The Tribune, Chandigarh, India

Recall of cars
More effective quality control needed

The recall of as many as 100,000 A-Star model cars by Maruti Suzuki India, including a large number of those exported, is a sure setback for the country’s largest car maker at a time when competition in the market is getting more and more intense. The cars have been recalled to replace the fuel pump gasket in cars manufactured between October 2008 and August 22, 2009. The manufacturers have acknowledged that in case fuel is filled to the brim, beyond cut-off position, a possible fuel leakage from the fuel pump mounting area may take place. This is a serious matter and it is just as well that Maruti Suzuki India has not waited for mishaps to occur and specific complaints to come to them from the consumer.

Significantly, this is not the first instance of recall affecting Maruti Suzuki. In 2000 the company had issued advertisements for the recall of 76,000 Omni vans due to a defect in the wiring harness which was a safety-related issue. However, only 75 per cent of car owners came forward to get the car part replaced. Also, about 50,000 Zens made in 1997 were recalled due to a defect in the steering column. In 2009, there were as many as 30 cases of spontaneous fires occurring inside the Tata Nano out of the 7,500 cars delivered. These fires were traced to a short circuit in the combination switch that controls the headlights, windscreen wipers and indicators located in the steering column.

It would be wrong to draw comfort from the fact that recalls occur in the United States, Japan and Europe too which boast of high quality standards. In January last, Toyota had recalled eight million cars in Europe and the US and suspended production of models such as the Corolla due to a problem with the braking system. The Honda also recalled cars worldwide to fix a fault with airbags of which over 8,000 were affected in India. But the cold reality is that the monitoring standards and quality control are far more stringent in the developed world than in India. Public consciousness is also far greater. In these areas, doubtlessly, we need to pull up our socks.

Sachin, Sachin!
Nothing is impossible, it seems

Sachin Tendulkar is on a song, and how! One round of applause does not die down when he comes up with yet another sterling performance, making every Indian delirious with joy. There is so much to root for but the first double century in one-day internationals is something which is mind-boggling. Lasting the entire 50 overs at the age of 37 is no mean feat in itself and extracting 200 not out runs from a team like South Africa is the stuff legends are made of. His 147-ball blitzkrieg was studded with three massive sixes and a record 25 boundaries. It only underscores his phenomenal mental and physical prowess.

What is all the more amazing is that even at this age, his appetite for runs is as strong as ever. He has scored four centuries in the last four Tests. Three of his four highest ODI scores have come in the last 12 months. His stupendous 175 against Australia in November and a whirlwind 163 in New Zealand in March were all huge milestones on the way to his 200-run historic knock at Gwalior.

Another cricket legend, Sunil Gavaskar, has already described Sachin as the greatest batsman the game has ever seen. Former England captain Nasser Hussain concurs, and rather places him higher than even the iconic Don Bradman. “Better than Brian Lara and Ricky Ponting, the other two great players of my era. Better than Sir Viv Richards, Sunil Gavaskar and Allan Border. And I would even say better than Sir Don Bradman himself,” he has written. Suffice it to say that Sachin is today beyond comparison. Gavaskar has identified two more peaks for him to conquer: a Test innings of 450 and an ODI knock of 250. Impossible? What is that? Come on Sachin, we are waiting!

Thought for the Day

For my name and memory, I leave it to men’s charitable speeches, and to foreign nations, and the next ages. — Francis Bacon

ARTICLE

Populism and safeguarded progress
End the Bt brinjal impasse
by B.G. Verghese

Environment Minister Jairam Ramesh’s moratorium on the introduction of Bt brinjal cleared last October by the Genetic Engineering Approval Committee of his own ministry is disappointing. In responding to “popular sentiment” in a matter of “no overriding urgency or food security” and waiting for “independent scientific studies” to restore “public confidence and trust”, he was more populist than persuasive.

Three of his Cabinet colleagues — Mr Sharad Pawar, Agriculture; Mr Kapil Sibal, Human Resource Development; and Mr Prithviraj Chauhan, Science and Technology — have disagreed maintaining that sentiment cannot rule science. To hand a veto to sundry dissenters is to disregard reason. And to hint that private research is somehow less reliable than public or public-private research (presumably on account of the profit motive) is contrary to fact. Public institutions were substantively involved in the Bt brinjal trials and the DG, CSIR, heads of agricultural universities and scientific departments within state universities and the Prime Minister’s economic advisory council have expressed their disquiet.

Senior scientists have charged that the public hearings were rigged and that they were shouted down or kept out by protesters. Surely, the issue must be debated and settled scientifically. Further, stagnant agricultural production and rising food prices render it urgent to make farming more profitable and productive through better seeds and higher returns per unit of land and water. Bt cotton has greatly enhanced yields with lower doses of fertiliser and pesticides. These are tangible gains that should not be denied or delayed.

Maybe, the answer now lies in quick passage of the pending Bill to establish a National Biodiversity Regulatory Authority, with a wider remit than the present GEAC. Once in place, this body should review the Bt brinjal impasse and take a decision on Bt research based on the best science available.

The country has a fixed stock of land on which increasing demands are being made on account of mounting population and development pressures. Present-day agriculture can no longer sustain the farm population with shrinking land-man ratios and current first Green Revolution technologies. We must move to higher productivity levels for which biotechnology offers a promising pathway. Further, the country must annually create 12 million jobs to absorb the growing labour force, quite apart from coping with those currently under-employed and unemployed, including those increasingly moving off the land.

Whole hierarchies of new employment are required, there is no way large and mega infrastructure and industrial projects can be avoided to exploit the economies of scale in a highly competitive, globalised world. This is also necessary to sustain 8-10 per cent growth that could eliminate poverty within the next decade, but with a smaller carbon footprint. Poverty is the worst polluter and human rights offender.

Urban and industrial expansion necessarily entails land acquisition with its concomitant environmental impacts and displacement. One cannot argue that past shortcomings presage future default. That would be a counsel of despair. It ignores the new awareness, stronger legal frameworks, stricter conditionalities, greater public auditing and increasingly better R&R, compensation and alternative livelihood packages, including participation in the future benefits for those affected.

The understandable nostalgia for the fading ways of life and the multiple social transitions this entails often mutate into another brand of populism by neo-Luddite forces so locked in the past that they cannot discern the future.

Vedanta’s Niyamgiri-Orissa Mining Corporation joint venture bauxite mine in Kalahandi-Rayagada in Orissa awaits final clearance while the adjacent Lanjigarh aluminium refinery, three km away, that it is intended to feed has commenced partial production based on ore brought from other mines. The case against the mine is that the Niyamgiri range is said to be sacred to the Dogaria Kandha, a primitive tribe, who will be displaced and suffer environmental hardship and a depleting water table. However, the Niyam Raja inhabits the entire 250 sq km range and is not confined to the 3.5 sq km mining location at an elevation of 1300 m which is capped by an impermeable laterite crust and is hence bare and uninhabited. Given removal of the laterite overburden to win the underlying bauxite, the refilled hilltop will become permeable and forested. This will augment the aquifer below and enhance the environment. The facts challenge the prevailing fiction.

There will be no displacement at Niyamgiri while the 120 families displaced at Lanjigarh have already been resettled and are being trained for industrial jobs and other avocations. Additionally, under a Supreme Court directive, Vedanta is to provide five percent of its net profit or Rs 10 crore per annum, whichever is more, in perpetuity for wider community development over a 15 sq km area. This does not seem like vandalising tribal life. Yet, the benefits and multiplier from the larger 5 mtpa aluminium project and related investments are being needlessly delayed by misplaced opposition.

Tata’s six mtpa steel plant at Kalinganagar, long delayed, may move forward this year while its related deep sea Dhamra port will soon be operational in collaboration with Larsen & Tubro. POSCO’s 12 mtpa steel plant and related captive port in Jagatsinghpur district is also held up by betel vine, cashew and prawn farm encroachers on the government-owned land allotted to the company. What is being defended by the POSCO Pratirodh Sangharsh Samiti is the existing livelihood pattern and way of life.

Can Orissa afford further delay and risk losing the bigger prize and huge opportunity for safeguarded development within its grasp?

MIDDLE

Words that rule
by P.C. Sharma

BOOKS rule the world, said Voltaire. So is true of words. Famous words of the French Revolution “Liberty, fraternity and equality” created a ferment that changed the destiny of French nation and shaped it for many others.

Winston Churchill was once asked: “What were the most powerful weapons you used to win the war”. His answer was “words, words and words”. His speeches have made the history of World War unforgettable: “we shall fight on the seas and on oceans, we shall fight on the beaches, we shall fight in the streets and fields, we shall never surrender”. These words lifted the mood of the nation and stirred Englishmen to face the bombardments that Hitler was hurling on England.

Gandhi’s “do or die” call breathed a new life into the freedom movement. People woke up from their slumber and gave a fight which became historic for not having to use violence or weapons. Lokmanya’s slogan “Freedom is our birth right” altered the course of freedom struggle.

And when the freedom dawned, nothing could describe it better than Pandit Nehru’s ‘Tryst with Destiny’ speech: “When the world sleeps, India will awake to life and freedom”. So moving. And so true. History of India’s struggle for freedom can never be complete without this speech.

Two cataclysmic words— ‘perestroika’ and ‘glasnost’ — rocked the Soviet Union. Used by Mikhail Gorbachev to restructure the Soviet Union, these words unleashed such transformative forces that brought down the Soviet monolith.

And the latest in word-power are Obama’s magic words ‘Yes we can’ that inspired his election campaign. These words put his oratory on everyone’s lips and him in the White House.

Current phase of history will not be remembered by the vogue words that dominate its idiom and phraseologies. Advent of globalisation spawned a new lexicon which has pushed out the language of simplicity and elegant usages. Commercialese and management coinages are the language of power and influence. ‘Data-based architecture’, ‘strategic thinking’, ‘coordination mechanism’, ‘paradigm shift’, ‘macro and micro levels, ‘multi-dimensional approach’ are some words which are the new elite of the vocabulary. They dominate all debate and intrude into all discourses on serious issues.

For these word-conductors, history holds no lessons, thesaurus is of no use. They trek the linguistic path unmindful of the danger of falling next into pits like “honorificabilitudinitatibus” — the longest word used by Shakespeare in “Loves Labour Lost” and ‘hippopotomonstro-sesquippedaliophobia’ (fear of long words). Pronounce as you wish!

OPED

Financial inclusion
FM should not forget the urban poor
by Premila Nazareth

While the nation lauds the government’s single-minded drive to take banking to villages, the Finance Ministry and the RBI are sadly neglecting a key constituency: the impoverished millions on the doorstep of urban banks, denied access for lack of ‘papers’. Despite the government’s clarion call for financial inclusion, my friends and I continue to find it difficult – if not impossible – to open accounts for our cooks, maids, drivers and gardeners.

Partly responsible are the Reserve Bank of India’s 2002 ‘Know Your Customer’ rules. These require banks to check the background of prospective applicants to guard against money-laundering and terrorism financing. Applicants must prove both identity and residence through one of six documents. Passport, PAN card, voter’s card, driving licence, identity card, or a letter from a recognised public authority/ public servant in the first case; and telephone or electricity bill, ration card, bank account statement, or letter from the employer/recognised public authority in the second.

Predominantly rural migrants, most of our urban poor do not have the correct combination of identity and address documents necessary to open accounts. The key sticking point is ‘local address’. This I learnt when I tried to open an account for Mahesh, the young Uttaranchali who lives and works in my house. He has a high-school I.D., a ration card, and a voter’s card (three KYC-approved identity documents), but these were insufficient to prove his bona fide. For, they display an Uttaranchal, not a Delhi address. Sona, our Maharashtrian ayah has no documentation at all, so hers was a ‘shut-before-opening’ case.

Recognising this Gordian knot, the RBI relaxed the documentary requirements for small deposit (or ‘no frills’) accounts with a total balance of Rs 50,000. In its ‘Know Your Customer’ circular of July 2009, it ruled that a written introduction/certification from an account holder was sufficient to open such accounts, provided the account was “over six months old and showed satisfactory transactions.”

Yet, eight months later, in direct contravention of this ruling, banks across the country continue to refuse to honour letters of introduction from account-holders/employers as sufficient evidence of identity and address. I thus face the ridiculous situation of living two doors away from the bank (in which my family has had six accounts for a decade), but which insists it cannot open Mahesh’s account since it does not have the wherewithal to verify the Uttaranchal address on his identity documents. Completely illogical, since he has now lived for five years with me in Delhi, visiting Uttaranchal only four times since then.

Bank branches have either not been properly briefed about the July 2009 relaxations, or they are using the 2002 KYC obligations as a convenient smoke-screen to duck opening unremunerative accounts for the poor. No surprise then that just 2 per cent of our over 33 million ‘no frills’ accounts are urban, as the Skoch Institute estimates.

In real terms, this is just 60,000 accounts. Minuscule in the context of India’s urban poor population of between 80 million and 190 million. We could immediately bring much of this population into the formal banking system merely by pressuring the banks to adhere to the RBI’s July 2009 relaxations. The national drive to financially empower the poor must thus strategically invest in tracking and pushing inclusion in the urban areas.

It is essential we start immediately. The UNDP’s ‘Indian Urban Poverty Report 2009’ shows India’s urban population doubling from 286 million to 575 million by 2030. More worryingly, it projects continued growth in our urban poor population due to expanding rural in-migration and lack of public services. Continuing exclusion from formal banking services will only aggravate this unfortunate trend.

Bringing the poor into the banks is also essential to establishing their identity within other formal skills and livelihood systems. For, when I tried to sign Mahesh up for Delhi driving classes to upgrade his skills and salary, he was turned away for lack of a ‘local’ bank account. I dread to think how many millions of bright, hard-working, young urban migrants are similarly held down by this ‘Catch 22’ of identification and ‘local address’.

The banks’ need for caution is understandable. But our system’s dogged insistence on ‘local address’ is misplaced, given an expanding ATM network and growing geographic mobility. In any case, most small depositors use their accounts primarily to store and save money. Thus, should they vanish with all their money, it is theirs and nobody else’s. Moreover, small deposits do not easily lend themselves to the kinds of scam seen on stock markets.

India’s 95-100 million domestic workers present the lowest-hanging fruit in the urban financial inclusion campaign. For, they all have close, organic links to households already within the banking system, significantly reducing the risk for banks. Since 90 per cent of these workers are women, the implications for social empowerment are significant.

This category of worker is also likely to make larger and more regular deposits than most urban and rural poor counterparts. In bigger cities, average domestic worker salaries range from Rs 3,500 to Rs 5,000, and average monthly savings from Rs 500-Rs 1,000. Employers would be happy to pay salaries via recurring monthly deposits. Account holders are likely to make one or two withdrawals a month. Urban ‘no frills’ accounts are thus likely to be continually active, cutting to the heart of the banks’ complaint that only 11 per cent of the nearly 33 millon rural accounts are.

The government must thus do some quick and clever thinking on how to incentivise our banks to, first, admit and, then, effectively serve our urban poor. To quote S.S.Tarapore, “No individual should be denied the right to open an account.” Some ‘carrot’ and some ‘stick’ might be required. But, judging from India’s telecom experience, energetic attention to enforcing banks’ urban ‘universal service obligation’ is more likely to trigger a low-cost system of ‘mass banking’, than crores of Budget spending on technology platforms and rural banking infrastructure.

The writer is an independent policy analyst.

Recovery was never going to be easy
by Hamish McRae

Stand by for the double dip – and a double dip led by America. The world economy has staggered out of recession, or at least most of the developed world has, for most of the emerging economies never went into recession at all. But during the past couple of weeks the "Phew!" factor has faded. Yes, there has been some growth and that is a relief but now, post the initial bounce, the slog has begun. That is the time when bad news accumulates, when it becomes clear that we are not through this yet by any means.

That has become particularly evident in the United States. The various fiscal measures to boost the economy are coming to an end. The "cash for clunkers" programme to boost car sales has already ended, and though US car-markers will have gained some modest advantage from Toyota's woes, many of the Toyota models are made in the US, so communities there have been damaged by the recalls.

The housing market, which has been steady for several months, faces a big challenge when the support from a mortgage tax credit comes to an end. Deals have to be signed by the end of April and sales concluded by the end of June to qualify for the homebuyer tax credit, a scheme which in effect gives new buyers $8,000 and people trading up, if they have lived in their present home more than five years, $6,500.

The problem will be a familiar one to Britons. Though prices have stabilised and in some areas actually risen a little, there is a huge overhang of people who would like to sell but have been holding off until the market was stronger and there will also be a stream of foreclosed properties hitting the market in the coming months.

As the realisation has mounted that the US economy is still in a lot of trouble, a sharp weakening of consumer confidence has occurred. Just yesterday the Conference Board, a firm of economic forecasters and analysts, reported that consumer confidence had plunged to a 10-month low, with homeowners in particular being worried about their future earnings and employment prospects. This is serious: consumption accounts for nearly 70 per cent of the US economy so any weakness there pulls the entire show down.

There is a further twist here. There are signs around the world that the period of ultra-low interest rates and other methods of monetary expansion are drawing to an end. China is tightening policy and India is expected to do so. Some smaller developed nations have increased interest rates. We here have halted, at least for the time being, our "quantitative expansion" programme. The European Central Bank has halted its unlimited lending programme and may stop other special measures next month. But what the rest of us do is overshadowed by what the US Federal Reserve does; we all matter a bit but the Fed matters hugely. Everyone is waiting to see when it will start to push rates back to normality.

And so the Fed's move last week to increase one of its interest rates from 0.5 per cent to 0.75 per cent takes on enormous significance, the first tiny sign that the interest rate tide has started to turn. The experts may say that if the US economy is weak through the summer and autumn monetary policy will remain loose and they are right. But ordinary people can see that once things turn they will continue to do so. The only question is the speed at which the tide flows.

So in the coming months there will be a string of troubling news that the recovery is faltering. There were some bad business confidence numbers yesterday from Germany, with the Ifo business climate index falling for the first time for a year. That suggests German growth is faltering and Germany of course remains Europe's largest economy. Several countries, including ourselves, will probably get a negative quarter of growth for the first three months of this year – though expect the numbers for the final quarter of last year to be revised upwards a little.

So what should be make of all this? I think the first thing to be aware of is that this is normal. Recessions have causes and until those causes have been tackled it is hard for economies to recover. In this instance the principal cause has been a huge credit bubble that inflated property prices and has left many people which debts they are struggling to get under control.

This is not the place to play the blame game – there has been plenty of that already. So let's just observe that until people and companies are comfortable with their debts and banks know the extent of the write-offs they will have to sustain, it is hard to have much of a recovery. This all takes time. But then it always takes time to recover from recession, whatever the causes thereof.

That leads to the second point. If this downturn follows the pattern of previous ones, there will be many months to go before global growth is properly rekindled. If you plot this US downturn against that of earlier ones you would not expect the graph to rise steadily until the end of this year. It would be nice to pretend otherwise but it ain't true. I know it seems ridiculous that if governments can rescue banks and central banks can pump in so much money that they turn around house prices, that they cannot also ensure that the recovery is solid and sustained. But they can't.

We are this spring seeing the limits of government power, and we are seeing it in the US, here in Britain, in Europe, everywhere. You can pile in additional demand for an economy for a while. That has happened right around the world and it has been successful. But you cannot follow those policies indefinitely, and if you try you reach a tipping point where your actions start to have perverse effects. I suppose that is where Greece is now.

— By arrangement with The Independent

World’s temperature record to be re-analysed
by Michael McCarthy

The whole of the world's instrumental temperature record – millions of observations dating back more than 150 years – is to be re-analysed in an attempt to remove doubts about the reality of global warming.

The new analysis, an enormous task which will be carried out by several groups of scientists working independently in different countries, has been proposed by the UK Met Office in the wake of recent controversies over climate science, such as the "climategate" email affair at the University of East Anglia and revelations that the last report of the Intergovernmental Panel on Climate Change (IPCC) contained inaccuracies and exaggerations.

The proposal was put to the World Meteorological Organisation by the Met Office at a meeting in Antalya, Turkey, earlier this week, and accepted by 150 delegates from around the world. Its detailed terms will be agreed at a conference to be held in Britain later this year.

The plan is for the entire global record of land-based air temperatures from 5,000 weather stations, which began before 1860, to be made freely available to anyone. It will then be reanalysed by at least three and possibly five groups of experts, whose different methods will be made transparent and open to scrutiny, and whose conclusions will be peer-reviewed.

The task is expected to take three years, and it is likely that its findings will form a core part of the next IPCC report, provisionally due in 2013 or 2014.

The Met Office stresses that it does not foresee that the new analyses will reveal any "substantial changes" from the basic conclusion in the last IPCC report, published in 2007, that the recent warming of the earth's climate is "unequivocal." Rather, it explains in its proposal document: "This effort will ensure that the datasets are completely robust and that all methods are transparent."

This makes it clear that although the Met Office feels a more detailed temperature record is needed, in particular so that new extremes can be detected by daily records (which might be smoothed out in current monthly averages), a principal impetus behind the whole exercise is confidence-building.

Trust in the current global temperature record and its potential demonstration of a changing climate was shaken by the release in November of the emails from University of East Anglia's Climatic Research Unit (CRU), which is the guardian of one of the temperature record's main data sets. The emails appeared to show the director of the unit, Professor Phil Jones, obstructing efforts by climate sceptics to obtain information on the way the record was put together; some sceptics have challenged the suggestion that the earth is warmer now than at any time in the last 1,000 years.

Professor Jones has stood down as head of the CRU while an independent inquiry is carried out into the emails controversy by Sir Muir Russell, which is due to report in the spring.

— By arrangement with The Independent

Corrections and clarifications

The headline “New Delhi rly station needs to be on track” (Page 18, February 23) is vague and inappropriate. A more apt headline would have been “Poor amenities at New Delhi rly station”.

The headline “Oz wants India on top six list” (Page 14, February 24) should have had ‘in’ for ‘on’.

The headline “Satyam drags Upaid to court” (Page 15, February 24) is inappropriate. A better alternative would have been “Enforce Upaid deal, Satyam to court”. There is no reference in the report to Satyam having dragged Upaid to court now.

In the headline “Rail budget brings no cheers to state (Page 9, February 25), instead of ‘cheers’ the word should have been used in singular.

Despite our earnest endeavour to keep The Tribune error-free, some errors do creep in at times. We are always eager to correct them.

This column appears twice a week — every Tuesday and Friday. We request our readers to write or e-mail to us whenever they find any error.

Readers in such cases can write to Mr Kamlendra Kanwar, Senior Associate Editor, The Tribune, Chandigarh, with the word “Corrections” on the envelope. His e-mail ID is kanwar@tribunemail.com.

H.K. Dua
Editor-in-Chief