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Quota to stay Raj at it again! |
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Bad bet
Scary inflation
The get-together
SEZ trouble in Himachal Death of a newspaper Iraq’s real gains
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Quota to stay THE Manmohan Singh government has got a shot in the arm with the Supreme Court judgement upholding the constitutional validity of the Central Educational Institutions (Reservation in Admission) Act, 2006, providing 27 per cent quota for the socially and educationally backward classes. Ever since Union Human Resource Development Minister Arjun Singh mooted this proposal in 2006, it has been receiving a volley of protest from students opposed to caste-based reservations in institutions like the IITs, IIMs and AIIMS. The Supreme Court itself had refused to vacate the stay on the impugned Act thrice, raising questions on its validity. Later, it tagged the OBC quota petition to a bunch of other petitions against caste-based reservations and referred them to a five-member Bench to examine several points of constitutional law. The Bench headed by Chief Justice K.G. Balakrishnan has now ruled that the Act does not violate the basic structure of the Constitution and that the delegation of power to the Centre to determine the other backward classes is valid. Significantly, the Bench ruled that the creamy layer among the OBCs should be excluded from the benefit of quota. Otherwise, the fruits of reservation will not reach the needy, it said. This is bound to disappoint the UPA government because it overruled the objections of the Left parties, the Oversight Committee and the Parliamentary Standing Committee and included the creamy layer in the Act following pressure from its allies like the DMK, the PMK, the RJD and the Lok Janshakti Party. Opinion was also sharply divided between the Congress and the BJP on the issue. Equally significant is the Bench’s order that reservations cannot continue in perpetuity and that there should be a periodic review of the implementation of 27 per cent quota for the OBCs. While the Centre has made no review of the progress made by the beneficiaries of reservations so far, the number of castes in the backward list has been swelling. The continued quota for the Scheduled Castes and the Scheduled Tribes is a typical example of how successive governments at the Centre, being afraid of their vote bank, have been blindly extending reservation to them every 10 years since 1951.
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Raj at it again! IF anyone thought that the unanimous condemnation Raj Thackeray’s hate campaign against North Indians in Maharashtra attracted, except within his charmed circle, would make him mend his ways, he is going to feel highly disappointed. The MNS leader is still on the same silly track and has rather decided to up the ante. On Wednesday, he called upon leading Mumbai industrialists like Tatas, Ambanis and Birlas to reserve 80 per cent jobs in factories and offices for Marathi sons-of-the-soil. The threat of launching an agitation if this demand is not met is implicit. And he does not stop even there. He has also demanded that from now on, 100 per cent jobs in all new industries should be reserved for Marathi-speaking people. He had been able to make such ludicrous demands only because he and his goons had been allowed to get away with organised assaults last time which led to the exodus of thousands of north Indians from Mumbai and other towns of Maharashtra. Nobody told him in certain terms that his vicious campaign ran counter to the fundamental rights of Indian citizens to stay anywhere in the country and practice any vocation they choose to follow. Such men are always ready to tear the fabric of the country asunder for the sake of a few local votes. His campaign has a lot to do with the poor showing of his party in the recent municipal elections in Mumbai and the failure of the government to take him by the horns. It is not possible for men of such mental makeup to understand that Mumbai is not just the capital of Maharashtra but also the financial capital of India. Most of its prosperity and affluence have come because of the sweat and tear of people from all over the country. The walls of chauvinism that he wants to raise there will do more harm to Mumbai than to India. Since he refuses to listen to sweet voices of reason, it is the duty of the government to pour the menacing music of firmness into his ears.
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Bad bet IT is incredible how sporting bodies lose focus every once in a while and fritter away energies on everything but sporting excellence, infrastructure and sportsmen’s welfare, which should be their primary concern. If the Board for Control of Cricket in India makes plenty of money, it is not because of its managerial quality but because of the enormous popularity of the game. Often, it makes decisions or considers hare-brained ideas that are not too far off from those of another body, governing the country’s national sport, which has successfully run that sport into the ground. Mr I.S. Bindra’s idea of the government legalising betting is a case in point. Mr Bindra, newly appointed as the principal advisor to the International Cricket Council, is taking the “if you can’t beat them, join them” line. Large-scale betting does go on during cricket matches, and if it cannot be stopped, the best thing is to legalise it, the argument goes. There are many exploitative and harmful activities that go on unhindered in society - to suggest that they could all be “legalised” and regulated would be to condone and encourage it, and further the harm that it causes to society. Gambling, which is what betting is, is clearly such an activity. Even the state-run lottery tickets have caused havoc in the lives of many poor families. It is not the rich who buy lottery tickets - meagre incomes are frittered away chasing an illusory dream, and compulsive buying has led to families being broken up and cases of suicides. Legalising betting would have a similar impact. Given the enormous popularity of cricket, many would jump at the chance of what they see as making easy money, without realising that it is the betting syndicates that make the money, not the would-be punters. Looks like fancy auctions of cricketers have turned the BCCI’s brains. Let it concentrate on cricket.
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Blessed are the hearts that can bend; they shall never be broken. —Albert Camus
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Scary inflation
Inflation
is bad news for everyone, especially the poor. Whereas an increase in the price of essential commodities by a few rupees is not going to hurt the middle and high income groups, it will hit the poor hard. Prices of 15 essential commodities have gone up by 20 to 40 per cent in the last one year. The price of wheat has nearly doubled and that of rice has increased from Rs 18 a kilo last year to Rs 26 a kilo. Dals are all in the range of Rs 40 and Rs 50 per kilo. Along with inflation, there is bad news on all fronts — industrial, agricultural, infrastructure and corporate sector growth. Inflation has flared up to nearly 7 per cent. Perhaps, the current inflation is a reflection of global trends of high oil and metal prices and it may be true that India cannot be “decoupled” from the US where both recession and inflation are creeping up. China has been experiencing a high (8 per cent) inflation in recent months. According to many, it is India’s and China’s high rate of economic growth which is driving up the demand for commodities in the world and the result is inflation. Indeed, there is a short supply in foodgrains as Australia, which is a big grain producer, is suffering from drought and much land in the US has been diversified for producing bio-fuel. There is a demand and supply mismatch in metals also and there is a global rise in the price of metals. The recent surge in India’s inflation too can be traced back to a rise in basic metal prices which has a big weight in the whole sale price index (WPI). Other reasons for the current crisis in India can be traced to the problems in the US economy which is a big player at the global level. The mismanagement of the US subprime mortgage crisis has already become visible in its impact on the Indian stock markets. Along with the sharp falls in US stock markets, Indian stock markets have also seen some very sharp downturns in recent times. The fact remains that Indian stock markets depend on a lot of foreign institutional investment flows coming from the US. As the subprime crisis took its toll in the US financial systems with one big bank after another declaring huge losses, the FIIs have been withdrawing from Indian stock markets in order to cover losses elsewhere. That is why the flow of FIIs has been reduced to a trickle and demand for dollars has gone up in the market, making the Indian rupee weaker against the dollar. Also, $1.9 billion of India’s foreign exchange reserves has been released in the market by the Reserve Bank of India in order to cater to the rising dollar demand. Softening of the rupee against the dollar will be good for Indian exports but will make imports expensive. It will not be helpful in solving the problem of inflation because imports of foodgrains and edible oils would be costing much more. There will be an impact on domestic prices of the high international commodity prices and inflation will be stoked further. In the domestic industrial production front, there has been a slack in the production of capital goods, and the manufacturing sector has grown at a slower pace. The reasons are many —infrastructure problems, slack demand for consumer durables, and slowdown of exports due to the rising rupee against the dollar. Now the high price of metals will push up the price of manufactures and inflation may rise further. The only way to control inflation in the short term is to tackle it mainly as a supply problem. If the prices of essential commodities are high because of a shortage, then the government will have to import these commodities and release them in the market. It has already declared that there would be a cut in the import duty on crude palm and soya oil, butter and ghee, and import duty on maze up to five lakh tonnes would be scrapped. Export of non- basmati rice and pulses has been banned to relieve the pressure of higher international prices. In the end, the government will have to get more supplies from our own agriculture. But agriculture has been in trouble for many years and even with the recent loan waivers, the fundamental problems have not been addressed. Low productivity and high cost of production leave low margins with farmers, who in turn are not able to invest in better inputs and irrigation works. More extension workers and irrigation works are needed as well as better seeds and fertilisers. India has to build its buffer stocks again because being a country of one billion people and becoming import-dependent for food is a scary scenario. The government has also treated the inflationary pressure as a monetary phenomenon and the RBI is likely to come up with a tight monetary policy. There is going to be no change in the high interest rate regime. This will further bring about recession in industry. The high interest rates in the last few years have led to a shrinking of investment by the corporate sector. It has only attracted foreign institutional investment flows which led to the hardening of the rupee against the dollar. The high-value rupee, though quite prestigious for India, has stifled Indian exports and in some export industries like textiles it has led to huge job losses already. The government has been trying to give the exporters various relief packages but their suffering has affected the overall export performance. Thus, India is not only facing inflation but unemployment as well. Whereas the Indian government has been feeling quite complacent, the US has been active in warding off recession by boosting the demand by giving huge fiscal incentives. In addition, to contain a severe liquidity crunch, the Federal Reserve has pumped billions of dollars and even financed JP Morgan’s buyout of Bear Stearns, one of the biggest banks in the US. The Federal Reserve has lowered the interest rate many times, the last big cut was on March 18 when it helped to boost the financial markets the world over. India’s sensex also reacted positively and picked up after the black Monday of March 17. But whether the incentives to boost consumer demand will work or not is yet to be seen. The US is also battling with the rise in commodity prices, including metals and crude oil. There could be a real danger of stagflation which means high inflation and stagnant growth. India, too, may enter into a similar phase. The demand may not pick up for consumer durables and housing because of high interest rates. Nor will industry be able to invest in cost-reducing technologies. The RBI will find it difficult to match the US rate cuts as it is afraid of speculation in the commodity markets. On the whole, without agriculture picking up and reaching a growth rate of 4 per cent, only stop-gap measures may be resorted to. In short term, imports of essential commodities may bring relief as well as the new rabi crop when it enters the market. Exports may get a reprieve because the rupee has softened, but imports will be costlier and the balance of payments deficit may widen. In all, the scene is grim on the inflation front unless essential commodities are in plentiful supply for the “aam admi” in the next few
months.
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The get-together The invitation from the chairman was to dinner at a five-star hotel. It was sent to me by “special delivery” because I happened to be the oldest pensioner living in Delhi. The occasion was the platinum jubilee of the company which, oddly enough, coincided with the golden jubilee of my association with it almost to a day. So my wife and I togged up for the evening, something we rarely did those days, our special excursions being of the informal “drop in when you can, if you can” kind. The chairman, grey-haired, urbane, dignified, looked very different from the young man who had joined the company as a probationer 17 years after I had done the same. His charming wife greeted us with warmth and affection. There were others, nearer my age but pensioners like myself. Three former deputy chairmen, two directors, apart from the two then on the board. A chief engineer and a chief chemist. There were old stagers who had begun as clerks in my time but whose intelligence and hard work had earned them managerial positions from which their sons had taken off. It was one of the latter who reminded me that he had been my “umbrella man”. I had gone to open a new branch in Jalandhar, way back in ‘55, taking with me from Delhi a trunk-load of files, this boy, then in junior management, and a driver. We “took possession” of the office in G.T. Road, then still under construction. Fortunately, it was the month of December but even so, the sun was uncomfortably warm with no roof to protect us. That was when my sole help stood valiantly behind me providing me with shade. There was much back-slapping and bear-hugging among the males, old rivalries forgotten. Much kissing between the females who, 30 years ago, were making catty remarks about one another. And among the 200 or so participants on this joyous occasion were those now working to keep the company’s name in the “top ten” list. Most of them I had not set eyes on before; some whose fathers had been my colleagues; some on the verge of retirement whose faces I recognised immediately while frantically searched my memory for their names. But with the company having grown from a single product organisation in my day to one offering a variety of goods and services, the yard-long designations of these “torch-bearers” are beyond my comprehension. What could I do but make vague noises on someone telling me that he was the “Manager, Corporate Finance Planning” or “Director Central Operations?” I went home replete with good food and drink and company anecdotes, chuckling over one observation I had made. It had seemed to me that the “gals” of my time were in far better shape than their balding and paunchy husbands. It’s wonderful what a low-calorie diet, a liberal application of hair-dye or pre-party rinse and a “facial” can do for a woman in her ‘50s or early
‘60s!
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SEZ trouble in Himachal The
temperature soars as one drives down the hill slopes from Kangra district of Himachal to Una, lower down, forming the terai belt of the region. The landscape changes dramatically from tiny terrace farms and pine forests to flat lands, an expanse of grasslands and wheat fields dotted with mustard flowers. Not very far away in Bhanjaal village of Gagret Block in Amb tehsil, farmers, men, women and children, gather in large hoards. Women, from conservative Rajput families, who rarely venture out of their homes, take on the microphone and swear to lay down their lives to save their lands. “We have not slept for the last week since we heard about the survey”, they say. The lives of farmers in the area were disrupted in late February this year, when the Deputy Commissioner of Una, ordered the Patwaris of Chhalet, Daulatpur, Gagret, Gondpur, Banheda and Amb circles to conduct a socio-economic survey for the project. “No public announcement was made for this survey and no information was given to the people of the area about what this was being done for. It was when the newspapers reported it that we realised that a big project is on the cards.” Says Narinder Parmar, a local farmer, resident of Kuneran, one of the villages being surveyed. The project in reference is SKIL infrastructure Ltd.’s (Maharshtra based Nikhil Gandhi’s venture) airport based multi-product Special Economic Zone to be spread over an area of 8000 acres. Says Kamal Kumar, Pradhan of Ambotta village, “Much of this area is agriculture land. The patwaris and local officials have attempted to mislead the local residents by saying that only government land is going to be used for the project. If they want 8000 acres of contiguous land, private agricultural land is sure to be involved on a large scale”. Further, most residents know only about the airport, while officials are refraining from calling it an SEZ. In the absence of any information, as the survey work began, so did speculations about the project and its probable impacts on the farmers who are likely to lose their land. In response to the survey and the possibility of an approval to the project, the local residents of 13 villages formed a Matri Bhoomi Rakhsa Sangarsh Samiti (MBRSS). Adds Parmar, “90 per cent of the farmers are unwilling to part with their land, which is the main source of sustenance. The 10 per cent who may be interested in selling have no stakes in the local area and we will ensure that they dont pressurise us in any way” he added. There is also some talk of channelisation of the Swan river for the project, which again is not going down well with the local population. While the river is mostly seasonal, flowing in the monsoon, it plays its role of recharging the ground water. Currently the area is facing severe scarcity of drinking water and any project that is likely to consume water at a large scale is bound to affect the supply for local residents. But not all farmers are in opposition. Says Puran Singh, who own about 150 acres of land in Mubarakpur, apart from an electronics store in the town, ‘I will be happy to give up my land. We work hard on the land and the returns have dwindled over the years.” The land rates have doubled suddenly and he is hopeful that the cash compensation amount will be good, atleast upto Rs 25 lakhs an acre. And what about those who do not have enough land. “Yes”, he adds, “the Dalits here, who must be about 30 per cent of the population are all agricultural labourers. They will lose out. But they may set up rehabilitation colonies”. However, not all residents as as optimistic as Puran Singh. “The Pong and Bhakra dam oustees are yet to be rehabilitated. We do not trust that the government is capable of resettling project affected people”, claim people at the protest rally. The developer SKIL Infrastructure has not been very fortunate with their attempts to develop SEZs. Their first project in Positara Gujarat met with staunch resistance by the local Waghri farming community there till the High Court of Gujarat upheld the Right to Life of the local communities. The Ministry of Commerce in 2006 had given an in-principle approval to SKIL for developing the Airport based Multiproduct SEZ over an area of 3230 hectares in Gagret Block and a 120 hectare tourism based SEZ in Kullu. The proposals for SEZ projects in the state were shelved by the Congress Government, who was in power last year, considering that elections were due in 2007 and stormy protests around SEZs in other parts of the country had gained substantial momentum by then. In an unexpected move the Chief Minister of the ruling BJP, in early February, announced the possibility of setting up a private airport based Special Economic Zone in Gagret, along the ‘Gujarat SEZ Model’. Supporters of the project hope for employment generation for the youth who are gradually opting out of agriculture. But even that is a grey area. Suneel Kumar from Mubarakpur left his home last year to work in a factory in Baddi District, the emerging industrial zone in the state. He was back home in a matter of few weeks. “The wages were not as good, the living conditions were poor”. After he returned he joined the Luminous Battery plant which came up in Gagret after it was declared an industrial area in 2003. But Suneel did not last there either: “We had to deal with chemicals all day. I started getting ill because of the fumes, so I decided to quit”. A large demonstration was organised by the villages at the District Collector’s office in Una on 4th April 2008, where the DC was forced to make a statement that no agricultural land would be acquired for the project. The writer is based in HP, on a fellowship, documenting the impact of SEZs
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Death of a newspaper Lucknow
– What the British Raj strove for but failed to achieve, the Indian National Congress accomplished last week: the closure of the National Herald. Sonia Gandhi succeeded in shutting down Nehru’s daily on April 1 after an eventful innings of seven decades. Nehru had once said he would sell Anand Bhavan to ensure the Herald lived. He even signed promissory notes once to buy printing paper for his daily. His daughter arranged a music recital of M.S. Subbulakshmi to raise funds for the Herald. Her husband Feroze Gandhi was its managing director. Feroze Gandhi and Umashankar Dikshit kept the paper alive against all odds. Even Sonia had once claimed that the candle her grand father-in-law had lit would always remain burning. A decade ago the Lucknow district administration, after the High Court goaded it, auctioned part of the property of the Herald and its two language dailies, the Navjivan and the Qaumi Awaz, to recover Rs. four crores, wage arrears of the 400 and odd workmen. The employees struggled hard for the newspapers’ continuance and survival. The owners worked equally hard to secure their shut-down. Electricity bills, amounting to Rs 52 lakh, were not paid, resulting in power disconnection. News agencies discontinued their services for non-payment of dues. Newsprint and ink were not bought. Worse still, wages were not paid for 22 months. And still the journalists and other employees kept the banner high. They persuaded the UP chief minister to defer the recovery of electricity bills. Kalyan Singh obliged, though the owners are Congress persons. The journalists gathered news copies from all over to feed the matter. They cajoled stockists to keep providing paper and ink. They even campaigned for advertisements. Such an arrangement could only be transitory. The workers were willing, the owners obdurate. All these rare and unusual things happened to a newspaper which was both a player and a witness in India’s war of liberation. Though Sonia Gandhi, the present owner, finds herself very busy, Jawaharlal Nehru, when not in jail, would always attend the directors’ meeting at Kaiserbagh office. He would catch the Allahabad train that brought him to Lucknow early morning. Sub-editor Tribhuvan Narayan Singh, later UP chief minister, would receive him and bring him in a tonga from Charbagh to Kaiserbagh for the meeting. The date was 24 October 1995, when the lawyers in UP went on strike for some reason, the Herald employees’ writ petition for payment of wages had figured in the High Court cause list that day. Some Katibs of the Qaumi Awaz, as a routine, went to the High Court. The two-judge Bench of justices D.K. Trivedi and Jagdish Bhalla asked those Katibs about their case. The two judges asked them to tell the Bench what they felt. The Katibs had witnessed their petition for the past one year passed over to a new date every time. They muttered, fumbled but narrated their tale of woe: no wages for 20 months, children’s school fees not paid, landlord threatening eviction. And virtual starvation. Justice Trivedi and Justice Bhalla ordered the Lucknow district magistrate to initiate immediate action on payment of dues after recovery as statutory land revenue from the Herald owners. The district administration was shaken from slumber. It had till then not implemented the order of the labour commissioner whom the employees had approached under the Working Journalists Act two years ago. The legal process started on 9 November, the 102nd birth anniversary of its founder editor K. Rama Rao, and just five and ten days before the birth anniversaries of its owners, Jawaharlal Nehru and Indira Gandhi. The Herald did not suffer so much financially before swaraj as during the Congress regime of 40 years. Very few Indian newspaper establishments can equal the National Herald in owning landed property. As munificent largesse from Congress chief ministers, the Herald acquired, ostensibly for publication purposes, huge land plots in Mumbai, Indore, Bhopal, Patna and earlier at New Delhi’s Bahadur Shah Zafar Marg. In fact, if ever the line between the Fourth Estate and the Real Estate vanished, it was in the Herald’s case. And still its employees during the past six decades were never paid regular wages. Once chairman Nehru had written to the general manager (20 April 1941): “It seems that an evil fate is pursuing us, or, to be more accurate, that we are thoroughly incompetent or incapable of managing our affairs.” Perhaps party politics and not sound economics dominated the Congress president’s thoughts. Otherwise, she would not have allotted Herald chairmanship as a sinecure. One of the chairmen was a Planning Commission member and another now governor in the south. And the closure notice on April 1 (what a day!) was signed by the All-India Congress Committee treasurer Motilal Vora, heading the Herald publications.
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Iraq’s real gains BAGHDAD — As we mark the fifth anniversary of the fall of Saddam Hussein’s regime, it is important to reflect on the journey we have embarked upon. Liberation offered us the opportunity to construct a new state, based on the rule of law and democratic principles. Unlike in the past, this Iraq would acknowledge and build upon its diverse ethnic and religious identities. That promise has not yet been fulfilled. Mistakes have been made, and few Iraqis doubt that political and economic reconstruction could have been handled better. Yet, against all odds, Iraq has closed its fifth year of freedom with tangible improvements – thanks to interlocking steps on security, the economy and national reconciliation. The transition to freedom has been exceptionally painful for Iraqis and Americans alike. When we assumed sovereignty in June 2004, the Iraqi security forces were almost nonexistent. Today our security forces are nearly 600,000 strong, and Iraqis are primarily responsible for half of Iraq’s 18 provinces. Through improved Iraqi security capabilities, through the coalition’s “surge” of troops and, above all, with support from local communities, the violence that obstructed economic, social and political progress has receded significantly. Anbar, a province once all but lost to terrorists, is now largely denied to them. Similarly, Baghdad is no longer a maelstrom of sectarian bloodshed. Al-Qaida, the great spoiler in Iraq and the region, is on the run. Al-Qaida remains a major threat but is now fighting to survive, not to win. The setback that Iraqis, with coalition assistance, have inflicted could well become the genesis of al-Qaida’s defeat across the Muslim world. Putting the terrorists and militias on the defensive has enabled some economic progress, and the government’s competence is growing. We have managed to reduce annual core inflation from 36 percent at the end of 2006 to 14 percent this month. Iraq now funds almost all of its reconstruction and the lion’s share of the costs for its security forces. Budget execution is improving. Our economic growth rate is expected to top 7 percent this year. Sadly, our politics has not kept pace. Baghdad has done much but not enough. We have passed crucial laws for national reconciliation. Parliament has voted on laws regarding pensions, de-Baathification, amnesty, a budget and provincial powers for elections later this year. Iraq’s political challenges have been exacerbated because of disputes among and within the partners in its governing coalition. The government’s recent confrontation with armed gangs and militias, particularly in Basra, may have changed that dynamic. The government showed leadership and a willingness to combat outlaws regardless of their sectarian affiliation. Few appreciated that politicians of all sects and ethnic groups rallied to the government. Just as Baghdad needs to make more of an effort, so do others in the region and the international community. Now is the time for Iraq’s neighbors to support Iraq’s government and the political accommodations reached in Baghdad. Their interference in Iraqi domestic affairs must end. ————— The writer is deputy prime minister of Iraq. By arrangement with LA Times-Washington Post
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