Article Written By: Amit Abhyankar

Special Economic Zones suddenly find themselves in news in India. They have worked wonders in countries like China. Do they really draw FDI or are just revenue guzzlers? Can China’s model of SEZs help India achieve the similar results? The article tries to find out…

What is a Special Economic Zone (SEZ)?

SEZ is a geographical region with different economic laws than a country’s typical economic laws, with the main goal of attracting foreign investment. In economic terms, SEZ is specifically delineated duty-free enclave and shall be deemed to be foreign territory for the purposes of trade operations and duties & tariffs. Countries which have experimented with this concept are China (with great success), UAE, Malaysia, India, Jordan, Poland, Kazakhstan, Philippines, Russia and to some extent North Korea.

Apart from Central government, any private/ public/ joint sector or State Government can set up an SEZ. Before recommending any proposal to department of commerce, the State must satisfy themselves that they are in a position to supply basic inputs like water, electricity etc.

SEZs have potential to play a key role in economic development of a country, as they did for China.

Success in China

There are currently over 4000 special investment zones worldwide. China started with SEZs in 80’s. After establishing the first Export Processing Zone (EPZ) in Kandla in 1965, India’s exports through EPZs have increased from Rs. 10 lakh to $ 1 billion. Sounds impressive, till one looks at China. China’s first SEZ at Shenzen ‘alone’ attracted over $ 30 billion in direct investment. In countires like China, UAE & Malaysia, these zones have-

(i) emerged as focal points for foreign investments

(ii) attracted over 20% of foreign direct investment

(iii) contributed to over quarter of country exports.

(iv) served as testing grounds for reforms & policies for governments

(v) indirectly, helped improve competitiveness of local industry, job creation, local skill upgradation & technology absorption from FDI.

Indian Scenario

India was one of the earlier starters in SEZ business. The SEZ policy in India first came into inception on April 1, 2000. However with lacunas like lack of central legislation, rigid labour laws, the SEZs in India were not off to a flying start. India has always looked enviously at China’s far larger & more successful zones. Prior to 2005, the policy relating to SEZs, contained in foreign trade policy, was implemented through piecemeal & ad-hoc amendments to different laws, besides executive orders. In order to avoid these pitfalls and to give a long-term & stable policy framework with minimum regulation, the SEZ Act 2005 was enacted. The Act provides the umbrella legal framework, covering all important legal & regulatory aspects of SEZ development as well as for units operating therein.

Land will often be provided by the State governments at concessionary rates, and both developer & operating units can receive tax holidays up to 15 years, provided they are export-oriented. The other important provisions include single window clearance mechanism for the units in the zone; fiscal regime for developers & units besides a legislative framework for setting up offshore banking units; unit being eligible to 100% tax exemption for first 5 years, 50% for the next 5 years and 50% of the ploughed back export profits for the next 5 years. The developers will continue to get 100% income tax exemption for 10 years in a block period of 15 years.

The aim is to enhance foreign investment, provide an internationally competitive & hassle-free environment for exports, boost industrial investment & exports and to generate employment while persuading the private sector to build social infrastructure that the states cannot afford. E.g. Reliance has announced to develop 10,000 hectares of prime land adjacent to Gurgaon, a satellite city on the outskirts of Delhi. The government hopes that the SEZs will bring in billions of dollars in investment and create over a million new jobs. India already has 11 functioning SEZs- 7 set up by the central government and 4 by private/joint/state sector. These 11 SEZs are functioning in- Kandla, Surat, Cochin, Santa Cruz, Falta, Chennai, Vishakhapatanam, Noida, Indore, Salt Lake (Kolkata) and Jaipur. Two others at Jodhpur & Moradabad are ready for operation. Already they generate 5% of total Indian exports! The Board of Approval in the Commerce Ministry in its three meetings so far has approved 150 proposals (out of nearly 380), less than 6 months after the SEZ Act. The list of bidders includes private players like Reliance, Wipro, Infosys & even public sector giants like ONGC. Reliance’s project of Maha Mumbai SEZ is going to be the largest project of SEZ in entire world by any private player. In July 2006, concerned over the proliferating SEZs, the government, against wishes of Commerce ministry, decided to put the upper limit to number of SEZs in India, and accordingly a cap of 150 was imposed. In this battle of finance & commerce departments, the later had the last laugh, as recently government lifted the proposed cap.

India & China: The Scenarios Compared

India has more or less adopted the same China model of SEZ development and expecting the similar results. However, the government is missing out on few vital differences:

(i) Free zones in countries like China, UAE were mostly public funded in which economic gains prospects assumed far more significance than financial viability considerations. Thus the responsibility of market to promote zones & to attract tenant industries was primarily shouldered by governments. The Indian model, on the contrary, envisages ‘private sector led’ development of such zones. Thus, the responsibility or risk of financing, marketing & promotion has been vested with private players, who have very little or no experience in these areas.

(ii) India is not a command economy i.e. foreign investors are not confined to SEZs only, which make these zones little special than were China’s where SEZs used to be the only route through which foreign investors could enter the country. Besides, Indian has no equivalent to Hong Kong or Taiwan where industries had a pressing need to relocate and China served as a ready relocation base.

(iii) China continues to score because it has bundled an attractive tax environment with world-class infrastructure and a liberal labour environment. In India, on the other hand, buckling under the pressure from Left parties, the government has axed the Section 50(b) from the central SEZ bill, which would have empowered states to ease labour laws in SEZs. Democratic India has strong labour unions organically linked to political parties. Authoritarian China, conversely, has very pliant unions. Here India has lost a crucial edge in the global environment marketplace.

(iv) India has also some advantages over countries like China. It has significantly larger English-speaking workforce than does China. India also has an edge in a number of key knowledge based industries like software, IT-enabled services, medical services, drugs & pharmaceuticals & agro-based industries. Hence India’s SEZs are therefore likely to develop along quite different lines from China’s. Indian zones will more likely attract investments in high-end human skill based industries & services sector.

(v) Also in the light of the increasing economic engagement of India with the ASEAN & China, it is more likely that a greater proportion of investment into Indian zones could come from these countries than from US or Europe.

Areas of Concern:

With the mushrooming of SEZs across the country, the RBI has cautioned the government on the revenue implications that could arise from such zones. Though SEZs would boost investment & economic growth, they could also aggravate the uneven pattern of development by pulling out resources from less developed areas.

As mentioned above, the role of the State government is vital in development of these zones. However, different State governments differ markedly in the quality of their vision, their capacity of build infrastructure & the political constraints under they operate. Thus development of these zones say in Gujarat and in West Bengal is going to be on different lines.

There were also allegations that a large portion of agriculture land was being converted into SEZ zones. This statement however holds no ground as total proposed area for SEZs is about 75,000 hectares, only 0.000625% of India’s total area under cultivation. Yes, the only concern is proper rehabilitation or reimbursement of the farmers losing their cultivated agricultural land for the project. Because Government estimation of value of land property is always less than the market price. However, the huge cry over the fear of so called ‘massive land grab’ seems, for me, entirely unfounded. When one weighs the advantages the SEZ is going to bring in, the sacrifice of that much cost sounds justifiable. Reliance’s SEZ project ‘Maha-Mumbai’ is caught in bit of troubled water over the allegations of such land-grabs. However Reliance assures that the project will bring in nearly 5 lakh jobs. There would be civic facilities like schools, hospitals etc. A new generation will grow along with such SEZs, it is argued. 

P Chidambaram’s worry is that development of SEZs and the consequent tax relief would result in unjustified loss of tax revenue (over Rs. 70,000 crore) due to direct tax drain. RBI echoed his view when it cautioned that the revenue loss for the government in providing incentives may be justified only if the SEZ units ensure forward & backward linkages with domestic economy. The Commerce Ministry has, however, denied these implications contesting that in fact government stands to gain Rs. 44,000 crore from them. It said government would also gain from sale of goods from SEZs to domestic tariff area as import duties would have to be paid and these would be on finished products & not on raw material that units will import duty-free. It defended the tax concession to exports by units in SEZs saying that the units in domestic tariff area were already getting such concessions.

Conclusion

Many experts have expressed concerns over the philosophy of sops boost exports. By now however government seems to be realizing the need for formulating a new Indian model of SEZ. India has in fact, the right mix of factors such as availability of large & skilled workforce, intrinsic comparative advantage in several industries, a strong policy framework, availability of complementing & supporting ancillary industry, an already buoyant export sector & vast local markets. SEZs can combine these factors into a powerful alchemy to power investment creation. Unless remedies can be found out to loosen prevalent rigid labour laws, the SEZs cannot be looked at as a panacea for all economic diseases. Opinions are divided on the benefits of SEZs. We would have to wait & watch. Time will definitely have the answer.

I’ve received couple of inquiries as to the SEZ Act, 2005. Hence for those interested in going through the Act itself, I have included ‘The Special Economic Zones Act, 2005′ in PDF format. Click here to download the Special Economic Zones Act, 2005.

For those interested in reading the SEZ Rules, 2006, the PDF File can be downloaded from here.

Article Written By: Amit Abhyankar

Recently the Karnataka High Court struck down the Karnataka Hindu Religious Institutions and Charitable Endowment Act, 1997. And now I believe is high time we discuss the legality of such Hindu Endowment Acts.

Through these Endowment Acts, the Government feigns to bring in various regulatory measures over management & administration of Hindu Religious Institutions under the pretext that vast funds available to such religious institutions are ill-managed and there is not uniform organisational framework for temples.

The first question is can government step in to regulate the functioning of any religious institution? Haven’t we been guaranteed freedom of religion under Articles 25-28 of the Indian Constitution? Now According to Article 26,

Every religious group or denomination has right to-

(i) to establish & maintain institutions for religious & charitable purposes;

(ii)to manage its own affairs in matters of religion;

(iii)to own & acquire movable & immovable property and

(iv)to administer such property in accordance with law.

Thus from Clause (ii) & (iv), we may deduce that the religious institution enjoys full autonomy in matters of ‘religion’ at the same time the property to be managed by the institution or trust must be in accordance with law. In case of Ratilal v. State of Bombay (1954), the Apex Court has laid down that regulation by the State cannot interfere with things which are essentially religious. That also implies that State can intervene in matters which are not essentially religious. Also it may interfere if any religious practice offends against public health or morality. So State may, if it feels, intervene in & regulate administrative & financial aspects of the institution. But at the same time, it may be noted that discriminating /managing /reforming /patronising any religion is totally outside the parameters of government jurisdiction.

Hence the real issues that come out are “To what extent can the government interference be labelled as ‘legal’?” and “Isn’t such governmental control over only Hindu religious institutions (and not any other religious institutions like Muslim/Christian) grossly discriminatory?”

Some facts to start with…in State of Bihar itself, government control over the temples through its endowment department, has resulted, according to Kishor Kunal, Religious Trust Administrator, in loss of temple properties worth Rs. 2000 crore. The picture isn’t different in other States. Thus the governmental control does not necessarily translate into better protection and transparent & efficient management. On the contrary, it’s resulting into temples/maths losing their properties. It cannot be denied that matters relating to spirituality & religion require the guidance of qualified religious persons. And what competence & specialisation that government possesses for controlling every aspect of Hindu cultural centres? Government mismanagement resulting in deliberate & irreversible liquidation of endowment lands clearly results in denying the temple/math/any other religious institution its vital functions.

In strict legal sense Government might be able to justify its interference in management of temple trusts etc for healthier utilisation of large funds they possess. But why target only Hindus? What about the Muslim/Christian religious institutions? In spite of their vast funds, properties and endowments in addition to the immense flow of foreign funds the Waqf Board of Muslims and the management of Christian religious institutions enjoy full freedom, self governance and autonomy. Now this discrimination, I believe, is simply unjustifiable- socially and also legally. This certainly can be labelled as gross misuse or abuse of State powers. The Secular Constitution certainly does not permit such discrimination on basis of religion. Why not allow an autonomous Hindu board to govern temples under the guidance of religious leaders, just as in other religious formations? Thus on the one hand the Indian Govt. continues to subsidise the “Hajj” pilgrimage of the Muslims to the tune of Rs. 200 crores annually, provides Rs. 1000 crores per year for Imams salaries, reservations are proposed on the basis of minority status, but on the other hand despoils the Hindu religious centres through State Control. This is not any positive discrimination in favour of any minority that Constitution allows, but a “negative reverse discrimination” against the India’s majority community.

If the government is really concerned about the mismanagement of funds in Hindu religious institutions, the Allahabad High Court has recently suggested a solution. It has directed the Central government to prepare a scheme for constituting a Board of the representatives of Hindu religious organizations on the pattern of the UP Muslim Waqf Board. A socially conscious and dedicated Board, working as an NGO, utilizing temple resources and donations, could among other things develop a vast network of educational institutions, medical facilities and orphanages for the benefit of the community, as is done by missionaries.

If lack of uniform organisational framework for temples is the matter of concern, it may be suggested that convening an assembly of representatives of shrines, temples, Hindu community and religious leaders from Dharma Sansad, Hindu Dharma Acharya Sabha, etc. for clearly defining the new legal and organizational framework ensuring community governance of temples and other religious places would be a welcome step. This body’s jurisdiction could also include training priests and constructing a religious based curriculum. Such an approach among other things should make the proposed Board completely autonomous and thereby responsible and accountable for the entire administration, including planning, executing, auditing, guiding, investigating and taking corrective steps as and when needed.

Thus, it should the priority of the Central Government to find the current status of temples, mutts and trusts under the endowment Trust; to help protect their religious assets; and to ensure smooth transition to an autonomous Hindu Board. Easier said than done especially in a country where political dictionary declares ‘Hindu bashing’ and ‘secularism’ as synonyms. The Apex Court of the country still remains the hope though. Ultimately, litigation and hopefully, future legislation will determine the proper and just sphere of interest of the government in the nation’s extensive religious affairs.

(Special Thanks to Adv. Mamta Singh as this article was written as a response to her vigilant query on legality of Endowment Acts.)

Article Written By: Amit Abhyankar

The recent row over presence of pesticides in Cola products has once again underlined the necessity of avoiding the overuse of chemical fertilizers & pesticides for agricultural purposes. The problem of farmers’ suicides remains an unsolved riddle. Can ‘organic farming’ be the answer? The article tries to locate the answer keeping in view the Indian perspective.

What is Organic Farming?

The scientific definition can be given as — Organic farming is a form of agriculture that relies on ecosystem management and attempts to reduce or eliminate external agricultural inputs, especially synthetic ones. It is a holistic production management system that promotes and enhances agro-ecosystem health, including biodiversity, biological cycles, and soil biological activity. Utilizing both traditional and scientific knowledge, organic agricultural systems rely on agronomic, biological, and mechanical methods, as opposed to using synthetic materials.

In simple words, organic farming avoids the use of synthetic (chemical) fertilizers, pesticides & genetically modified organisms. It was initiated as a conscious rejection of modern agro-chemical techniques in the 1930s by the British agronomist Sir Albert Howard, often called “the father of modern organic agriculture”. He studied traditional farming practices in Bengal, India and came to regard such practices as superior to modern agricultural science and recorded them in his 1940 book, “An Agricultural Testament”.

What’s the difference?

The significant difference in the approach lies in the fact that while in conventional modern farming, chemical fertilizers are used to feed the plants directly, in organic farming, the organic materials (including animal manure, compost, grass turf, straw, and other crop residues), are applied to fields to improve both soil structure and moisture-holding capacity and to nourish soil life, which in turn nourishes plants. Biological pest control is achieved through preventive methods, including diversified farming, crop rotation, the planting of pest-deterrent species, and the use of integrated pest management techniques. Thus organic faming concentrates on ‘feeding the soil rather than feeding the plants’ as ‘feeding the soil always feeds the plants’. Enhancing soil health is the cornerstone of organic farming. This is a biological process, driven by micro-organisms, that allows the natural production of nutrients in the soil throughout the growing season.

Why Organic Farming?

Modern Agriculture has now become ‘market’ driven, with quantity scoring over quality, the intrinsic & nutritional value. Pesticide and other chemical residues in food and an overall reduced quality of food have led to a marked increase in various diseases, mainly various forms of cancer and reduced bodily immunity. Pesticides are not bio-degradable, are highly toxic and find their way into ground water and water bodies, contaminating them and rendering them unfit for drinking purposes. Food contaminated by chemicals or grown from genetically-modified seeds and planting material is unhealthy. That’s plain and simple and easily understood. Consuming such food is akin to allowing a time bomb tick inside whoever eats it.

Negative impact on environment includes enormous levels of chemical buildup in our environment, in soil, water, air, in animals and even in our own bodies. In the name of growing more to feed the earth, we have taken the wrong road of unsustainability.

The side-effects of modern farming includes land exhaustion, nitrate run-off, soil erosion & compaction, contaminated food, threat to indigenous seeds and animal breeds and species Habitat destruction, increasing cost of chemical fertilisers, pesticides, weedicides, agricultural fuel, imported animal feed etc.

This is where organic farming comes in. Organic farming has the capability to take care of each of these problems. Besides the obvious immediate and positive effects organic or natural farming has on the environment and quality of food, it also greatly helps a farmer to become self-sufficient in his requirements for agro-inputs and reduce his costs.

Organic farming is superior cost-wise as well. The figures of study conducted in Madhya Pradesh (1995) are as follows-

Cost: Modern Farming- Rs. 3000 (for Fert.) + Cost of Weedicides & Pesticides

Cost: Organic Farming- Rs. 1500 (No extra cost)

Yield in Modern Farming: (Wheat) 16-20 Quintals per Hectare

Yield in Organic Farming: (Wheat) 15-17 Quintals per Hectare

Here’s a story of a farmer in Nashik- Mr. Madhavrao Barve insists on making his unique organic blend of fertilizers mixing fresh cow dung with a little bit of honey and ghee. It sounded funny to those who saw him do it, but Barve knew he would bring back his land to life. He got this recipe, he says, from the Arthasashtra, the ancient Hindu epic. Barve now shows off his sugarcane farm saying that he gets 107 tonnes an acre, more than what other farmers who are still using chemicals get from their lands. He spends an average of Rs. 200 an acre whereas farmers using chemicals have to spend Rs. 5000, as the pesticides are expensive. “We must learn to use repellents and not killers,” he says.

The Indian Scenario

Indian Central Government set up a National Institute of Organic Farming in October 2003 in Ghaziabad, Madhya Pradesh. The purpose of this institute is to formulate rules, regulations and certification of organic farm products in conformity with international standards. In 2005, as per Govt. of India figures, approximately 190,000 acres (77,000 hectares) were under organic cultivation. The total production of organic food in India as per the same reference was 120,000 tons annually, though this largely included certified forest collections. Officially, only 0.03 per cent of its land is slated to be under Organic Agriculture.

Organic farming has been identified as a major thrust area of the 10th plan of the central government. 1 billion rupees have been allocated to the aforementioned National Institute of Organic Farming alone for the 10th five-year plan. It’s a $31 billion (2005) global organic market and India’s current share is only 0.001 per cent.

The irony and difficulty of the new governmental push for organic agriculture is that 65% of the country’s cropped area is “organic by default,” (or at least ‘relatively organic’) according to a study by Rabo India. Because About 65% of India’s cropped area is not irrigated. Chemical fertilisers require sufficient water to respond. Pesticide use in these lands would also be less as the economics of these ‘not-so profitable’ crops will not permit expensive inputs. These areas are at least “relatively organic” or perhaps even “organic by default”. While neither of these terms necessarily denotes a healthy farm or a recommended agriculture system, it would at least imply a non-chemical farm that can be converted very easily to an organic one providing excellent yields and without the necessity and effort of a lengthy conversion period.

There are a number of farms in India which have either never been chemically-managed/cultivated or have converted back to organic farming because of their farmers’ beliefs or purely for reason of economics. These thousands of farmers cultivating hundreds of thousands of acres of land are not classified as organic though they are. Their produce either sells in the open market along with conventionally grown produce at the same price or sells purely on goodwill and trust as organic through select outlets and regular specialist bazaars. These farmers will never opt for certification because of the costs involved as well as the extensive documentation that is required by certifiers.

The Problems

The weak link in the organic/economic chain is certification. Under current government policy, it takes four years for a farm to be certified as organic. The cost of preparing the report is a flat fee of Rs. 5000, and the certificate itself costs another Rs. 5000. While these costs are bearable for any organic greenhouses, they are equal to or more than an entire year’s income for the average small farmer, if the costs of travel and inspection are included.

Another problem is the transition from non-organic to organic farming. This transition isn’t going to be easy, owing to several direct and indirect costs involved in the whole process of conversion. At the initial stages of conversion, yields may be lower compared to those under conventional practices, although they may turn out to be equal or even higher once the transition phase gets over.

New investments may be needed in farm machinery, fencing, storage space etc. Additional costs may also be associated with organic fertility building measures, such as, reseeding grassland, establishing green manure, legumes and so on. Since such organic techniques are generally more labour intensive so labour costs are also likely to be higher compared to the pre-conversion period.

Information and knowledge gathering may be expensive as well, due to the costs of literature, training courses, advisory services etc. Furthermore, high costs would also be involved in getting the inspections (at least once a year) and ultimately certification done by an established certification agency. Besides, there are problems like lack of demand in the domestic markets, constraints on access to international markets, inadequate availability of different organic inputs, such as organic seeds, bio-fertilizers, bio-pesticides etc.

What needs to be done?

Given the multiplicity of direct as well as indirect benefits of organic farming (that includes financial, economic, social, environmental, ecological and other benefits), which far outweigh the initial costs of conversion, there is enough justification for a conversion support policy on part of the Central Government.

It is high time that the Government of India make a structural shift in its current policy stance of promoting organic agriculture merely as a means of enhanced earnings from the export front and support it as the technology of mainstream agriculture in the country. The Ministry of Agriculture should devise a full-fledged long-term policy framework to create an environment conducive enough for organic agriculture to flourish.

Well-thought-out subsidy and other support schemes need to be designed so as to make conversion to organic agriculture easier and cheaper Support structures may also be introduced for small farmers’ group certification.

Appropriate networks should be created in the country for dissemination of information among the farmers about international as well as local markets for organic produce.

The creation of a proper balance between export and local consumption, however, warrants exploration of various domestic market and marketing alternatives, such as weekly farmer’s markets, buyers-sellers meet, organic fairs, and so on.

Steps also need to be taken to enhance consumer awareness about the health-safety and environmental implications of organic produce. Heavy investments are required to be undertaken over a longer period in order to carry out several promotional activities and for development of domestic marketing networks before local marketing of organic products can actually take off in India.

Market development needs to happen for various organic inputs as well. Products such as bio-fertilisers, bio-pesticides, bio-control agents etc., should be made available in adequate quantities and at reasonable prices.

Conclusion

The condition of Organic Farming in India is best summarised by P.V. Satheesh, Director of the Deccan Development Society in the Hindu newspaper’s annual environmental report,- “It’s a sobering thought that the farmers producing the best and cleanest food must pay extra to certify, instead of inorganic foods being certified as potentially bad for our health.”

Organic Farming cannot be looked at as a panacea for the all the food & agricultural problems. However it’s beyond doubt that a conscious effort in the direction of making organic farming as the technology of mainstream agriculture is not by any means unwarranted.

Article By: Amit Abhyankar

With the UPA Government announcing increase in fuel prices (June 5), widespread protests enveloped the country, with almost all political parties including Left parties, BJP, Socialist party coming out on the road against the price-hike. While government maintains that the hike was inevitable, the opposition talks about plenty of alternatives being available. What’s the reality? Here’s an effort to go into the details of the issue- the economics & politics behind it.

With State Assembly Elections out of the way and with Parliament being not in session, the time seemed just ripe enough for the oil price rise. And accordingly petrol prices were hiked by Rs. 4 a litre & diesel by Rs. 2 a litre. This is 7^th price hike by the UPA Government in just two years. Bur why such a stern resistance to oil price increase by just couple of rupees?……..because these products are universal intermediates that enter into the cost of production of a number of goods & services. With latent inflationary expectations, this price rise is expected to have cascading effect. Even the outsourcing activities of India are very much dependent on the future oil prices, say major outsourcing think-tanks. India’s cost of living is heavily dependent on oil price. As oil price increases, salary levels in India will rise much faster than the inherent official inflation level, affecting extent of outsourcing.

The Politics

Post-hike developments including Sonia Gandhi requesting for roll back of the price rise & refusal to accede to this request by Murli Deora, with backing of Manmohan Singh, reflect a conscious play-act in which Sonail Gandhi, as a Congress Party Leader, takes on the role of defender of the common man’s interests and Manmohan Singh presents himself as a pragmatic policymaker.

The Congress party also issued a directive to Congress-run State Governments to reduce the proportionate Sales tax (levied by States) on petrol & diesel. This was, it seems, Congress Party’s cynical form of politics, rather than the agenda of Government at Centre. And the congress-run state governments have complied, making the opposition-controlled States villains in eyes of common people. The popular anger against the price-hike thus gets automatically shifted against the opposition-controlled States. What a dirty political masterstroke!

The Government Claims

The government is using the ‘theory of necessity’ to justify the hike, suggesting that there is no alternative. With increase in global petroleum prices, the hike is said to be inevitable. Government is said to be using its resources to subsidize & stabilize (or rather freeze) kerosene & LPG prices (around 3,500 crore rupees in form of subsidies), which directly affect the ‘needy’. Government is arguing that if domestic retail prices are not adjusted to reflect changes in global prices, resulting loss would show up in the accounts of the ‘oil marketing companies’ like Indian Oil Corporation, Bharat Petroleum, HP and IBP (and not upstream oil companies) as ‘under-recoveries’. [These oil marketing companies receive their supplies of petrol & diesel from refineries at price that equal their import price + Customs Duty.] If the prices are not raised, it is argued, the under-recoveries by such companies would touch Rs. 73, 500 crores in the current fiscal year. The Petroleum Ministry has gone to the extent of claiming that ‘under-recoveries’ of Public Sector oil companies would require petrol prices to be increased by Rs. 9.33 a litre, diesel by Rs. 10.43 a litre, kerosene by Rs. 17.16 a litre and LPG by Rs. 114.45 a cylinder. Actual hike is only a fraction of the requirement, the government argues.

Now the Reality

Firstly, the method of calculating subsides on domestic LPG and kerosene is based on “import parity pricing” of petroleum products and not unrecovered costs (which is more appropriate). Therefore, the subsidy amount being based on a flawed methodology results in misleading figures. It’s quite an exaggeration to say that government is shouldering a lot of burden through subsidies. Firstly, the Central Government reaps Rs. 77,692 crores (2004-05 figures) from oil sector through duties, taxes, royalty, dividends etc. Compared to other Asian economies, India’s levies on oil are high. Additionally, the Government imposes a `cess’ on indigenously produced crude and collects about Rs 6,000 crore annually from the public. For year 2006-07, this amount would touch Rs. 7,500 crores figure as Chidambaram has increased this cess in the last budget. This amount adds up to the Consolidated Fund of India. And compare this with amount of annual subsidy which is just around Rs. 3,500 crore. So there’s no net burden on government. In fact, the Government is collecting much more than the burden it claims to be sharing.

Even oil companies are reaping profits from the current pricing system. The import parity allows oil companies to factor in the Customs duty to arrive at the import parity prices. Since the country does not import petrol or diesel, the amount collected as notional Customs duty from the public, estimated at Rs 10,000 crore, goes to bolster the financials of oil companies.

The deliberate use of the ‘under-recoveries’ to suggest actual losses has been one of the defining features of the media’s coverage of the petroleum industry in recent years. In reality, ‘under-recoveries’ is a notional concept, which allows substantial padding to prices.

Thus, the claims of a huge subsidy burden and bleeding oil companies are exaggerated, as most of the burden is borne by the consumers.

The Economics

The problem is “Is it possible to shield the consumer from fluctuating global oil prices?”. C.P.Chandrashekhar (Frontline) opines that there is an adequate buffer to shield consumers from the increase in global oil prices.

The answer to the question as to ‘who is going to share the burden of oil cost’ is relatively simple. The burden needs to be shared by-

1) The upstream Oil Companies (viz. ONGC, the Oil India Ltd, the Gas Authority of India, Ltd. and excluding Oil ‘Marketing’ Companies) and refineries—– which receive prices that more than compensate for costs;

2) The Central Government —- which collects revenue in form of Custom Duties + Excise Duties + Cess + Dividends etc;

3) The State Government—- which benefits from Sales Tax;

4) The Consumer—–who is shielded partially from full impact of international prices.

The real question is how the burden should be shared. C. Rangarajan Committee tried to find an answer. (C. Rangarajan was former Governor of RBI.) The Committee, after much deliberation & examination of many facts & figures, which we need not dwell into at the moment, concluded that it is the Centre Government (and firms controlled by it) which is in best position to shoulder the maximum burden for it has alternative sources of resource mobilization available. State Governments would find it much more difficult to waive the revenue they are getting through Sales Tax on oil products, for the simple reason that alternative available to them for additional resource collection are very limited. Hence the States should be last to be touched. The Committee thus recommended fixing of excise duties at around Rs. 14.75/litre for petrol & Ra. 5/litre for diesel.

The Problems

The biggest problem is the lack of transparency in pricing of petroleum products. Import parity method of determining price is criticized by many. It results in the government having a vested interest in hiking oil prices in order to bolster its revenues. In fact, successive reports of the Parliamentary Standing Committees attached to the Petroleum Ministry have called for dismantling of this arbitrary & opaque system of pricing.

The second big problem is lack of competition in this sector. Only state-owned oil companies are permitted to market the subsidized oil products. Plus the subsidies to PSUs means distorted market in undue favour of state-owned companies, virtually killing the private competitor.

Short-term measures

Had the recommendations of the Rangarajan Committee been implemented, the price increase would have been less to the extent of 80 paise for petrol & Rs. 1 for diesel. If further adjustments in duties & taxes and upstream oil company profits had been made, the price increase could have been much lower than the one imposed. Last year, France imposed a ‘windfall’ tax on oil refining companies with the logic that the oil companies should not be allowed to mint money at the expense of society at large. Similar experiment here is not unwarranted.

Rather than resorting to these measures, however, what Centre has done is to reduce the subsidy on kerosene (by targeting it at below poverty line households), raise prices of petrol & diesel and share the remaining burden with oil companies. Chidambaram’s refusal even to consider a cut in excise duties indicates a rigid mindset that is deeply rooted in fiscal fundamentalism – refuse to consider other options & then claim there is no other way. The Union Cabinet only seems to be interested in protecting its own revenue & dividends.

Long-term measures

The prevailing tax structure needs an overhaul. The import-parity pricing regime should be dismantled and oil companies allowed to charge market-determined prices.

The Government’s intervention in the sector needs to be rationalised to facilitate the market process with subsidies targeted at the poor and the really needy. The petroleum sector requires a comprehensive competition framework and not stringent regulations.

A price stabilisation fund must be created to take care of spikes in international crude prices.

A petroleum and natural gas regulatory board should be established to foster competition and ensure transparency in the determination of prices of petroleum products.

Conclusion

One of the most significant threats to sustained economic growth of the country is the global oil scenario. This requires an effective conservation strategy, which can be feasible only if prices of petroleum products are determined transparently and allowed to reflect in their economic cost.

Article By: Amit Abhyankar

Regionalism would always (and should always) take a backseat in country like India. Still the various States having their individual culture & language can boast of uniqueness of their own in various aspects. This series is an effort to discover that uniqueness. Starting with my State- Maharashtra…

Maharashtra……….the state I proudly call ‘the meeting place of North & South’. It’s because Maharashtra marks the geographical and cultural transition from the North to the South.

Maharashtra literally means ‘Maha’ ‘Rashtra’ i.e. great nation. (Yes, there are plenty of theories concerning origin of the name; but this seems more appropriate.) First May, 1960 was the day when the present Maharashtra came into being by amalgamation of some parts of former Bombay State & Central Provinces.

From geological variations like—from Deccan Plateau to natural sky-scrappers of Sahyadri ranges to geological instabilities ranging from earthquakes to tsunamis, Maharashtra has seen it all. It may not boast of rivers like Ganga & Yamuna, but numerous small-large rivers symbolize the cultural heritage of Maharashtra and of course, support its agriculture. 720 km of coastline ensures its 2^nd rank in fish production, next only to Kerala. This ancient land is also well endowed with industrial and fuel minerals. Proximity of oil fields at Bombay High provides enormous advantage to the state though it actually has no royalty claim over it.

Covering 1/10^th of national territory, the State boasts of being second most populous state in India, and the second most populous subnational entity in entire world. Since ancient times, the Maharashtrian society is an amalgam of several races- Nag, Kol, Mund, Dravid and Aryans. In fact, nowhere in India is such a diversity of ethnic elements observed as in Maharashtra.

The state has glorious past. It finds its mention right from the period of Ramayan & Puranas. Empires of Satvahana, Vakataka, then upto the advent of Muslims, Maharashtra has experienced it all. But the part of history that makes not only every Maharashtrian but also every Indian proud is the rise of Shivaji. Concept of Swarajya had its seeds right in his empire. 1857 freedom struggle saw leaders like Tatya Tope, Nanasaheb & Queen of Jhanshi, all of Maharashtrian origin. The late freedom movement witnessed numerous heroes emerging from this State- Tilak, Savarkar, Vasudeo Balwant Phadake, Chafekar brothers to name few. The need of social reforms was met by persons like Mahatma Phule & Ambedkar.

‘Glorious past does not ensure illustrious present’, they say. But Maharashtra has maintained its edge even in this age of technology. This most industrialized state in India, contributes 23% of industrial output and 1/7^th of national income. The state, with agriculture as its backbone, as like of India, has done quite well in sugar & cotton industries. The cooperative movement has given boost to sugar industry. The capital of this State, Mumbai, alone contributes, in the nationally kitty, 10% of factory employment, 33% of income tax collections, 60% of customs duty collections, 20% of central excise tax collections, 40% of India’s foreign trade and rupees 40,000 crore in corporate taxes. This commercial capital of the country has headquarters of most financial organisations- The RBI, SBI, Exim bank, UTI, SEBI, Film Finance Corporation, KVIC, – you name it, Mumbai has it. Numerous Indian conglomerates such as the Tata Group, Godrej and Reliance are located in Mumbai. Bombay Stock Exchange is the oldest stock exchange in the country. The Dalal Street is better known as “the Indian Wall Street”. Mumbai is in fact set to become financial capital of South-East Asia.

Maharashtra is 2^nd in literacy rate. From medical to military and from hotel management to IITs, Maharashtra has it all. Cities like Mumbai & Pune are becoming education hubs, adding to the cosmopolitan outlook. The state has produced scientists like Narlikar, Govarikar & plenty more.

Art in Maharashtra having centuries-old tradition, has undergone continuous evolution – from cave temples of Karla, Ajanta & Ellora to J.J School of Art. This musical region provides adequate representation to all four music categories- primitive, folk, classical & Popular- from Sangeet Ratnakar to Geet Ramayana. The traditional tamasha, powada, lavani have a peculiar hold on minds of masses. Voice of India –Lata Mangeshkar finds her proud origin in this very State. So do the ‘master-blaster’ Sachin 6+4dulkar and the little master ‘Sunny the Great’. Within Mumbai is located Bollywood, the epicentre of India’s Hindi film and television industry. Mumbai is the birthplace of Indian cinema, with the oldest film shot here in 1896. Mumbai also boasts of large number of cinemas, including Asia’s largest IMAX dome theatre. The Marathi film Shwas, was recently nominated for Oscars. From actresses like Smita Patil to Madhuri Dixit, and from directors like Dada Kondake to Amol Palekar, Marathi contribution to Indian cinema is significant.

In all, Maharashtra has truly been the ‘gateway of India’. The transitional mixture of north & south has rendered a unique heritage to this State, which it has proudly conserved. Still a fair way to go; but the path is right and the destination in sight; it will get there very soon.

Article By: Amit Abhyankar

Uniform Civil Code, Common civil code, the words remind more of a political bedlam than a legal question. Utterly unfortunate as the situation is, it demands an immediate attention. The question is a legal question because it is a mandate addressed to the ‘State’ by Art. 44 of the Constitution of India. In India, however, legal questions are often politicized and thereby confused,- particularly when the issue relates to the election prospects of each political party as there is always the luring vote-bank of minorities in sight.

Article 44 of the Constitution pledges for a uniform civil code. It runs as- “The State shall endeavor to secure for the citizens a uniform civil code throughout the territory of India”. While many parts of the civil law have already been codified in enactments applicable to the entire population of India, such as the Civil Procedure Code, the Evidence Act, the Transfer of Property Act, and the like, the controversy has arisen in case of unification of personal & family laws of the parties such as marriage, divorce, adoption, wills, intestate succession etc. (The word ‘personal law’ has been clarified in Entry 5 of List III of 7^th Schedule).

It would not be impertinent to observe the circumstances under which the Article was incorporated in our Constitution. A Hindu-Muslim lady ‘Aruna Asaf Ali’ in her book ‘Resurgence of Indian Women’ points out at the background that gave birth to the concept of non-interference in personal laws of minorities. She rightly observes, “…in the early years of freedom, non-interference in personal laws of minority religious communities was understandable; it was designed to assure them, especially the Muslims, that though the sub-continent had been partitioned at the instance of Muslim League, India was not a Hindu State and that the identity of the minorities would be respected. But over the years, political parties have come to treat the minorities as vote-banks to be wooed through their traditional leaders…”

The basic reason for asking a separate nation at the time of independence was that the Muslim League argued that the Muslims do have a separate Personal Law which can be effectively incorporated & implemented in an altogether different nation only. This resulted into deplorable partition of India. Thus, separate personal law was underlying reason behind offering a separate nation. That in turn implies that in the concept of ‘different personal law’ lies the bug of theory of ‘two nations’. The framers of the Constitution had seen this all and had in their minds an urge to not let this happen again. Hence in the Constituent assembly, it was made clear that in a secular nation, personal laws relating to such matters as marriage, succession and inheritance could not depend upon religion, but must rest on the law of the land. A uniform civil code was accordingly necessary for achieving the unity & solidarity of the nation, which was envisaged by the very Preamble to the Constitution.

All these circumstances were, however, forgotten by the national leaders after independence so much so that they even forgot that separatism contained in the theory of personal identity of Muslims was nothing but a relic of the same old ‘two-nation’ theory, which the framers of the Constitution had themselves fought against.

Whether Art. 44 implies one thing or the other is not a thing of interpretation for any scholars of any religion or political dignitaries. It is the Judiciary that has been vested with the sole & final power of interpreting the provisions of the Constitution. So it would be noteworthy to see the stand of the Judiciary on this issue. In the case of Mudgal v. Union of India (1995), which is one of the most recent cases, amongst many others, in this context, the observations of the Honourable Apex Court would prove to be eye-openers to the general public as well as the Government. The Court observed that it was altogether unjustifiable for the Government to discriminate between Hindus & Muslims. Personal Laws of the Hindus relating to marriage, succession and inheritance have sacramental origin similar to those of the Muslims & Christians. Still, replacing the traditional Hindu sacramental personal law, Hindu personal law was codified by various enactments in 1955-56. So why to keep Muslims away from such enactments? The Court added that “there is no justification to ignore Art. 44 in deference to Muslim sentiments in particular”.

It goes further to opine that-

“Art. 44 is based on the concept that there is no necessary connection between religion & personal law in a civilized society. Article 25 guarantees religious freedom whereas Art. 44 seeks to divest religion from social relations and personal law. Religious practices violative of human rights & dignity and sacerdotal suffocation of essentially civil & material freedoms are not autonomy but oppression. A unified code is imperative both for protection of the oppressed & promotion of national unity & solidarity. In the Indian Republic there was to be only one Nation-Indian Nation-and no community could claim to remain a separate entity on the basis of religion”.

If we now examine all the arguments advanced against the implementation of Uniform Civil Code, it will be evident that none of these hold water. The first such contention is that Art. 44 of the Constitution should be repealed because it hurts the sentiments of Muslims, or at least, the Muslims should be exempted from its operation, to be governed exclusively by the Shariyat as their personal law. This demand, however, seeks to put the clock back. At the time when the Constitution was framed, all such claims, counter-claims were considered and rejected on the grounds that (a) matters such as marriage, inheritance and the like, falling under the category of ‘personal law’, are secular matters having no essential relation to religion and that (b) without a uniform civil code, inter alia, the people of India belonging to heterogeneous elements, could never be united into a Nation. The provision in Art. 44 is nothing but an implementation of the objective of ‘fraternity, unity and integrity of the Nation’, which is not only enshrined in the Preamble to the Constitution, but also in the Fundamental Duties in Art. 51A(c), (e). To assert in the face of these provisions, that the Muslims should remain a separate entity on the basis of religion is an overt act under S. 2(f)(ii) of the Unlawful Activities (Prevention) Act, 1967. It is a pity that those who are responsible for enforcing the laws in India, do not even think of prosecuting anybody for such offence, either because of ignorance or because of the lure of the ‘vote bank’.

Art. 25 of the Constitution, which prescribes Secularism, implies that all religions shall be equal in the eye of the State and that the followers of every religion shall have the same rights to profess and practice their respective religions. Hence saying that uniform civil code should only be applied to majority of the population and not to any particular religion is not secularism, but naked communalism.

Articles 25-27 guarantee to all citizens, including Muslims freedom to practice & propagate his own religion. However, Articles 25-27 do not provide any protection to the Muslim personal law against Art. 44. Because if that was the intention of the makers of the Constitution, then Art. 44 should have added—‘excepting in respect of Muslims’. As per the rules of interpretation, even a Court has no power to add a word, not to speak of an Exception or Proviso, where the language of a provision is clear & unambiguous. Article 44 is absolutely clear & unambiguous in its every connotation.

Another defense taken against Art. 44 is of Art. 29, which guarantees right as to ‘culture’ and it is contended that personal law forms a part of ‘culture’. The word ‘culture’ is not defined in Art. 29. However, one thing is certain that it has to be read with Article 44 & 51A(f). Firstly, it has to be noted that Articles 25-28 are grouped under the heading ‘freedom of religion’ and thereafter, comes the heading ‘Cultural & Educational rights’ including thereunder Articles 29 & 30. it would follow that the ‘culture’ referred to in Art. 29(1) is something which is not founded on religion and which may belong to any section of the citizens’ which may not be necessarily be a religious minority. Hence, even if it is conceded that Muslim Personal Law is founded on religion it does not follow that it is a part of the ‘culture’ of the Muslims within the meaning of Art. 29(1). Distinction between culture & religion needs to be taken into consideration. The best illustration of this proposition would be a saying of Justice Chagla, – “I am Muslim by religion, but a Hindu by culture”. If this proposition be true, a Muslim’s claim to be governed by a different personal law, alleged to be founded on religion, cannot be defended as a fundamental right under Article 29(1). It would not be out of place here to quote what Justice Chagla has to say regarding Art. 44, “The Constitution was enacted for the whole country, it is binding on the whole country; and every section and community must accept its provisions & its directives including the Art. 44”.

A fear is expressed that if Art. 44 is implemented, it would wash away the separate identity of Minority communities. This fear is totally unfounded as there are Articles 25-27 to protect one’s own religion, religious beliefs & sentiments.

Justice Beg, former Chief Justice of India, during his lecture on ‘Impact of Secularism on Life & Law’, has made remarkable observations in context of present issue. He concludes that questions of personal law, such as marriage or succession, are not matters of religion. It maintains that the very Provision in the Hindu Succession Act, 1956, that it is applied to Buddhists, Jains & Sikhs, but not to Muslims, Christians, Parsis & Jews, is inconsistent with the Directive Principle laid down in Art. 44 of the Constitution.

If we are to compare the status of present controversy in India with other nations, observations of European Chief Justice in a Division Bench of Mauritius (in case of Bhewa v. Govt. of Mauritius), would be noteworthy- “We never had in our country, whether during French or British administration, any personal law in spite of the fact that the major religions of the world have been present here for generations; a uniform civil code has always been in force”.

Thus, the whole nation needs to get out of the controversy surrounding this issue of ‘uniform civil code’. Uniform Civil Code, as dreamed by Art. 44 of the Constitution, is need of the hour. If we are to stand as one nation, if secularism is to be honored & followed in its real sense, there is no alternative to uniform civil code. The next question is in what way we are to implement the same. It is true that a Uniform Civil Code for the whole of India cannot be drafted or brought into force all at once. It should be progressive i.e. to be applied in stages and part by part, having regard to realities.

Preparing a comprehensive code through an expert body like Law Commission in consultation with the Minorities Commission can be looked at as a long term measure. Such code shall have due regard to the modern day concept of human rights of women. Second option is to adopt certain immediate measures which would ‘pave the way’ for a unified civil code. These include-

a) To appoint a Committee to enact a Conversion of Religion Act, to check the abuse of religion by any person, and to make it applicable to every person, whether he is a Hindu, a Muslim, a Christian or the follower of any other religion.

b) Such law may provide that every citizen who changes his religion cannot marry another wife unless he divorces his first wife.

c) Such law may also provide for maintenance, succession etc of the parties concerned in the conversion, to avoid any clash of interest after death.

d) The next stage would be to pinpoint those vulnerable points which call for reforms. These include issues like Triple Talak, Polygamy, lack of dowry prohibition in certain religions (‘dowr’ needs to be distinguished from ‘dowry’), loopholes in the Child Marriage Restraint Act, 1929, no provision for compulsory registration of all marriages (similar provisions are there in countries like Iran, Algeria, Malaysia; then why not in India?). Legislation as regards to all these issues should be aimed at ironing out all the inter-community differences.

Thus, the issue under Art. 44 today is not whether the provision under Art. 44 is undesirable but only whether its implementation should be started now. The quotation of Hassan Imam, a member of Constituent Assembly, would be a befitting climax to this long discussion—

“Talk of making India strong; ….it is all right and a very desirable thing to have a uniform law. It is a must thing because otherwise we would be guilty of making a nation within a nation, a community within a community”.

Article By: Amit Abhyankar

“Constitution is for a real union of the Indian people, built on the basic concept of sovereignty of the people, to ensure them Justice. That is the real spirit of the Constitution.”

- Sardar Vallabh Bhai Patel

Dream, just a hollow dream. Isn’t it? Ask yourself. Are people of India ‘really united’ as one nation? Or are we seeing with the very naked eyes the abrasive reality of politics based on region & religion? Are the people ‘the real sovereigns’? Or is the power a game of money & muscle for few elites? Is common man at the receiving end of the justice? Or does the figure of one judicial proceeding behind every 25 persons of India demystify the reality that Justice is being chased, on & on for months, years, decades? A horde of question marks, in a vain pursuit of few full stops!

Need for Constitutional review has always been a topic of raging debate across the country. The founding fathers of the Indian constitution who granted more rights to the people without balancing them with their duties, perhaps did not foresee the emergence of present political environment, wherein the political players of various segments in the country are more interested in fulfilling their individual aspirations than the aspirations of the people.

In some respects, the constitution, impressive though it is, has failed to translate noble principles into tangible, practical instruments. This glaring inadequacy is seen in dispensation of justice, protection of basic liberties, enforcement of bureaucratic accountability and appointments and accountability of constitutional functionaries. The Constitution of India, despite its evocative Preamble and lofty Directive Principles of State Policy, has essentially depended upon the old Government of India Act of 1935, with a sprinkling of other ideas borrowed from the Irish, Australian and other constitutions. That is not surprising, considering that the Constituent Assembly which drafted and adopted the Constitution was, in the words of Granville Austin, “a one-party body in an essentially one-party country. The Assembly was the Congress and the Congress was India”.

Securing to all citizens justice — social, economic and political is one of the avowed goals of the constitution. However, there is glaring failure to translate this into practical action. The failure of justice system, our incapacity to ensure at least a few years of school education to all children, the continuing shame of child labour and a highly centralized polity negated this constitutional promise of justice for all. Unnecessary litigation, needless appeals, dilatory procedures have actually denied justice to the people. The facts are incontrovertible. There is no time limit for adjudication of cases. The plight of tens of thousands of juvenile undertrials languishing for years in inhuman conditions is an extreme example of the failure of justice system. Anarchy, rise in crime, break down of public order and criminalization of society and polity are some of the glaring consequences of this failure of justice system.

A constitution cannot operate in a vacuum. Even otherwise sound constitutional design might fail if it does not take into account the specific nature and requirements of a society. Over the past fifty-five years several distortions have crept into our state structure. As the domination of a single party has become a thing of the past, the working of the bicameral parliament has been distorted. As the Rajya Sabha is a permanent body with a one third of the members indirectly elected by State legislatures every two years, it ceased to reflect the will of the people at any point of time. Even governments with a clear mandate in the Lok Sabha have found it difficult to get legislation through the Rajya Sabha.

Ambedkar rightly said that the constitution is only as good as the men and women who operate it. Each generation has the benefit of experience of the past and should have the capacity and the right to build upon the foundations of this experience. If certain portions of the constitution have become redundant or dysfunctional over the years or if new problems arise and new instruments and rules are needed to face those challenges, then constitution must be revised. Our constitution is a fundamentally sound document, and its preamble, fundamental rights and most of the directive principles are as relevant today as even before. However, the detailed working of the state structure requires a careful review and reform in keeping with these basic constitutional principles. A wise Constitutional review could be the answer to many problems.

So what kind of amendments we are envisaging? The National Commission to Review the working of the Constitution was set up, which has come up with its final report in the year 2002. The commission has made multitude of recommendations. Starting from the fundamental rights- the definition of ‘State’ as included under Article 12 is inclusive & not exhaustive. The connotation of expression ‘other authorities’ has always been obscure. The issue that whether the BCCI (Board of Cricket Control India) is ‘State’ or not is recent example of surrounding controversy. Hence the Article needs an explanation that “the expression ‘other authorities’ shall include any person in relation to such of its functions which are of a public nature”. The right of freedom of speech & expression should expressly include freedom of press & media. Similarly, right of privacy needs to be part of Article 21. It also needs to include right to work in limited sense. E.g. to make it obligatory on the State to bring suitable legislation for ensuring the right to rural wage employment for a minimum of eighty days in a year. Right to education for children upto age limit of 14 years should be enlarged to greater extent. Every person must have the right of safe drinking water and of an environment that is not harmful to one’s health or well-being.

As regards to directive principles, the Commission feels that they should be provided more backing by setting up implementation-mechanism. The commission recommends establishing a high-status body to analyze the socio-economic condition of the State before deciding the extent of application of directive principles. The Commission also recommends that the heading of Part IV of the Constitution should be amended to read as “Directive Principles of State Policy and Action”. Under this head should come the rights of work, social security, health, education, food, freedom from hunger, shelter & clothing. A special Article is needed to be incorporated for population control- “The State shall endeavour to secure control of population by means of education and implementation of small family norms”. The State will be under the duty of promotion of Inter-Religious harmony and inter-faith values by setting up ‘Mohalla Committees’ with the participation of prominent members of different communities to take note of early warning symptoms and alerting the administration in preventing them. Due emphasis also needs to be given on fundamental duties. Further, it is necessary to separate religious percepts from civil law.

As regards to electoral process, a foolproof method of preparing the electoral roll right at the Panchayat level constituency of a voter and supplementing it by a foolproof voter ID card which may in fact also serve as a multi-purpose citizenship card for all adults is the necessary electoral reform. Further, the EC should consider the use of tamper-proof video and other electronic surveillance at sensitive polling stations/constituencies. Any election campaigning on the basis of caste or religion and any attempt to spread caste and communal hatred during elections should be punishable with mandatory imprisonment. If such acts are done at the instance of the candidate, these would be punishable with disqualification. The Representation of the People Act should be amended to provide that any person charged with any offence punishable with imprisonment for a maximum term of five years or more, should be disqualified for being chosen as or for being a member of Parliament or Legislature of a State. Criminal cases against politicians pending before Courts either for trial or in appeal must be disposed off speedily, if necessary, by appointing Special Courts. The political parties as well as individual candidates should be made subject to a proper statutory audit of the amounts they spend. These accounts should be monitored through a system of checking and cross-checking through the income-tax returns filed by the candidates, parties and their well-wishers. At the end of the election each candidate should submit an audited statement of expenses under specific heads. A comprehensive law regulating the registration and functioning of political parties or alliances of parties in India [may be named as the Political Parties (Registration and Regulation) Act] should be made.

The Parliamentarians have to be like Caesar’s wife, above suspicion. They must voluntarily place themselves open to public scrutiny through a parliamentary ombudsman. Supplemented by a code of ethics which has been under discussion for a long time, it would place Parliament on the high pedestal of people’s affection and regard.

Right to information should be guaranteed and needs to be given real substance. The Prevention of Corruption Act, 1988 should be amended to provide for confiscation of the property of a public servant who is found to be in possession of property disproportionate to his/her known sources of income and is convicted for the said offence.

A ‘Judicial Council’ at the apex level and Judicial Councils at each State at the level of the High Court should be set up. There should be an Administrative Office to assist the National Judicial Council and separate Administrative Offices attached to Judicial Councils in States. The criminal investigation system needs higher standards of professionalised action and it should be provided adequate logistic and technological support. The number of Forensic Science Institutions with modern technologies such as DNA fingerprinting technology should be enhanced. In order to cope up with the workload of cases at the lower level and also to curtail arrears and delay, the States should appoint honorary judicial magistrates selected from experienced lawyers on the criminal side to try and dispose less serious and petty cases on part-time basis.

Panchayat should be categorically declared to be ‘institutions of self-government’ and exclusive functions be assigned to them by amending Article 243(G). The Eleventh and Twelfth Schedules to the Constitution should be restructured in a manner that creates a separate fiscal domain for Panchayats and Municipalities.

Agriculturists and many other traditional producing classes suffer from the adverse effects of natural calamities like drought, cyclone, floods, etc. A similar national convention should identify the measures required to protect them from such adverse effects of natural calamities including crop insurance, preparedness etc., arrive at a consensus about these measures and institute a continuing machinery of continuous monitoring and corrections and modifications.

The number of necessary reforms in the Constitution is countless. But these reforms should start forthwith. Shut your eyes, but problem will still remain a problem. Problems do not run away because you run away from them or prefer to ignore them. India is at crossroads; she may flung herself into the darkness of paralysed governance & fiscal collapse, if nothing is done or it may scoot on the vehicle of timely Constitutional Review towards some new high. We need strong political will to realise such in-depth review of the Constitution because when it comes to national wellbeing, there cannot & ought not be any compromise!

Article By : Amit Abhyankar
……..who fell in ‘the’ pit…..a very deep pit (55 feet to be precise…….53.29834 feet to be more precise………..16.1582 inches wide to be even more precise!!!), while playing, while running from North direction……or…….may be from North-West direction.

No, I am not joking. It’s just a glimpse of media coverage this event received. On Kurukshetra, while the little prince was fighting battle of his life, electronic media was busy marketing (or rather commercializing) the event, competing for maximum coverage.

I am not against media coverage of events such as these. I also fully admire the extent of rescue efforts taken up by the military and yes, they deserved the pat on the back. Value of every human life is immense; then it may be of ‘our’ Prince or ‘of Prince of Persia’.

But what bemuses me is the extent of electronic media coverage it got! 50 hours of almost non-stop media coverage! News as important as the ones related to Mumbai bomb blasts, Israel attack on Lebanon, the well-being of Indian people therein, Election Commission’s stand, Naxal attacks…………where were these news? May be in even deeper pit of disregard!

There’s no fault of the child in this. True. It was an accident. May be it was. But may be it could have been avoided. Were not family members, especially the mother, guilty of being careless enough to allow child to wander away? However, with so many children of her own and concepts like family planning, population control going for a ride, it might be easier said than done! Wasn’t it a mistake, a mistake which eventually earned the family a fortune? Yes accidents do happen inspite of all care. And even if we assume this was the case of pure accident, beyond anyone’s control, the aftermath of the event bewilders me even more!

No one (including the believers of ‘investigation journalism’) is bothered to find out who was at fault behind keeping the tube-well open or at least unprotected. There may be thousands of such open, dangerous pits all over the country waiting entry of thousands of more ‘prince’. But government isn’t exactly bothered about that. Giving couple of lakhs of rupees to ‘whipping boy’ must be easy for them rather than spending crores on prohibition measures.

I can understand the reward for the rescuers. They deserved it. But what’s the achievement of Prince or his family?…….that they allowed him to fall down the pit? Why was the ‘mistake of recklessness’ rewarded with a cash prize of lakhs of rupees? And too by the governments and some sections of media? Won’t this send a wrong message to the society?………Can’t maintain your child? Go ahead, push him down a pit, the government would rescue him & provide for his welfare! It may sound as a rude joke, but mind you, reality isn’t far away either.

Media often covers the pathetic condition of families of talented, yet neglected artists, of soldiers who died for our country, of social workers who spent their lives just to enlighten others’. If the media channels have lakhs of rupees rotting in their kitty, why don’t they spend them here, where they matter most? Had they given the same amount of money to farmers committing suicide in Maharashtra, may be they could have saved dozen of more lives!

But ifs & buts don’t dictate life, do they? The boy, thankfully, was saved this time and what’s more his family got undeserving reward for the mistake. But isn’t it a high time our government & media realise their responsibilities and live up to that?

The ordeal of Prince remains a part of history now, raising many questions for the future to answer!

Article Written By: Amit Abhyankar

    “Abhyankar……” the familiar shrill yell of our postman! I collected few magazines & couple of letters (yes, I still receive few snail-mails even in this era.). As I scanned the contents, there was ‘frontline’ talking about ‘Peace in Peril’ in Lanka, ‘Yojana’ highlighting the urban development, the Special Economic Zones and then there was ‘Reader’s Digest’, the cover story of which attracted my attention- “How Polite are you? We Test the World and Mumbai shocks us!”

As I glanced through the article, the ‘table of courtesy’ showed New York the most courteous city in the world while Mumbai languishing right at the bottom. I did set everything aside I was doing & went through the entire article. Were good manners dead in Mumbai? The Survey emphatically claimed so. They had conducted the survey of around 60 ‘randomly selected’ Mumbaikars and the three tests were- whether a person holds door open for person immediately behind him; whether the shopkeeper says ‘thanks’ to his customers & whether anyone stops by to pick up the ‘deliberately dropped’ pile of papers! And Mumbai scored a meager 32%, standing 35^th in the list of 35 surveyed cities of the world!!!

    I closed the magazine and many thoughts flooded in. One could debate for all day on the rationality behind the method used for the survey. Yes, the three said tests are by no means sufficient to label any city ‘shockingly impolite’; nor will the number of persons surveyed give correct picture of entire city. Equally agreed, the concepts of manners, politeness, and courtesy do change over time & place. Hence what is generally accepted manner here may be grossly discourteous in other part of the world. Saying ‘thank you’ to every customer is not the kind of manner particularly observed in India; nor does any customer expect to receive the same.

    Having said that, the question remains- Wouldn’t we do better by following these ‘seemingly insignificant’, ‘important nevertheless’ manners? Would it be bad if everyone follows the standard norms of manners, observed worldwide? Won’t a shopkeeper be creating a permanent bond between him & his customer by just uttering a pleasant ‘thank you’? ………But we do know Mumbai; don’t we? There’s famous tale here- if anyone would tumble down on the platform, trying to get off from moving ‘local’, the people around would either seem totally indifferent or find amusement in counting the number of tumbles. In this city where people move ‘alongside’ the mass of other people, but more importantly ‘along with’ the minute hand of the clock, are we really expecting too much?

    “After 9/11, New Yorkers are more caring. They understand shortness of life”, points out the former Mayor Ed Koch. ‘Would Mumbaikars ever….?’ I wondered, not for long though; because something happened just two days after this……..Mumbai 7/11.

    Those serial blasts & the aftermath presented entirely different face of Mumbai…….

People, stunned for a moment or two, realize the situation and start helping others; they don’t wait for police to arrive & start the rescue work; they hardly think that lifting the dead bodies or giving a helping hand to those injured is work of Ambulance alone. I cannot help but wonder, whether the ‘most courteous’ citizens of New York would ever dare to do this? Rhetoric question; isn’t it? But around here, people do; they do (not just because police are often late), without any complaint, not wanting to be just show-offs! Rain cannot deter them. They work in absence of & then alongside the police. Someone stops for hours on platform, just to deliver message of some injured person to media because that unknown person while being carried into the ambulance requested him to do so! People residing nearby the station join the rescue work. Some make arrangement for food & water; others use their private cars as ambulances for unknowns. The new bed-sheets from some nearby houses become the covering clothes for dead bodies. Some nearby Restaurant owner provides food at no cost. Someone whispers- ‘there’s shortage of blood in some hospitals’ and soon the donors make blood-bank in every hospital full……Unending stories……and there would be plenty more as I write this.….all of them telling something to the world……

…… “Manners? We have them aplenty when it matters most!”

Article Written By: Amit Abhyankar

Ever heard of ‘poorism’ or ‘slum tourism’? May be not. You must have however heard, I bet, ‘Circuit’ asking a tourist in ‘Munnabhai’, “Can’t you see TajMahal in India?” and the intriguing answer, “No…..Real India……poor people…..hungry people!” That’s slum tourism…..Now you got it!

We have had Taj; we have had magnificent temples & sculptures; but now it seems India has more alluring tourist centers– Makeshift homes under footbridges near Delhi Railway Station; Dharavi in Mumbai & the likes.

Agencies like ‘Reality Tours & Travels’ in Mumbai & ‘Salam-Balak Trust’ in Delhi are busy organizing ‘reality tours’ for foreign & local tourists, giving them an ‘opportunity’ to peak in the lives of poor Indians, the concept borrowed from the famous ‘Brazil Tours’. With fees ranging from Rs. 200 to 600, the tour guides explain the tourists how the children live, what they do for a living, where they sleep, how they are addicted to correction fluid called ‘Eraz-Ex’ & how they are beaten up by police & obviated by locals. Cheerful travelers in bright holiday T-shirts gazing at profound misery!

Should we allow this? Aren’t we portraying a very repulsive image of India? Aren’t we invading the privacy & dignity of those dwellers? But before we hasten ourselves to any conclusions, let us hear the other side of the story as well.

The organizers claim that the trips are undertaken not to showcase poverty but sensitize the tourists & create awareness about slum way of life. The agencies also claim that 80% of the profits after tax are given away to local NGOs, working for upliftment of the same slum-dwellers. E.g. The Salam-Balak trust runs a school & dispensary for these children. Javed, one of the founders of this agency & also former dweller of these slums himself, claims this helps remove wrong notions about the children living on rail platforms. “Now they (tourists) don’t associate them with pick-pocketing anymore”, he beams with satisfaction, “The children have found new hope”.

So is this the way to help the slum-dwellers? (And we thought it to be a government duty.) The common wisdom is that to draw tourists, we need to promote only nice things like the beautiful beaches of Thailand or the mountains of Bhutan. Is it time we try promoting our slums as well, which we have always shied from admitting exist? Would it make the locals acknowledge the slums they have always neglected?

I would prefer to give answers of most of these questions in negative. No, that’s not the way! Another Javed, this time Javed Abidi, a disabled rights activist, says, “The children or the slum dwellers in no way benefit from this. Celebrities and foreign dignitaries make it a point to visit slums, street children and girls’ homes. Children are lined up for photo-ops and it just ends there… There is no accountability after that.” This is so significant. Where’s the follow-up? If the donor agencies want to take theses tours for assessment work, it’s fine! But who has given rights to these tourists to invade the privacy & dignity of dwellers? Won’t it cause mental trauma for the children? It definitely will. And who’s going to take the responsibility of protecting them from foreign pedophiles?

If this is way of raising funds to help eradicate poverty, it is, by all means, a totally unacceptable & unethical way of doing it. To me it’s not a worthy initiative to be applauded; rather a shameful voyeuristic ‘poorism’, we better ward off.

Article Written By: Amit Abhyankar

    When ISRO announced its first Lunar Mission- Chandrayaan, Mylswami Annadurai, its Project Chief, must have been well aware of the tough road ahead. And it is proving to be one as well; not because of any technical deficiencies, but from a speculation that is making rounds in media & some sections of society (including few political groups); a speculation that ISRO is going to squander billions of rupees, in a country, a very ‘poor’ country I may add, like India on a mission, which lacks in novelty & instrumentality. The allegations are based on the hypothesis that ISRO is actually wasting crores of rupees on something which has been achieved by some countries decades ago. “What’s justification in sending unmanned spacecraft on moon, where we all know Uncle Sam has actually landed years ago”, the questions are raised, “and that too at the expense of ‘socio-economical’ advancement of millions of poverty-stricken people”?

    Now let us hear the other side of the story. I think it’s high time we stop harping about our poverty. Indian economy is too big (worth $ 600 billion) to be rattled by such ‘petty expenses’. Yes, they are petty expenses, when compared to other economic indices. We are going to spend trillions of rupees in next 7 years on mere highway development. In our annual budget we can provide for 102 billion rupees for Tsunami relief, hundred billions on Infrastructure & Health! Look at these figures and compare them with the cost of Chandrayaan, which is only 3.8 billion rupees! Can’t we afford that? We certainly can.

Another query, allegation to be precise, is that what we are aiming at is already achieved by others many years ago. Agreed that few countries have successfully landed on moon, that too decades ago. But that does not mean whatever we are going to do is totally useless. We all know how technology has progressed by leaps & bounds over the years. Obviously there have been plenty of technological innovations since the last moon mission. Hence with newer gadgets accompanying our spacecraft, we would be in a position to amass data that would be totally new, not only for us, but also for entire world. Our mission objective includes carrying out high resolution mapping of topographic features in 3D, distribution of various minerals and elemental chemical species including radioactive nuclides covering the entire lunar surface using a set of remote sensing payloads. The new set of data would help in unraveling mysteries about the origin and evolution of solar system in general and that of the moon in particular. During two years of its flight, it is intended to survey the lunar surface to produce a complete map of its chemical characteristics and 3-dimensional topography. The Polar Regions are of special interest, as they might contain water ice.
And the latest news suggests that a lunar orbiter being built by India may be hauling a U.S. radar experiment designed by US Department of Defense to help unravel whether the Moon’s poles contain pockets of water ice. Prospect for another such high-tech Radar accompanying Chandrayaan is subject to approval of ISRO. So look who is dictating terms here. There’s race amongst nations, a fierce competition, to put their payloads on India’s Chandrayaan. And guess who’s in the race? NASA, ESA, Bulgaria & others. NASA has already announced its intention to send M3 (Moon Mineralogy Mapper) with our spacecraft, headed for a September 2007 liftoff, if………only if………, ISRO selects it in an independent competition. Here we are, calling shots for the first time in field of Space thanks to this project. Can we still label it as useless?

Even countries like China, Japan are very much interested in carrying out similar lunar missions. But they can’t (at least in near future), because they don’t have half of the technical know-how required for such mission. But we do. And that’s why we are going to do. Just imagine we carrying out the project successfully……we would be joining a very very elite club. It would increase India’s status as a potential partner in future space explorations. This way, we would qualify ourselves to participate in international programmes in this area. It would open immense possibilities, lots & lots of opportunities.

Some might say, why not aim directly at mars, just like US is doing? I would say it would be like asking a student from secondary school to prepare thesis for Ph.D.! We will one day reach mars…….definitely…….. but the process has to be gradual. Let us successfully complete out Chandra-mission first, then to bhaiya ……….Pluto bhi door nahi………