30 November 2015

Speech by the President of India, Shri Pranab Mukherjee at the presentation of dr. APJ Abdul Kalam IGNITE Awards

I am happy to be amidst you today in this prestigious institute which has excelled in higher education and provided leadership for the management and business education in the country. The fusion of excellence and relevance in this campus, which has been exhibited through the creative and innovative ideas of young children from all over the country, makes this institute magnetically charged with ideas and energies.

2. At the outset, I would like to congratulate the young award winners whose creative ideas and innovations are at display at the exhibition organized by National Innovation Foundation. It is heartening to see so many creative young minds tackling some of the challenges faced by our society at such a young age. This certainly augurs well for the future of our country.

Ladies and Gentlemen,

3. Indian Institute of Management, Ahmedabad has had an illustrious history. It has excelled in academics and given the best of the management talent to India and to the whole world. Today, you can find the alumni of IIM-Ahmedabad working in corporates, governments, public services and in many other areas. The alumni of this institute have expanded the brand IIM-Ahmedabad globally. Today, I call upon the faculty, students, and alumni of IIM-Ahmedabad to continue to engage with creative minds from industry, business, entrepreneurs, society leaders and with those who work at the grassroots. The Institute must continue to address the pressing issues confronting today’s society. It must strive to be a beacon of knowledge, nurture other institutions with generous mentorship, and maintain a culture that blends the drive for excellence and performance with the spirit of collaboration and compassion.

4. IIM-Ahmedabad has been committed to supporting innovation and entrepreneurship. The Institute’s Center for Innovation Incubation and Entrepreneurship has been doing path-breaking work in strengthening the ecosystem of innovation in Ahmedabad, Pune, Jaipur, and other cities all over India. I understand this institute is launching a course focused on entrepreneurship in its PGP curriculum. This programme offers scholarships to students and encourage them in pursuing entrepreneurial dreams early in their careers. Elective courses such as Shodh Yatraand Rural Immersion Module encourage students to experience how innovation is sparked at the grassroots and among the underprivileged. These kinds of innovative programmes will help in realizing the entrepreneurial goals identified through "Start-up India, Stand-up India” initiative.

5. National Innovation Foundation and IIM-Ahmedabad, has given a global identity to the Indian model of social innovation. An appreciable effort has been made by various student clubs for community outreach activities. One of the intended objectives of this community outreach has been to learn from the disadvantaged section of the society and also to encourage them to dream bigger. I would encourage the Institute to continue investing energy and resources in nurturing innovations that accelerate the nation’s economic progress and create a sustainable inclusive society.

6. Recognizing the centrality of innovation to economic and social progress, President’s Secretariat has taken a number of initiatives to bring inclusive innovations to the center stage of country’s consciousness. Innovation scholars, writers, artists, inspired teachers and students from central institutions are being invited to stay at the Rashtrapati Bhavan for a period of two weeks. These In-Residence Programmes are aimed to celebrate the spirit of innovation and creativity and to recognize and learn from the success stories of the individuals who have contributed to the cause of society and the nation in their own way.

7. Innovation is key to economic development and reflects the maturity of a nation and society to respond to the emerging needs and challenges. Innovation is a continuous process and needs to be nurtured at each and every step. Realizing the importance of innovation in the life of a nation and society, Rashtrapati Bhavan has started the tradition of hosting the Festival of Innovations. The first Festival of Innovations was held in Rashtrapati Bhavan during March, 2015 in collaboration with the National Innovation Foundation. This Festival endeavored to link grassroots innovators with innovative minds at different levels in diverse fields. The second Festival of Innovations will be held in March, 2016. I take this opportunity to invite the participants who are here today, to participate in the Festival of Innovations and take your ideas to a global level.

8. Innovation, higher education and industry need to be closely networked for maximum benefit of the society. Any innovation happening either at the grassroots level or in the higher educational institutions must be linked to the industry for commercialization of the innovation. For this, as the Visitor of 114 central institutions, I have been asking the institutions to establish strong industry-academic inter-linkages. This is one of the ways to readily bring the innovations in the market. For this to happen, I have been encouraging the institutes of higher learning to collaborate with the institutes and industry within India and abroad for creating a conducive ecosystem for nurturing innovation and research. In the recently held Visitor’s Conference at Rashtrapati Bhavan, the Indian academic institutions concluded 43 MoUs with the industry in diverse fields. I hope that these kinds of industry-academia collaborations will help the academic institutions in aligning their activities with the needs of the industry and society.

Ladies and Gentlemen,

9. I am told that National Innovation Foundation received over 28,000 submissions for the Dr. APJ Abdul Kalam IGNITE Competition, 2015 from all the States and Union Territories of the country. It is a great tribute by the children of our country to late Dr. APJ Abdul Kalam, recipient of Bharat Ratna and former President of India. The renaming of Award in the memory of Dr. Kalam is a fitting tribute to him, who always ignited the young minds through his visionary leadership and creative ideas. I compliment the National Innovation Foundation for this initiative.

10. Today, I visited the innovation exhibition and found lots of ideas and innovations which can address the needs of developing society, particularly the elderly people and weaker sections of the society. The children have proved that innovative spirits can dispel any amount of inertia and replace it with exciting new possibilities. I am very optimistic about our future when I see the younger generation which does not want to live indefinitely with unsolved problems. Innovations from creative youngsters are the best examples of "Samvedna se srijansheelta” (innovation from compassion or empathy). India is a country of 1.2 billion creative minds. The constructive use of these billions of minds can free the Indian society from many of the problems which we are facing today. It is for each one of us as an individual to make a commitment and to dedicate oneself for solving the problems of society and country.

Ladies and Gentlemen,

11. IIM-Ahmedabad is a world class institution and a leader in the field of management education. I am happy that IIM-Ahmedabad is mentoring IIM-Nagpur to create a new leader in the field of management education. Today, this institute has taken a leadership role in making suggestions for improving higher education system in India and for nurturing innovation ecosystem. The suggestions made today here show the commitment of this institute in two very important and critical drivers of the economy – higher education and innovation. I will always look forward to see the leadership flowing from this great institute in the areas of work relevant to governance, public policy, innovation, higher education and entrepreneurship.

12. I once again compliment all the young award winners and hope that they will continue to keep thinking creatively and ensuring an inclusive and innovative future for our country. I wish you all a great future and hope that you will spare no effort in contributing towards inclusive development of India.

Remarks by Prime Minister Shri Narendra Modi At the Launch of the International Solar Alliance COP 21, Paris, 30 November 2015

President Hollande, Excellencies, industry leaders

Let me begin by once again expressing solidarity with the people of France; And, our deepest admiration being such an outstanding host to the world in a difficult moment.

To my long cherished dream of an international alliance of solar-rich countries, President Hollande responded with keen interest and immediate and full offer of support.

This is the inaugural day of a defining global conference on climate change.

For his support at every step, and his decision to co-chair the launch, I am deeply grateful.

Just as positive was his response to the idea of a book of quotations on Nature from the world to remind us all of our timeless wisdom. I am honoured to co-author the preface with him.

Since ancient times, different civilizations have given a special place to Sun. In the Indian tradition, Sun is the source of all forms of energy. As Rig Veda says, Sun God is the Soul of all beings, moving and non-moving. Many in India begin their day with a prayer to the Sun.

Today, when the energy sources and excesses of our industrial age have put our planet in peril, the world must turn to Sun to power our future.

As the developing world lift billions of people into prosperity, our hope for a sustainable planet rests on a bold global initiative.

It will mean advanced countries leaving enough carbon space for developing countries to grow. That is natural climate justice.

It also means a growth path with lighter carbon footprint.

So, convergence between economy, ecology and energy should define our future.

The vast majority of humanity is blessed with generous sunlight round the year. Yet, many are also without any source of power.

This is why this alliance is so important.

We want to bring solar energy into our lives and homes, by making it cheaper, more reliable and easier to connect to grid.

We will collaborate on research and innovation. We will share knowledge and exchange best practices.

We will cooperate on training and building institutions. We will discuss regulatory issues and promote common standards.

We will attract investments in the solar sector, encourage joint ventures and develop innovative financing mechanisms.

We will partner with other international initiatives on renewable energy.

There is already a revolution in solar energy. Technology is evolving, costs are coming down and grid connectivity is improving.

It is making the dream of universal access to clean energy become more real.

India has a capacity of 4GW and we have set a target of adding 100 GW of solar power by 2022. By the end of next year, we would have added another 12 GW.

I am delighted with the industry response. As you put clean energy within the reach of all, it will create unlimited economic opportunities that will be the foundation of the new economy of this century.

This is an alliance that brings together developed and developing countries, governments and industries, laboratories and institutions, in a common enterprise.

India will be pleased to host this initiative at the premises of our National Institute of Solar Energy. We will provide land and contribute approximately 30 million U.S. dollars to build the Secretariat infrastructure.

We will support operations for five years, and together we will raise long terms funds to achieve our prescribed goals.

This day is the sunrise of new hope – not just for clean energy, but for villages and homes still in darkness; and for our mornings and evenings filled with a clear view of the glory of the sun.

Li-fi 100 times faster than wi-fi'

A new method of delivering data, which uses the visible spectrum rather than radio waves, has been tested in a working office.

Li-fi can deliver internet access 100 times faster than traditional wi-fi, offering speeds of up to 1Gbps (gigabit per second).

It requires a light source, such as a standard LED bulb, an internet connection and a photo detector.

It was tested this week by Estonian start-up Velmenni, in Tallinn.

Velmenni used a li-fi-enabled light bulb to transmit data at speeds of 1Gbps. Laboratory tests have shown theoretical speeds of up to 224Gbps.

It was tested in an office, to allow workers to access the internet and in an industrial space, where it provided a smart lighting solution.

Speaking to the International Business Times, chief executive Deepak Solanki said that the technology could reach consumers "within three to four years".

The term li-fi was first coined by Prof Harald Haas from Edinburgh University, who demonstrated the technology at a Ted (Technology, Entertainment and Design) conference in 2011.

His talk, which has now been watched nearly two million times, showed an LED lamp streaming video.

Prof Haas described a future when billions of light bulbs could become wireless hotspots.

One of the big advantages of li-fi is the fact that, unlike wi-fi, it does not interfere with other radio signals, so could be utilised on aircraft and in other places where interference is an issue.

While the spectrum for radio waves is in short supply, the visible light spectrum is 10,000 times larger, meaning it is unlikely to run out any time soon.

But the technology also has its drawbacks - most notably the fact that it cannot be deployed outdoors in direct sunlight, because that would interfere with its signal.

Neither can the technology travel through walls so initial use is likely to be limited to places where it can be used to supplement wi-fi networks, such as in congested urban areas or places where wi-fi is not safe, such as hospitals.

Is the India vs Bharat trope passé? The divergence between the fortunes of India and Bharat has been a recurring theme not just in economics but in many a Bollywood movie

Is the India vs Bharat trope passé?

The divergence between the fortunes of India and Bharat has been a recurring theme not just in economics but in many a Bollywood movie

The urban-rural divide in India is a cliché. The divergence between the fortunes of India and Bharat has been a recurring theme not just in economics but in many a Bollywood movie. Could it be that we are moving away from this rather glib urban-rural dichotomy? It would appear so from a recent World Bank research paper, Cities, Catchment Areas and Prosperity in India, by Yue Li and Martin Rama.

Development is not necessarily a process where all urban centres grow faster than rural. Instead, the centres of growth are usually clusters and agglomerations where skills, knowledge, infrastructure, networks and money converge. These are the areas of highest productivity in the country.

Of course, it’s well-known that location is an important driver of labour productivity. Why else do people migrate from rural Bihar to work in Mumbai and Delhi? What is interesting about the paper is its finding that as far as labour productivity is concerned, “the performance of large rural areas and that of small urban areas resemble closely, challenging the conventional view of a rural-urban divide.”

The paper maps the spatial productivity patterns across the country by classifying centres into four types: top locations, their catchment areas, average places and bottom locations. The top locations are the 100 places with the biggest location effects. An example of a location effect is an average Indian household moving from a small rural area in the Malkangiri district of Odisha to Gurgaon, which, the paper says, would see its nominal household expenditure per capita increase 3.6 times. The seven large urban areas that qualify as top locations are, in descending order, Mumbai, Bengaluru, Faridabad, Thane, Kolkata, Surat and Delhi.

What’s remarkable, though, is that some small cities are among the top locations, while some large cities are not. The study also finds that top locations and their catchment areas include many high-performing rural places. Conversely, large urban areas such as Agra, Kanpur, Varanasi and Patna have location effects below the Indian average. A vast majority of the bottom locations are bunched together in the middle of India, crossing the states of Madhya Pradesh, Chhattisgarh and Odisha. A number of bottom locations can also be found in Uttar Pradesh and Bihar. Interestingly, most of them are not rural but small urban areas.

Taking the catchment areas into account, the study identifies 17 clusters in the country. These clusters are spread across several districts and even states. For example, the cluster of Mumbai, Surat and Thane encompasses nine districts in Gujarat and Maharashtra; the cluster of Ahmadabad covers seven districts in Gujarat; and the cluster of Bengaluru includes five districts in Karnataka and Tamil Nadu.

Within the 17 clusters, there are 12 large urban areas, 91 small urban areas, 45 large rural areas and 67 small rural areas. In other words, what matters for development is not so much whether the area is urban or rural, but whether it forms part of a cluster. Location, location, location, as they say in realty, is what counts for productivity as well.

The authors underline the point by mentioning that more than 10% of the rural population lives in one of India’s 17 clusters, compared with about 18% in its 218 bottom locations. Nevertheless, it’s a fact that top locations and catchment areas have both significantly lower employment shares in agriculture and significantly higher shares in manufacture. They also have higher educational attainment at both secondary and tertiary levels and better access to infrastructure and services. These are, rather obviously, factors that set apart India’s most productive areas from the rest of the country.

The paper also highlights that road density increases from bottom locations to top locations and top locations register significantly higher road density than any other tier. In other words, the lesson is: build the roads and the firms will follow. Indeed, that is precisely what is happening. High costs in cities have led to firms converting their land into lucrative real estate while shifting their factories into those parts of the hinterland that are well-connected. In recent years, manufacturing has been moving into rural areas.

It follows from all this that the current government’s single-minded emphasis on road building, therefore, is the right one, as is the work being done on the North-South and East-West freight corridors. As a paper by Urmila Chatterjee, Rinku Murgai, and Martín Rama in theEconomic & Political Weekly pointed out earlier this year, in an economy that is transforming rapidly both economically and spatially, the rural-urban divide is becoming blurred. Perhaps a more fruitful way to look at the Indian economy is in terms of growth clusters and how to extend them.

The numbers behind climate change

Climate change has a long history. Scientists have been warning about rising temperatures and carbon dioxide levels since the 1960s. However, it took a couple of decades before governments started moving. The Intergovernmental Panel on Climate Change (IPCC) was set up in 1988, and two years later, further international cooperation materialized at the Rio Earth Summit, when the United Nations Framework Convention on Climate Change(UNFCCC) was established to stabilize greenhouse gases. Here’s a look at the numbers that explain the politics of climate change and what countries have promised so far.

Why the Ambedkar legacy really matters

Why the Ambedkar legacy really matters
More important than tactically quoting him is to understand the Ambedkarite project

One of the welcome features of the parliamentary debates on the Constitution last week was the centrality given to the ideas of B.R. Ambedkar. We also saw the sorry spectacle of various political parties trying hard to claim him as one of their own. Such attempts to forcefully fit Ambedkar into a straitjacket does injustice to a complex thinker, undoubtedly the most scholarly political leader India has ever had.

Ambedkar wrote on various issues for over four decades, with utter intellectual honesty. A quick look at his oeuvre reveals an astonishing range. He wrote on why India needed to adopt the gold standard, on the exchange rate of the Indian rupee with the British pound, the evolution of provincial finance, the origins of the pernicious caste system, economic modernization as the ultimate solution to farmer distress, what needs to be done to annihilate caste, how to protect the rights of the oppressed, searing critiques of M.K. Gandhi, attacks on the Hindu orthodoxy, why the creation of Pakistan would be good for India, the nature of the Constitution, the need for linguistic states and the humane message of the Buddha. His range included economics, political philosophy, anthropology, history, religion and law.

The current fashion is to selectively quote from Ambedkar to make limited sparring points, as a result of which he is being claimed by the Hindutva camp, the Congress, the free market crowd, the Lohiaites and the Communist Left. His grammar of anarchy speech, made on the day the constituent assembly met on 26 November 1949 to adopt the draft Constitution, is a favourite these days. Far more important than tactically quoting Ambedkar is to understand the bigger Ambedkarite project, which has unfortunately not kept pace with his growing posthumous popularity.

Ambedkar himself often spoke about his intellectual debt to the philosopher John Dewey, who was his mentor at Columbia University. Many of the constant themes in Ambedkar’s varied writings spring from the school of pragmatic philosophy that Dewey was a distinguished member of. The pragmatists championed the cause of individual liberty, they welcomed modernity, they had a disdain for metaphysics, their politics was moderate, and they argued that truth is not an objective category, so any idea must be judged by whether it works or not when put into practice.

But perhaps the most significant idea or at least the most relevant for our times, from Dewey that one can find in Ambedkar is democracy as a way of sharing a common life with other human beings. Democracy is thus not just about periodic elections but a way of living. One core idea is that human beings are not only shaped by social institutions but also shape them in return, but the latter is possible only if there is an aware citizenry that has had the benefit of good education and equal rights. Ambedkar brilliantly adapted these insights from the pragmatic philosophers to develop his critiques of the caste system, his ideas about the Indian nation and his views on the requisites of a robust democracy.

It is easy to selectively quote Ambedkar. He wrote like a libertarian economist in defence of the gold standard in his early career. He led labour unions for the time when he flirted with what he described as state socialism. He attacked Hindu society but had hard truths to share about the reality of Muslim politics in undivided India. He was the moving spirit of the Constitution but once threatened to burn it in a fit of anger. He wanted India to have a strong centre though he warned about the threat of dominance by the Hindi states.

Picking and choosing quotes while ignoring the larger Ambedkarite project is an easy sport that too many indulge in these days. That Ambedkarite project is about individual liberty, the end of the caste system, social democracy, a democratic public culture, the embrace of modernity, pragmatism, constitutional methods and education for an enlightened citizenry.

Can any political party claim Ambedkar as its own?

The cost of redistributing wealth

The cost of redistributing wealth
Should we just redistribute all the wealth until everyone has an equal amount?

’d like to explain how most modern economists think about wealth redistribution. If you discuss welfare, taxes or inequality with an economist, you are bound to run into a concept called the equity-efficiency tradeoff. It’s the idea that there’s a fundamental tradeoff between the size of the economic pie and the equal distribution of said pie.

Suppose you’re a really rich person. You have $50 billion in wealth, though it fluctuates day to day depending on the financial markets. But even if the markets take a tumble, you will still have enough to buy almost anything you want.

Now suppose some hacker comes and steals $10,000 out of one of your brokerage accounts. The difference it would make in your purchasing power would be negligible. Now suppose that hacker, in the tradition of Robin Hood, decided to give the stolen $10,000 to a poor man in a slum in Baltimore. That $10,000 is probably as much as the poor guy earns in a year. Suddenly, his yearly salary is doubled and his risk of having to sleep in a homeless shelter is dramatically reduced.

This difference in the marginal value of wealth—the value of each additional dollar—is a key part of modern economics. It underlies our theory of risk and our theories of labour and leisure. But it also has implications for what we think of as human welfare—the total well-being of the species, or the nation. A given number of dollars creates more well-being in the hands of the poor than in the hands of the rich.

So, should we just redistribute all the wealth until everyone has an equal amount? Even if you think that doing so would be morally acceptable, you would have good reason for caution. Although rich people might not notice one or two random thefts from their bank accounts, they will most definitely notice the systematic appropriation of their wealth by the government. That systematic appropriation, of course, is called taxation.

When you tax people, you usually cause them to reduce the amount that they do the thing that is subject to the tax. That’s not always true—if you tax people’s labour, they may work less because of the decreased value of an hour of work, or they may work more because they are poorer than they were before. But in general, taxation reduces economic activity. Taxing investment reduces investment, and taxing consumption reduces consumption.

Anyway, the basic message is that the more the government tries to shift income around, the less total income there is to distribute.

This is sometimes known colloquially as “Okun’s bucket”, after economist Arthur Okun, who once likened redistribution to moving wealth from one person to another with a leaky bucket.

Modern empirical techniques have allowed economists to get a better idea of how big the leaks are in the bucket. For example, a recent paper by Nathaniel Hendren looks at the earned income tax credit, food stamps and housing vouchers. He finds that for every dollar redistributed from rich to poor with those programmes, anywhere from 34 cents to 56 cents leaks out and is lost.

This is how economists think when they consider redistribution programmes like the ones mentioned above. They don’t normally consider moral questions, like whether it’s ethical for the government to confiscate one person’s income in order to give it to another. When they do attempt to wade into the moral side of things, the result is often ham-handed and awkward.

Thus, economists typically leave questions of justice to the philosophers and politicians. Mostly, they focus on trying to quantify the tradeoff between equality and efficiency. That may seem a bit heartless, but to many economists, it feels like the most objective way to approach questions of redistribution. Bloomberg