Special Economic Zone (Sez) at Jawaharlal Nehru Port Trust

The Prime Minister Shri Narendra Modi is to lay the foundation of a Port- Based Multi-product Special Economic Zone (SEZ) at the prestigious Jawaharlal Nehru Port Trust (JNPT) at Sheva, Navi Mumbai on Saturday, August 16, 2014. This industrial infrastructure project is to be established on 277 hectares with a total Public and Private investment of about 4,000 Crore rupees. This is being planned as a Self-Sustainable Integrated Development Project having a potential of generating over 1.5 lakh direct and indirect jobs. The ambitious SEZ to be developed through JNPT-SPV (Special Purpose Vehicle) under the Engineering, Procurement & Construction (EPC) mode is scheduled to be completed within three years. With a focus on the upcoming sectors of India, the SEZ will develop Free Trade Warehousing Zone, Engineering Goods Sector, Electronics and Hardware Sectors, Non- Conventional Energy Sector, Multi Services (IT and Healthcare) Sectors and Apparel and Textiles Sectors. Shri Modi, who is to arrive in Mumbai on a day’s visit to Maharashtra, is also scheduled to lay the foundation of a Port Connectivity Highway Project at the JNPT and also allot land to the JNPT Project Affected Persons (PAPs) under the 12.5% scheme of Maharastra government implemented by the City and Industrial Development Corporation of Maharastra Ltd. Various projects have been expedited by the Union Minister of Road Transport, Highways & Shipping & Rural Development, Shri Nitin Gadkari over the last two months. These projects in Mumbai are to be inaugurated as part of these measures. The Port Connectivity Highway Project with a Cost of about Rs.1927 Crores is to be completed by December 2017. The Ministry of Shipping has decided to execute this Project on (Engineering, Procurement & Construction (EPC) mode through the Special Purpose Vehicle (SPV). The project has been undertaken under the National Highway Development & Port Connectivity Programme of the union government. Due to rapid development in the area on account of development of JN Port, JNPT-SEZ, and the proposed International Airport, etc. it was felt necessary to augment the carrying capacity of the existing road network to 6/8 lane configuration by providing improved facilities comprising of flyovers, railway over bridges, interchanges etc for uninterrupted flow of traffic plying on the road network connecting the Port and the National Highways. Accordingly, it is now proposed to develop this road network to 6/8 lane configuration with service roads. The NH-4B, Amra Marg & SH-54 were earlier developed to a four-lane facility by the National Highways Authority of India (NHAI) through the Special Purpose Vehicle (SPV) comprising of NHAI, JNPT & CIDCO. Allotment of land under 12.5% scheme to Project Affected Persons (PAPs) of JNPT has also been a long pending issue. Resolution of the dispute was essential for smooth operation and future development of JNPT. The land owners, whose lands were acquired for JNPT, have been agitating for land allotment under the 12.5% scheme as decided by the Government of Maharashtra in respect of land acquired by CIDCO for the Navi Mumbai Project. A decision was taken to grant the benefit of 12.5% land allotment scheme on humanitarian grounds to the JNPT PAPs, though legally as per the Hon’ble Supreme Court order the Port was not liable to implement 12.5% scheme. Based on the decisions taken, a proposal was moved for approval of the Cabinet by the Ministry of Shipping to transfer 12.5% of the 1172 hectares of land to Government of Maharashtra to distribute it to the JNPT PAPs. Though 12.5% of 1172 hectare worked out to 146.5 hectares, 35.5 hectares have already been given to four (4) villages under the Gaothan Extension Scheme of Maharashtra Government by JNPT. Hence, it was proposed to transfer the remaining 111 hectare (146.5 hectares – 35.5 hectares) which was in accordance with the decisions taken at the meeting on 22.3.2011. The Union Cabinet approved the transfer of 111 hectares of JNPT land to Government of Maharashtra for allotment to PAPs of JNPT in line with the Government of Maharashtra’s scheme for PAPs of Navi Mumbai of CIDCO. The Cabinet also allowed JNPT to provide CIDCO the cost of development of minimum amenities to be finalized in consultation with CIDCO/Government of Maharashtra. Accordingly, Ministry of Shipping accorded approval to the proposal of JNPT to provide Rs.212.34 crores for development of basic amenities which was worked out in consultation with CIDCO. Based on the approval of the Union Cabinet, JNPT initiated action to hand over 111 hectares of land to the Government of Maharashtra for distribution to the PAPs. Meanwhile, Chief Minister of Maharashtra wrote a D.O. letter dated 6.11.2013 to the then Minister of Shipping with a recommendation to consider allotment of total land of 160 hectares instead of 111 hectares allotted as per the Cabinet decision for distribution among the PAPs (12.5% of 1172 hectares private land) for implementation of the 12.5% land scheme and for allotting 40 SQM land to each of the landless labourers in the project affected villages). It was also submitted by the PAP Sangharsha Samiti as well as by the officials Government of Maharashtra that while computing the land requirements for distribution under 12.5% scheme, the aforesaid 35.5 hectares should have been deducted from the total private land acquired by the Port i.e. 1172 hectares. It was submitted that PAPs are entitled for 12.5% of total land of 1136.5 hectares after such deduction which comes to 142.06 hectares and not 111 hectares as sanctioned by the Ministry of Shipping. The Ministry of Shipping has recently forwarded a proposal for seeking approval of the Cabinet for sanctioning additional land of 47.20 ha which falls under CRZ-I in addition to 111 ha of land as already approved by the Union Cabinet. Jawaharlal Nehru Port Trust (formerly NhavaSheva Port Trust) was commissioned on 26th May, 1989. For the construction of the Port, land to the extent of 1172 hectares was acquired through Government of Maharashtra from 12 villages of the UranTaluka, Dist. Raigad, Maharashtra, in the 1980s. This was done as part of the land acquisition for the Navi Mumbai Project. During the acquisition of land, there was strong resistance from the land owners. However, after a lot of discussions, assurances and promises, the task was completed successfully. One of the assurances given to the land owners of the Navi Mumbai Project (from which JNPT was given land) at the time of acquisition of the land was that they would be given back developed land to the extent of 12.5% of the land acquired from each of them. This issue of compensating the erstwhile landowners of JNPT warrants a permanent solution, so that the functioning of the Port which handles about half of India’s international trade goes on smoothly and unhindered.

Tests and protests

It is the ticket to the so-called steel frame, a career of power and prestige: the IAS. But the civil services aptitude test, part of the preliminary examination, has thrown open a class and geographical divide - aspirants from the Hindu belt fear being outshone by the English-speaking 'elite' in the test. The last word has not yet been said on this struggle.

If the Civil Services Aptitude Test (CSAT), part of the Civil Services preliminary examination make many aspirants apprehensive, an evident push for Hindi since the Modi government took over has turned the debate into a language row, which had been more or less settled in the five decades since it flared up.

What was essentially apprehension about the advantage Engineering and Management graduates had over those from a Humanities background in cracking CSAT has been compounded by poor translation into Hindi of these questions by the Union Public Service Commission (UPSC) and the failure to address this problem in the years since the prelims format was changed in 2011 to give more emphasis to aptitude.

Even now, nearly a week after the government took the view that the marks obtained in the English comprehension skills component of CSAT should not be used for merit or gradation purposes while calculating the prelims results, the Union Public Service Commission (UPSC) has not spoken on whether it will factor in this opinion and how it will be implemented. Adding fuel to the fire is the fact that in the first CSAT in 2011, the UPSC set a cut-off in the English component of the paper as a qualifier, and the commission’s silence on this front this time round is not helping matters at all.

CSAT tests comprehension, interpersonal communication skills, logical reasoning and analytical ability, decision-making and problem-solving, general mental ability, basic numeracy, data interpretation and data sufficiency, besides English comprehension skills (all of class X level). This paper replaced the objective-type “optional subject”, which along with the test on General Studies, in which aptitude questions were a component, constituted the prelims for over three decades.

Protesting students like Vikas Kumar allege that there has been a sharp drop in the number of students who opt for languages other than English to take the main examination since the introduction of CSAT. “This means that those from the regional language medium are just not getting through the prelims,” he said.

Referring to the number of candidates who took the main examination in other languages in the Civil Services Examination of 2013, he said only 26 appeared in Hindi and a total of 54 in all languages other than English. “Pre-CSAT, it was 50:50,” said the young man who has made six attempts at the prelims and three at the mains. Of his six prelims, two were in the CSAT era, both of which he failed.

Now that the English component has been removed, the agitating students’ demand is that the prelims be postponed by a month to make up for the time spent in protests. While they want CSAT to be scrapped, an alternative goalpost they have set is to make this a qualifying paper and use General Studies only for merit. Any candidate who gets 30 per cent marks in CSAT should be deemed as qualified and the General Studies scores should be used for deciding the merit list.

While the government’s opinion on doing away with the English component of CSAT has gone down well with the Hindi belt students, may others feel a tad short-changed as the English questions accounting for 22.5 per cent marks were their sure shot in the paper.

In making this recommendation, the government, says Rajya Sabha member J.D. Seelam, went by the point raised by Shiksha Bachao Andolan Samiti convener Dinanath Batra in his petition against CSAT in 2010. Stating that the English component put those from the regional language medium at a disadvantage, he wanted it to be removed from CSAT. The Delhi High Court asked the government to set up a committee to look into the matter. The government purportedly firmed up its mind on doing away with the English component after consulting with this committee and the UPSC.

Stating that Hindi had become a slave to the English “queen”, Mr. Batra, who has been the general secretary of Vidya Bharati, a network of schools run by the Rashtriya Swayamsevak Sangh, has gone on record to claim that “We think that we have been behind the motivation of this struggle.” He said he had met Minister of State for Personnel Jitendra Singh on the CSAT issue in July and flagged points from his petition to him.

The former Union Minister and educationist Y.K. Alagh, who had headed the committee which recommended CSAT in 2001, has alleged that the protests were being spearheaded by coaching institutions. However, Jojo Mathews, a founder director of Alternative Learning Systems, a coaching institution with several centres across the capital, says there has been no spike in demand for prelims coaching post-CSAT.

Mr. Mathews, as many others, insists that the paper is not tough. “CSAT can be cracked by students from a Humanities background with some practice,” he says.

Now the government has accepted the “force” in the argument that aspirants should be allowed to take the examination in all languages included in the Eighth Schedule of the Constitution. The fact is that while the question papers are in English and Hindi for the prelims and the mains, the answers for the latter, except the mandatory English paper, can be written in any Eighth Schedule language and the prelims are anyway objective-type papers where answers have to be only marked out.

World class MSME India

“Your article last week on customer value touched the core of my heart as I am constantly fighting for this cause,” wrote my valued reader Commodore G S Kanwal, retired from the Indian Navy. “But we are more or less in a Catch 22 situation.”
Small businesses, like the 44-bedded hotel service that Commodore Kanwal runs and is fighting various social and career factors to retain trained staff in, are the real backbone of our country. I’ve promoted the cause of MSMEs (micro, small and medium enterprises) in this column as well as detailed how to encourage their activities in my books Jalebi Management and its sequel Strategic Pokes. We should always remember that all big companies began as MSMEs. Courier service UPS, with over $55 billion revenue, started with just four bicycles in 1907 and is now among the world’s best companies. Another example of an MSME blooming is the $473 billion Walmart retail company that started as Walton’s 5&10 in 1950 — a dime store in a small US town called Bentonville in Arkansas.

Among developed countries, the outstanding performance and internationalisation of Germany’s MSME sector is worth emulating. According to Sequa gGmbH, a development organisation where Germany’s top four business membership organisations DIHK, ZDH, BDI and BDA are shareholders, Germany’s economic structure is determined by MSMEs that account for almost 99 per cent of all businesses, and employ about 80 per cent of regular workers. The government has several support programmes and measures to promote MSMEs. Contributing significantly to GDP, they’ve made the German economy the strongest in Europe today.

Unlike in Germany, about three-fourths of India’s MSMEs cannot access banks or institutional financing as per a study by industry body Assocham and finance advisory Resurgent India. Without adequate credit, most MSMEs actually borrow from their family and friends, which naturally impacts their business planning in terms of time and ability to raise the required amount. A new kind of short-span, flirting with money entity, has mushroomed in our economy; the start-ups funded by angel investors. Start-ups remind me of the attitude some bachelors have regarding their girlfriends. By hook or crook, these start-ups have to prove their model is working. They try to hike valuation to sell out and encash big money within a short span of time. In relationship analogy, it’s like working hard and making a name to grab the plum dowry that’s waiting when he opts for an arranged marriage, ditching his girlfriend. Most angel investors look for short-term investment and quick earnings. This influence of working to finally sell out is not setting a good example. To become a solid entrepreneur, you have to drive your business for the long term.

Let me note some hard truths that MSMEs face in India’s modern economy:

1. MSMEs oftenrun like a family business where there’s no question of hiring hardcore professionals.

2. The younger generation does not want to carry forward the business the father set up. Having witnessed the fair amount of struggle required to run the show, these youngsters prefer to become an employee with less responsibility and the assured monthly pay slip.

3. Entrepreneur fathers consider that only their generation can do business. Having sent their children to the kind of schools they themselves have not gone to, the children develop an outlook that’s rather dissimilar from their parents. Thereafter, the father develops low confidence in his child’s capability and the son doesn’t want his father as boss at work.

4. For arranged marriages and social recognition, the value of young people working in big corporate houses and being the manager of a large number of people is higher than if they were working in their father’s business.

5. To be an entrepreneur, you need to have three skillsets: (a) Knowing your product in depth so you know its selling point; (b) People management skills to keep employees motivated and reduce attrition; (c) Be an outstanding salesperson to play in a competitive marketplace. It’s not always the case that one person will have all three competencies. As an entrepreneur, you may have one or two of these skillsets, so it’s extremely important that you find an appropriate partner.

6. An entrepreneur who does not have the right capability for the segment of business being pursued tends to spread out into diverse business areas. But without single focus, a long-term steady business can never be built up.

7. Such diversification leads to most funding institutes not trusting the competency, sustaining strategy and capacity of MSMEs. To safeguard their loans, banks ask for detailed documentation and securities that leave MSMEs flummoxed. Even short-term working capital on credit is not easy for them to get. Actually banks have evidence too of suffering non-performing assets on having loaned to small businesses. So for MSMEs, cash flow is a constant problem to run day-to-day operations and fuel their future growth.

In these points I’ve listed, there is a big role the government can play. Several industry and government bodies already exist to facilitate MSMEs, but how concretely is help provided? It’s essential to create “World-class MSME India” as a driving force where the two basic requirements for MSME business growth would be customer centricity and retaining a defined global quality standard.

My earnest request to our new government is to take non-bureaucratic action in this area. Among such actions could be the professional handling of MSMEs to represent their interests in capability building and getting loans, having our embassies overseas promote business with MSMEs, encouraging them through consultancy to develop innovative power, and having a dynamic TV channel by Doordarshan exclusively dedicated to MSMEs with inspiring stories and professional advice to get ahead. When MSMEs flourish, employees will not leave their jobs so easily, and the country’s GDP can experience galloping growth.

India draft 5-year plan of action to deepen ties with ASEAN

 Seeking deepening of ties with ASEAN, India on Saturday said it would soon draft a five-year plan of action starting 2016 to take the “trajectories” of common interests with the 10-member grouping to a new level and particularly emphasised on improving connectivity in the region to further boost trade and people-to-people contact.

In her address at the 12th India-ASEAN meeting in Nay Pyi Taw, External Affairs Minister Sushma Swaraj said the new government in India would like to stand with the grouping and take the relationship forward so people’s aspirations for growth and development could be fulfilled.

“As you are on the brink of achieving your long cherished goal of the ASEAN Community by 2015, I bring to you the assurance of the new Government in India that we would like to stand with you and take the trajectories of our common interests higher in the coming years, both in terms of achievement and relevance to our bilateral ASEAN+1 relationship and also in terms of the multilateral ambition at the regional and global levels,” Ms. Swaraj said in her first engagement at multilateral fora.

Strongly pitching for improvement in connectivity, she said India wanted connectivity in all its dimensions - geographic, institutional and people-to-people. She also referred to 5Ts of government of India — Tradition, Talent, Tourism, Trade and Technology — reflecting priority areas and noted that in foreign policy connectivity precedes them all.

“To the 5 Ts of the Government of India — Tradition, Talent, Tourism, Trade and Technology, I would like to reiterate the value of a ‘C’ before them all in foreign policy — the ‘C’ of connectivity in all its dimensions, geographic, institutional and people-to-people. I would like this ‘C’ of connectivity to translate into tangible and urgent action on the ground, bringing our capacities together to mutual benefit,” she said.

Talking about taking forward the ASEAN-India ties to the next level, she said India will soon draft an action plan in this regard. “We have an impressive array of 26 cross-sectoral annual dialogue mechanisms between ASEAN and India. We should soon be drafting our next Plan of Action for 2016-2021,” Ms. Swaraj said.

“The ASEAN-India strategic partnership owes its strength to the fact that our ‘Look East’ to ASEAN meets your ‘Look West’ towards India. There is synergy and a sense of fraternity in our partnership, as we look towards a shared future of peace and stability, economic growth and prosperity in our region,” Ms. Swaraj said.

The External Affairs Minister described the Vision Statement and the report of the ASEAN India Eminent Persons Group as “good reference points” but insisted that the interpretation of these “needs to be grounded in the geo- political realities of today and the common aspirations of our people for growth and development.”

The ASEAN-India Eminent Persons group had suggested measures to improve the ties in diverse areas.

Ms. Swaraj said the “overwhelming involvement” of people across ages and professions in the various events that year in all the ASEAN countries and India were evidence of the “deep and longstanding connections between our countries, past and present”.

“I am looking forward to now working with you all for taking these sentiments of comfort and collaboration between us to new heights across the three pillars and bring greater speed to some long pending issues,” she said.

There has been significant progress in ties between India and the ASEAN grouping in the last few years in diverse sectors, particularly in trade and commerce.

The bilateral trade grew by 4.6 per cent from $68.4 billion in 2011 to $71.6 billion in 2012.

ASEAN’s exports were valued at $43.84 billion and imports from India amounted to $27.72 billion in 2012.

The target has been set at $100 billion by 2015 for ASEAN-India trade.

The members of ASEAN include Brunei, Cambodia, Indonesia, Myanmar, Singapore, Thailand, Philippines and Vietnam.

India and the ASEAN have already implemented a free trade agreement in goods and are set to widen its base and include services and investments. The India-ASEAN Trade in Goods Agreement was signed in August 2009 and it came into force on January 1, 2010.

In her address, Ms. Swaraj also congratulated Myanmar on becoming Chair of the ASEAN.

“We are delighted to be part of this moment of achievement for Myanmar, as ASEAN Chair,” Ms. Swaraj said.

Government to declare “National Hypertension Day” soon

Facilities for personalised treatment in government hospitals on anvil

The Union Health Ministry has conceptualised dedicating a particular day of each year for highlighting the dangers of Hypertension, the silent killer which, according to World Health Organisation (WHO), accounts for 7 percent of disability adjusted life years worldwide, and 9.4 million deaths annually. Speaking at the 23rd Annual Conference of the Hypertension Society of India (HSICON) here today, Dr Harsh Vardhan, Union Health Minister, said “I am preparing the Ministry to meet the growing burden of non-communicable diseases (NCD). Hypertension, diabetes, cancers, coronary artery disease, etc. are projected by WHO as the biggest gnawers of our public health budget in the next decade.” The roots of most NCD, including hypertension, lie in the modern, sedentary lifestyle, the Minister said. Therefore, more resources than before would be deployed for the objective of raising public awareness on preventive measures and early diagnosis. That is why he feels the need for declaring a certain day of each year as “National Hypertension Day”. “I hope to marshal the synergies of organisations like organisations in the medical field into making National Hypertension Day a platform for intensive dialogue between government and patient, pharmaceutical company and patient, lifestyle gurus and patient, and so on. It will also highlight the dangers of consuming junk food, alcohol consumption and smoking, physical inactivity, as well as the importance of Yoga for both prevention and management of hypertension,” Dr Harsh Vardhan said. In India, hypertension is the leading NCD risk and estimated to be attributable for nearly 10 percent of all deaths. Adult hypertension prevalence has risen dramatically over the past three decades from 5 per cent to between 20-40 per cent in urban areas and 12-17 per cent in rural areas. Most people don’t know they are suffering from hypertension until it is too late. The number of hypertensive individuals is anticipated to nearly double from 118 million in 2000 to 213 million by 2025. It is estimated that 16 per cent of ischemic heart disease, 21 per cent of peripheral vascular disease, 24 per cent of acute myocardial infarctions and 29 per cent of strokes are attributable to hypertension. This underscores the huge impact effective hypertension prevention and control can have on reducing the rising burden of cardiovascular disease. Dr Harsh Vardhan added, “The loss to the economy should not be measured only by the drain on the public health system caused by hypertension, but also in terms of the productivity loss because hypertension strikes a human being during the most productive years and emasculates the ability to deliver to one’s fullest potential.” The Minister announced firm plans by the Ministry of Health to give a push to both into hypertension research and free treatment/management under the public health system. “A three-pronged plan is conceptualised. First, by raising awareness of prevention and early diagnosis among the largely youthful population, we hope to bring down the number of undiagnosed hypertensive patients over the next five years. Secondly, the Government will deploy funds for research into personalised treatment which is the major area of research worldwide into the development of medicines for this condition. And, thirdly, the government health system will be fitted out with departments for individualised treatment of patients,” the Minister said. The Health Minister elaborated that the effect of hypertension on the heart, kidneys and eyes creates additional burden on the government system. For this, he recognises the need for promoting the Yoga way of life backed up by a culture of having periodic check-ups. The government is therefore factoring into the evolving Universal Health Assurance plan an integrated treatment strategy for medium-to-long term reduction of the population under hypertension.

Ebola outbreak is a public health emergency: WHO

The World Health Organization on Friday declared the Ebola outbreak in West Africa to be an international public health emergency that requires an extraordinary response to stop its spread.

It is the largest and longest outbreak ever recorded of Ebola, which has a death rate of about 50 per cent and has so far killed at least 932 people. WHO declared similar emergencies for the swine flu pandemic in 2009 and for polio in May.

The WHO chief, Dr. Margaret Chan, said the announcement is “a clear call for international solidarity” although she acknowledged that many countries would probably not have any Ebola cases.

“Countries affected to date simply do not have the capacity to manage an outbreak of this size and complexity on their own,” Dr. Chan said at a news conference in Geneva. “I urge the international community to provide this support on the most urgent basis possible.”

The agency had convened an expert committee this week to assess the severity of the continuing epidemic.

The current outbreak of Ebola began in Guinea in March and has since spread to Sierra Leone and Liberia, with a suspected cluster in Nigeria. There is no licensed treatment or vaccine for Ebola.

The impact of the WHO declaration is unclear; the declaration about polio doesn’t yet seem to have slowed the spread of virus. During a WHO meeting last week to reconsider the status of polio, experts noted countries hadn’t yet fully applied the recommendations made in May, there have been more instances of international spread and outbreaks have worsened in Pakistan and Cameroon.

In the United States, the Centres for Disease Control and Prevention have already elevated their Ebola response to the highest level and have recommended against travelling to West Africa. On Thursday, CDC director Dr. Tom Frieden told a Congressional hearing that the current outbreak is set to sicken more people than all previous outbreaks of the disease combined.

“I don’t know what the advantage is of declaring an international emergency,” said Dr. David Heymann, who directed WHO’s response to the SARS outbreak and is now a professor at the London School of Hygiene and Tropical Medicine.

“This could bring in more foreign aid but we don’t know that yet,” he said.

Other experts hoped the declaration would send more health workers to West Africa.

“The situation is very critical and different from what we’ve seen before,” said Dr. Heinz Feldmann, chief of virology at the U.S. National Institute of Allergy and Infectious Disease. “There are so many locations with transmission popping up and we just need more people on the ground.”

WHO did not recommend any travel or trade bans but said people who had close contact with Ebola patients should not travel internationally. For countries with Ebola, WHO issued various recommendations, including exit screening at international airports and border crossings to spot potential cases. It also discouraged mass gatherings.

WHO said countries without Ebola should heighten their surveillance and treat any suspected cases as a health emergency.

This week, two of the worst-hit Ebola countries Liberia and Sierra Leone brought in troops to enforce quarantines and stop people infected with the disease from travelling. Liberian President Ellen Johnson Sirleaf said no one with a fever would be allowed in or out of the country and warned some civil liberties could be suspended if needed to bring the virus under control.

Chan said while extraordinary measures might be necessary to contain the outbreak, it is important to recognize civil rights.

“We need to respect the dignity of people and inform them why these measures are being taken,” she said.

Building smart cities without energy

Despite India’s effort to achieve energy security by opening new mines and acquiring oil wells abroad, the massive quantity of energy required for smart cities is likely to remain elusive

Recent statements by Ministers from the National Democratic Alliance, when read together, provide insights into the government’s acche din promise. Urban Development Minister M. Venkaiah Naidu promised to create a hundred smart cities with better facilities, connectivity and a better environment. Environment Minister Prakash Javadekar said that to reduce poverty, India’s carbon emissions must grow till 2030-40.

But can India access the massive quantity of energy needed to develop 100 smart cities? Will more fossil fuel use, the primary cause for carbon emissions in projects such as smart cities, bullet trains, river linking, necessarily reduce poverty? Can India replicate the 20th century development model of the North nations?

It is unclear whether the new smart cities that Mr. Naidu referred to are greenfield ones or upgraded older cities. Presuming they are the latter, two questions arise: how much energy does upgradation require, and is this energy available?

Fossil fuelled cities

Unlike the fully fossil-fuelled cities of North nations, Indian cities are semi-fossil fuelled. They consist of an older city constructed in a pre-fossil fuel era, with narrow streets made for pedestrians and animal carts and low-rise buildings made from lime binders, and a newer city constructed with broad streets for fossil- fuelled vehicles and concrete high-rise buildings. A conservative energy cost for upgrading 5,000 kilometres in older cities is 600 million tonnes of oil equivalent (MTOE). That is almost equal to India’s annual total primary energy supply (TPES) worth Rs. 35 lakh crore, i.e., more than double of the Union budget for 2014-15.

Since 2000, India’s energy consumption has grown at 7 per cent per annum, keeping pace with GDP growth. If the additional energy consumption for the smart cities project is spread over the next 10 years, the annual fossil fuel consumption rate will have to jump to 15 per cent.

Unlike money, extra energy cannot be printed at will. It has to be first found, and then accessed. India is already hard pressed to meet the current demand for fossil fuel. Coal contributes 60 per cent of the fossil fuel that India consumes. The country has the fifth largest coal reserves in the world. Yet, it imported 21 per cent of its coal last year, as indigenous production failed to meet demand. Consequently, India’s power utilities enforce regular rolling power cuts. Opening new coal mines has its own problems. According to former Environment Minister Jairam Ramesh, untapped coal blocks are in dense forests that constitute only 2.5 per cent of the country’s area. Opening them will further endanger our forests.

Indigenous oil and gas reserves and production are low. Increasing imports will burden the economy, particularly if, as market analysts predict, instability in the Middle East prolongs and oil prices jump from $110 to $150 per barrel.

The party is over. We have hit peak oil and new oil discoveries have been few and small. Oil production has remained at 85 mbd for the last decade, despite rising demand. Peak gas will take place two-three decades later. Replacing oil and gas with coal will increase atmospheric carbon dioxide rapidly, and green and nuclear energies cannot replace fossil fuels.

Despite India’s effort to achieve energy security by opening new mines and acquiring wells abroad, the massive quantity of energy required for smart cities is likely to remain elusive.

Other Asian countries

Comparing India’s carbon emissions, development, and the percentage of poor people with other Asian countries that share the same tropical ecological space throws light on the second question.

India has a per capita carbon emission of 1.5 T per annum. Bangladesh, Cambodia and Laos emit 20 per cent, and Bhutan two thirds of that amount. Yet, the Human Development Index (HDI) scores of India and these countries are similar, ranging from 0.515 to 0.554. The multidimensional poverty index (MPI) puts about half of the population in India, Cambodia, Laos and Bangladesh and a quarter in Bhutan, under the poverty line. Sri Lanka’s has done much better. Its HDI is at 0.715, placing it 46 ranks above India, and has only 5 per cent of its population below the MPI line. Yet its per capita carbon emission is 0.6 T per annum, 60 per cent less than India’s.

Bangladesh, Bhutan, Cambodia, Laos and Sri Lanka matched or emulated India’s HDI and MPI scores but with significantly lower per capita emissions. Their performance questions Mr. Javadekar’s statement. How did they do it?

First, they used proportionally less fossil fuels, whose contribution ranged from 25 to 50 per cent of their TPES, compared to India’s 73 per cent, and hence lowered their per capita carbon emissions. Second, lower urbanisation in these countries results in less energy consumption and emissions. Cities consume over 75 per cent of TPES of a country but produce only 5 per cent of it. Third, India’s greater reliance on fossil fuels makes its economy less energy efficient and more polluting, consequently leaving less per capita energy available for poverty alleviation.

The energy density of fossil fuels is very high, and requires large investments in mining, transport, power generation and distribution. Only the state and big business can make the large investments required to produce energy from fossil fuels. To recover investments, it makes sound business sense to sell it for profit rather than to alleviate poverty. Biomass has an energy density that is half to a fourth of fossil fuels, and its energy conversion technologies are simpler, requiring smaller investments. Energy from these sources is cheaper and more accessible to the poor to meet daily needs.

In the last two decades, India’s economy has grown rapidly, but so has the gap between the rich and the poor. India’s GDP quadrupled.India’s Gini index, a measure for income inequality where zero denotes complete equality, is up from 0.32 to 0.38. For two decades India has sung the 10 per cent growth mantra, paying little heed to distributive justice.

There is growing consensus that “trickle down” benefits of growth have been weak in India. If the trends of the last two decades continue, it will take India several decades to lift the people under the poverty line above it, provided global warming and peak oil don’t tip the global economy into a crisis. If either happens, the poorest and the most vulnerable will be impacted the most.

To be more convincing, Mr. Naidu should share his energy costing and supply analysis for the proposed 100 new smart cities. The Ministers for Railways and Water Resources should do the same for the bullet train and river linking projects. And Mr. Javadekar must argue his “more emissions for poverty reduction” statement. Else there will be further gain maximisation for a few.