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A Tribune Special
Enter the new era of rising prices |
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Damages for accidents
Profile
On Record
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Enter the new era of rising prices Higher
prices of staple vegetables such as onion and potato have pushed food
inflation higher to 14.55 per cent in the first week of November. On
an annual basis, prices of potato have doubled during the one-year
period ending October 31, 2009, at 102.47 per cent while onions are
expensive by 38.24 per cent. At the same time, pulses have got dearer
by 27.03 per cent and rice by 63 per cent on a year-on-year basis. Crisil
Principal Economist D.K. Joshi says the pressure on food prices will
continue for some more time. Hopefully, the late revival in monsoons
and governmental steps would tackle the ever-inflating price rise. But
why did this rise happen? The underlying dynamics of food price
inflation is quite complex. Drought is said to be the primary reason.
Low rainfall early in the monsoon period hit the country’s rice,
sugarcane and groundnut crops, threatening to cause shortage. This,
along with a rise in demand spurred by schemes like the National Rural
Employment Guarantee Scheme, which offered job alternatives to the
original agriculturalists, sent food prices rocketing. Also the
governmental infrastructure is so poorly equipped that it cannot even
preserve food grains like paddy and wheat. Regardless of the
constraints from the supply side, we continue to squander the food
available, especially vegetables and fruits. Tonnes of foodgrains rot
in the open due to lack of proper storage godowns. Now a situation
has come where we have to import rice. The government estimates that
there would be a shortfall of over 15 million tonnes in the 2009-10
kharif season due to drought and floods in several states. Economists
also attribute the hike to global inflationary expectations. In a
recent BBC interview, Josette Sheeran, Head, UN World Food Programme,
has warned that the rise in basic food costs could continue for a
couple of years. Theorists like her say that this could be the
breakdown of the ‘Goldilocks era’ for global commodities — a
period stretching back to over 30 years during which food prices are
generally stable. It also seems that the Earth has begun groaning
under the pressures of the ever-growing population. She cannot take it
any more. At the end of World War II, the Earth supported a global
population of about 2.5 billion people; today it is over six billion
and is expected to peak at nine billion by 2050. It took thousands of
years for the world’s population to reach 2.5 billion, but merely
another century to more than treble. The per capita availability of
arable land, which was one acre just a few decades back, will decrease
to one-third of an acre by 2050. Increasing world population is
spurring food demand. The government has failed to effectively
monitor the demand and supply mechanics in the market. The difference
between the prices of perishables in the wholesale market and local
markets is unbelievable. The rehriwallas, on account of the
mass hysteria due to the price rise and buyers’ ignorance, are
taking the people for a ride. In an ordinary Indian household, food
expenditure makes up for a large share of the total expenditure. The
price hike, along with the craftiness of vendors, is pinching a huge
hole into the Aam Admi’s pocket. Hence, the system needs to
be regularised by pre-setting of some profit margin and maximum retail
price for vegetables and informing the public of the same through
media. Since the hike has hit the poor hard, the public distribution
system must be made more effective and perishables included in its
list. According to a recent report by the International Food Policy
Research Institute (IFPRI), India has more hungry people — over 200
million — than any other country. The current hike in food prices
would further reduce the food-buying capacity of many poor families,
making their condition worse. Another cause for worry is that though
food prices have increased considerably, people’s incomes have not
kept pace with it. Rather the recession has led to widescale layoffs.
This will force many families further into hunger. The government must
wake up to this impending danger as this would lead to further
malnutrition and hunger-related deaths. The need of the hour is to
develop a proper storage infrastructure for perishables at the
national level. Farmers must be encouraged to diversify and shift
their focus from paddy and wheat. No doubt, it’s our staple diet,
but that does not make up for a balanced diet. In the 1960s, we had
our historic Green Revolution. However, that boon proved to be
lopsided as agriculture got to be linked to just paddy and wheat. We
have not been able to save even that from rotting because of our poor
storage facilities. The government might have to import as much as
2,00,000 tonnes of rice if there is greater price parity to meet
domestic demand. According to a report drafted for ministers of the G8
nations, the world will face "a permanent food crisis and global
instability unless countries act now to feed a surging population by
doubling agricultural output". There is need for proper
implementation of the Prevention of Blackmarketing and Maintenance of
Supplies of Essential Commodities Act, 1980, by the Centre and the
states for preventing unethical practices like hoarding and black
marketing. The Act empowers the Centre and the states to detain those
whose activities are prejudicial to the maintenance of supplies of
commodities essential to the community. As it seems, the problem of
price rise is too complicated to be solved by following some easy
steps. However, some measures taken by the government to narrow down
the wide demand-supply gap and the Aam Admi to spend sensibly
would go a long way to check the ever-inflating price rise.
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Damages for accidents
Owing
to negligent driving, a bus ferrying school children broke the railings of the Wazirabad Yamuna bridge and fell into the river, claiming 29 students in 1997. However, it took more than a decade for the athorities to decide the compensatory claims of the parents in 2009 — the basis being ‘fault liability’ of the driver, the bus owner and the insurance company. The issue to be settled all along right from the Motor Accident Claims Tribunal, through the High Court, and finally to the Supreme Court was how to compensate the loss of the
distressed parents. Loss of life is indeed irrevocable. Nevertheless, to maintain the sanctity of a legal order, an attempt is made to devise some mechanism to compensate even if the loss is irreversible and, therefore, irreparable. This is the enigma that the law courts and the legislature are trying to resolve by evolving principles of compensation. The most basic principle, evolved on the analogy of commercial contracts, is that the person, who has suffered loss on account of some accident, should be put in the same position by awarding him compensatory damages as if the negligent or tortuous act had not been committed at all! But what about the loss in case of death of school students who themselves are dependant upon their parents? Most seemingly, the children bestow upon their parents a lot of love and affection and provide them emotional support and satisfaction, but all that deprivation and pain and suffering caused to them due to their accidental death is incalculable in money. What pecuniary loss the parents have suffered by the untimely demise of their children? Lord Atkinson responded to this interrogative about a century ago when he observed in an English case Taff Vale Rly. Co. v. Jenkins, (1911-13) All England Reporter: “In case of the death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child’s lifetime. But this does not necessarily bar the parents’ claim and prospective loss will found a valid claim provided that the parents establish that they had a reasonable expectation of pecuniary benefit if the child had lived.” The “prospective pecuniary loss” proposition has been adopted and developed by the Indian courts into at least two basic principles of pecuniary damages and non-pecuniary damages. The first one attempts to compensate, what is termed as, the “dependency loss” of the parents in future. This is the compensation for the loss of money support in terms of money. The second principle attempts to compensate non-pecuniary damages, say, in the form of incalculable loss of love and affection as distinct from the money loss, but again in terms of money. In both cases, the only measure for determining damages is that the awarded amount should be adequate, just and reasonable. In the application of these principles, however, the compensatory amount vastly varied. Extreme variation even within one and the same jurisdiction is disturbing. Surely, compensation award is intended neither to be a “bonanza,” “largesse,” or “a source of profit,” nor “a pittance” to become an apology for compensation. This is how the Supreme Court has recently lamented in Sarla Verma v. Delhi Transport Corporation (2009). True, this is due to the number of imponderables involved. Nonetheless, such a spectacle weakens the rule of law if we continue to remain in the realm of uncertainties. To bring certainty and uniformity, the Supreme Court, in the course of its judicial decision-making, has evolved “the multiplier method” for the award of pecuniary compensation, and the concept of “conventional amount” for the award for non-pecuniary compensation. The multiplier method is based upon the principle that the claimant must be paid a capital sum which would yield sufficient interest income to provide material benefits of the same standard and duration as the deceased would have provided for the dependents if he had lived and earned. In the calculation of this capital sum, there are involved a number of variables, such as how much personal and living expenses need to be deducted while calculating the yearly loss of dependency, how much effect is given to the future prospects of the deceased, inflation, and general price rise that erodes value and purchasing power of money, how to decide and determine the suitable multiplier on the basis of length of dependency, how to discount for contingencies and uncertainties, et al. Over the years, the courts have standardised the value of various variables by keeping in view the profile of a relatively stable economy. Likewise, the concept of “conventional sum”, which is paid for loss of life and not loss of future pecuniary prospects, is standardised. This is done by fixing an appropriate amount that the society considers just and proper and which is quite independent of financial position of the victim or the claimant, but dependant on the capacity and the ability of the deceased to provide happiness to the claimant. The various principles evolved by the courts for eschewing variations have now gained statutory recognition with the incorporation of new provisions by amending Act of 1994 into the Motor Vehicles Act, 1988. The new Section 163-A, read with Schedule II of the Act, provides for the payment of compensation on structured formula basis. The tabulated data of this Schedule prescribes compensation to be awarded with reference to the age and income of the deceased. A bare perusal of this data instantly reveals at least two flaws that somehow or the other seemed to have crept in. One, there is an amiss when a lesser compensation is prescribed where a higher multiplier of 18 (corresponding to the age group of 25-30 years) is applicable, and larger compensation with lower multiplier of 15, 16 or 17 (corresponding to the age group of 15-25 years). And two, it is inconceivable how the higher compensation is awarded in case where the deceased was having no income on the basis of notional income of Rs 15,000 per annum, whereas lower compensation where the deceased had some income, say, ranging between Rs. 3,000 and Rs. 12,000 per annum! The said Schedule bears some beneficial features of social security and standardisation that strengthen the rule of law by seeking objectivity in the vast realm of subjectivity. The Centre should review the Second Schedule from time to time keeping in view the cost of living as notified in the Official Gazatte and as envisaged under Sec 163-A of the Motor Vehicles Act.n The writer, a former Professor and Chairman, Department of Laws, Panjab University, Chandigarh, is presently Director (Academics), Chandigarh Judicial Academy
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Profile by Harihar Swarup
Cricket
is in the blood of Mohinder Amarnath, aptly chosen for BCCI’s highest honour — C.K. Naidu Life Time Achievement Award. He is, after all, son of the great Lala Amarnath, the first post-Independence captain of India, who too was the first recipient of the prestigious Award as far back as 1994. The Amarnath family is in the business of cricket. Mohinder’s brother, Surinder Amarnath was a test player. His brother Rajinder Amarnath is a former first class cricketer and currently a coach. Now 59, Mohinder made his debut against Australia in Chennai in December 1969. He was seen in the latter part of his career as the finest Indian batsman against express pace. Both Imran Khan and Malcolm Marshall have praised his batsmanship, courage and ability to endure pain. In 1982-83, Mohinder played 11 test matches against Pakistan and the West Indies and scored over 1000 runs in the two series. In his Idols, Sunil Gavaskar described him as the finest batsman in the world. He made his first test century at Perth at the WACA (the fastest and bounciest wicket in the world) batting against Jeff Thomson at his fastest. Popularly known as “Jimmy”, Mohinder is known for his remarkable personality, courage and determination. In an era replete with fast bowling and unrestricted in use of bouncer, he never stopped hooking. He received hairline fracture of the skull, was knocked unconscious by Imran Khan, had teeth knocked out by Malcolm Marshal, was hit in the jaw so painfully by Jeff Thomson in Perth that he could eat only ice cream for lunch. What separated Jimmy from others was his ability to withstand pain. In Bridgetown Test during India’s tour of West Indies in 1982-83, Mohinder had to retire for stitches after being hit on the head. On returning to the game, he faced one of the history’s most lethal bowlers, Michael Holding. Michael would try to intimidate Jimmy by bowling a bouncer, and indeed he did so. While most would duck, Mohinder stood his ground and hooked the ball to the boundary. On another occasion, he was struck by a nasty lifter from Malcolm Marshal during India’s second innings of the Barbados Test (1983). He was rushed to the hospital, received six stitches and then returned to the arena. As he was washing blood from his shirt in the dressing room, a wicket fell. Despite writhing in immense pain, he walked back to the middle, wearing the same blood stained shirt. Marshal greeted him with a bouncer. He fearlessly hooked the ball into the stands. In a career spanning more than two decades, Jimmy faced the fast bowlers fearlessly in his playing days at a time when Indian batsmen used to surrender meekly in front of quality fast bowlers. Mohinder was also noted for his conflicts with the Indian cricketing political establishment, famously having called the selectors a “bunch of jokers”. This often resulted in his exclusion from the Indian team. Once dropped without logic, he displayed strength of mind to script stirring comebacks. So much so that he came to be known as “comeback man”. During his two decades at the top, he was dropped several times but every time he fought his way back in the Indian team. After retiring from international cricket, Mohinder had coaching stints with Bangladesh and Morocco and the Rajasthan Ranji Trophy team. He created a cricketing coaching TV series, and penned a book on the same subject. He was appointed consultant of the Bengal Ranji team in 2008. The CK Naidu Award comes with a trophy, citation and cash prize of Rs 15 lakh. With this honour, Mohinder joins the galaxy of cricket stars, which, besides his father, included Syed Mushtaq Ali, Vijay Hazare, Polly Umrigar, Mansoor Ali Khan Pataudi and Bishan Singh Bedi. Among the CK Naidu Award winners, Mushtaq was very popular. An opening batsman, he enthralled the viewers with his powerful hits which often turned into
sixers.
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India emits lesser carbon dioxide than others: Sant by Shiv Kumar
As the climate change
meet in Copenhagen is fast approaching, various sections in the country
are arguing for the Indian negotiators to stand firm against demands by
developed nations to accept lower carbon emission norms. Conceding to
such demands, it is argued, would hinder development of India’s
economy and attempts to raise millions of Indians above the poverty
line. Among such voices is Prayaas, a Pune-based non-government
organisation which conducted a study to show that Indians emitted far
lower carbon dioxide than other countries like the US. Girish Sant, co-ordinator
of Prayaas, who conducted the study, tells The Tribune in Mumbai
that Indian society is structured to use resources and energy
economically compared to other countries. Excerpts: Q: What is
the relationship between income growth and higher energy use you have
spoken about in your study? A:
Basically, to increase income we need more energy. Also higher
income will result in higher energy usage as people try to spend their
incomes. As far as Indian economy is concerned, one reason it needs less
energy, say, as compared to China to raise its income since the
contribution from the service sector is far higher. Another factor is
that the way our society is structured results in lower energy use.
Unlike in other countries people use public transport more. Owing to
higher power tariffs, there is a tendency to find ways to consume less
electricity. A very large segment of the population still cook using
chulhas which is a renewable energy resource. Thanks to the policy of
cross-subsidies adopted by the government, the per capita use of
aviation fuel is low among Indians since airfares are higher in the
country, though it is changing now. According to the data from the
International Energy Association (IEA), India had 4 per cent global Q: Why has Indian industry become more energy efficient? Q:
In India, there is a severe unmet demand for power. As more power units
come on stream, won’t Indian power use come closer to developed
countries? A: Yes. But the advantage is that income levels would go
up and millions of people would be raised above the poverty line.
Moreover, high price of power ensures that the use of energy is kept to
the minimum. Q: While cross-subsidies have kept diesel prices low in
the country, won’t subsidised power result in wasted resources? Q:
India is promoting use of renewable sources of energy like wind power.
How successful have these efforts been? A: Actually, the rate of
installed capacity of wind power is growing at a higher rate in India
than in the developed countries like the US. However, the power
generation ratio for installed plants is higher in the US due to wind
conditions. Thus, the US needs to do more for promoting wind energy than
they are doing now.
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