29 July 2015
igniting minds
In the passing away of former President A.P.J. Abdul Kalam, India has lost not only a visionary scientist and an institution-builder, but also a staunch nationalist who was an inspirational figure for people across generations. Turning India into a developed country of the first world was his dream, and he set about making this a reality through words and deeds, first as scientist, then as the President, and later, till the very end, as an ordinary citizen. Kalam began as a civilian rocket engineer and metamorphosed into a missile technologist, but it is as the “people’s president”, as the first citizen who was accessible and who stopped to listen to the grievances of ordinary men and women that he won the love and affection of his countrymen. In the fields of civilian space and military missile technologies, Kalam put India on the world map by laying strong indigenous foundations for them. When India joined the exclusive club of spacefaring nations comprising the U.S., Russia, France, Japan and China on July 18, 1980, Kalam was the Project Director of the Satellite Launch Vehicle-3 in the Indian Space Research Organisation (ISRO). Since then, India has joined the world leaders in satellite launches and space research.
Kalam’s tenure in the Defence Research and Development Organisation and as the director of the Defence Research and Development Laboratory (DRDL) at Hyderabad heralded immense achievements in missile technology; he was part of the team that envisioned India’s Guided Missile Development Programme. Projects such as the development of the Prithvi, Akash, Trishul and Nag missiles were undertaken. Kalam also insisted on the development of a strategic missile with re-entry technology, resulting in the Agni missile. He insisted that both ISRO and DRDO develop composites such as carbon-carbon, fibre-reinforced plastic, etc to make motor casings lighter so that the vehicles can carry a heavier payload. His consortium approach led to the indigenous development of phase shifters, magnesium alloys, ram-rocket motors and servo-valves for missiles. As scientific adviser to the Defence Minister, he helped conduct India’s nuclear tests at Pokhran in May 1998. But more than as a scientist and a technocrat, Kalam will be remembered for his tenure as India’s 11th president, when he moved the institution away from being merely formal and ceremonial in nature. He used the presidency as a platform to inspire youth, who were readily impressed by his earthy demeanour and discursive approach to public speaking. The missile man had his critics, but India’s most popular president leaves behind the legacy of more than one generation of inspired Indians.
27 July 2015
Government crackdown will purify NGOs
“NGOs in crisis”
“13,000 in 2 months”
“Crackdown on NGOs”
If you have been reading newspapers in the last few months, you would have encountered some of these headlines. There is serious worry over the fate of non-governmental organizations (NGOs), and what the government intends to do with them.
My view is somewhat different: The ongoing crackdown could, in fact, turn out to be ultimately good for the innumerable honest but nondescript NGOs in the country.
The news reports seem to imply that the government does not like NGOs and is harassing them by questioning their actions and accounts. In fact, if we go deeper, the government is only moving against those NGOs which are allowed to receive foreign donations under Foreign Currency Regulation Act (FCRA) rules. However, the truth is that among the hundreds of thousands of NGOs in India, there are only a few which have such permission and have better financial resources.
From my experience working with NGOs, I would say the country’s social equity is based on the work of numerous low-profile NGOs with no foreign funding and little domestic funding, toiling at the village, panchayat and sub-district levels.
One could compare the contribution of these NGOs to that of 26 million micro-enterprises in our villages, clusters and small towns. Do the country’s economy and sustainability depend on these small firms or on the few large multinational companies and Indian firms with foreign investments? I would say the reason why we as a country never go into a deep economic crisis, unlike many other countries, is our intra-country dependency.
Similarly, if we look at our villages, talukas, blocks, sub-divisions and districts, you will find few signs of governance. Whatever social equity exists there is due to volunteers and the work of non-profit and non-governmental organizations.
Amid such governance failure—part of the reason could be found in the Socio Economic and Caste Census and part in the lack of businesses in rural areas—the only institutions that are effective on the ground in rural India are NGOs. Ironically, if ever someone was serious about delivering governance to these areas, the only option would be to depend on local NGOs or social organizations.
In my own experience, the deeper I go into districts, panchayats and villages, the only people I find capable of doing something good are always a group of volunteers or non-profit organizations. A business house with good intentions may provide money, some government bodies may appreciate your work if you’re lucky and stay out of your way as a good gesture, but the only people who would walk with you would be an NGO—and I mean it.
This does not mean all NGOs are free of the corruption that pervades India. As in the government and the private sectors, NGOs also have corrupt and dishonest elements. This is where there is good news for the NGOs and not-so good news for the government. Considering that the government is asking NGOs tough questions, we are, in fact, going to be better placed. In any case, the NGOs are supposed to be the custodians of the money granted for serving a cause, and they have no reason to hide their actions and accounts of what they are doing. In fact, for a well-meaning NGO, transparency will add value and help in raising funds.
I know for a fact that NGOs suffer immensely due to their inability to market themselves and raise funds. About five years back, we started talking to grassroots NGOs to help them go online and use the Internet as a marketing tool. We encouraged them to share local content and their work and reach out to those who may contribute to their resources by funding. We were humbled by the experience. About 5,000 such NGOs that had never known what information technology meant went online and now have several heart-warming stories to share of how digital inclusion has uplifted them in terms of legitimacy, accountability and transparency.
Moreover, with our advocacy, we also got .ngo approved as a top level domain, which is provided to valid NGOs. Which means any organization with a website bearing a .ngo extension can be considered a trusted NGO. This leads to the possibility that this database can be seen as pool of potential NGOs with whom companies and governments can choose to work with trust and dependency.
I also expect the NGO sector as a whole to be purified due to the government’s demand for NGOs to be online and share their accounts and sources. Thus, the pure and legitimate NGOs will make the life of governments even more miserable, if they fail to be accountable.
Since dedicated and honest NGOs will have nothing to lose, they will act with conviction and not just take orders. And that situation for NGOs at large is good news.
In my next column, I will discuss with you how going online has changed the lives of several grassroots NGOs—and those of the people they serve.
RBI at risk of losing autonomy? FSLRC draft gives the centre the right to appoint 4 out of 7 monetary policy committee members, and takes away the veto power of RBI governor
RBI at risk of losing autonomy?
FSLRC draft gives the centre the right to appoint 4 out of 7 monetary policy committee members, and takes away the veto power of RBI governor
At first glance, the revised draft of the Indian Financial Code released last week, 853 days after the Financial Sector Legislative Reforms Commission (FSLRC) published the first draft, seems to be a balancing act.
It has recommended substantial dilution of the powers of the proposed Financial Sector Appellate Tribunal (FSAT). This will replace the existing Securities Appellate Tribunal and entertain appeals against all financial sector regulators, including the Reserve Bank of India (RBI), but won’t have the powers to set aside any regulations which the first draft had envisaged. This is good news for the Indian central bank, but the not-so-good news is the composition of the monetary policy committee or MPC that it has proposed.
The latest draft gives the Union government the right to appoint four out of seven MPC members. It also takes away the veto power of the RBI governor even as he will have a casting vote in the event of a tie in the MPC (which can happen if one member is absent at the meeting).
A January 2014 report on revising and strengthening the monetary policy framework by RBI deputy governor Urjit Patel had recommended a five-member MPC with the governor as the chairman, the deputy governor in charge of monetary policy as vice-chairman, and the executive director in charge of monetary policy as a member. Even the two other external members, according to the Urjit Patel report, should be picked up by the chairman and vice-chairman on the basis of their expertise and experience in monetary economics, macroeconomics, central banking, financial markets and public finance. Overly tilted in favour of RBI, this report also suggested that the governor and, in his absence the deputy governor, will have a casting vote in case of a tie, but it was not in favour of the governor enjoying the veto power.
The idea of the veto power of the governor was mooted by the original report of the FSLRC which had spoken about a seven-member MPC, chaired by the RBI governor. While one member will be from the RBI, five independent experts in the field of monetary economics and finance will be appointed by the Union government, it had suggested. Of the five, the appointment of two members will be in consultation with the governor. It had also said that a representative of the central government, without having any voting rights, would participate in the MPC meetings to express the views of the finance ministry. The revised draft has changed the representation of RBI: government ratio in the MPC from 2:5 to 3:4 but dropped the proposed veto power of the governor.
This has sparked off a debate on the government maiming RBI and enjoying a greater say in the making of India’s monetary policy. The fear is politicization of the process as the members chosen by the government are expected to toe the government line, which often has short-term views on growth and inflation.
Let’s take a look at how the central banks in the developed markets work on monetary policy. In the US, the Federal Open Market Committee or FOMC decides on the Fed funds rate. Indeed, its seven board members are appointed by the president but their appointments are ratified by the Senate. And, there are instances of the Senate rejecting the president’s nominee. For instance, in August 2010, the US Senate scrapped the nomination of MIT professor and an expert on taxes and social security,Peter Diamond, to the Federal Reserve Board. There are five more FOMC members who are regional reserve bank heads, taking the total number to 12, each having one vote. The Bank of England’s monetary policy committee has nine members, including the governor, three deputy governors and the chief economist of the central bank. UK’s chancellor appoints the rest, who are independent. A member of the Treasury is allowed to attend the meetings and join the debate but doesn’t have a vote. The European Central Bank has a larger committee to decide on interest rates, consisting of six executive council members with permanent voting rights and 19 representatives from member states.
The fight between the finance ministry and RBI on the central bank’s so-called autonomy is not new. Rajan’s predecessors D. Subbarao and Y.V. Reddy had pitched battles during their tenures. While Reddy’s run-ins with the finance ministry were more on specific issues, Subbarao fought over broader policy issues. Many believe that RBI lost the battle for autonomy to the ministry of finance when Parliament passed the regulatory dispute resolution bill, paving the path for the creation of the Financial Stability and Development Council. Ahead of that, an 18 June 2010 ordinance empowered the finance ministry to resolve all disputes between the regulators, prompting then governor Subbarao to write to the finance minister, saying “the appearance of autonomy is as important as the actual autonomy itself”, and “the very existence of a joint committee (the council) will sow seeds of doubt in public mind about the independence of regulators”. The governor urged Pranab Mukherjee, then finance minister, to “allow the ordinance to lapse” but Mukherjee did not oblige him.
Even if the government enjoys the power of appointing four of the seven members of the MPC and the RBI governor does not enjoy the veto power, there’s nothing to worry about as long as the credentials of the members are impeccable and they are not serving government officials. Since the minutes of the MPC meeting will be made public, the government will be exposed if it plans to push its agenda through its nominees. Also, not the governor alone but the entire MPC will be held accountable if the inflation target is missed. This means everybody will have a stake and credibility to defend. The new set-up will not dent RBI’s autonomy, but even before it is put in place, the finance ministry should stop expressing its opinion on interest rates.
NITI Aayog likely to draw the line on poverty
A high-powered taskforce on poverty elimination, constituted under vice-chairman of NITI Aayog Arvind Panagariya, is expected to favour the need for a poverty line for comparing their impact of government programmes on the lives of lower strata of society over a period of time. However, the taskforce is likely to leave the responsibility of calculating that number open-ended.
Even as talks are on to use the recently-released Socio Economic Cast Census (SECC) of rural households and yet-to-be-released urban numbers for targeting government programmes and subsidies, the poverty ratio would give a better understanding of these distributions and help in improving these schemes.
According to a senior official, the taskforce, whose tenure has been extended till the last week of August, is expected to finalise its recommendations in the next few weeks. Its term was to expire in June this year. Those involved in the task force said the calculation of the poverty line could be done either by the Aayog itself or the National Statistical Commission, headed by former chief statistician Pronab Sen.
The taskforce is also expected to highlight the need for sustained economic growth and composition of that growth as being the imperatives to bring down poverty. Public intervention and need for household-level subsidies are also expected to be stressed upon as being other factors to lower poverty.
Officials said a point of view, which says that when the SECCfor Rural India has already thrown up a number in absolute terms based on certain deprivations and there is no need to recalculate poverty based on any other criteria, could find mention in the taskforce report.
The opposite view will also find place in the final report, but the dominant view emerging is that there should indeed be a national poverty number, but who should do the calculation ought to be left open-ended, the official remarked. The taskforce recommendations would come, even as the erstwhile Planning Commission landed itself in a number of controversies relating to poverty line and yardsticks for calculating that. It revised its numbers later, but that had also earned flak from various quarters.
An earlier method, based on the Suresh Tendulkar methodology, had said taken anyone spending more than Rs 33 in urban areas and over Rs 27 in villages a day in 2011-12 as not poor. Later, the Rangarajan panel had pegged these as Rs 47 a day in urban areas and Rs 32 in villages. Apart from Panagariya, the other members of the taskforce include Bibek Debroy, member of NITI Aayog, and experts like Rathin Roy, Surjit Bhalla and the government's chief statistician, T C A Anant.
Even as talks are on to use the recently-released Socio Economic Cast Census (SECC) of rural households and yet-to-be-released urban numbers for targeting government programmes and subsidies, the poverty ratio would give a better understanding of these distributions and help in improving these schemes.
According to a senior official, the taskforce, whose tenure has been extended till the last week of August, is expected to finalise its recommendations in the next few weeks. Its term was to expire in June this year. Those involved in the task force said the calculation of the poverty line could be done either by the Aayog itself or the National Statistical Commission, headed by former chief statistician Pronab Sen.
The taskforce is also expected to highlight the need for sustained economic growth and composition of that growth as being the imperatives to bring down poverty. Public intervention and need for household-level subsidies are also expected to be stressed upon as being other factors to lower poverty.
Officials said a point of view, which says that when the SECCfor Rural India has already thrown up a number in absolute terms based on certain deprivations and there is no need to recalculate poverty based on any other criteria, could find mention in the taskforce report.
The opposite view will also find place in the final report, but the dominant view emerging is that there should indeed be a national poverty number, but who should do the calculation ought to be left open-ended, the official remarked. The taskforce recommendations would come, even as the erstwhile Planning Commission landed itself in a number of controversies relating to poverty line and yardsticks for calculating that. It revised its numbers later, but that had also earned flak from various quarters.
An earlier method, based on the Suresh Tendulkar methodology, had said taken anyone spending more than Rs 33 in urban areas and over Rs 27 in villages a day in 2011-12 as not poor. Later, the Rangarajan panel had pegged these as Rs 47 a day in urban areas and Rs 32 in villages. Apart from Panagariya, the other members of the taskforce include Bibek Debroy, member of NITI Aayog, and experts like Rathin Roy, Surjit Bhalla and the government's chief statistician, T C A Anant.
| POVERTY TASKFORCE |
|
Educational reach and grasp
Over the past few weeks, new data releases have provided a wealth of information about different aspects of the state of the country's development and the diversity of conditions across states. The Socio-Economic and Caste Census, which I wrote about in my previous column, is one of these. Two reports from the 71st Round of the National Sample Survey, carried out during January-June 2014 also add to the data pool. One of these deals with household behaviour and expenditure on health services, while the other covers education. This column provides perspectives on some of the findings of the education survey.
The education survey covered about 66,000 households across the country, of which about 37,000 were rural. It sought information about standard indicators relating to institutional affiliation, attendance, access to incentives such as meals and scholarships and so on. Three indicators, which were of particular interest to me under the "reach and grasp" motif, were physical access, use of supplementary services - private coaching - and access to and ability to use computers and the internet.
I take it as given that, other things being equal, physical access to a school is a significant determinant of whether kids enrol and attend regularly. Minimising travel distance, time and effort required must be a key education policy objective. For many rural households, presumably, there is little room for choice between schools; it is only a question of whether it is physically feasible to attend. Urban households are more likely to have choices, but have to take quality and cost differences into account.
On the physical access criterion, there is both good news and not-so-good news. In rural areas, for the country as a whole, 94 per cent of households had access to primary school facilities (Classes 1-4) within 1 km and all households had access within 2 km. However, there was a sharp drop-off in access to upper primary (Classes 5-8) and, further, to secondary schools (Classes 9-12). Only 67 per cent of households had access to upper primary schools within 1 km. Of course, older kids can physically handle longer commutes; from this standpoint, over 97 per cent had access within 5 km. At the secondary level, only 37 per cent had access within 1 km, while 12 per cent had to send their kids to schools over 5 km away.
There is considerable variation across states on this parameter. Hilly and relatively sparsely populated states, of course, have lower densities. Of the larger states, Telengana has 100 per cent access to primary schools within 1 km, while, interestingly, Kerala reached only 62.5 per cent. Local conditions, including transport services obviously matter. It is also logical to expect a change in the location pattern as kids move from lower to higher segments. However, perhaps we should be thinking of location and access benchmarks for rural schools, which minimise the adverse impact of difficult access on enrolment and attendance. The larger context in which this issue becomes important is the sharp drop-off in enrolment between primary and secondary schools - almost 30 percentage points. How much of a factor is physical access in this transition?
As might be expected, the access problem is much less significant for urban households. Ninety-two per cent have access to primary schools, 83 per cent to upper primary schools and 73 per cent to secondary schools within 1 km of their residence. Here, the issue is of quality and cost. Parents need to have a simple and transparent quality and cost metric to be able to base their decision on and regulators need to monitor and enforce some basic quality standards.
The second indicator that caught my eye was the prevalence of demand for private coaching. We all have our prejudices about private coaching. Is it a necessary evil or a legitimate substitute for parental and family supplements? Whatever one may see it as, the fact is that it is costly and a source of iniquity across households. Be that as it may, the survey shows, as might be expected, that there is an increase in usage as kids grow older and there is a persistent gap between boys and girls. In the primary segment, 23 per cent of boys and 20 per cent of girls across combined rural and urban households use private coaching. The proportion increases to 28 per cent and 25 per cent in the upper primary segment and 38 per cent and 35 per cent in the secondary segment.
Here again, there are some striking variations across states. In West Bengal, 71 per cent of boys and 63 per cent of girls in primary school rely on private coaching. By contrast, in Uttar Pradesh, only 12 per cent of boys and nine per cent of girls use coaching at this level. Does this reflect different aspirations? Or, differences in the quality of the education system? Each interpretation of these variations will have its own policy implication.
The third indicator that I think deserves deep scrutiny is digital access. We have, of course, separate estimates of telecom connectivity and smartphone usage, which are shaping the larger debate on delivery of benefits. This survey focus provides estimates on household possession of computers and, besides this, internet access for at least one member of the household who is above the age of 14. Six per cent of rural households and 29 per cent of urban households possess computers. Not surprisingly, the less affluent states typically have penetration lower than the national average. On the internet access parameter, the picture is a little more comforting; 16 per cent of rural households and 49 per cent of urban households meet this criterion of access.
From the perspective of using technology to improve access and quality of education, these numbers suggest that it is going to be a long haul. However, this should not deter experimentation and scaling in areas in which penetration is reasonable. Above all, providing computer access to as many schools as possible is imperative.
As the government works its way through to a new education policy, it must draw upon objective analysis of these data as well as the wealth of other evidence on what works and what doesn't that is available. Of all aspects of public policy, the costs of being wrong on education will be both high and persistent across generations.
The education survey covered about 66,000 households across the country, of which about 37,000 were rural. It sought information about standard indicators relating to institutional affiliation, attendance, access to incentives such as meals and scholarships and so on. Three indicators, which were of particular interest to me under the "reach and grasp" motif, were physical access, use of supplementary services - private coaching - and access to and ability to use computers and the internet.
I take it as given that, other things being equal, physical access to a school is a significant determinant of whether kids enrol and attend regularly. Minimising travel distance, time and effort required must be a key education policy objective. For many rural households, presumably, there is little room for choice between schools; it is only a question of whether it is physically feasible to attend. Urban households are more likely to have choices, but have to take quality and cost differences into account.
On the physical access criterion, there is both good news and not-so-good news. In rural areas, for the country as a whole, 94 per cent of households had access to primary school facilities (Classes 1-4) within 1 km and all households had access within 2 km. However, there was a sharp drop-off in access to upper primary (Classes 5-8) and, further, to secondary schools (Classes 9-12). Only 67 per cent of households had access to upper primary schools within 1 km. Of course, older kids can physically handle longer commutes; from this standpoint, over 97 per cent had access within 5 km. At the secondary level, only 37 per cent had access within 1 km, while 12 per cent had to send their kids to schools over 5 km away.
There is considerable variation across states on this parameter. Hilly and relatively sparsely populated states, of course, have lower densities. Of the larger states, Telengana has 100 per cent access to primary schools within 1 km, while, interestingly, Kerala reached only 62.5 per cent. Local conditions, including transport services obviously matter. It is also logical to expect a change in the location pattern as kids move from lower to higher segments. However, perhaps we should be thinking of location and access benchmarks for rural schools, which minimise the adverse impact of difficult access on enrolment and attendance. The larger context in which this issue becomes important is the sharp drop-off in enrolment between primary and secondary schools - almost 30 percentage points. How much of a factor is physical access in this transition?
As might be expected, the access problem is much less significant for urban households. Ninety-two per cent have access to primary schools, 83 per cent to upper primary schools and 73 per cent to secondary schools within 1 km of their residence. Here, the issue is of quality and cost. Parents need to have a simple and transparent quality and cost metric to be able to base their decision on and regulators need to monitor and enforce some basic quality standards.
The second indicator that caught my eye was the prevalence of demand for private coaching. We all have our prejudices about private coaching. Is it a necessary evil or a legitimate substitute for parental and family supplements? Whatever one may see it as, the fact is that it is costly and a source of iniquity across households. Be that as it may, the survey shows, as might be expected, that there is an increase in usage as kids grow older and there is a persistent gap between boys and girls. In the primary segment, 23 per cent of boys and 20 per cent of girls across combined rural and urban households use private coaching. The proportion increases to 28 per cent and 25 per cent in the upper primary segment and 38 per cent and 35 per cent in the secondary segment.
Here again, there are some striking variations across states. In West Bengal, 71 per cent of boys and 63 per cent of girls in primary school rely on private coaching. By contrast, in Uttar Pradesh, only 12 per cent of boys and nine per cent of girls use coaching at this level. Does this reflect different aspirations? Or, differences in the quality of the education system? Each interpretation of these variations will have its own policy implication.
The third indicator that I think deserves deep scrutiny is digital access. We have, of course, separate estimates of telecom connectivity and smartphone usage, which are shaping the larger debate on delivery of benefits. This survey focus provides estimates on household possession of computers and, besides this, internet access for at least one member of the household who is above the age of 14. Six per cent of rural households and 29 per cent of urban households possess computers. Not surprisingly, the less affluent states typically have penetration lower than the national average. On the internet access parameter, the picture is a little more comforting; 16 per cent of rural households and 49 per cent of urban households meet this criterion of access.
From the perspective of using technology to improve access and quality of education, these numbers suggest that it is going to be a long haul. However, this should not deter experimentation and scaling in areas in which penetration is reasonable. Above all, providing computer access to as many schools as possible is imperative.
As the government works its way through to a new education policy, it must draw upon objective analysis of these data as well as the wealth of other evidence on what works and what doesn't that is available. Of all aspects of public policy, the costs of being wrong on education will be both high and persistent across generations.
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Heartfelt congratulations to all my dear student .this was outstanding performance .this was possible due to ...
