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Brakes on NCTC Interlinking rivers |
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No mining at will
A look at
Russia’s coming poll
Munching
a film
Banks scare, arhtiyas
snare Caught in
lenders’ trap – with govt help
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Interlinking rivers
Going
by experts’ reports and official records placed before it, the Supreme Court has concluded that the interlinking of India’s rivers is possible to tackle floods and provide water to drought-prone states and that the Centre and most states are willing to implement it. The court has directed the Centre to appoint a committee to monitor what could be the world’s biggest such project, which was originally expected to cost Rs 5 lakh crore. Proposed by the NDA government in 2002 and supported by former President A.P.J. Abdul Kalam, the ambitious project languished in the court for 10 years as the court tried to understand the complexities of such a large venture. Outside the court, the UPA government has not shown much interest in the project. The immediate response of a Congress spokeswoman — “it is easy to join rivers on paper” — is not very enthusiastic. Inter-state river water disputes — for instance, between Punjab and Haryana over Sutlej-Beas waters and between Karnataka and Tamil Nadu over Cauvery waters — have proved some of the most challenging to settle. Water is a highly emotive issue and short-sighted, squabbling politicians raise passions in their bid to be seen as champions of their state’s rights, disregarding the broader national interest. The recent cases of Centre-state standoff — over multi-brand retail and the National Counter Terrorism Centre — do not inspire much confidence that cooperation required to execute the river-linking project would be possible. Even if a political consensus does ultimately emerge, there are problems of land acquisition, dislocation of people, environmental impact, NGO protests, and more importantly, financial viability and desirability of the project. The court seems to have relied on the findings of the NCAER and a standing committee of Parliament to reach its conclusions. The final call will have to be taken by the Executive. In a democracy people at large will have to be convinced that rivers can be tamed and forced to run contrary to their gravity-driven natural course, and that it is worth the money and effort involved.
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No mining at will
The
Supreme Court has ruled that mining of minor minerals such as sand even in areas less than five hectares in Haryana and Rajasthan will require clearance from the Union Ministry of Forests and Environment (MoEF). This is an indication of the apex court’s lack of trust in the state governments. It has reason. The record of the two governments thus far in honouring the guidelines for mining has been shameful, with disastrous consequences for the environment, especially in the Aravalli ranges in Faridabad, Gurgaon and Mewat districts. Ban on mining in varying degrees has been imposed on and off in the Shivalik and Aravalli ranges in Haryana over the past decade by various courts. The major contention always has been restoration and reclamation of the mined areas, on which neither the miners nor the state government have been forthcoming. In fact, the state government has been seen to be supporting the miners, and doing little to implement environmental guidelines. When mining in areas above five hectares was banned, it bypassed the order by dividing mining areas into plots smaller than five hectares. Even in the latest appeal by mining companies, the state has supported their case. At the same time, the state over the years has been opposing mining of major minerals. The reason is simple: the state gets huge royalty from minor minerals, whereas the major minerals are controlled by the Centre. Besides, gains from the unauthorised mining that happens on the side are an even greater incentive for state policies to favour miners. As the miner-bureaucrat-politician nexus works in one extreme and courts look to protect the environment, it is the common man — who needs construction done for houses and commerce — who suffers. Getting environmental clearance from the MoEF, as directed by the court now, is a lengthy process. With little sand or gravel available legally, unauthorised — and therefore unregulated — mining is going on in various river beds and hills of the state. All this could be avoided if only the state government would of its own ensure sustainable mining.
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Everyone has his day and some days last longer than others. — Winston Churchill
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A look at Russia’s coming poll No
one doubts that Mr Vladimir Putin will become his country’s President again. Speculation centres on whether he will win in the first round on March 4 or will have to go into a second round. Indeed, the nuances of Russian politics and the softening of the state structure are as intriguing as they are significant. When Mr Putin came to power after the chaos of the Boris Yeltsin era, Russians heaved a sigh of relief because he brought order and discipline to a country pining for a strong hand. Luck favoured him in the windfall he received in the form of high energy prices. Russians became more prosperous and a middle class solidified to become a new power factor. It is ironical that the same middle class feels empowered and is no longer content with merely following orders. The unique phenomenon of large, sometimes massive, anti-Putin demonstrations in the heart of Moscow and in other cities in the run-up to the presidential election and, earlier, against an allegedly rigged parliamentary election, were an eye-opener. What was equally remarkable was the Kremlin’s indulgence to permit them to take place. What did not go down very well with articulate Russians was the sweetheart deal made long ago on swapping jobs between Mr Putin and Mr Dmitry Medvedev after the former observed the letter of the law by resigning as President after two terms. In a sense, the middle class felt cheated because the people were not a party to the secret deal and, somewhat to the surprise of the Kremlin, instead of the full-throated welcome Mr Putin’s prospective return to the No 1 position it had expected, the reaction was muted although there were many Russians who welcomed the news. If the future Russian President is meeting his countrymen’s new responses with forbearance, he has bent somewhat in demonstrating a new flexibility. Restrictions on media have been loosened, political satire has returned in full glory and regional governors will again be elected, rather than appointed. Mr Putin’s rhetoric, however, remains combative, perhaps to keep his core supporters enthused. Indeed, it would appear that the Russian concept of democracy is moving ahead, perhaps fitfully and at its own pace. There have been several phases in Russian evolution after the fall of the Soviet Union. The then victor, President Boris Yeltsin, placed inordinate faith in American goodwill and new liberal economic reforms were scripted by US economists without fully taking into account Soviet circumstances. People used to cradle-to-grave welfare – never mind its quality – suddenly became paupers. During a visit to Moscow in the late 90s, I saw the heart-rending spectacle of old men and women sifting rubbish to obtain scraps of food and material goods. It took President Yeltsin’s second term to realise that the US was not as generous as he had assumed and was working after its own interests, in common with every nation-state. First, the pliant Foreign Minister was sacked and a new attempt was made to bring some order to the economic and political chaos through Russian, rather than American, recipes. But Yeltsin was a very sick man even as he had sought re-election, choreographed by a team of US image builders. The state of his health was kept secret. The joke going around Moscow towards the end of his second term was that the wisest decision he took was to select Mr Putin as his successor. The second phase of Russia’s evolution was the consolidation and centralisation of power under the Putin presidency even as Yeltsin sought, and was granted, amnesty for his sins and those of his family and cronies, estimated to amount to billions of dollars in stolen funds. Restoration of order was welcomed as was growing prosperity. But dissent began to grow in Mr Putin’s second term, in particular due to his dealings with the oligarchs, men who had made vast amounts of money during the Yeltsin era in particular by exploiting their insider status to buy state companies for a song. President Putin’s edict was that these new-rich oligarchs could keep their ill-gotten wealth as long as they did not meddle in politics. The wise stayed silent and those who preferred caution to adventure took their fortunes and themselves abroad, London being their favoured watering hole. One who took a stand and remained at home is Mikhail Khodorkovsky, head of the giant Yukos enterprise, who remains in prison. Psychologically, Khodorkovsky’s treatment by the state apparatus – few have faith in the impartiality of the Russian judiciary – was perhaps the turning point in the middle class’s disillusionment with Mr Putin. Years of confinement for an energy baron for funding opposition candidates in elections showed the nailed fist in unusually stark terms. The March presidential election will represent a new phase in Russian evolution. By all accounts, it will be a mellower time, with Mr Putin and the middle class making adjustments that will imply a kinder and less heavy-handed administration. Once elected, President Putin will install Mr Medvedev as his Prime Minister. Russians and the rest of the world have never doubted who the boss was, despite Mr Putin choosing the No 2 slot the last time round. Mr Putin still believes that Russia should be a strong power although he is too much of a realist not to recognise that the old order in which the Soviet Union sought to balance the power of the United States is over. The future President’s accent will be on modernising his country’s military machine, eroded by years of chaos and neglect after the fall of the Soviet Union, and, while allowing a measure of dissent and democratic freedoms, to keep power in his hands. How far the middle class will seek to push Mr Putin remains to be seen. For the present, it has been relishing the freedom to demonstrate openly and will try to wrest greater freedom. The future promises to be exciting even as we must bear in mind some distinct Russian characteristics. Russians are a deeply nationalist people while retaining more than a streak of sentimentality. Perhaps novelist Leo Tolstoy best mirrors the Russians’ true face by mirroring the sweep and sensibilities of their
character.
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Munching a film People
go to cinema for many reasons. Only a few go there to watch a movie. I was watching ‘Descendants’, the sensitively portrayed Alexander Payne film on the complexity of human relationships. And it featured my favourite actor George Clooney. I had waited through the week, knowing the fate of good films - they don’t last beyond a week. Finally, when I could make it for the last show, I found myself sandwiched between two young people. On my right was a young couple, who, I think, had come to an English film, seeking privacy. Obviously, they were not interested in the traumatic experiences of a family shown on the screen - the tangled relationship of a land baron of Hawai with his two teenaged daughters and his wife, who was comatose, was not worthy enough for their kind attention. The couple was giggling, throwing pop corns at each other. After a while, pop corns were substituted by coke! They must be missing champagne! Despite the meekness of our laws and their meeker implementation, I dared to ask them twice to keep quiet. Somehow you begin to feel guilty when you try to chastise the young. And their defiance makes you feel old for no particular reason. I remembered Mrs Maheshwari, the Hindi teacher! After the words left my politically incorrect mouth, I hoped, they didn’t carry a knife! Even mobile phones are supposed to be on silent mode during a show, I reminded them! But this was nothing compared to what was going on to my left! And this could not be stopped under any law -not in our country! This guy had bought God knows how many bags of nacho chips and he ate with such crackling noise, as though 10 amplifiers were fixed inside his mouth. I guess some mouths have good acoustics! Now, here was Clooney, talking to his comatose wife, after her infidelity was disclosed to him by his teenaged daughter, but she lay there vegetated… his angst, frustration and self-pity, receiving only silence in response were building up tension. Right then, to my left, an explosion of sorts took place with a heightened snarling, chomp and crunch, as though a dozen buffaloes were let loose on dry fodder. I imagined the giant jaws of an earth- mover at work. I gave the guy a few dirty glances, hoping that he would understand his high decibel delight of consumption was distracting me from the finer silences, interspersed with a few delicate dialogues in the film. But the guy continued to eat all the silences of the film with meditative insouciance towards the world around him. And his hunger remained insatiate even though the film reached its complex cross-road. Finally, someone sitting on the back seat came to my rescue. He countered his loudness with a louder Punjabi reprimand, “Aei tussi gharon kucch ni khatta (didn’t you eat anything at home)!” Alas! The timing of this reprimand coincided with Clooney’s older daughter’s boyfriend eating chips on the screen and our glutton dodged the target. He had come to eat! I bet he didn’t watch a single scene! During the interval, I saw the guy was dressed up in top- brand clothes, head to toe; now he was carrying a huge bag of pop corns. I panicked. Why this enigmatic chip lover chose a movie hall for such loud expression of his gluttony, I wondered! Meekly, I changed my
seat.
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Banks scare, arhtiyas snare
Farm
produce payments made through arhtiyas act as a security, facilitating the recovery of loans to farmers. Unable to cut through complicated banking procedures, farmers have to turn to exploitative
arhtiyas
The regulation of agricultural markets by enforcing the Punjab
Agricultural Produce Markets Act 1961 was a landmark in the history of
state agriculture. This outlawed a large number of malpractices of
market middlemen which farmers were facing haplessly, forcing them to
sell their produce immediately after harvest and in the village to
itinerant traders at low prices. The legislation helped the farmers
realise remunerative prices through a free play of market forces which
later provided a strong base to the launching of the Green Revolution.
With an amazing performance, the system continued to prevail and even
became a role model for other states wherever it was replicated.
Under the Act, the commission agent (arhtiya) was supposed to
facilitate the process by acting on behalf of the seller-farmer in
terms of providing space for displaying produce, unloading, cleaning,
weighing, effecting sale by open auction and arranging an immediate
payment to the farmer. Minimum time and botheration was
involved.
Moneylenders turn middlemen Concurrently, describing the
critical picture that “a farmer is born in debt, lives in debt and
bequeaths his debt”, a replacement of private money lending by
institutional credit in the rural areas was strongly recommended. With
their business orientation, moneylenders took it as an opportunity to
divert to the function of market middlemen. Being in touch with a
large number of farmers of the area, they recycled their financial
resources. Exploiting the ignorance of farmers, they even charged
exorbitant rates of interest. Feeling the pulse of their clients, they
started the sale of critical farm inputs like seed, fertilizers,
pesticides etc and even essential consumer goods. Later, a number of
schemes for the improvement of agricultural marketing were mooted
enthusiastically by state governments from time to time but flopped
due to various reasons, especially because of the vested interest of arhtiyas.
Strengthening cooperatives by linking credit with marketing,
mechanical handling of produce and direct procurement by agencies are
glaring instances which faced stiff opposition from the arhtiyas.
They had a dominance in the functioning of market committees and a
sizable amount of market fee was diverted to the paving of market
yards, providing parking facilities, farm rest houses etc which
otherwise should have been provided by themselves. As a market reform
measure, almost a decade back, it was realised that direct payments of
sale proceeds to farmers should be made by the procurement agencies.
In case the buyer makes a direct payment to the seller with due
payment to the arhtiyas in lieu of the services rendered, why a
market facilitator should be a hurdle? It clearly highlights their
vested interest. Obviously, the money passed through them acts as a
security facilitating the recovery of cash and in kind advanced to the
farmer and without losing their clientele. Punjab has become a
typically mono-culture of rice-wheat in two-third area and
cotton-wheat in about one-fourth of the cultivated area. Again 90% of
paddy and cotton production and 70% wheat output are offered for sale.
Almost the entire marketed surplus of wheat and paddy is sold at the
minimum support prices (MSPs). Cotton is purchased by private trade at
market prices without much variation with the understanding that the
produce would be transported up to ginning and pressing units. The
marketing system does not warrant the display of produce in the market
yard and incur unnecessary expenses. Thus transactions are simple but
large in number. Let this marketing channel be simplified and
service efficiency increased by direct online payments in bank
accounts of farmers at least for wheat and paddy. Going a step
further, the sale can be effected in the village level primary
cooperative societies. It would even breathe life into the cooperative
system which is the only ray of hope for the revitalisation of small
farm economies.
Sharp rise in commission Arhtiyas
constitutes a strong lobby which is apparent from the fact that the
commission paid to them was 1.5% ad valorem till 1990, after which it
was enhanced to 2.0% without assigning any additional function. They
again prevailed upon the government in 1998, further getting it raised
to 2.5%. Every successive increase in agricultural production and a
still faster increase in marketed surpluses which can undoubtedly be
treated as a net contribution of research and development efforts but
its fruit was politely passed on to the commission agents. If they
claim having ancestral relations with farmers, why were the cotton
farmers facing a grave economic crisis for more than a decade till
2002? Strong justifications are made and struggles are launched for
raising MSPs of farm produce while earnings of the commission agents,
who remain silent spectators, automatically go up. The commission in
Punjab mandis was estimated at Rs 900 crore in 2010-11 as against Rs
60 crore in 1989-90. If every firm and industry has corporate social
responsibility, then why should such an agency not do funding for
research and rural development of the area? Even for making payments
of bonus at times by the central and state governments, the procedure
of payments gets complicated as with the increase in number of
middlemen, more of corruption and politics get involved. Direct
payments would also provide a check on unaccounted money. The
writer is a former Professor & Head, Department of Economics &
Sociology, PAU, Ludhiana
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Caught in lenders’ trap – with govt help It is high time state machinery recognised that an economy which owed its prosperity to a particular class and occupation is now becoming a laggard mainly because of its farmer-unfriendly policies. If this is not remedied, a heavy cost would be borne by not just farmers, but the entire state The
recent decision conveyed to the Centre by the Punjab government that it is not “possible” to make direct payments to farmers for foodgrains procured for the Central pool can only be labelled unjust. It seems to be more of a politically motivated decision than based on any of the grounds put forward for the refusal. It is, indeed, appalling how easily the state authority has decided to continue denying the farmer his due right to receive the fruits of his hard labour and wait endlessly to get only a part of his due through
arhtiyas, or sellers of his produce. This calls for a serious review (and revision) of the
arhtiya-farmer relationship and the arrangement of sale of foodgrains. The
arhtiya and the farmer are bound together in multiple ways. The former is a moneylender for the latter. Farmers borrow in a big way from
arhtiyas because borrowing from them is quick, hassle free and devoid of elaborate paper work. Actually, this borrowing is highly exploitative. The rates of interest charged are anything between 24 and 36 per cent per annum, which is way higher than what banks charge. Money-lending contracts are linked to output contracts, that is, pledge of selling crops through the lender-arhtiya only. The relationship is sometimes extended even further with farmers buying on credit their daily provisions and even inputs from
arhtiyas who also run retail shops. The final outcome is that when grains are to be sold, it is the lender-arhtiya who undertakes the sale with the procuring agencies, receives commission from the buying agency as also the payment for the grains sold. It is only after he deducts his dues that the farmer receives his dues -- often so meagre that another round of lending-pledge of crop begins. The cycle is never ending. It can be argued that the cultivator can avoid borrowing from the commission agent so that he is saved from the exploitation of higher interest rates and pledge of sale of crops to the lender. At least then he can rightfully and forcefully demand a direct payment to himself for the sale of grains. Easier said than done! It would be wrong to assume that farmers are ignorant of the exploitative practices of
arhtiyas. But borrowing from this source is more or less a necessity for them. Despite the measures and reforms announced and undertaken by the institutional banking structure, fulfilling the entire credit needs of farmers is still a far cry. Add to that the rigours of obtaining a loan, which, even after recent amendments like Kisan Credit Cards, are still daunting for farmers who are not very literate — financially and otherwise. Further, farming is an expensive occupation with costs of cultivation shooting up while productivity and remuneration lag behind. This has led to increased borrowings, more from
arhtiyas than banks as is confirmed and reported innumerable times by official and independent surveys alike, and the shameful spate of suicides. A beginning, thus, has to be made by breaking the interlinked credit-output dealing between the
arhtiya and the farmer. Increased per capita levels of institutional lending, low rates of interest and a quick and simple procedure of lending to farmers will go a long way in tackling this issue. Low rates of interest have already been implemented, and the lending procedure too is being simplified in steps, but more will have to be done in terms of providing adequate and timely credit which is enough so that the need for informal and tied borrowing is reduced to the minimum. A total financial inclusion — not just in the sense of mere opening of bank accounts -- especially for farmers is called for. If the financial dependence of farmers on
arhtiyas is cut down substantially, it can be hoped that the move to make direct payments to farmers will not face such stiff opposition from the
arhtiyas. For, it is the thriving money-lending business of arhtiyas that faces demise if direct payments are made to farmers under the present arrangement. Account-payee cheques are of little use if these are to be retained by
arhtiyas only. The umbilical cord of finance will have to be snipped away by the government — the sooner the better. Meanwhile, it is up to the state machinery to refuse to bow to pressure from the strong
arhtiya and farmer-cum-arhtiya clout. It should refrain from such feeble excuses that making direct payments to farmers is an enormous task requiring elaborate preparations. Had it heeded to the Union government’s directive last year, preparations could have begun then and completed this rabi season. How can a work be finished if it is not begun at all and is postponed each crop season? And surely the Punjab Rules 1962 are not ‘amendment-proof’! The writer is a Professor of Economics, Department of Distance Education, Punjabi University, Patiala
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