seem overwhelming, but there are solutions to the garbage pandemic through the crucial processes of material recycling and composting. Efficient composting is possible through an optimal combination of microbes and temperature to produce a nutrient-dense soil conditioner.
  • Mathangi Swaminathan, in her article in Economic and Political Weekly, sheds light on India’s broken waste management system. In India, less than 60% of waste is collected from households and only 15% of urban waste is processed.
  • There are several problems in India in how waste is treated. First, segregation of waste into organic, recyclable and hazardous categories is not enforced at source. As a result, mixed waste lands up in the landfills, where waste-pickers, in hazardous conditions, try to salvage the recyclables, which are of poor quality and quantity by then. Second, ideally, waste management should not be offered free of cost to residents. Only if residents pay will they realise the importance of segregation and recycling. Third, there is the issue of logistical contractors who are motivated to dump more garbage in landfills as their compensation is proportional to the tonnage of waste. They are also prone to illegally dump waste at unauthorised sites to reduce transportation costs. Fourth, and importantly, organic farming and composting are not economically attractive to the Indian farmer, as chemical pesticides are heavily subsidised, and the compost is not efficiently marketed.
  • We need a comprehensive waste management policy that stresses the need for decentralised garbage disposal practices, This will incentivise private players to participate. Unless these concerns are addressed, what will we tell our children who inherit this planet? That our greatest existential challenge, climate change, was also facilitated by garbage?