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India set to make a V-shaped recovery

The sharp improvement in the performance of core sectors and the quick resumption of high activity levels in the economy indicate that India is close to achieving a fast-paced and broad-based V-shaped recovery in the third quarter of FY21.

Sanju Verma

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India’s GDP growth for Q3 FY21 has come in at 0.4%, versus the -7.3% recorded in Q2 of FY21. Earlier, the contraction for Q2 had been estimated at 7.5%, but has now been revised upwards to a decline of only 7.3%. Q1, on the other hand, has been revised from a 23.9% to a 24.4% contraction. The NSO said, “GDP at constant (2011-12) prices in Q3 of 2020-21 is estimated at Rs 36.22 lakh crore, as against Rs 36.08 lakh crore in Q3 of 2019-20, showing a growth of 0.4%.”

Will the Indian economy have a V-shaped recovery, as is now increasingly being touted? The answer, without doubt, is a resounding yes! With a Covid recovery rate of over 97%, a mortality rate of barely 1.4% and an active caseload of only 1.2%, and with over 15 million people vaccinated, the overall economy of the country is rapidly moving back to normalcy and the GDP numbers are only going to get better in Q4. This is evident from the IHS Markit India Manufacturing PMI reading of 57.5 and 57.7, recorded in February and January 2021, respectively. Composite PMI reading rose from 55.8 in January 2021 to 57.3 in February, the highest since October 2020, while Services PMI rose from 52.8 in January to 55.3 in February, the highest in a year. Unified payments interface (UPI) trades hit a new high of 2.3 billion transactions in January 2021, amounting to Rs 4.31 lakh crore in value terms. The blistering pace continued in February 2021, with 2.29 billion transactions, amounting to a value of Rs 4.25 lakh crore, further corroborating the full-fledged V-shaped recovery which is taking shape.

Services growth in Q3 fell by 1%, which is much lower than the 11.3% fall seen in Q2 and the 21.4% fall in Q1. Agriculture growth has come in at a solid 3.9% in Q3, versus 3% in Q2. Manufacturing sector grew by 1.6% in Q3, which is great news as the big decline of 35.9% in Q1 and the 1.5% fall in Q2, at the height of the Covid pandemic, has now turned into a positive number. The industrial sector witnessed a growth of 2.7% versus a -3.03% growth in Q2. This 2.7% growth was supported by a manufacturing growth of 1.6%, electricity, gas, water and utility services growth of 7.3% and a healthy growth in construction at 6.2%. The high traction in the real estate sector was on the back of the reduction in stamp duty and other levies across various states, thereby attracting home buyers to invest in new homes.

The output of eight core infrastructure sectors grew 0.1% in January 2021 as compared to last year. The infrastructure output, which comprises eight core sectors, including coal, crude oil, and electricity, fell by 8.8% during the April-January period in 2020-21, against a growth rate of 0.8% in the corresponding period in 2019-20. However, Q4 should see a turnaround in the infra space. The Modi government’s decision to invite private investment in 400 port and shipping projects worth Rs 2 lakh crore will give a fillip to the infra space. The Modi government is also aiming to attract investment worth Rs 3.39 lakh crore during the Maritime India Summit 2021, that kicked off on March 2, 2021. 

The Indian Railways carried 119.79 million tonnes of freight in January 2021, the highest ever in a month, beating its previous record of 119.74 million tonnes in March 2019, showcasing how the Indian economy’s momentum is gaining rapid traction. In February 2021, the Indian Railways’ loading was 112.25 million tonnes, which is 10% higher compared to February last year, which had been 102.21 million tonnes. On just February 28, 2021, the freight loading of the Indian Railways was 5.23 million tonnes, which is 37% higher compared to last year’s loading for the same date, at 3.83 million tonnes. 

For the December 2020 quarter, cement major ACC saw a solid 73% jump in profit, while cement behemoth Grasim saw profits rise by a massive 107%. Since cement sales are a lead indicator, it should be suffice to say that a core sector bounce is back on the cards. Car sales, another lead indicator, continued to be robust with a 16% growth year on year (YoY) in January 2021, with Toyota, Tata Motors, Honda and Nissan, witnessing a YoY growth of 92%, 94%, 114% and 220%, respectively. In February 2021, while Maruti saw a growth of 11.8% year on year (YoY), tractor major Escorts saw a growth of 30.6%, showing the all-pervasive nature of a demand resurgence that is underway in both rural and urban areas.

The economic growth in the coming year, i.e., 2021-22 (FY22) will be robust, with a broad-based momentum across various sectors. The government’s focus on infrastructure, real estate demand on the back of low-interest rates, recovery in commodity prices and healthy consumption expenditure all point to better times for the GDP trajectory. Private and foreign investment is also on the rise and capex should be higher than in previous years, aiding long-term growth. In the last one year, FPI and FDI inflows put together have been in excess of Rs 2.32 lakh crore, which speaks volumes about India’s attractiveness as an investment destination, all thanks to Prime Minister Narendra Modi’s courage of conviction and reformist mindset which is now bearing fruit.

Significant recovery in manufacturing and construction segments also augurs well for the support these sectors are expected to provide to growth in FY 2021-22. Real GVA in manufacturing has improved from a contraction of 35.9% in Q1 to a positive growth of 1.6% in Q3, while in construction the recovery has been from a contraction of 49.4% in Q1 to a positive growth of 6.2% in Q3. Going ahead, only for a quarter at the most, we are likely to see the continuation of a K-shaped recovery, with some sectors growing faster than others. However, beyond Q4 FY21, the K-shaped recovery will soon transform into a sharp V-shaped recovery that will be both fast-paced and broad based in FY22.

The growth stimuli available from the Union Budget and additional measures, including the production linked incentive (PLI) scheme, will lead to a sturdy growth path over the recovery horizon. The real push will be visible in the Q4 (January-March) 2021 because lockdowns in many sectors, particularly hospitality and travel, have begun to ease substantially. The 1% growth in GVA and 0.7% growth in core GVA (core GVA excludes agriculture and public administration), in particular, marks the end of a contractionary phase. In fact, all the sectors except (a) mining and quarrying, (b) trade, hotels, transport and communication services, and (c) public administration, defence and other services, have recorded positive growth in the third quarter of FY21, which is great news as it vindicates the flurry of GDP upgrades seen in recent times. Even in trade and hotels, the pace of decline has slowed down significantly from a negative growth of 15.3% in Q2 to 7.7% in Q3. In public administration, the pace of fall has been reined in at -1.5% from -9.3% in Q2. The construction sector, which contributes about 9% to India’s GDP, is back with a bang on the back of a strong recovery in execution, registering a 6.2% growth in Q3 from -7.5% in Q2, which is nothing short of outstanding. India is amongst the very few economies which are posting growth for the December 2020 quarter—one amongst 16 major world economies – which shows that Prime Minister Narendra Modi’s Rs 30 lakh crore stimulus package has been able to boost both business sentiment and spending via the multiplier effect.

While gross fixed capital formation (GFCF) has improved from a contraction of 46.4% in Q1 to a positive growth of 2.6% in Q3, private final consumption expenditure (PFCE) has recovered from a contraction of 26.2% in Q1 to a much smaller contraction of 2.4% in Q3. The revival of investment demand, triggered by capital spending by the Modi government, has helped in a big way. Besides the overall uptick in the economy, the resurgence of GFCF in Q3 was also triggered by capex by the Central Government, that increased year-on-year by 129% in October, 249% in November and 62% in December 2020. The fiscal multipliers associated with this capex are at least 3-4 times larger than government final consumption expenditure (GFCE), as capex induces much higher consumption spending than normal income transfers.

For the fortnight ending January 8, 2021, credit growth has picked up to 6.6% YoY, while deposit growth is 11.4%. Excellent results by banking sector biggies showcase the ongoing economic momentum. HDFC Bank and ICICI Bank posted profit growth of 18% and 19%, respectively, for the December 2020 quarter, with the retail loan book growing by anywhere between a healthy 13% to 16%. The robust profit growth for these two banking giants came about, despite a high provision coverage ratio (PCR) of 148% for HDFC and 78% for ICICI.

Needless to add, the Indian economy has seen a superb rebound from the onslaught of the Covid-19 pandemic, thanks to the Modi government’s relentless war against the Wuhan virus. From being a net importer in March 2020 to becoming the world’s second largest exporter of PPE kits and N95 masks, it is a telling tale of how “Make in India” is about a grand vision and also about the ability to translate that vision into a meaningful end result. India produced more than 60 million personal protection equipment (PPEs) and almost 150 million N-95 masks till October 2020, from almost zero in March 2020. India also exported more than 20 million PPE and over 40 million N-95 masks during this period. Speaking of Covid, the two states that account for over 72% of all the active coronavirus cases in India are Maharashtra and Kerala, one where the Congress in in power with allies and another which is a Left-ruled state. The horrific performance by these two states in reining in Covid is a testimony to all that is woefully wrong with both the politics and economics of the Congress and the CPI(M).

With a pro-growth budget, structural farm and labour market reforms and the Modi government’s bold decision to raise Rs 2.5 lakh crore by monetising 100 sick, loss making and unviable CPSEs, coupled with the RBI’s resolve to support the financial markets and economy, the Indian economy is well poised to ride the long-term structural growth path, despite states like Maharashtra being a drag due to the misgovernance of the Congress-centric Maha Vikas Agadhi (MVA) alliance.

Investments were the primary driver in pushing up Q3 GDP numbers and were up 2.1% YoY, versus a fall of 28.2% in the first half of fiscal year 2020-21 (1HFY21). Consumption was down only 2.2% YoY in Q3, versus a sharp fall of 16.7% in 1HFY21. The 4.9% growth in consumer durables and 2% growth in consumer non-durables in December 2020 are a precursor of demand resurgence. Even two-wheeler major Hero Moto Corp, for the last six months, has been selling over 4.5 lakh units every single month, with more than 14 lakh units sold in just the two months of October and November 2020. Tractor major M&M too has seen utility vehicle sales growing in excess of 20% on an average in the last few months, pointing towards a demand rejuvenation. Nominal GDP grew strongly at 5.3% in Q3, implying that GDP deflator was 4.8% in 3QFY21. While CSO/NSO expect a contraction of 1.1% YoY in 4QFY21, implying an 8% fall in FY21, this is highly unlikely. Many domestic investment banking houses believe Q4 real GDP growth could be as high as 3.5%, leading to a GDP decline of only 6.7% in FY21, versus CSO’s more conservative estimate of an 8% decline in GDP in FY21.

An 8% or 6.7% GDP decline is less relevant. The more relevant part is that growth momentum is picking up pace significantly, with GST collections in January 2021 at Rs 1.19 lakh crore and February collections being equally healthy at Rs 1.13 lakh crore. GST collections have topped the Rs 1 lakh crore mark every single month from October 2020. FASTag collections hit Rs 102 crore last Friday, crossing the earlier high of Rs 80 crore collected by way of toll in a single day. E-way billing is applicable for inter-state sales in excess of Rs 50,000. Rs 6.42 crore E-way invoice reference numbers (IRNs) were generated in January 2021, versus a number of just 26 lakh IRNs that were generated in September 2020, once again vindicating the sharp uptick in routine business activity.

The GVA equivalent of manufacturing companies, arrived at after adding up wages, depreciation, interest and profit before tax (PBT), grew a robust 17% on a yearly basis in Q3 FY21, after a 9% growth in Q2 this fiscal and a 29% contraction in Q1. Since manufacturing GVA is a leading indicator of the manufacturing sector’s performance, the sharp uptick in manufacturing GVA is indeed highly reassuring. In many cases, GVA equivalent is a better predictor of manufacturing sector’s performance than IIP since the latter captures volume of production while the former captures value of production, ICICI Securities argues. Hence, the manufacturing sector is expected to record a healthy growth in the upcoming Q4FY21. The manufacturing GVA currently has a share of 19% in the country’s real gross value added (GVA).

Moody’s has raised India’s growth forecast to 13.7% for FY22, from the earlier 10.8%. For the current FY21 fiscal also, Moody’s revised its prediction of a contraction in real GDP to 7.1%, from the earlier projected contraction of 10.6%. Interestingly, Moody’s has also said that the Modi government’s fiscal deficit for FY21 and FY22 could be much lower than the projected 9.5% and 6.8% of GDP, respectively, supported by stronger revenue generation in the fourth quarter of FY21 and higher nominal GDP growth in 2021-22 (FY22). The big upside to growth projections in FY22 are absolutely realistic and not based on a low base effect. Rather, the massive growth upside in FY22 will be driven by facilitative government measures, including the Modi government’s capital expenditure increases, with the Central Government budgeting an impressive 34.5% rise in capital spending at Rs 5.54 lakh crore in FY22, compared to the revised estimate for FY21.

Exports which were lagging too have begun to pick up, with a 6% YoY growth in January 2021, and February seeing only a minor fall of 0.25%. Imports also grew by 7% in February, versus a 2.03% growth in January 2021. Interestingly, in February, while oil imports fell by 16.63% YoY, non-oil imports rose by 16.37%, suggesting both an economic revival and improving terms of trade.

The initial policy choice of “lives over livelihoods” succeeded by “lives as well as livelihoods” is now bearing excellent results, converging with the foresight the Modi government had about an imminent V-shaped recovery when it entered the war against the pandemic. The sharp V-shaped recovery is being driven by rebounds in both private final consumption expenditure (PFCE) and gross fixed capital formation (GFCF) as a combination of the astute handling of the lockdown and a calibrated fiscal stimulus that has allowed strong economic fundamentals to trigger quick resumption of high activity levels in the economy. It would be apt to sum up India’s swift economic recovery with a brilliant quote from Prime Minister Narendra Modi’s Independence Day speech last year, where he emphasised the relevance of Aatmanirbhar Bharat, when he said, “It is now time for India to move forward with new policies and new customs. Now simple and ordinary will not work. Our policies, our processes, our products, everything should be the best.”

The author is an economist, national spokesperson for the BJP and the bestselling author of ‘Truth & Dare: The Modi Dynamic’. The views expressed are personal.

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Opinion

CHANNI’S AAM AADMI IMAGE PUSHES AAP ON BACKFOOT IN PUNJAB

Pankaj Vohra

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Punjab Chief Minister Charanjit Singh Channi is emerging as the most effective politician in the border state and if he manages to assist the Congress in winning next year’s Assembly polls, he would have joined the big league. The simple but astute politician appears to be giving a tough time to his rivals, and to begin with, he has damaged the prospects of the Aam Aadmi Party (AAP) more than anybody else. Till a few months ago, most of the surveys considered the AAP as the frontrunner in Punjab but it is evident that Arvind Kejriwal is struggling to put the Congress down, and so far, his efforts have not succeeded. Channi because of his humble background and unwavering determination is synonymous with the image of the Aam Aadmi and through his actions, has pre-empted many promises made by Kejriwal and the company. The Delhi CM had first accused Channi of being a `naqli’ Aam Aadmi but his political jibe did not click. Next, he accused Channi of being `naqli Kejriwal’, while alluding to Channi following his party’s agenda which is again proving to be counter-productive. The proof of the pudding is in eating and what Kejriwal was promising to bring to Punjab, Channi has already implemented what he is calling the Congress programme aimed at helping the common citizen of the state.

The power tariff has been brought down by rupees three, arrears of the poor have been waived off, petrol and diesel prices are down by rupees ten, and the sand is now sold for one-fourth the price it was being sold earlier. Kejriwal has claimed that at least 25 Congress MLAs and two MPs were in touch with him, but Channi has hit back by telling the AAP Boss that why would Congress MLAs be looking towards him when his own flock—11 of the 21 MLAs who won on the AAP symbol—have already switched sides. Channi has asserted that how can he be a `naqli’ Kejriwal and taunted the Delhi CM that he cannot become a `naqli’ Channi either and being an outsider to the state, the common citizen could not identify himself or herself with him. The latest attack on the Congress by Kejriwal is that he is attempting to draw a wedge in the top ranks by praising Navjot Singh Sidhu and lashing out at the rest of the leadership. Kejriwal is a master strategist in many ways and knows he has to do something fast if he has to weaken the grand old party. Congress leadership at the Centre is aware of the maverick ways of Sidhu and has also drawn a contingency plan for the poll preparation which could run parallel to what the former Test cricketer is doing.

There is speculation in political circles that Sidhu could jump towards AAP, closer to the polls, thus giving Kejriwal a popular face and adding momentum to his party’s campaign. The logic being given is that Sidhu realizes that with Channi as the head of the government, he has little chance of becoming a Congress Chief Minister in the immediate future. Punjab is turning out to be a battle between Congress and the AAP with the Akali Dal desperately trying to resuscitate itself. Captain Amarinder Singh’s new political party is yet to take off and is heavily dependent on the BJP to both fund and back it. The BJP on its part is watching the unfolding situation very closely and would want to know the list of Amarinder Singh’s candidates before supporting him. This may take time since the Captain would only be able to provide and finalise his list, once Congress declares its own nominees. Those who do not find a berth, would gravitate towards the former CM, which is the belief with which he is moving ahead. There are conjectures in political circles that his wife, Preneet Kaur, and one more Lok Sabha MP from the State may join Amarinder’s party. Preneet has already been served a show-cause notice by the AICC. On his part, Channi is unruffled by what is happening and in a recent interview to a TV news channel, had a dig at the Captain and also the Badals. He said that earlier people would want to know about the working hours of the former CM.

But now they want to know what were the sleeping hours of the current CM while referring to his tight and strenuous work schedule. He said that he has been functioning without an army of advisers, OSDs and PAs, thereby reducing the load on the exchequer while reiterating that he stood for the common citizen and not for the elites like Amarinder and Badals, who had the resources to look after themselves. The former CM had described Channi as a “good boy’’ implying that he was inexperienced. However, Channi has shown far greater political maturity towards the problems confronting the state and their solutions. The political narrative in the border state is changing at a very rapid pace, and for the Congress, which is imploding everywhere else in the country, Channi could very well be a match-winner they have been looking for.

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Opinion

The saga of COP26: Why we should be concerned

It is because of the flawed approach of UNFCCC and IPCC that Combating Climate Change Movement has not gained the required momentum even after 24 years of the Kyoto protocol.

R.N. Malik

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The 26th Climate Change summit, called COP26 (Conference of Parties) started its proceedings on the 31st of October and continued the discussions up to the 12th of November. After a lot of haggling for two weeks, the conference produced the Glasgow Climate Pact (GCP). The media, as a whole, has dubbed the pact as a weak narrative belying the hopes, aspirations, and ambitions of those who are concerned about the catastrophic future of the earth due to the drastic changes in the climate patterns, leading to the triple problems of floods, droughts, and cyclones as a result of global warming. Antonio Guterres, UN Secretary-General, calls the deal “A compromise with welcome steps.” Originally, the conference was called upon to deliberate on three main agendas.

1. That all nations must agree to cut down the consumption of fossil fuels (oil, gas, and coal) to reach the status of Net Zero Emissions (NZE) by 2050. US agreed to abide by the directive to reach the NEZ status by 2050. But China and India agreed to achieve this target by 2060 and 2070 respectively.

2. Both UNFCCC ( UN framework convention on climate change) and IPCC ( Inter-governmental panel on climate change) had discovered that the safe value of the rise of global temperatures to prevent or avoid perceptible changes in climate cycle or pattern was 1.5 C and was likely to reach around 2050. This value of temperature rise can be stabilised provided all nations decide to gradually cut down the present level of consumption of fossil fuels to reach the Net Zero Emissions (NZE) status by the year 2050 after switching on to new renewable or non fossil fuels (nuclear or hydrogen fuel) sources of energy. Accordingly, all nations submitted their updated targets to develop alternate sources of energy by 2030 keeping in mind complete achievement of NZEs status by 2050. Indian targets were declared on the floor of the house by the Prime Minister in person.

The annual consumption of these three types of fossil fuels produces 50 billion tonnes of GHGs; Carbon dioxide being the principal component. China produces 31% emissions followed by US(16%) and India(5%).These three countries together produce 52% of the global emissions while 30 top consumer countries (G30) produce 90% of the global emissions. So it would have been much better if UNFCC and IPCC concentrated on G30 countries and leave the rest 165 who hardly consume 10% of the fossil fuels per year. In fact, many countries like Bhutan have already reached the NZE status and some are about to reach it.

The concept of NZEs does not mean that consumption of fossil fuels will be reduced to zero. It only means the following: The total amount of emissions of GHGs (calculated in terms of CO2 equivalent) from fossil fuels is equal to the amount of CO2 absorbed by the forests, crops, carbon sinks, and by new and old technologies of sequestering CO2 to be used for commercial uses.

The basic mistake made by UNFCCC and IPCC is that both did not calculate the values of the two sides of the equation for individual countries of the G30 group. This calculation would have enabled the major emitters to know the extent to which the consumption levels of fossil fuels by the years 2030 and 2050 needs to be reduced. Consequently, the individual nations could expand the forest areas to maintain a higher value of consumption of fossil fuels. The World Energy Outlook report for the year 2021 indicates that nations will have to cut down the 2019 consumption levels of fossil fuels by 50% to achieve the NZE status in 2050. In other words, China and India will have to phase out 50% of their thermal power plants by 2050 and the global consumption of crude oil would be reduced to 50 mbpd. Oil and gas-producing countries are greatly worried about the arrival of this scenario because their prosperity is entirely based on the sale of crude oil and natural gas.

3. In the 2009 climate summit at Copenhagen (COP 15), it was agreed that developed nations would release a sum of $100 billion every year towards the climate-financing fund to enable underdeveloped countries to switch on from fossil fuel energy sources to alternate sources of energy. This fund never arrived from the wallets of the rich nations and the progress of transition of energy from one side to another never picked up. India was at the forefront to take up the cause of the underdeveloped nations to compel rich nations to contribute the arrears of $ 1.0 trillion towards the climate financing fund.

THE AGREEMENT DRAFT

The Glasgow Climate Pact contains the following three features in response to the three principle issues raised above:

1. All nations agreed to focus on sticking to the Paris conference (CP21) goal of limiting the temperature rise to 1.5 C from the preindustrial levels due to global warming caused by GHG emissions. But the draft is totally silent whether countries like China and India are bound to reach NZE status by 2050 or not. Reaching NZEs by 2050 is the soul or essence of the Combating Climate Change Movement (CCCM) and the COP 26.

2. All major emitter countries of GHGs (read G30 countries) will scale up and resubmit their NDCs (nationally determined contributions) or targets for cutting down the consumption levels of fossil fuels for the year 2030 along with pathways to reach NZE status by the year 2050 in COP27 to be held next year in Egypt. India had declared that it would be able to develop 500 GW of renewable or green energy by 2030. No other country had made such an ambitious announcement.

All countries agreed to phase down the unabated coal power and fossil fuel subsidies in line with the coal use by the poor and vulnerable sections of society. The term ‘phase out coal’ was replaced by ‘phase down coal’ at the instance of India, China, and Iran. India considers this change of terms as a great diplomatic victory though the change of terms does not mean much because the NZE targets do not ask for zero consumption of fossil fuels.

3. Only a perfunctory clause was added in respect of the commitment of rich nations to pay the arrears due to the commitment made in COP9 to contribute $100 billion per year towards the climate financing fund. Now the draft says, “The member nations urge the rich nations to start the contribution fresh from now onwards till 2025 and then double the amount of contribution ($200 billion per year) from that year.” The term ‘urge’ instead of a firm direction makes the draft greatly watered down. It is not understood how the underdeveloped countries agreed to accept this clause without a firm assurance from the rich countries even though they are signatories to this draft as they were in 2009.

FLAWS IN THE APPROACH

Both UNFCCC and IPCC, the two main drivers of the Combating Climate Change Movement, have adopted a flawed approach to take the nations towards the goal of Net Zero Emission status by the year 2050. The key points of the flawed approach are enumerated below:

1. UNFCCC and IPCC should have first concentrated their efforts on reducing the consumption of fossil fuels of G30 countries (who presently consume 90% of the fossil fuels), and also hold discussions with them individually, to find out to what extent each country is really in a position to reduce the fossil fuel consumption without jeopardising the economic growth and then fix the NDCs targets for the year 2030. This exercise will greatly avoid the bickerings during the discussion during the next summit.

2. Combustion of fossil fuels presents three problems simultaneously I.e. air pollution, climate change, and depletion of resources. Air pollution has become the most serious problem at the moment. But both UNFCCC and IPCC never talk about this great health hazard. China is burning 11 million tonnes of coal and 14mbpd of oil daily (half of the global consumption) and people are facing very serious health problems in most of her big cities. India too is facing identical problems of air pollution in big cities due to vehicular emissions and Supreme Court is now taking the Delhi government to task. Likewise, depletion of these vital resources will be a big problem to be faced by the next generations. Chinese coal at the present rate of consumption will not last more than 30 years. Likewise, 60 billion tonnes of extractable coal reserves in India will not last more than 70 years. If all three issues are highlighted simultaneously, all nations will show more promptness to reduce the consumption levels.

3. Every country has its limitations in developing renewable resources of energy. Many G30 countries like Japan do not have hydropower potential. European countries do not have enough clear sky days to generate solar power during the five winter months of the year. India has very scarce potential for generating wind energy. Therefore, the two UN bodies should assess the renewable energy potential while fixing the targets.

4. The COP26 agreement only talks about reducing coal consumption whereas combustion of oil produces very obnoxious gases like SO2, NOx, and lead oxide. The major cause of severe air pollution in the cities with concomitant health hazards is vehicular emissions. Therefore, equal stress should be given to replace the existing fleet of cars and small size trucks with electric vehicles and transfer an appreciable part of the freight and passenger load of trucks and buses to the railways.

5. Use of nuclear power and hydrogen fuel can be good substitutes for replacing fossil fuels. But people do not allow the setting up of nuclear power plants after the explosion in a nuclear power plant in Japan. Research on developing hydrogen fuel is still in the embryonic stage. Therefore, G30 countries need a rethink on the use of nuclear power and should provide more funds to the development of hydrogen fuel.

6. 166 countries with very low consumption of fossil fuels discovered and cried out in the conference that real culprits of triggering climate change are 30 countries (G30) who consume 90% of the fossil fuels and release an equal amount of emissions. But the climate change does not limit the climatic upheavals to these G30 countries alone and sweeps the entire world. So they, G166, are suffering because of the brazen and profligate use of fossil fuels consumed by G30 countries to sustain their prosperous economies and leaving very little for future generations. But their genuine cry was heard and yet ignored.

It is because of this flawed approach of UNFCCC and IPCC that Combating Climate Change Movement has not gained the required momentum even after the 24 years of the Kyoto protocol. The pact reached at Glasgow on 14 November is rightly called an agreement better than no agreement. The only achievement of this conference has been to postpone its three main agendas to the next year’s conference (COP27) to be held in Egypt.

The writer is a retired Engineer-in-Chief of Public Health Department Haryana and has had an illustrious career for 34 years. Views expressed are the writer’s personal.

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Opinion

LEADERS REMEMBER AHMED PATEL, SONIA GANDHI’S TROUBLESHOOTER

Pankaj Vohra

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Ahmed Patel was without any doubt the most powerful functionary of the Congress in this century. On his first death anniversary on Thursday, several top leaders paid tributes to him, recalling his pronounced role during the presidentship of Sonia Gandhi without mentioning that in fact, he was the de facto chief of the grand old party. This is not an exaggeration that he wielded more influence on the central leadership than anyone before him. Some veterans try and compare his understated but exalted position with that of R.K.Dhawan and Makhan Lal Fotedar, but Ahmed Patel had a much larger say in political matters for a considerable long period. His opponents accused him of being responsible for the decline of the Congress and often claimed that Sonia Gandhi had outsourced the party to him for day-to-day affairs and he did what he pleased, sometimes without the knowledge of the High Command. Ahmed’s grip over the organization started loosening once Rahul Gandhi came on to the political scene and though the entire Gandhi family paid homage to him on his anniversary, it was an open secret that Rahul wanted his role to diminish. The astute and perceptive former political secretary realized this and had shifted his strategy to maintain an extremely low profile while getting his way in crucial matters. In the recent past, the appointment of D.K.Shiv Kumar as the Karnataka State president was engineered by him even though Rahul was not in his favour and because the Vokkaliga community to which he belongs is essentially with H.D.Deva Gowda. Shiv Kumar got the job because he had facilitated the stay of Congress MLAs from Gujarat when Ahmed was contesting for a Rajya Sabha seat facing stiff competition from the BJP whose strategy was designed by Amit Shah. Ahmed was victorious and till this day, some questions have been raised on who was responsible for giving him the additional two votes which he required to retain the seat. These are untold stories of politics. Ahmed also played the most significant part when the Maharashtra government was formed after an alliance between the Congress, NCP, and the Shiv Sena. Like most things good or not so good done by him, he never took credit and allowed others to boast about their achievements.

Ahmed’s USP was that enjoyed cordial relations with top leaders of other parties as well and it was not surprising that after his demise, Prime Minister Narendra Modi allowed his family to occupy his official residence, 23 Willingdon Crescent for as long as they wished. They finally moved out in July. In sharp contrast, the Congress High Command did not hold even a single prayer meeting for him in the national capital, and according to the political buzz conveyed to the family that there was no need for this in the capital since condolence gatherings had taken place in Karnataka, Maharashtra and some other places.

The problem in Congress is that the leadership has not been able to find a suitable replacement for him. There is nobody close to the Gandhis who is accessible and thus in any position to address the grievances of state functionaries and ordinary workers. There is nobody to even speak to established leaders. Thus, this vacuum is hurting the party which should have by this time given greater responsibility to the likes of Kamal Nath, Ashok Gehlot, and Bhupinder Singh Hooda. Ahmed Patel like everyone else had his fault lines as well, but no one can doubt that Sonia Gandhi’s dependence on him was absolute and he was perhaps the only one who could get his way through the complicated decision-making process in the party. The erosion of the Congress started during his lifetime but the party is grappling with its worst phase with no one there to oversee the political road map and its implementation.

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Opinion

Gati Shakti: PM Modi’s masterplan for connectivity

Be it Purvanchal Expressway or the upcoming Jewar airport, the ability to coordinate seamlessly with the state government concerned and translate vision into reality has been the high point of PM Modi’s holistic, development-oriented agenda.

Sanju Verma

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Prime Minister Narendra Modi launched the Gati Shakti, National Master Plan for multi-modal connectivity, heralding a new chapter in governance, on October 13. Gati Shakti, a digital platform, will bring 16 ministries including Railways and Roadways together, for integrated planning and coordinated implementation of infrastructure projects. It will incorporate the infrastructure schemes of various ministries and State governments like Bharatmala, Sagarmala, inland waterways, dry/land ports, UDAN, etc. Economic Zones like textile clusters, pharmaceutical clusters, defence corridors, electronic parks, industrial corridors, fishing clusters, and agri zones will be covered to improve connectivity & make Indian businesses more competitive. It will also leverage technology extensively including spatial planning tools with ISRO imagery developed by BiSAG-N (Bhaskaracharya National Institute for Space Applications and Geoinformatics). This multi-modal connectivity will provide integrated and seamless connectivity for the movement of people, goods, and services from one mode of transport to another. It will facilitate last-mile connectivity of infrastructure and also reduce travel time for people. In line with the goals of Gati Shakti, Mumbai Port Trust, for instance, is undertaking a slew of projects, seeking harmony between the needs of cargoes and ships on one hand and the needs of the city and citizenry on the other. Gati Shakti project is yet another instance of how cooperative federalism is something that the Modi government is fully committed to.

Needless to add, with the resolve of Aatmnirbhar Bharat, the foundation of India for the next 25 years is being laid stoutly and soundly, by the Central government. People of India, Indian industry, Indian business, Indian manufacturers, and Indian farmers are at the centre of this great campaign of Gati Shakti, which is a people-centric, futuristic, mega initiative. What sets the Modi government apart from erstwhile, lethargic, Congress-led regimes, is the fact that we have not only developed a work culture of completing the projects in time, but efforts are underway to complete projects ahead of time. With the whole-of-government approach, the collective power of the Central government is being channelled into fulfilling these infrastructure-oriented schemes. Gati Shakti is an extension of holistic governance, therefore, in more ways than one.

Over the years, the signage ‘Work In Progress’ became the symbol of lack of trust, with cost and time overruns, being the hallmark of all that was wrong with the decrepit Nehruvian model, that was repeatedly flogged for decades together, by successive Congress regimes. But today’s 21st century India, is leaving behind old systems and practices, that emanated from the “Command Economy” model of Nehru and his dynastic proponents. Today’s mantra under PM Modi is: ‘Work For Progress’.

Wealth for progress, plan for progress, and preference for progress, underline the inclusive approach of the Modi government.

The subject of infrastructure in our country was never a priority for most political parties, for decades together. This, even though it is globally accepted that the creation of quality infrastructure for sustainable development is a time-tested way to create a virtuous cycle of economic activities that create employment on a large scale. Due to the wide gap between macro planning and micro implementation, problems of lack of coordination, lack of advanced information, thinking and working in silos— all these factors led to hampered construction and wastage of government resources and budgets. Gati Shakti project will therefore be a force multiplier and working based on this master plan, will result in optimum utilisation of resources.

The first interstate natural gas pipeline in India was commissioned in 1987. After this, till 2014, i.e. in 27 years, only a 15,000 km long natural gas pipeline was built. Today, work is underway on a war footing for a more than 16,000 km long gas pipeline across the country.This pipeline is slated to be completed in the next 5-6 years. Again, in the 5 years before 2014, only 1900 km of railway lines underwent doubling. In the last 7 years alone, more than 9000 kilometers of railway lines have been doubled. In the 5 years before 2014, only 3000 km of railways were electrified. In the last 7 years alone, more than 24000 kilometers of railway tracks have been electrified. Before 2014, the metro rail was running on only about 250 km of track. Today the metro has been expanded up to 700 km and work is going on in the 1000 km new metro route. In the five years before 2014, only 60 panchayats could be connected with optical fibre. In the last 7 years of the Modi government, we have connected more than 1.5 lakh gram panchayats with optical fibre, in a grand testimony to what resolute political will can achieve.

To increase the income of the farmers and fishermen of the country, infrastructure related to processing is also being expanded rapidly. In 2014, there were only 2 mega Food Parks in the country. Today 19 mega Food Parks are functioning in the country. Now the target is to take their number to more than 40. There were just 5 waterways in 2014, today India has 13 functional waterways. Turnaround time of vessels at the ports has come down to 27 hours from over 41 hours in 2014. The country has realised the pledge of One Nation, One Grid. Today India has 4.25 lakh circuit kilometers of power transmission lines compared to 3 lakh circuit kilometers in 2014.

With the development of quality infrastructure, India can realize the dream of becoming the business capital of the world. PM Gati Shakti will be the driving factor. Just as JAM (Jan Dhan, Aadhar, Mobile) trinity revolutionized accessibility of government’s welfare schemes to the people, PM Gati Shakti will do the same in the field of infrastructure. With the Gati Shakti National Master Plan, India’s economic growth will find greater traction through major infrastructure upgrades, that will cut logistics costs and enhance efficiency. Essentially, the Gati Shakti project will be an integrated umbrella of over Rs 111 lakh crore worth of projects, under the National Infrastructure Pipeline (NIP) for the period 2021-25. This includes reducing the ratio of logistical costs to GDP that has prevailed at over 14%, before PM Modi took charge, to an aspirational level of sub 8%. Reducing vehicular emissions to meet climate change commitments, curtailing input costs on fuel, a fillip to efficiency in port operations, improvement in cargo handling capacity, and cutting vessel turnaround time, will be the added benefits and byproducts of the ambitious Gati Shakti project. The observations in the Economic Survey for 2020-21 underscore the role of active Centre-State partnerships for infrastructure building. Significant delays to projects can often be traced to hostile land acquisition decisions that alienate communities or violate environmental laws.

It is to the Modi government’s credit that environmental integrity has never been compromised and rehabilitation of affected people has always been given utmost priority. The Jewar airport’s strategic location will create over 1 lakh job opportunities for the young from adjoining areas: Aligarh, Hapur, Greater Noida, Ghaziabad, and Bulandshahr.

The airport will be spread over 1334 hectares of land and will have a capacity to serve around 1.2 crore passengers, annually. That number will go up to over 7 crore passengers from 2040 onwards. Job opportunities will come not just from work at the airport but also from allied industries like storage, defence, and food. But beyond all these numbers, what stands out is the fact that the UP government spent Rs 4326 crore on the acquisition of land, rehabilitation, and resettlement. Be it Purvanchal expressway or the upcoming Jewar airport, the ability to coordinate seamlessly with the concerned State government and translate vision into reality has been the high point of PM Modi’s holistic, development-oriented agenda.

The writer is an Economist, National Spokesperson of the BJP and the Bestselling Author of ‘Truth & Dare-The Modi Dynamic’. Views expressed are the writer’s personal

To increase the income of the farmers and fishermen of the country, infrastructure related to processing is also being expanded rapidly. In 2014, there were only 2 mega food parks in the country. Today 19 mega food parks are functioning in the country. Now the target is to take their number to more than 40. There were just 5 waterways in 2014, today India has 13 functional waterways. Turnaround time of vessels at the ports has come down to 27 hours from over 41 hours in 2014. The country has realised the pledge of ‘One Nation, One Grid’.

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Opinion

NEW EDUCATION POLICY: THE GATEWAY TO VISHWAGURUTVA

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“Param Vaibhavam Netumetat Swarashtram…” (I shall strive to take my country to its highest glory). This feeling of supreme glory could not be achieved from the rules or laws borrowed from some foreign power, but from Indian norms, traditions, and historical examples. By changing the policies made during the colonial rule, which aimed only at making Indians the clerks of the British, emphasising on India’s glorious history, society, philosophy, knowledge-science, guru-shishya tradition, Indian languages, Vedic studies, etc. The New Education Policy (NEP) was announced last year. Today, on the completion of one year, the positive effect of this policy is being seen in educational institutions, research institutes, and many institutions related to social life. Many experiments like the translation of technical education books in Indian languages by AICTE, the vision of inter-disciplinaryness, integrated, and comprehensive approach in subjects, and Indian knowledge tradition are being implemented at the ground level. The NEP has also made it clear that the education policy is not only concerned with formal educational institutions but also with all those aspects of social life where the individual influences the society through his conduct and behaviour. Education policies, when only clerks or employees, if they are made to make, their resources are also limited. 

The objective of the NEP is to make every person an Indian and India to be a world leader, so its means are not limited to formal educational institutions but apply to wide areas. There is clear evidence in ancient Indian Vedic texts that people from geographical places like Aryavarta, Brahmavarta used to take the initiation of human behaviour and conduct. The then education system, guru-shishya tradition, and environment-friendly education are some of the important facts that are the main dimensions of the education of that time. Even today there is a great need for environment-friendly education. The education policy borrowed from abroad will always force the advocate to wear a black coat (whether the season is summer or winter), environment-friendly education will allow him to groom according to the environment. Borrowed education will become the cause of linguistic slavery, mental slavery, and others, whereas the NEP will allow calling for freedom according to the environment. 5+3+3+4 formula contained in education policy, facilities for health and nutrition along with education, adjustment of skill development in education, experiments like social experience in education and science inherent in Indian knowledge, philosophy, Vedic mathematics, and environmental elements 

together will help solve modern problems. The high character model of the teacher will also develop necessary character qualities like character building and personality development, which to date have never been given a place in the old education policies. The dream of Vishwagurutva is not achievable only by formal education. In the areas where education exerts its influence, such a seal of Indianness is necessary in those areas, that clears the filthy stigma of slavery and paves the way for a brighter future.                   

The writer is Assistant Professor, Tilkamanjhi Bhagalpur University, Bihar.

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Opinion

Fungible: The idea at the centre of the NFT sensation

NFTs could transform the way digital goods are created, consumed, and traded online and Indians are also ready to test waters.

Suravi Sharma Kumar

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What makes NFTs special is that each one represents something unique, and not interchangeable with anything—in other words, not “fungible”. This is what distinguishes them from cryptocurrencies like bitcoin, which are fungible—interchangeable—even though they use the same software technology (blockchain technology) as NFTs. NFTs serve as a kind of deed proving ownership for original editions of various digital artefacts—whether works of art, sports collectables or music albums. Even a tweet can be monetised with an NFT.

Once Indian megastars Amitabh Bachchan dropped his NFT collection and Salman Khan announced his partnership with NFT marketplace Bollycoin declaring the imminent launch of his digital assets. Indians are all set to test the NFT waters. With my limited knowledge of digital economics/assets, I sat down glued to my laptop screen surfing the internet for information on the freewheeling world of ‘non-fungible’ tokens. I pondered on the expanded phrase of the three letters — NFT to have an ‘idea or some understanding’ of the nature of the asset — fungible, a Latin term that has come to mean ‘interchangeable’ now helps to define unique digital objects selling for phenomenal prices.

In the three initials that make up the name, the N for “non” and the T for “token” are straightforward enough, but what about that F for “fungible”? Although the word “fungible” looks like “fungus” and its plural “fungi,” I discovered that there’s no etymological connection; “fungus” has a different Latin root. ‘Fungible’ goes back to the Latin word “fungibilis” meaning “useful,” in turn from the verb “fungi” meaning “to perform.” The same root gives us such words as “function” and “perfunctory.” 

In English, “fungible” entered legal and financial circles in the 17th century for contracted goods that could be replaced by equivalents without breaking the contract such as a quantity of grain that could be substituted with an equal amount of similar grain.

After hours of surfing, I realised that the latest internet trend around the digital asset is uniting such disparate worlds as art, sports, music, and gaming in an investment frenzy: “NFTs”. It also says that what makes NFTs special is that each one represents something unique, and not interchangeable with anything — in other words, not “fungible”. This is what distinguishes them from cryptocurrencies like bitcoin, which are fungible — interchangeable — even though they use the same software technology (blockchain technology) as NFTs.

NFTs serve as a kind of deed proving ownership for original editions of various digital artefacts — whether works of art, sports collectables or music albums. Even a tweet can be monetised with an NFT: Twitter founder Jack Dorsey auctioned off his first post to the site for $2.9 million.

The new kind of digital collectable item is stamped with a unique bit of code that serves as a permanent record of its authenticity and is stored on a blockchain, the distributed ledger system that underlies bitcoin/ cryptocurrencies. These collectables can be bought and sold like trading cards, and the nature of blockchain technology means that once a token is created, it can’t be deleted or counterfeited. That makes it useful for artists, musicians, and others who want to create limited edition digital goods.

NFTs in all possibilities could transform the way digital goods are created, consumed, and traded online. Some news organisations have already experimented with selling NFTs, and YouTubers and other online influencers have begun creating their own lines.

Some of the NFT buzzes are shallow hype, no doubt. The cryptocurrency world is full of scammers and get-rich-quick hustlers whose projects often fail. Critics point out that NFTs and other cryptocurrency-related projects require enormous amounts of energy and computing power, making them a growing environmental hazard.

There are also legitimate questions about what, exactly, NFT buyers are getting for their money, and whether these tokens will turn into broken links if the marketplaces and hosting services that store the underlying files disappear.

But there’s something real here that is worth taking seriously. For decades, artists, musicians, and other creators have struggled with the fact that, on the internet, making copies of any digital artefact is trivially easy. Scarcity — the quality that gives offline art its value — was hard to replicate online, because anyone who downloaded a file could copy and paste it an infinite number of times, with no loss in quality.

Block-chain technology changed that by making it possible to stamp digital goods with a cryptographic marker of authenticity and keep a permanent record of its ownership. You can copy the file contained in an NFT, but you can’t fake the digital signature behind it, which gives collectors of rare digital goods some peace of mind. And NFT fans think the technology could be used to keep track of all kinds of goods in the future — titles to houses and cars, business contracts, and wills.

Creators can even attach a royalty agreement to their NFTs, entitling them to a cut of the profits every time their assets are resold.

It’s easy to be sceptical of NFTs. But I’m cautiously optimistic about them, for the simple reason that they represent a new way for creative people to eke out a living on the internet.

For years, traditional media companies have resisted new, internet-based distribution strategies because they viewed them — often correctly — as a threat to their business models. Most things on the internet were free, and things that weren’t free could be easily pirated or copied. If you wanted to get paid for your creations, your best options were to create a paywall, hire an army of lawyers to enforce your copyright or put yourself at the mercy of a licensing service or a huge social media network, which might share some of its advertising revenue with you, if you were lucky or exceptionally good.

Digital subscriptions are one way for creators to take back control of their destinies. NFTs could be another. By making it possible for artists and musicians and the kind to turn individual works into one-of-a-kind digital collectable items, NFTs could erode the economic dominance of social media middlemen and give more power back to the people who are producing creative and interesting things.

The writer is a medical doctor (pathologist) and holds an MA in Creative Writing from the University of London. The views expressed are personal.

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