The Tribune, Chandigarh, India

Identifying citizens
NPR, UIDAI need to function in unison

Right from its conception, the UIDAI's Aadhaar card had been controversial, especially over the duplication of data being collected under the National Population Register (NPR). The BJP had been particularly opposed to it, as the party feared the card may be used by ineligible people to gain Indian citizenship, or at least benefits meant only for citizens. A flagship scheme of the UPA, it lost the charm once the direct-benefits scheme based on it hit hurdles in implementation. The UPA largely had itself to blame as it tried to push through the scheme right at the fag-end of its tenure, without doing adequate groundwork. That, combined with the perceived disapproval of the BJP for Aadhaar, gave rise to fears that the Modi government would bury a scheme that had many positives.

The Prime Minister's recent push for picking up the pace for the issuance of Aadhaar cards would have brought relief to supporters of the scheme. Now, the Home Minister has stated that the NPR would be taken a step further to identify people specifically as Indian citizens and then issue them 'national identity cards’. This could have been a potential source of confusion, but Rajnath Singh somewhat addressed it by indicating the UIDAI data may also be utilised. The question whether we should duplicate effort on collecting similar data — which should have been addressed before the inception of the UIDAI — still remains. The move for cooperation between the head-counting agencies thus gives hope.

One authoritative card, which gives verified identity along with biometric data on a citizen, is no doubt an absolute necessity in a modern democracy. It will cut through a plethora of devices used currently to establish a person's identity, arguably the clumsiest of which is the affidavit. A man from Punjab will be promptly and readily accepted as an Indian citizen even in Karnataka, facilitating swift legal help or social benefits due. For the government it will mean real-time knowledge of all citizens’ activities, once the scheme is connected to various public services. And knowledge is power.

Thought for the Day

I may be a living legend, but that sure doesn't help when I’ve got to change a flat tyre. — Roy Orbison, an American singer-song writer

On this day...100 years ago

lahore, tuesday, july 14, 1914

The late Lady Hardinge

THE death of Lady Hardinge is sudden, unexpected and almost tragic. It has cast a great gloom over the country. She was quite unlike most others who had been called to the exalted position she had occupied in India. The first glimpses of the many noble qualities with which she had been richly endowed were seen on the occasion of her greatest trial when she displayed an amount of coolness, courage and strength of will which men have failed to show under less trying circumstances. All the great womanly virtues showed themselves to advantage in her scheme of children's day; and all her actions and all her thoughts had been influenced by her motherly instinct. We see this noble influence of that noble woman in the memorable message which His Excellency Lord Hardinge sent to Indians from his bed of pain and suffering. We see it in the little Simla incident of two years ago when she had a poor Indian child, a daughter of Professor Ram Deva of Gurukula, examined by His Excellency's physicians on hearing of the non-success of other medical men's treatment.

"Gadr Di Ganj" and the "Hindustanee"

THE "Government Gazette" Extraordinary of the United Provinces, dated the 11th instant, notifies the forfeiture of the Gurmukhi pamphlet entitled Gadr di Ganj and the monthly paper in English entitled the Hindustanee of Vancouver. In regard to the latter publication it should be noted that it is not any particular issue that is under a ban for containing words "which have a tendency to bring into hatred and contempt the Government established by law in British India." The Lieutenant Governor declares "all the issues, present and future, of the said monthly paper wherever found to be forfeited."

ARTICLE

No clear road map for India
Budget continues Congress government policies
Jayshree Sengupta

Why was there no big-bang change in the budget? After all, the Modi government had the full mandate to do so

It was a budget which seemed to be too long and cautious. It also did not seem to deviate from the path of previous budgets. If this budget is like a prelude to something more drastic to come in future, then it is quite acceptable. Because although Finance Minister Arun Jaitley acknowledged quite succinctly all the areas of weakness, the budget did not have many new features and did not contain a clear and crisp road map for a prosperous India. Hopefully in the next Budget, the government will move away from the Congress prototype and shadow and have something new of its own to say. Meanwhile, if the economy does well and there is a turnaround, the next budget would be a bold one.

Jaitley started off by rightly pointing out that the economy is in bad shape and there has to be an agenda for macroeconomic stabilisation and a concrete future action. The Modi government inherited not only a fiscal mess but also an economy burdened with inflation, low GDP growth and slowdown in investment and manufacturing as well as inadequate infrastructure. In a surprisingly detailed way, many diverse areas were touched upon but the direction that the corporate sector and the aam admi were waiting for was missing.

In general the Modi government posed a budget that guaranteed a continuum of Congress government policies and there was no drastic change or turnaround from social sector sops. Rumours were rife about mindless subsidy cuts and doing away with many of the welfare schemes. Instead the budget contained many small schemes that were aimed at appeasing various sections of the population-mainly the poor and the underprivileged.

The emphasis on the girl child was a welcome feature which translates to acknowledging the fact that despite all the glamour of high economic growth and India being third in the world in terms of GDP (PPP), much need to be done to save girls from being killed before birth. The budget has also made provisions for giving them education. Women's safety in cities is also a crying need to which there was a mention in the budget.

Somehow the Modi government has risen to the challenge of fiscal consolidation and keeping the fiscal deficit at 4.1 per cent of the GDP. How this is going to be done was not spelt out clearly. One is not sure from where additional resources will be garnered as no disinvestment plans for some ailing PSUs were announced.

Regarding income tax, the exemption limit has been raised slightly to Rs 2.5 lakh, which means now some more people will not be paying direct taxes. In general, serious efforts should have been made to bring more people in the tax net because in a huge country like India only 2 to 3 per cent people pay income tax. Bringing back black money stashed abroad was also mentioned but what about unearthing black money within India and using it for development? The corporate sector is no doubt disappointed that the retrospective tax has not been repealed but instead a committee has been appointed to settle disputes.

For encouraging investment, tax exemption under Section 80 C has been increased from Rs 1 lakh to Rs 1.5 lakh. India needs FDI, especially in infrastructure, and to the delight of many the limit for FDI in insurance has been raised to 49 per cent. FDI in defence has also been opened up which is somewhat controversial and could be a security concern. FDI in housing has been encouraged and the limits for investment have been raised. FIIs that left India and are based abroad have been encouraged to return to India because now there will be no tax on income but only on capital gains. Long-term capital gains tax, however, has been raised much to the disappointment of investors in long-term debt. E-commerce in retail has been allowed.

For removing poverty in India surprising amounts of sops have been offered. Giving skill training to youth in a serious and sustained manner will reduce poverty because with training, youth will get jobs and help families get out of poverty. Also, lots of extant rural poverty alleviation schemes have been enhanced but isn't the main problem with multiple schemes one of implementation?

The emphasis on solving the pressing problems of rapid urbanisation is welcome and the slum development scheme and 'housing-for-all' schemes would hopefully lead to a big improvement in the availability of low-cost housing.

In agriculture, an area in which most important announcements were made, the significant ones related to storage and marketing. If farmers can directly sell their produce to local agents instead of taking it to the mandis, there would be quicker availability of produce from farmers to consumers. Also storage capacity enhancement will lead to price stability. Restructuring of the Food Corporation of India and the public distribution system has been promised.

The various promises for more IITs, IIMs and AIIMS-type medical research institutions are all a welcome continuation of the past policies of the Congress-led UPA government. In infrastructure, roads, ports, river projects and cluster development figured. Jaitley also talked about improving EPZs and addressing the problems of small and medium enterprises. There will be 20 new industrial clusters for their benefit.

But why was there no big-bang change in the budget? After all the Modi government had the full mandate to do so. Instead it took hesitant small steps. It could be because the time was short and the budget was put together in a hurry. More policy changes that will give a clearer direction to the foreign investors, the corporate sector and the ordinary middle-class people are sure to come, especially when a higher trajectory of growth has been promised.

MIDDLE

Soccer mania in a cricket-crazy nation
Bhartendu Sood

As I turned to the sports page of the paper the other day, I was a bit stunned, not because Germany had inflicted a humiliating 7-1 defeat on much-fancied Brazil, but what really left me surprised was that the news of Vijay Murli scoring a century in the ongoing first cricket Test match between India and England series was buried in one corner.

I can tell you that 50 years ago nobody would have accepted that soccer grabbed more eyeballs on TV, got more prominent space in newspapers than cricket in this cricket-crazy country where cricket was a religion. What Test cricket was to many like me is best described by these anecdotes from my early years.

Ii was the Dasehra day in 1964. Still in my teens, I had gone to the city Ramlila ground to see the effigies of Ravana and his cohort burn. Television had not entered India as yet and cricket enthusiasts relied upon the ball-to-ball running commentary from All India Radio. The second cricket Test match between India and Australia was in progress. Everywhere people could be seen glued to their transistor sets as the match had reached a very interesting stage. India was 248 for 8 and needed 11 runs to win. One of the most accomplished all-rounders of the time, Chandu Borde, was on strike. Australian captain Bobby Simpson brought in his best bowler, Graham Mackenzie. In the happy din, the only thing that could be heard was the announcement that three successive boundaries had been hit and India had scored their only second victory against formidable Australians with a tag of underdogs. Lo! All of a sudden Chandu Borde had become the idol of the crowd.

During my student days whenever Test series were in progress, one or the other student would bring a pocket transistor in his bag to keep everybody informed of the score. Once, I was so absorbed that, for a second, I forgot that our physics teacher, who had a no-nonsense reputation, was standing just behind me. Held by the scruff, I was trembling, until he asked, “Has Wadekar completed his century?”

During examinations, I'd tell my friend in the hostel to knock on my door in the morning. But when the Test series in Australia and New Zealand were on, I didn't need anyone to wake me — I would be glued to the transistor long before the day's play began.

After graduation when I joined an industry, the rules did not permit employees to carry a transistor, but I'd manage somehow. Once, during a match, my unusually frequent visits to the toilet made my new boss suspicious. But then he too was a Test enthusiast. We had a “chupke chupke” agreement. I would keep him informed of all developments.

Those were the days when a Test series would be in progress, the first thing you’d ask after entering your client’s office was: “Hey, what’s the score?” And if the proceedings would be at an interesting stage or your favourite batsman would be on the wicket, it was not unusual to forget your real work and that would be pushed to the next day.

Well, I don’t know whether this change of taste is temporary or is going to stay like the Chinese noodles and Italian pizza.

oped-diplomacy

Building on the BRICS of solidarity
PM Narendra Modi will be in Brazil for the BRICS Summit, beginning on July 15. It can be an opportunity for India to leverage trade ties with the Latin American countries to its own advantage
Deepak Bhojwani

A proactive India can ensure that Latin American countries become its trade partners

As the hype of the football World Cup subsides, the Brazilian coastal town of Fortaleza, renowned among other things for its gigantic sand dunes, will host the leaders of the most important emerging countries in the world on July 15.

Prime Minister Narendra Modi has already established a reputation for recalibrating the teeth-to-tail ratio in foreign policy. In what will be only his second foreign tour, he will meet with the Presidents of China, Russia and South Africa, in the company of Dilma Roussef, the President of Brazil, a vital strategic partner.

The Summit is expected to roll out important decisions, especially on the formation of the BRICS Bank, with a capital base of US $100 billion.

On the sidelines of the Summit, Modi is expected to have a meeting with those of the other 11 leaders of the Union of South American Nations — UNASUR — who accept Brazilian President Dilma Roussef’s invitation, and will be in Brasilia on July 16.

A Brazilian initiative covering all the 12 nations of South America, UNASUR was formalised in Brasilia in 2008. It is still the most powerful political grouping in a región struggling to achieve a common identity since independence two centuries ago. The fact that most of these leaders will be in Brasilia is testimony to the role of Brazil, the only Portuguese-speaking country in a largely Spanish-speaking environment, in bringing Latin America to the world, and vice versa.

Few prime ministerial visits

While the BRICS agenda is a mountain being scaled by the sherpas and others, the meeting which PM Modi will have with the Latin American leaders, apart from his bilateral with President Roussef, holds tremendous significance. It is no secret that visits by an Indian Prime Minister to Latin America have been fewer than to any other region. After Indira Gandhi’s odyssey in 1968 (she visited eight countries), prime ministerial visits, apart from Brazil, have been mainly for multilateral events — to Argentina, Mexico and Colombia.

Although there can understandably be no set agenda, the fact that such a meeting is taking place is important for India’s outreach to that supposedly distant continent. Supposedly because other BRICS members, specially Russia and, more importantly, China, have been aggressively wooing that region. South America, with an area five times that of India, four times its GDP, and an average per capita income of over $11,000 per annum, has still to catch the fancy of our top leadership.

In this century, trade with the 33 countries of Latin America and the Caribbean has grown at a compound rate of over 30 per cent since 2001. It soared to over $46 billion, despite a slowdown in the past year. The 12 South American countries accounted for approximately 80 per cent. India’s exports have also seen steady growth, despite a continuing trade deficit, largely due to growing imports of crude oil.

Fortunately, Indian businessmen, some of whom will hopefully be in the PM’s entourage, have assessed the potential and have leveraged the complementary nature of its resource-rich economy. On July 6, Pawan Munjal of Hero Motors launched a $70-million motorcycle factory on a 17-acre plot in Colombia.

Four countries in South America — Venezuela, Brazil, Colombia, Ecuador — and Mexico, accounted for almost 20 per cent of India’s world wide crude oil imports in 2013. Extensive investments, worth several billion dollars have been made by Indian public and private sector companies in hydrocarbon concessions, so far in Brazil, Venezuela and Colombia.

With Argentina, Peru and Ecuador also under consideration, apart from Mexico, India’s energy security strategy has an alternative to the current unstable environment in Iraq, Sudan, Iran, or even the South China Sea.

Indian investments

Indian enterprise has been exploring other sectors. Shree Renuka Sugars has invested heavily in sugar plantations in Brazil. Praj Industries has been setting up ethanol plants all over the region for years. Suzlon is active in Brazil and Chile. Indian automobiles, pharma, chemicals, IT are on firm footing. Indian hotel companies are scouting partners and properties in a fast-growing tourism market.

PM Modi, as Chief Minister of Gujarat, had met with the Latin American Ambassadors in India on more than one occasion. One can assume he is aware of the absence of political baggage, the enormous economic and commercial prospects. Gujarat, with the refineries of Reliance and Essar, as well as other business connections, accounts for over 60 per cent of India’s imports from Latin America.

Latin American presence

He must also be aware that several Latin American business houses have set up shop in India and more are keen to have a foothold in this enormous market. According to this year’s World Investment Report by the UNDP, India’s outgoing FDI pales in comparison to that of South and Central America combined — at $8.5 billion compared to $45.5 billion in 2012; $1.7 billion against $32.2 billion in 2013.

The UNASUR 12 are a cogent group of mostly progressive economies. While there may be internal divisions, there is near unanimity on the importance and potential of India. All 12 have embassies in Delhi. There are pending requests from several of these ambassadors for visits by their Presidents to India, expressing long-standing interest.

Ecuador, for instance, is the only country to have purchased India’s Dhruv helicopters — seven in 2008. Two of these crashed, in 2009 and 2014 — no aspersions on HAL from the Ecuadorians — and need to be replaced. India has defence agreements with Brazil, Colombia and Peru as well. There are agreements on cooperation in outer space and nuclear technology. The agenda has been drawn up years ago.

Time is of essence

Though the business environment augurs well, there is little time to lose. Most of these countries have seen the writing on the wall and are stitching together free- trade agreements among themselves and with other major economies. The Chinese President is scheduled to visit friendly Argentina, Venezuela and Cuba after the BRICS Summit. China has invested or loaned over $100 billion within the region. Our Ministry of Commerce’s belated interest in negotiating free-trade agreements with Colombia and Peru needs to be ratified at the highest levels. An amplification of a trade agreement with Chile has been pending with India for almost two years. Yet another with the five-nation Mercosur needs to be expanded.

If this visit conveys the right signals to South America, and to Latin America as a whole, India will be joining a party already in full swing. It will have to work harder to attract the right kind of attention. The Prime Minister’s visit is timely and should take full advantage of this opportunity.

— The author, a former ambassador, has represented India in eight Latin American and Caribbean countries

They can bank on this

At the Sixth Summit of BRICS, a new financial architecture will be established. A monetary stabilisation fund, the Contingent Reserve Arrangement (CRA) and a development bank called BRICS Bank will begin to operate after the summit. The CRA will have $100 billion, with contributions from China of $41 billion dollars; Brazil, India and Russia, with $18 billion each and South Africa with $5 billion. The BRICS Development Bank will begin operation with a capital of $50 billion, with contributions of $10 billion and guarantees of $40 billion from each of its members. It will have a capacity of financing up to $350 billion. China plans to create an Asian infrastructure bank to rival the Asian Development Bank, which is dominated by the US and Japan. Shanghai is considered to be the frontrunner to become home of the new BRICS bank. China, Russia, India and South Africa are putting forward cities to be the host. The choice of city is expected to be made on July 15. The leadership of the bank will be decided in July and will likely be rotated every five years.

Building BRIC by BRIC

The term, "BRICS", was coined by chief economist of Goldman Sachs Jim O’ Neill in his publication, Building Better Global Economic: BRICs. Almost a decade ago, O’Neill decided to start thinking of them as a group – which he gave the acronym BRIC. It was a simple mental prop. The bolder move was to predict — publicly, and in Goldman’s name – that by 2041 (later revised to 2039, then 2032) the Brics would overtake the six largest western economies in terms of economic might. At the time, many scoffed at this idea. The predictions turned conventional western wisdom on its head; and O’Neill hardly seemed an obvious champion of the concept. A large man with working-class Manchester roots, he does not exude the aura of any globetrotting elite. His office is decorated with splashes of cherry red memorabilia from Manchester United Football Club, and he still speaks with the thick, flattened vowels of his childhood. Indeed, when O’Neill coined the term BRIC, in 2001, he had never properly visited three of the four countries (the exception was China), and spoke none of their languages. Bric has become a near-ubiquitous financial term, shaping how a generation of investors, financiers and policymakers view the emerging markets.

Factfile

BRICS is the acronym for an association of five major emerging national economies: Brazil, Russia, India, China and South Africa. It was BRIC before inclusion of South Africa in 2010.

The members are developing or newly industrialised countries, distinguished by large, fast-growing economies and significant influence on regional and global affairs.

On June 16, 2009, the BRIC countries held their first summit in Yekaterinburg. A declaration was issued, calling for the establishment of an equitable, democratic and multipolar world order. Since then, they met in Brasilia in 2010, Sanya in 2011, New Delhi in 2012 and Durban in 2013.

Scholarly attention has been given to BRICS by Brazilian political economist Marcos Troyjo and French investment banker Christian Deseglise. They founded the BRICLab at Columbia University to examine the strategic, political and economic consequences of BRIC countries’ rise. Projects for power and prosperity are analysed through graduate courses, special sessions with guest speakers, education programmes, and conferences for policymakers, business and academic leaders.