The idea of Swachh Bharat

Last week a friend’s child succumbed to dengue. Coincidentally, the teenager’s tragic demise came about on the eve of the first anniversary of Swachh Bharat Abhiyan—the clean India programme launched a year ago by Prime Minister Narendra Modi.

Nobody is making a case that the tragic circumstances could have been reversed, but the risk of the teenager falling prey to a vector-borne disease could have been mitigated significantly if indeed the state of our country’s environment were not so pathetic.

Littering, open drains, spitting in public, potholes that become receptacles for stagnant water are just a few examples about how we as a society have enhanced the capability of such diseases to spread with such devastating consequences.

The statistics of this neglect are staggering:

— Poor sanitation and lack of hygiene are causing one in every 10 deaths in this country; about 1,000 children die every day.

— Nearly 600 million Indians, almost twice the size of the US population, indulge in open defecation.

— Diarrhoea, a consequence of lack of sanitation and clean drinking water, is the largest killer and accounts for every twentieth death.

— Under-nutrition among children aged less than five years is almost 50%.

This is the consequence of collective neglect for the last six decades. And fixing this can’t be the responsibility of only one important stakeholder—the government. Addressing the Safaigiri event hosted by the India Today group last week, the Prime Minister said as much when he pointed out that this had to become a national project. “If viewed as a government project or as one belonging to Modi, then it (Swachh Bharat Abhiyan) is destined to fail.”

According to the Prime Minister, while personal hygiene is a way of life for most Indians, the same is not true with respect to social hygiene. In other words, while keeping one’s home and surroundings clean is a daily priority, the same is not true when it comes to using community assets—such as streets, public transport and so on. As he argued, somehow this has come to be the responsibility of the government.

The Prime Minister is spot on. You travel to the US, Europe or East Asia and one would be struck by the cleanliness around us. Yes, the concerned civic authorities are doing a good job, but it is as good as what the local people will allow it to be. If everyone in these countries behaved like us (as Arvind Adiga wrote in his compelling work, White Tiger; the occupant of an expensive car did not think twice in tossing garbage on the street), then these countries would be no better.

The point here is not to publicly decry the lack of civic sense among Indians. Instead, it is to say that the idea of Swachh Bharat Abhiyan offers a terrific opportunity to launch a social movement. Think. When was the last time one single issue bound the nation—it was the collective fight for Independence from British rule. Leaders such as Mahatma Gandhi marshalled the energies of the common people to generate this unstoppable collective energy around us. No matter what it cost—lives lost, careers ruined, families destroyed—Indians were willing to pay the price. And winning freedom took decades—similarly, one cannot overnight expect to overcome the neglect of several decades.

But the good news is that there exists today an enabling environment to fuel a social movement around cleanliness. The Prime Minister’s backing and the bi-partisan support (West Bengal ruled by Mamata Banerjee embraced the toilet campaign and proudly acclaimed in April: Nadia district is now open defecation free, the first in the country in the last two years) guarantees political backing for the cause. And, of course, the fact that nearly two-thirds of India is less than 35 years of age should help; not only do they not carry historical baggage, they would be far more amenable to positive ideas than the preceding generation, which has lived through an era of cynicism.

In the final analysis it is clear that the first anniversary of Swachh Bharat Abhiyan should serve as a launch pad to widen the support base of this movement. And cleanliness, like in our homes, is something that will be perceptible once it becomes a movement. We should take inspiration from what former US President John F. Kennedy said, “Ask not what your country can do for you, ask what you can do for your country.”

World’s ‘extremely poor’ to fall below 10% of global population: World Bank

World’s ‘extremely poor’ to fall below 10% of global population: World Bank

Extreme poverty has long been defined as living on or below $1.25 a day, but the World Bank’s adjustment now sets the poverty line at $1.90 a day

The number of people living in extreme poverty is likely to fall for the first time below 10% of the world’s population in 2015, the World Bank said on Sunday as it revised its benchmark for measuring the problem.

Extreme poverty has long been defined as living on or below $1.25 a day, but the World Bank’s adjustment now sets the poverty line at $1.90 a day.

The Bank said the change reflects new data on differences in the cost of living across countries, while preserving the real purchasing power of the previous yardstick.

Using the new benchmark, the World Bank projects that 702 million people or 9.6% of the world’s population will be living in extreme poverty in 2015, down from 902 million people or 12.8% of the global population in 2012.

The global development lender attributed the continued fall in poverty to strong economic growth rates in emerging markets, particularly India, and investments in education, health, and social safety nets.

“... these projections show us that we are the first generation in human history that can end extreme poverty,” World Bank Group president Jim Yong Kim said in a statement.

However, he warned that slower global growth, volatile financial markets, conflicts, high youth unemployment and the impact of climate change were obstacles to meeting a UN target to end poverty by 2030, part of a new set of development goals adopted by 193 countries at the United Nations last month.

“But it remains within our grasp, as long as our high aspirations are matched by country-led plans that help the still millions of people living in extreme poverty,” Kim added.

According to the Bank, around half of those living in extreme poverty by 2020 will hail from hard-to-reach fragile and conflict-affected states. Sub-Saharan Africa accounts for some half of the global poor.

Experts said the prospect of emerging economies losing steam could challenge promises to eradicate extreme poverty.

“If economic growth of the developing world over the last 15 years was an anomaly, was a blip, then we’re in trouble,” said Laurence Chandy, a fellow at the Brookings Institution whose research focuses on global poverty.

“If instead it’s a kind new normal then we’ve got a good chance of getting close to this goal,” he told the Thomson Reuters Foundation.

The World Bank first introduced a global poverty line in 1990, setting it at $1 a day. It was adjusted last in 2008, when the group raised it to $1.25 a day.

Across the planet, the number of people living in extreme poverty has dropped by more than half since 1990, when 1.9 billion people lived under $1.25 a day, compared to 836 million in 2015, according to the United Nations.

This follows the adoption in 2000 of the Millennium Development Goals (MDGs), which included the eradication of extreme poverty.

Replacing the MDGs are the Sustainable Development Goals, a set of 17 goals to combat poverty, inequality and climate change by 2030—with ending extreme poverty for all people everywhere, a key target.

First Meeting of the National Sagarmala Apex Committee ON 5TH October, 2015

First Meeting of the National Sagarmala Apex Committee ON 5TH October, 2015

The first meeting of the National Sagarmala Apex Committee (NSAC) will be held on 5th October, 2015 in New Delhi. The meeting will be chaired by Union Minister of Shipping and Road Transport & Highways Shri Nitin Gadkari. The members of the NSAC include Vice Chairman NITI Aayog, Chief Ministers of Andhra Pradesh, Goa, Gujarat, Karnataka, Kerala, Maharashtra, Odisha, Puducherry, Tamil Nadu and West Bengal, Union Cabinet Ministers of Finance; Water Resources, River Development and Ganga Rejuvenation; Urban Development; Railways; Agriculture; Rural Development; Civil Aviation; Skill Development & Entrepreneurship; Environment, Forests & Climate Change; Commerce and Industry; Tourism. Secretary, Shipping is Member Convener.

The broad agenda of meeting includes discussions on constitution and scope of NSAC, Concept of Sagarmala and decisions of Government of India relating to Sagarmala, action taken on setting up of Sagarmala Institutional Mechanism, engagement with Maritime States & Line Ministries, progress on the elements of Sagarmala Programme, identification and implementation of projects, critical role of State Governments in project identification & implementation, role of Ministries in project identification & implementation.

The prime objective of the Sagarmala project is to promote port-led direct and indirect development and to provide infrastructure to transport goods to and from ports quickly, efficiently and cost-effectively. The project aims at (i) Supporting and enabling Port-led Development through appropriate policy and institutional interventions and providing for an institutional framework for ensuring inter-agency and Ministries/Departments/States’ collaboration for integrated development, (ii) Port Infrastructure Enhancement, including modernization and setting up of new ports, and (iii) Efficient Evacuation to and from hinterland.

IAS 2015 MAINS ESSAY TEST 2

FRBM without its teeth

The Fiscal Responsibility and Budget Management (FRBM) Bill, 2000, took three years to get passed by Parliament and become the FRBM Act, 2003. In the process, some claim that its teeth were removed. The explicit annual targets, as a proportion of GDP, for reduction of fiscal (0.3 per cent) and revenue deficits (0.5 per cent) were eliminated from the legislation. The Act simply stated that the Centre will take appropriate measures to eliminate revenue deficit by March 31, 2008. Annual numerical targets were left to the government to formulate in the FRBM Rules under the delegated authority of the FRBM Act.

Without an autonomous Fiscal Management Review Committee and beyond the jurisdiction of civil courts, the FRBM Act, many claim, became like the Constitution's Directive Principles of State Policy.

The NDA government that got the FRBM Act passed did not last to promulgate the Rules. Under the first UPA government, the FRBM Rules came into force from July 5, 2004. While notifying the Rules on July 2, 2004, an amendment to the Act was passed for a one-year postponement of the target year for eliminating the revenue deficit to 2008-09. Before the ink on the FRBM Act was dry, the Finance Minister, in his Budget Speech for 2005-06, pressed the pause button vis-à-vis the FRBM Act because of the drastically changed pattern of devolution and funding recommended by the 12th Finance Commission. In March 2005, former Chief Economic Advisor Shankar Acharya published an article in this newspaper entitled "Farewell fiscal responsibility?"

What followed indeed looks like a farewell to fiscal responsibility. The FRBM path of fiscal correction was halted from 2008-09 because of unanticipated changes in the prices of fuel and fertiliser. Outlays on major subsidies shot up from Rs 67,498 crore in 2007-08 to Rs 1,23,581 crore in 2008-09. Off-budget bonds issued to the petroleum and fertiliser companies amounted to a further Rs 95,942 crore or 1.8 per cent of GDP in 2008-09. On August 28, 2008, the central government asked the 13th Finance Commission to lay down a revised road map for fiscal consolidation.

With elections for the 15th Lok Sabha scheduled for April-May, 2009, an Interim Budget for 2009-10 followed on February 16, 2009. A new Finance Minister, in office for only three weeks, called the economic circumstances extraordinary and announced extraordinary measures. The FRBM targets were relaxed to boost demand and counter the impact of the global financial meltdown.

Post-election, the Budget for 2009-10 presented on July 6, 2009, included a fiscal stimulus package. Between 2008-09 and 2009-10, as a proportion of GDP, the fiscal deficit shot up from 6.0 per cent to 6.5 per cent, with an even bigger increase in revenue deficit from 4.5 per cent to 5.2 per cent. Of course, the medium-term commitment to fiscal consolidation and a return to the FRBM targets at the earliest were reiterated.

In the context of FRBM, the 13th Finance Commission, in its report submitted on December 29, 2009, argued against disturbing the existing classification of revenue and capital expenditure in an ad hoc manner. Yet, in what was described as the "Godzilla of all fudges played out in this country in the guise of fiscal consolidation", Budget 2011-12 quietly introduced the concept of "effective revenue deficit." It is the revenue deficit adjusted for grants to states for asset creation. The Budget of 2012-13 went farther. Through the Finance Act, known for its missile-like efficiency for getting passed without elaborate discussion or amendments, it changed the FRBM Act itself. The Centre's commitment to eliminate its revenue deficit was dumped for the elimination of the tenuous concept of "effective revenue deficit". The amended FRBM Rules of May 7, 2013, stretched the time for its elimination by six years to March 31, 2015, and for bringing the fiscal deficit down to three per cent of GDP by eight years to March 31, 2017.

In 2014-15, as a proportion of GDP, the revised estimate of revenue deficit of the central government was far above zero at 2.9 per cent, and fiscal deficit 1.1 percentage points above the three per cent mark to be achieved by March 2017. So, has the FRBM Act been an exercise in futility?

Undoubtedly, even the toothless FRBM Act has been beneficial. Fiscal consolidation is like quitting smoking. Not easy. Politicians and policy makers want fiscal consolidation; but only in the medium term, not the current year. Most smokers recognise smoking as injurious to health, and want to quit, but, not now and here. There are short-term costs. Taxes are painful, and cutting expenditure hurts some constituency. Quitting smoking leads to withdrawal symptoms, frayed tempers and mood swings. Finally, not consolidating this year, like continuing smoking for another day, does not have immediate disastrous consequences.

In the move from discretion to rules in the fiscal arena, like in quitting smoking, there are many failed attempts before success. The US experience with debt ceilings from the First World War days and Gramm Rudman Hollings Act (1985), and EU experience with the Stability and Growth Pact since 1997 are cases in point.

Legislature consisting of the elected representatives of the people will, and should, have the power to formulate laws and change them at their discretion. The durability and success of fiscal rules ultimately depend on popular support for such rules. Pursuit of a virtuous rule, even when diluted, leads to mobilisation of popular support. In the 1950s and 1960s, there were only lonely voices of economists such as B R Shenoy against fiscal profligacy. With the FRBM Act, there is now a larger constituency against fiscal excesses.

India banks on subsidy cuts, higher taxes on fuels

India is experimenting, said the submission, with a careful mix of market mechanisms together with fiscal instruments and regulatory interventions to mobilise finances for climate change.

India would need to spend at least $2.5 trillion between 2015 and 2030 on mitigation activities to meet targets as part of its Intended Nationally Determined Contribution (INDC) submission to the United Nations Framework Convention on Climate Change (UNFCCC).

To achieve the INDC of reducing the emissions intensity of its GDP by 33 to 35 per cent by 2030 from the 2005 level, India has said it will bank on fiscal measures including fuel subsidy cuts and increased taxes on fossil fuels including diesel and petrol.

The Modi government’s policy of duty increases that are an implicit carbon tax of $140 for petrol and $64 for diesel in absolute terms will help India achieve a net reduction of 11 million tonnes of CO emissions in less than a year.

Over the past one year, India has almost cut its petroleum subsidy by about 26 per cent, according to the 38-page document. This, it said, is substantially above what is now considered a reasonable initial tax on CO emissions of $25- $35 per tonne. “The subsidies cuts and increased taxes on fossil fuels have turned a carbon subsidy regime into one of carbon taxation.”

India is experimenting, said the submission, with a careful mix of market mechanisms together with fiscal instruments and regulatory interventions to mobilise finances for climate change.

Cess on coal

One of the dedicated funds at the national level for meeting the costs of mitigation is the cess on coal. In 2010, the cess was imposed at the rate of Rs.50 ($0.8) per tonne of coal and has been quadrupled to Rs.200 ($ 3.2) per tonne of coal. The coal cess translates into a carbon tax equivalent, using the emission factor for coal, of about $2 per tonne. This forms the corpus for the National Clean Environment Fund -- used for financing clean energy, technologies, and projects related to it.

The total cess collection, of Rs.17,084 crore ($2.7 billion) till 2014-15, is being used for 46 clean energy projects worth Rs.16,511 crore ($2.6 billion).

Tax-free infrastructure bonds of Rs.5,000 crore ($794 million) are also being introduced for funding of renewable energy projects during the year 2015-16, India said.

Forestry sector

Also included in the submission is the 14th Finance Commission recommendation on incentives for forestry sector that has based the devolution of funds to states from the federal pool of taxes on a formula that attaches 7.5 per cent weight to the area under forest. According to the estimations based on 14th Finance Commission data, the initiative provides afforestation a boost by conditioning about $6.9 billion of transfers to the states based on their forest cover, which is projected to increase up to $12 billion by 2019-20. “Implicitly, India is going to transfer to states roughly about $174 per hectare of forest per year which compares very favourably with other afforested countries,” the INDC document said.

Preparing for Paris

India’s commitment to adopt low-carbon pathways for development is welcome reaffirmation that it fully recognises its role in averting dangerous climate change. In the statement of climate goals and plans — formally called the Intended Nationally Determined Contributions, or INDCs — which has been submitted to the UN Framework Convention on Climate Change, the Narendra Modi government has emphasised the expansion of clean technologies to generate power, greater energy efficiency in infrastructure, and a significant widening of forestry as key measures. There are several other actions that it will take in the areas of transport, buildings, agriculture and waste management in order to balance economic growth with carbon emissions. With all this, India promises to reduce the emissions intensity of its GDP by 33 to 35 per cent by 2030, from 2005 levels, while not committing itself to any absolute reduction in greenhouse gas emissions. What is significant is that the national plans given in the INDC, ahead of the Paris Climate Conference in December 2015, depends on the “unencumbered availability of clean technologies and financial resource from around the world”. Such a position is consistent with the principle of ‘common but differentiated responsibilities’ that guides climate negotiations. Yet, India cannot avoid addressing the internal contradiction — affluent citizens have access to cheap, abundant energy and mobility while the poor and the vulnerable are forced to fend for themselves — in facing the negative effects of climate change.

On the positive side, since much of India’s infrastructure is yet to be built, the Central and State governments can adopt the greenest technologies to ensure that the long-term impact on emissions is positive. This is particularly important in the design and construction of built structures, including housing and offices, mass transport systems and lighting, to name a few. New coal-based power generation facilities have a prolonged lock-in effect of high emissions, and it is vital to opt for the cleanest systems. Financing such a major effort requires massive funding; the INDC data estimate that between now and 2030, at least $2.5 trillion would be required for the country to meet climate change action requirements. Some of the funding could come from the taxing of fuels. As with the coal cess, there could be a climate tax on transport fuels — this would result in a tax-and-share arrangement where high-volume users would pay a tax to fund common facilities. Another area that needs support is in helping citizens scale up their contribution to renewable energy. Incentivising citizen-investment in roof-top solar installations would unlock private funds and help the country exceed the 100 GW it aims to generate from this source. That will be a world-leading achievement.