India Development Concerns

Ban exports from Reliance Refinery

2008-07-19T10:26:00.000-07:00

There is a fuel shortage in the country - no diesel at the petrol bunks (they are living upto their name by not stocking diesel) and if at all they have diesel, there are serpentine queues (causing traffic jams on the roads) with 2 or 3 hours waiting to get a rationed amount (no tank full, please) and at times you are forced to buy only premium diesel. It is hurting the economy - cab drivers and auto drivers have to live with reduced incomes, trucks are off the road and even school buses are running out of diesel. There is loss of industrial production because there are 3 hour power cuts in some states and there is no diesel to spare for the industry because individual car owners seem to get precedence. Hotels are panicking because they are not getting enough diesel to run their generators.

The problem is partly because of dieselization of Indian Economy (as Dr Vijay Kelkar stated many years ago) by keeping the price of diesel low (ostensibly to keep bus fares and train fares loo) which resulted in perverse use of diesel by the even the ultra rich for SVUs and Mercedes Cars. Diesel is not only more polluting than petrol but also responsible for sulphur emissions that causes acid rain. Worldwide diesel and petrol are priced about the same but in India diesel is about 20 to 25% cheaper which makes it a compelling reason for car buyers to opt for diesel even though the price of diesel cars are much higher.

The diesel shortage is said to be because the PSU Oil Companies have stopped importing crude and products as they have run out of funds. Their financial position has deteriorated because fuel price increases have been put on hold for long by the government which was trying to keep the electorate (aam aadmi to kuch milana chahiyee) happy by holding the prices despite record high crude prices of over US$130 per barrel in the international market. While this is the case with PSU oil companies, the private sector giant, Reliance Petroluem has stopped all domestic sales (shut down all its petrol bunks which are said to be state-of-the-art with VSAT links and dining facilities for drivers) and is exporting all its production to maintain its profitability and keep the shareholders smiling.

Our government has banned export of rice (as a precautionary measure) when there was a food shortage in many countries, despite criticism that we are hoarding food while there were poor people starving in other less fortunate countries. India was not responsible for the global food crises - blame it on climate change or diversion of food crops for fuel by USA and European countries. My question is why doesn't the Indian Government ban export of petroleum products by Reliance Refinery? The country can pay Reliance import parity price (after all the millions of shareholders cannot lose if Reliance sells at a loss) and use the products in the domestic market. And yes, even the damned diesel not only for our fuel guzzling SUVs and Mercs but for the cabs and autos and the industries which are faced with power cuts. The delay in monsoon is going to make the load shedding worse. The time to act is NOW, ban the exports from Reliance refinery and use the products for the domestic market. It is for the National Economy, after all!!

Nano is Beautiful - The New Symbol of Indian Economy

2008-02-04T09:12:00.000-08:00

Now that the heat and dust have settled down after the launch of Nano, I feel the need to express my thoughts. The Nano has done more for Brand India and the Image of Indian Manufacturing and for India Inc in recent times than any single thing / event / product. Of course IT and ITES have raised India’s economic and intellectual profile but Nano is the culmination of efforts of just one company and the vision of one individual. You can never expect General Motors or Toyoto or Ford to design or built a car for less than USD 2500. What would they make on that kind of sticker price? You are right, peanuts!!. These companies are busy building SUVs and luxury cars to a pampered lot of customers who have the purchasing power. For them, the rule is more fancier or bigger the car, bigger the profit. What can you make on USD 2500? At best may be USD 250 which is not good enough for any MNC automobile giant. The idea could have come only to someone who has his roots in a developing country and gets the inspiration to meet the needs of the common people and solve the problems of a developing country.

Consider the long term impacts. I would imagine GM and Ford and not to forgot Suzuki, who tried to snub Tata, would be swallowing their egos and start designing their own versions of Nano. But then Tata would have a head start and would bring out the electric version of Nano and may be also the Plug In Electric Hybrid version of the Nano. This will make even the environmentalists who belittled the Nano eat an humble pie.

If the Fords and General Motors come to India with their fancy cars and expect the road infrastructure to be made suitable for the cars needed for a growing economy, is it not a sad irony that Nano is to be blamed for all the congestion it would cause for so many two wheelers would be replaced by Nano. It is for the government to regulate the transportation sector and choose the optimal mix between public transport and private vehicles. Nano is the product of commercial enterprise and if the customers go for it and if it gives the MNC auto giants a run for their money, so be it. The future market for cars is in the developing world and the Nano is suitable for this market, not just because it is made for the smaller physical frames of orientals.

We have a Mahatma Gandhi who made Einstein wonder that such a man ever walked on earth and we have a Vishwanathan Anand who inspired a whole generation of Chess Champions. We have the Nano now which can be the symbol for emerging prowess of Indian Manufacturing and can be the rallying spirit that all is not lost in manufacturing and can inspire India to compete with China in manufacturing itself. India has built its own economic model with IT and ITES, different from that of its Asian neighbours with low cost manufacturing and now India can show it to the World that the Nano is a paradigm shift in the Motor Car since Henry Ford rolled out its Model T. Of course, the market for Nano has to be created in India first and the government can certainly support these efforts with Nano friendly regulations. How about, lower life tax or no life tax for vehicle registration or exemption from excise duties and sales tax or allocation of preferred parking spots to Nanos.

Taxing times for Cars

2008-01-13T06:50:00.000-08:00

It has just become more expensive to own a second car in Hyderabad. Life tax has been increased by 3% for owning a second car ostensibly to discourage people from adding more cars to the already congested roads. The higher life tax is applicable to even those people who already own a two-wheeler and want to buy a car. The authorities think that traffic problems can be solved with this move and something had to be done in that regard. This is a half hearted measure that is too little too late without giving adequate thought to the overall issue.

India is perhaps one of the few countries that has remained insulated to the all time high crude oil prices. Petrol prices don’t go up when crude prices go up because of political concerns over public backlash or negative vote in any of the interminable elections in the country. It is rather shocking that in India people are going for bigger cars even as oil prices keep going up. There is a need to limit the size of the cars in the interest of fuel efficiency, lower pollution and to avoid congestion on roads. Government of India has rightly provided lower excise duty on small cars about couple of years back. Although, the foreign car makers protested initially they have responded to this initiative with new small cars like Chevy Spark from General Motors and i10 from Hyundai.

An independent initiative to develop a revolutionary small car prized at Rs 1,00,000 is the TATA Nano that has been unveiled on Jan 10^th at the Auto Expo in Delhi. The Nano is appropriate for India and only an Indian company can take the bold initiative to develop it despite the doubting thomases and nay sayers and the detractors. The Nano will herald higher safety on the road in India as it will give an option to families riding two-wheelers with small children. The Nano can be hailed as an alternative to Autorickshaws which should also be subjected to the same safety standards as cars. The Auto is a product of famous India ‘Jugaad’ made by Bajaj Auto under the erstwhile license and permit raj with least concern for environmental pollution and safety of the driver / passengers.

Bigger cars and SUVs mean big profits for auto companies and though they are fuel inefficient and bad for the environment. The higher life tax should selectively target the petrol / diesel guzzlers like the TATA Safari Dicor, Chevorlet Tavera, Mahindra Scorpio, Honda CRV, Mitsubishi Pajero, Toyota Innova and Land Cruiser and a host of other desi and imported SUVs. It is crime to allow import of SUVs like the Hummer which probably gives a mileage of 3km a litre. Government of India can impose a non-tariff barrier on the import of these SUVs by setting a minimum mileage limit and this cannot be challenged even in the WTO after all it will be good for the environment. It will also be part of developing countries response to climate change mitigation that has caught the imagination of the whole world.

These big cars and SUVs should be charged higher parking fees and should pay a Carbon Tax that should be collected every year along with the insurance (based on mileage recorded) so that they owners feel responsible through out the lifetime of their ownership.

I personally feel owning a two-wheeler and a car could be encouraged as the owner will have the choice of using the car when traveling with the family rather than the couple and the kids riding the two-wheeler which is totally unsafe.

What we need is better public transportation – buses, metro rails, car pooling etc. Over 10,000 vehicles are being registered in Hyderabad every month. The congestion will get worse inspite of the flyovers and the metro rail or the bus rapid transit system. We need drastic measures to overcome drastic situations and I suggest the following bold initiatives to contain the menace of traffic growth:

1) Keep Autorickshaws off the road once a week (just imagine how peaceful it is on those days when the Auto drivers go on strike)

2) Keep cars over 1000 CC off the road once a week (to encourage ownership of small cars) or allow cars ending with odd number only on odd days and cars ending with even number only on even days (this will encourage car pooling)

3) Enrolment of a child in school must be conditional upon the parents living within a 10km radius from the school.

4) Give an extra allowance to employee who walk or cycle to work or an incentive to employees who live within 10km from their workplace.

5) Inter city buses and outstation lorries must not be allowed within city limits between 7am to 10pm. Inter city buses must be terminate outside city limits and ferry passengers to the city with smaller buses or taxis or autos.

6) Increase the daily working hours and make it a five day working week for offices.

7) Earmark places for markets and vendors to stop encroachment of the roads by vendors.

8) Build some parking ramps near important market places like Charminar, Abids, Ameerpet etc. Places like Charminar should be made completely pedestrian places.

9) Lastly, invest in metro rail and bus rapid transit systems.

Road Sweeping is a thankless job in Greater Hyderabad

2008-01-06T03:51:00.000-08:00

Muncipal Corporation of Hyderabad has rechristened itself as Greater Hyderabad Municipal Corporation. We take pride that Hyderabad is a happening city and hence felt the need to add "Greater" to feel better. Or the City became Bigger and seemingly Better and hence Greater.

Some of the fundamental functions of a Municipal Corporation is maintaining civic amenities - clearing garbage, sweeping the roads, maintaining the roads etc. I am aghast at the way we sweep the roads by engaging groups of women and giving them brooms. In the last twenty odd years, I have seen no attempt, no innovation to improve this broom. The small improvements that I have noticed are that these women have been wearing jackets for a few years with MCH logo and some of them who sweep in the night wear jackets with luminous stripes so that the drunken drivers and avoid them and ram their expensive cars into the dividers. I feel extremely sympathetic to the plight of these poor women earning their living by sweeping the roads with a SHORT BROOM.

Why can' t we have a broom with a long handle (like the broom used to rake and gather dried leaves)?
Are they given a short broom so that they bend their back and supposedly sweep more efficiently? This is more like memsaab appreciating the baiye because she bends and sweeps the dirt out of the nooks and corners.
Have any studies been done in MCH, departmentally or by third party, on the long term health problems and the effects on the spine / vertebral columns of these workers?

It is appalling that no one in MCH, not even the venerable IAS special commissioner nor the politically elected councillors, thought of the productivity improvements by the use of a broom with a long handle that will reduce the strain on the backs of these women? By the way, many of these commissioners and councillors have taken the opportunity at taxpayers expense to go abroad and see how cities work and introduced things like metal garbage boxes, luminous road signs, new bus stop designs in their own special way that achieves the intended purpose partially. The design of the side walks in Hyderabad really take the cake and must be the work of the mason with little or no input from the contractor and the MCH engineer and this item deserves a separate blog entry. The MCH's engineers' jobs must be so cool that they dont have to design anything leave alone the ergonomic considerations in design and no wonder that the flyover at Panjagutta collapsed because these engineers could not see that the contractor was taking risks with the scaffolding that was supported only on soil instead of concrete blocks.

Are we so insensitive that we don't feel anything for the plight of these women?

The Chandrababu Naidu's government introduced night sweeping of the roads and through contractors and roads used to look clean during that time that visitors to the city used to comment on that. Now, the roads themselves are in such a bad shape that people dont notice the dirt and filth on the roads when they are busy bracing themselves as they travel through the next ditch or pothole.

I think there is a great opportunity for the Y S Rajasekhar Reddy's government to provide long handled broom to the road sweepers and show these workers and the citizens that their government cares for the poor and is keen to improve the working conditions of the poor and show that they are ready to improve productivity and efficiency.

Lathi and The Indian Police

2008-01-05T20:57:00.000-08:00

Ever wondered why the Indian Policemen still carry lathis. The lathi was vielded on the Satyagrahis and was used by the British to break their bones unlike rubber truncheons which would only bruise them. It is a legacy of the imperial rule and should have been discarded by the parliamentarians of the constituent assembly most have whom have suffered the blows of lathis. For the poorly equipped police force it is the easiest way for the constable or home gaurds to empower themselves on the street. The constable doesnot have any powers to book offenders many a time and has to depend on the lathi itself to even defend himself from any hooligans or dacoits.
It is high time that reforms and technological upgradation of the police force considers the history and the shame of the lathi in the Indian freedom struggle and and discard the lathi once and for all. We should equip / modernize the police force with better gadgets like truncheons, zapper guns, GPS enabled alarms or buzzers (rather than mere whistles) . Think about the poor constable who involved in maintaining law and order or regulating traffic or crime investigation (when they are not stuck with orderly duties of the more privileged officers) without being equipped properly when considering the adminstrative reforms or modernization of the police force.