The Tribune, Chandigarh, India

Tuesday, March 4, 2003, Chandigarh, India

THE TRIBUNE SPECIALS

50 YEARS OF INDEPENDENCE

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E D I T O R I A L P A G E

EDITORIALS

Pak’s Al-Qaida drama
PAKISTAN President Pervez Musharraf knows that he must keep sending US President George W. Bush the latter's favourite Al-Qaida dish at reasonable intervals to remain in office. The arrest of a top Osama bin Laden aide in Rawalpindi and his subsequent handing over to the US authorities is part of the ritual for preventing the global community from asking too many questions about American support to a country that openly runs terrorist training camps in Pakistan-occupied Kashmir.

Punjab’s industrial policy
AFTER seven years and several hiccups, the Punjab Government finally announced on Friday its much-awaited industrial policy. Delayed by inter-ministerial wrangles, it was badly timed too. Coinciding it with the Union Budget deprived it of part of the usual excitement. That industry has by and large welcomed it speaks of its populist appeal.

Fillip to tech education
THE Union Cabinet’s decision to take over 17 Regional Engineering Colleges in the country as fully-funded institutes of the Central Government should be seen in the context of the latter’s continued efforts to improve technical education. The scheme to upgrade the RECs into National Institutes of Technology on the lines of the Indian Institutes of Technology is not new.

EARLIER ARTICLES

	Sachin stamps his class March 3, 2003
	Time to change people’s mindset, says Mufti Sayeed March 2, 2003
	An innovative budget March 1, 2003
	Message in Economic Survey February 28, 2003
	Poll-driven Railway Budget February 27, 2003
	Pak battering NAM February 26, 2003
	Over to the voters February 25, 2003
	From Ayodhya to Delhi February 24, 2003
	Power of the Indian mind: our heritage & asset February 23, 2003
	Smear campaign February 22, 2003
	Cruel ways of nature February 21, 2003

EDITORIALS

Pak’s Al-Qaida drama

PAKISTAN President Pervez Musharraf knows that he must keep sending US President George W. Bush the latter's favourite Al-Qaida dish at reasonable intervals to remain in office. The arrest of a top Osama bin Laden aide in Rawalpindi and his subsequent handing over to the US authorities is part of the ritual for preventing the global community from asking too many questions about American support to a country that openly runs terrorist training camps in Pakistan-occupied Kashmir. What is more, Pakistan will receive a bonus of $25 million, not a small amount for a cash-starved nation, for helping the FBI agents smoke out Khalid Shaikh. President Bush is reported to have rubbed his hand with glee on learning about the arrest and described it as “fantastic”. The ritual was performed evidently because US troops stationed in Afghanistan for possible attack on Iraq will face an offensive from revived Taliban and Al-Qaida activists based in Pakistan. In the past few weeks American troops stationed on the south-eastern border touching Pakistan have been engaged in the heaviest fighting since the overthrow of the Taliban regime. The incidence of attempted ambushes of patrols and rocket attacks on US bases has steadily increased. The stage-managed arrest of Khalid Shaikh, the third most important figure in the Al-Qaida network behind Osama and Ayman al-Zawahri, may help the Bush-Musharraf partnership to fool their own respective constituencies. But the global community is not impressed. And neither is India.

As far as Delhi is concerned, Islamabad is the epicentre of the terrorist activities in Kashmir and Kabul and that Washington is not being fair to its post-9/11 commitment of leading a global campaign against all forms of terrorism. Yes, both Pakistan and Afghanistan play a key role in the American plan to control the region through an increased military presence and coercive diplomacy. President Bush's reaction to the arrest of Shaikh was meant for public consumption. Deep down he must be worried because of increasing opposition to his flawed Iraq policy. A veteran US diplomat who served in the embassies from Tel Aviv to Casablanca, Mr John Brady Kiesling, has done what Mr Harsh Mander had done after the post-Godhra rioting in Gujarat. In his letter of resignation to Secretary of State Colin L. Powell he has said that he would step down as Political Counselor in the US Embassy in Athens on March 7. He has questioned the US policy on Afghanistan and the entire model for waging a collective and effective war against global terrorism. This letter is sure to give President Bush a few more grey hair as would the news that the Taliban and Al-Qaida elements, that survived the post-9/11 American action because of Pakistan's patronage to them, are now regrouping under Islamic extremist Gulbuddin Hekmatyar for a post-winter offensive. There is still time for him to do course correction. The global goodwill in favour of a US-led crackdown on all forms of terrorism in any part of the world was mindlessly frittered away by President Bush. He must crack the whip on Pakistan with a view to reviving the global coalition against terrorism. A morsel every now and then of an Al-Qaida dish from General Musharraf is bad for the health of his country and the rest of the world.

Punjab’s industrial policy

AFTER seven years and several hiccups, the Punjab Government finally announced on Friday its much-awaited industrial policy. Delayed by inter-ministerial wrangles, it was badly timed too. Coinciding it with the Union Budget deprived it of part of the usual excitement. That industry has by and large welcomed it speaks of its populist appeal. It comes more as a reaction to industry’s usual demands instead of giving the state a new industrial direction in view of the changing economic scenario. The most applaudable feature of the new policy is the abolition of what is commonly called the “inspector raj”. Industry has often complained of harassment and corruption at the hands of government officials visiting units for inspecting compliance with various regulatory laws. Armed with the option of self-certification, industry can now breathe more easily. The second significant feature is the introduction of the Local Area Development Tax (LADT), which will replace octroi and entry tax from July this year. The previous SAD-BJP coalition government had abolished octroi without arranging for an alternative source of income for the civic bodies, which brought civic development to a halt. The LADT will reduce, if not remove altogether, harassment and delay as it will be collected at the state entry points only and is expected to provide more funds to the municipalities. The third notable point is the focus on the industrial development of the state’s three border districts of Amritsar, Gurdaspur and Ferozepur. Whether or not the string of incentives announced for the neglected border areas succeed in luring industry, only time will tell. Why the old industrial town of Batala has stagnated and the new industrial destination of Goindwal has failed to take off can give a clue to all that is wrong with industrial development in the border belt.

Clubbing the state’s excise policy for 2003-04 with its industrial policy has diluted the effect of the former. By allowing provision stores in the five municipal cities — Amritsar, Jalandhar, Ludhiana, Patiala and Bathinda — to sell beer and wine, the Amarinder Singh government has taken a major initiative in de-monopolising liquor trade and discouraging smuggling without succumbing to the temptation of raising liquor prices to collect more of easy revenue. On the industrial front, however, the state government has not shown similar boldness. In the competitive environment it is not advisable to keep inefficient units alive with sops and subsidies. Protection, if any, should be given to agri-processing industries which can boost agriculture also. The sun-rise industries like IT and biotechnology will not enter Punjab unless the bureaucracy and the political leadership make attitudinal changes and follow the examples of Andhra Pradesh, Karnataka and, lately, Kerala. For industrial growth would not pick up, no matter how attractive industrial policy is, until and unless sound, better-than-others infrastructure is put in place. Although the government has allowed units to undertake in-house power generation, it will add to their costs. There is an immediate need to put the PSEB house in order to ensure quality power supply. Throwing public money at perpetually complaining and laggard industrial units will not yield the desired results. Industry should be told, firmly and unambiguously, to learn to walk without crutches, become efficient and competitive or fold up.

Fillip to tech education

THE Union Cabinet’s decision to take over 17 Regional Engineering Colleges (RECs) in the country as fully-funded institutes of the Central Government should be seen in the context of the latter’s continued efforts to improve technical education. The scheme to upgrade the RECs into National Institutes of Technology (NITs) on the lines of the Indian Institutes of Technology (IITs) is not new. This has been in operation since last year. However, what follows the Union Cabinet’s decision in this regard is the change in the NITs’ pattern of funding. Earlier, the Centre was funding 70 per cent of the bill. However, hereafter the Union Ministry of Human Resource Development will meet 100 per cent of the NITs’ bill. It may be recalled that states like Orissa, Bihar, Madhya Pradesh, Rajasthan and Assam were facing financial problems in running the NITs. These state governments were maintaining that it was becoming difficult for them to impart quality education to students because of resource crunch. Now that the HRD Ministry has assumed complete responsibility of funding, efforts could be stepped up to improve professional education in these institutions. In fact, the Centre’s very idea of renaming the RECs into the NITs and change the funding pattern is to develop them as model institutions and enable students to receive technical education almost of the same quality as is being provided by the IITs. True, it would be unfair for one to compare the standard of education being imparted in the NITs with that in the IITs. However, one thing is clear: during the last few years there had been a general impression that the RECs were way behind the IITs and were not fulfilling their avowed objectives. The latest decision is bound to rejuvenate them and instil confidence and pride among the students.

A significant development in this context is the Centre’s decision to conduct an All-India Entrance Examination for students desirous of joining the NITs. This will not only make the process of admission credible, just and transparent but also increase the competitive spirit and enterprise among the aspirants. Interestingly, keeping in view the stiff competition at the all-India level, some serious aspirants start preparing for the IIT entrance examination right from Standard VII itself. Thus, the all-India character to the NITs’ admission process is bound to attract talent and merit. What is more, even though the Centre has taken over the NITs, the existing admission quota wherein 50 per cent of seats reserved for students hailing from the state where a particular NIT is located will continue. With a billion plus population, the demand for scientifically and technically qualified personnel in the country is on the increase. According to the HRD Ministry’s report, Japan has 110 scientists and technical personnel per 1,000 people and 7.1 people per 1,000 involved in research and development. However, India has a much lower ratio of 3.5 per cent per 1,000 in terms of scientists and technical manpower and 0.3 per 1,000 involved in scientific research. The recent steps taken by the Centre — including the Deemed University status for all NITs — are expected to give a fillip to technical education. Through greater interaction with the IITs, there is tremendous scope for the Centre to meet the growing demand for quality technical and scientific education.

OPINION

A critical look at Union Budget
Unfair to SSIs & poverty alleviation cause
Bharat Jhunjhunwala

WHILE presenting the Union Budget the Finance Minister said that his first priority was that of poverty alleviation and generation of employment. Alas! The policies espoused by him do not reflect that commitment.

The share of priority sector lending in gross bank credit has been consistently declining. Bank managers do not have any incentive to lend to a large number of SSIs because it entails higher administrative costs. The requirement of 40 per cent lending to priority sectors has not delivered because there is no real punishment. The present requirement is that the shortfall amount is to be deposited in government bonds. The banks are already buying government bonds anyway. Therefore, this is not a “punishment”.

The minister has now said that the banks will be required to lend to SSIs at no more than 2 per cent above their prime lending rate. This will be counter-productive though it sounds nice to the ear. The basic problem of the SSIs is not the rate of interest. Interests constitute a small fraction of their cost in comparison to large capital-intensive industries. Their main problem is the availability of adequate and timely credit. Another difficulty is that of collateral. The newcomer has no pucca house to pledge. The minister has done nothing to solve these problems and reverse the declining share of SSI lending in gross bank credit.

In fact, the restriction of 2 per cent above the prime lending rate will act as a disincentive. The banks were till now charging high rates of interest from the SSIs and partly offsetting the high administrative costs of servicing a large number of small accounts. Now the banks have lost that flexibility. Lending to SSIs may directly hit at the banks’ profitability because they would be deprived of an offsetting opportunity.

It was necessary to develop a cross-subsidisation policy. A 1 per cent tax on the amounts loaned should have been imposed on all large loans and a 2 per cent subsidy should be provided on small loans. This will have made it profitable for the banks to lend to small borrowers. Such cross-subsidisation should not be confused with budgetary subsidies. This is more akin to imposing lower rates of service tax on the interest for the SSIs.

The Finance Minister has announced that reservations for the SSIs in respect of 75 more items will be withdrawn. There exists a genuine case for such a step. Reservations create an incentive for the SSIs to remain small. The country also is deprived of the benefits of large-scale technologies. However, in the same breath, the SSIs should be compensated for the employment and entrepreneurship that is generated. Providing across-the-board preference to labour-intensive industries while withdrawing reservations should have done this. The incentives can be in the form of lower rates of taxes, exemption from the operation of certain labour laws, preference in government purchases and provision of assistance in technology upgradation and creation of websites, etc. These incentives should be available both to small and large labour-intensive industries. Preferential treatment to the SSIs is provided because of their contribution in employment generation and entrepreneurship creation. Let us provide incentives directly to these factors instead of reserving certain sectors. This will have the benefit of promoting labour-intensive production in all sectors rather than the few reserved sectors as at present. This policy will also help the SC/STs as they will get jobs.

The minister has similarly failed to deliver on poverty alleviation. He has announced that the Antyodaya scheme will be expanded to cover a larger number of below poverty line persons and more funds will be provided for self-help groups. Both these policies are going to meet with failure.

Revenue officials and sarpanches do the selection of beneficiaries for the Antyodaya scheme. Often the kith and kin of the sarpanch are selected rather than the genuine BPL families. This problem remains unsolved in the proposed expansion of the scheme. This charity-oriented approach also hits at the self-esteem of the beneficiary. His mind is oriented towards encashing his proverty rather than coming out of it. He develops an incentive to remain poor. It creates a dependence complex. The net beneficiary of such shcemes is the welfare mafia. Government officials make money in running the public distribution system while the sarpanch gets the benefits diverted to his chosen few.

The self-help groups (SHGs) involve high transaction costs. A dairy woman attached to an SHG has to attend the various meetings of the group. She has to keep the SHG president in good humour so that she gets the money when required.

The private dairy woman is not straddled with these transaction costs. Secondly, the problem of the rural areas is not credit. The problem is that of availability of profitable opportunities. Rural bank branches routinely have very low credit - deposit ratio. This indicates that the people of the village are investing their money at a 7 per cent interest rate. Why should they borrow at 12 per cent offered by the SHG? If the rich man of the village cannot make a dairy profitable at 7 per cent interest rate, then how will the poor man make it profitable at 12 per cent? It is also seen that the SHGs begin to go defunct as soon as new net lending from the banks ceases. The SHG movement is beneficial, again, for the welfare mafia. The NGOs make a living in “training” and management of accounts while the poor borrowers are left to face the recovery when the loan matures.

The minister has two alternatives for poverty alleviation. He can promote efficient large-scale industries, tax them and use part of that money in schemes like Antyodaya and Indira Awas Yojana. Alternatively, he can restrict capital-intensive production in selected industries such as weaving and soap making, and create huge employment. The nation has to bear some cost in either case. In the former the cost comes in the form of taxation while in the latter it comes in the form of a higher price of the select items. The former policy is undesirable because it creates a dependence complex and its main beneficiary is the welfare mafia. The latter policy is much preferable.

The Finance Minister should realise that 50 years of welfare state has not removed the scourge of poverty because the welfare mafia has appropriated the benefits. Instead of persisting with that well-disproved approach, he should have created employment opportunities while accepting a higher cost of production in a few sectors. Our ITIs should be reoriented to provide self-employment oriented training in these areas. These sectors may include new trades such as STD booths, handicrafts and call centres.

Unfortunately, the minister has chosen to tread on the discredited path and is certain to meet the fate of his predecessors. This is not to deny that poverty has been lessened in the country, but the credit for this goes to free trade that has enabled us to increase our exports of labour-intensive items such as carpets and diamonds. The budget is, therefore, entirely disappointing as far as poverty alleviation is concerned.

The writer is a well-known economic commentator.

American support-seeking drive
V. Gangadhar

“THE old order changeth yielding place to the new”, goes the saying. And looking at the forces arrayed against the government of Iraq under President Saddam Hussein, we can only explain “And how!”

Despite fierce opposition to any unilateral military action against Iraq from Germany and France from within the North Atlantic Treaty Organisation (NATO), quite a few new entrants were prepared to go along with the strong line advocated by the USA. This group included nations from the former Eastern Europe, who were satellites of the former Soviet Union during the Cold War era.

East Europe was strictly “chee, chee” to the West in those days. Particularly a nation like Bulgaria which was regarded as the scum of the earth. Referred contemptuously as the Bulgers, they were referred to as the stooges, hatchet men of the USSR. In the popular James Bond novels, the Bulgers were not the villains, that honour went to the Russians. The Bulgers were the sidekicks, bunglers and scavengers of the worst kind. who were assigned to handle the worst kind of jobs by their Soviet masters before they were decimated by 007 and company.

It was the same in the diplomatic arena. Britain accused one of the Bulgarian diplomats of being member of the secret service who had killed a dissident leader by poling him with an umbrella whose sharp point was coated with some deadly poison. The killing made news in the West and the diplomat was packed off to Sophia, adding one chapter more to the unseemly acts of the Bulgers.

The transformation of the Bulgers from despicable villains to heroes was rather startling. Bush and Co. are wooing the Bulgarians because their country is now a member of the Security Council and its vote could be crucial in any debate on the war against Iraq.

Sections of the responsible US media had commented on these developments with derision. Highly respected New York Times columnist Maureen Dowd in her column, “Thank Bush for Bulgarian Wine”, visualised a state visit by the non-entity Bulgarian President to the White House and the red carpet welcome accorded to him. Wrote Ms Daud, “To get Saddam, the Bush administration has dizzily turned the world upside down and inside out. Our new best friends are the very people we used to protect our old very best friends from. During the Cold War, we safeguarded Old Europe from the Evil Empire. Now we have embraced the former Soviet bloc satellites to protect us from the Security Council machinations of our paramours, France and Germany. NATO was created to protect Western Europe from the Communist hordes, namely the Bulgarians who tried to outdo the bizarro Albanians as the most Stalinist regime in Eastern Europe and were known as the “thick necks” who did all the dirty work for the KGB"

Maureen Dowd's satire is biting and exposes the hypocrisy of the USA and Great Britain. According to her, the present situation is a “battle of the pipsqueak powers. We dragoon Bulgaria to offset France dragooning Cameroons.” Has the USA forgotten the fact that such was the sycophancy of Bulgaria to the Soviet Union that they were prepared to become the 16th Republic of the “Evil Empire”. Bulgaria was expelled from the 2000 Olympic Games on doping charges and it was involved in an international conspiracy to kill the Pope.

Such alliances make no sense and are referred to as the Warsaw Pact of Mr George Bush. If the USA is bent on winning friends and influencing people from East Europe, it also has some unexpected support from Western Europe, Spain. Now Madrid, after its bloody past association with dictators like General Franco, had fought a ferocious war against fascism, but the stigma was still there. Perhaps, that was why the Spanish government was siding with the USA and the UK. Who knows memories of the Spanish Civil War, immortalised by the presence and participation of men like Ernest Hemingway, had been erased from the minds of the Spanish people. The present government is not so right-wing as believed to be, but on the Iraq issue it has thrown its lot with the USA and the UK. Spain, obviously, is in need of economic aid and is prepared to compromise its self-respect and pride in going along with the USA.

Another new found ally is Turkey whose parliament has refused to allow bases to the US invading forces. Basically, Turkey, which always felt that it was more European than even the Europeans, had always gone for good bargains. The USA was offering the new Turkish regime billions. But like the famed Oliver Twist, Ankara wanted more! Obviously, self-interest counted far more than self-respect and independence. Ankara did not seem to realise that opening its bases to foreign troops would compromise its status as an independent nation. Yet, in the numbers game, the motley crowd led by the USA is increasing day by day. The USA and its major lackey, the UK, have the capacity to make offers which the smaller nations cannot resist in typical Godfather fashion.

It is amazing how the world has changed since the collapse of the Soviet bloc. Today, the biggest bully in the world, the USA has made it clear that whatever be the outcome of the UN debate, it is going for Saddam Hussein's removal. One cannot think of a more shocking act of contempt for the world body. How can the UN function if the USA went on amassing troops all around Iraq and is even preparing for the official assassination of the legal head of a nation. Washington is prepared to stoop to any level to gain support for its unjustifiable deeds and hence the wooing and winning of nations like Bulgaria.

The NAM summit in Kuala Lampur did make some feeble noises against any unilateral action by the USA but the group knew that Mr Bush did not care for world opinion, particularly the views of a group of motely, third world nations. And with Bulgaria and Rumania safely in the bag, the American President, may now go to woo feuding Rwanda and Burundi, promising the Hutus and Tutsis small nuclear weapons so that they destroyed each other, if only they supported the US action on Iraq.

MIDDLE

No laughing matter this
N.S. Tasneem

LAUGHTER may or may not be the best medicine, but it is an expression of one’s attitude to life. Only the person who does not consider life a laughing matter can laugh boisterously. It is like coming out of the closed chamber to breathe in the open air. Mostly laughter serves the purpose of ironing out the wrinkles of the soul. The body too gets back its lost composure. At the same time, the mind is attuned to the symphony that emanates from the struggles of life. Laughter indicates the end of an uncertain phase and the beginning of the restoration of self-confidence. It is like a shower bath when the face is held upward.

Sometimes, I wonder as to why people do not laugh heartily. The dour look, laced sometimes with a wry smile, provides a sad commentary on the psychic state. Nothing moves the heart as the mind is always clogged with the problems of one sort or another. Comforts seem to be aplenty but there is no feeling of cheerfulness. People move about as if they were walking in sleep. Somnambulism makes their eyes inverted and they have a hazy view of things around. They have bitter memories of the past and uncertain futuristic expectations. They seem to be heading towards a destination, the outline of which is ever blurred.

Life is hectic no doubt but it does not mean that the individuals should be deprived of even some moments of hilarity. Free from all worries, they should feel for sometime at peace with themselves, if not the world. In these supreme moments, they can unwind themselves and be prepared for the busy routine the next day. But the vacant hours are never vacant for them either for introspection or for transcending themselves. The very purpose of having a good time is lost when someone returns from a function emotionally exhausted or intellectually dissipated. Moreover, within the four walls of the house, nothing happens to create an atmosphere of togetherness and bonhomie. Even at the individual level, self-consciousness indicates the distance between the various members of the household.

There was a time when laughter was in the air. People could laugh away the blues by taking recourse to fund and frolic. Witty remarks always engendered convivial response. The idea was not to belittle a person but to laugh at his cost. Laughter is like the bursting of a cracker that has been ignited by all the participants at the same time. Mirza Ghalib was once relishing juicy mangoes in the company of his friends. In the meanwhile a donkey came there, sniffed at the remains of the fruit and went away. A person who had no liking for mangoes remarked: “See, Mirza Ghalib, even the donkeys do not eat mangoes.” At the rejoinder of Mirza Ghalib, there was a loud guffaw: “Yes, only the donkeys don’t eat mangoes.”

When did we laugh last? This is the question that now weighs heavy on the minds of most of the people. They look at the faces of one another so as to find a clue to this query. But blankness stares back at them with its annoying presence. It is like hiding away one’s face from the guilty inner self. Stress and strain create an embarrassing situation where laughter sounds hollow. Like the personal grief, it is now considered pertinent to hide one’s feelings of glee and gladness. The fear is that the others may attribute it to frivolity, if a person is found laughing at an anecdote or the eccentricity of a person. Indeed to be caught laughing is like being vulnerable to worldly pleasures. It is another matter that this thing reveals an innocent soul and an immaculate mind.