All Newspaper editorials in one place – January 11, 2024




THE HINDU Editorials January 11, 2024

Change for the worse

India and Maldives should see the benefits of closer ties


The rapid decline in ties between India and the Maldives, just a month after Prime Minister Narendra Modi met with the newly elected Maldivian President Mohamed Muizzu, should set alarm bells ringing. The trigger came from tweets by three Maldivian Ministers, attacking Mr. Modi for promoting the Lakshadweep islands during his recent sojourn there at a perceived cost to the Maldives and for his close ties with Israel; the Ministers also made derogatory remarks about Indians. The tweets have been deleted, the Ministers suspended, and the Maldivian government has distanced itself from them, but the damage has been done. The respective Ambassadors were summoned. Hurt Indians have crowded social media sites calling for an economic “boycott” of the Maldives — Indian tourists make up the most arrivals post-COVID-19. However, the underlying reasons run deeper, and could have a broader impact on India-Maldives relations and the neighbourhood, accruing to the change in government in Male. Mr. Muizzu rode to power on the back of the PPM’s “India Out” campaign. Despite its disappointment with the win of ‘anti-Indian forces’, given the warm relationship it shared with his predecessor Ibrahim Solih, the Modi government sent a Minister to his swearing in, and there was a Modi-Muizzu meet at the COP28. However, Mr. Muizzu chose Turkey as his first bilateral destination, and is now visiting China — becoming the first President not to make India his first priority. Even President Yameen, who began the “India Out” movement and cozied up to Beijing, visited Delhi first in 2014. Mr. Muizzu has continued to press India on the withdrawal of its military personnel, even though India has clarified their role.

With the calls for boycotts and rising hypernationalistic rhetoric, Delhi and Male need to take a step back and reassess their responses. Mr. Muizzu can ill-afford to antagonise India, given its proximity, economic might and historical position as a net security provider in the Indian Ocean, something Maldives has relied on. India too must see the futility of muscling in a much smaller neighbour, however egregious the provocation. The last few years of ties between the Solih government and Delhi show the benefits of a stronger relationship: India’s infrastructure forays and development projects in the islands, an intense strategic partnership, support during the COVID-19 pandemic, and cooperation on the international stage. For India, in a region that sees several elections this year, it is paramount to ensure that domestic political changes in the neighbourhood do not change the basic structure of bilateral ties, or affect regional stability.


THE HINDU January 11, 2024

Comfortable win  – Sheikh Hasina enjoys popular support, but she must be more accommodative


There was no surprise in the January 7 Bangladesh national elections, which were boycotted by the main opposition party. In the preliminary results, the Awami League, Prime Minister Sheikh Hasina’s party, had won 222 seats in the 300-member Parliament, while the Jatiya Party, one of several smaller opposition parties in the fray, secured 11 seats. Most of the remaining seats went to independents. The Bangladesh Nationalist Party (BNP) called for a general strike, protesting the “sham” election and demanding Ms. Hasina’s resignation. The BNP, which had accused the Awami League of rigging past elections, had demanded elections under a neutral caretaker government. But Ms. Hasina dismissed the opposition’s call, saying there was no provision for caretaker governments in the amended Constitution, leading to violent protests and a crackdown on the opposition. Ms. Hasina says the elections were free and fair, but her attempt to dismantle the BNP using state institutions is hardly a secret. Former Prime Minister and BNP leader Khaleda Zia is under house arrest over corruption charges; the party’s acting leader and her son, Tarique Rahman, lives in London in exile; and several other senior party leaders are in jail. The elections, held amid the BNP’s strike, saw a fall in voter turnout — from over 80% five years ago to 40%.


Being Sheikh Hasina is not easy. Most of her family members, including her father, Sheikh Mujibur Rahman, were massacred on August 15, 1975 in Dhaka. She fought Ershad’s dictatorship along with Ms. Zia in the 1980s and early 1990s, steering the country back to democracy. In the early 2000s, when the BNP was in power, a grenade attack on one of her rallies killed 20 of her comrades. In her second term, in 2009, Bangladesh was grappling with a host of challenges, including internal instability. Ms. Hasina offered a stable civilian rule, cracked down on Islamist extremists, held those responsible for the 1971 genocide accountable and oversaw a period of economic boom and opportunities. Unsurprisingly, independent polls show that most Bangladeshis approve of Ms. Hasina’s performance. But at the same time, the woman who once fought for democracy now faces accusations of turning the South Asian country of 170 million people into a one-party state. She now faces new economic and political realities. Post-COVID-19, there is high inflation, falling foreign exchange reserves and a doubling of debt. Neither Ms. Hasina’s vengeful high-handedness nor the opposition’s violent non-cooperation is helping Bangladesh. The Prime Minister, in her fourth term, should be more conciliatory and accommodative if she is to build a democratic, prosperous naya Bangladesh.




January 11, 2024

Bad weather report

Confirmation that 2023 was hottest year should lend urgency to decarbonisation, efforts to plug gaps in renewable energy


For the better part of 2023, it was all but certain that the year would be the warmest on record. Beginning June, the average global temperature registered a record high every month. Now the EU’s Copernicus Climate Change Service (CCS) has confirmed that in 2023, the planet was 1.48 degrees hotter than the period when the large-scale burning of fossil fuels commenced. Scientists at the CCS have warned that the 12-month period ending in January or February 2024 could be 1.5 degrees above the 1850s. This does not mean that the threshold set by the Paris Pact is likely to be breached soon — the landmark agreement pertains to averages over a much longer time. But the weather pattern this year sets a worrying precedent, especially because the average temperature in 2023 was 0.17 degrees higher than in 2016, the previous record year — in global warming terms, a very large increase.


By all accounts, renewable energy installations have increased appreciably in the past five years. However, this does not seem to have had a meaningful impact on the decarbonisation of the planet. CCS data show that GHG concentrations in the atmosphere reached a record level in 2023 — this along with El Nino has driven most of the warming. The rate of increase in methane emissions was lower than in the past three years. But carbon dioxide in the atmosphere increased at a rate similar to that observed in recent years, indicating that RE deployment is being offset by the use of unclean energy. Blaming the Third World and emerging economies for this increase in the emissions burden would be simplistic, and unfair. According to a study published in the journal Nature last year, historically, the combined share of emissions (1850-2021) of the US and the EU is more than 32 per cent. India’s share, in contrast, is less than 3.5 per cent.


Of course, this does not mean that countries in the Global South do not have work to do. India’s remarkable growth in total RE capacity in the last nine years –from 35 GW in 2014 to close to 180 GW — means that it is well placed to attain its goal of 500 GW RE capacity by 2030. However, like most parts of the world, India is yet to develop technology that enables storing of excess energy when the sun isn’t shining or the wind isn’t blowing. In recent times, the US-China rivalry has hobbled RE supply chains. Last year, China wielded its national security rules to impose export bans on rare earth minerals — it dominates the world market in these commodities that are critical to the green energy transition. In a somewhat similar vein, the Biden administration has blocked US subsidies to Chinese battery manufacturers. In the last two months, the two countries have indicated their willingness to overcome tensions on the climate front. The weather record of the last year indicates that climate diplomats, especially in the big powers, need to be much more nimble.



January 11, 2024

Tighten your seatbelts

As another US presidential election cycle kicks off, there will be drama and spectacle. And long echoes


Some elections matter more than others. As the long US presidential election season kicks off with the Iowa caucuses — both the Democratic and Republican candidates are chosen through an internal party election — and the Republican debate, the riveting run-up to the November polls has begun. US elections generate global interest for two reasons. First, America continues to be the largest economy, with considerable military and strategic heft. What happens in the US election will have a bearing on how other countries, particularly middle powers like India, orient themselves on the global stage. Second, the US’s immense soft power — particularly in the English-speaking world — has meant that America’s culture wars have a reach and influence far beyond its borders. Unfortunately, however, interest in American politics does not always translate into a reasoned engagement based on information and perspective. The impact of the US presidential elections on other countries, like India, is either over-determined or understood too little.


It is clear that Donald Trump — and the idea of “Trumpism” — is the elephant that isn’t in the room. Trump is not part of the Republican debate. The two “frontrunners” participating in the Republican debate this week — Nikki Haley and Ron DeSantis — are far behind the former president. Trump’s judicial troubles — he is facing multiple criminal charges, including for inciting an insurrection — seem to have had little effect on his popularity so far. For the Democrats, barring any major surprises, President Joe Biden is likely to be the nominee, as incumbents are rarely defeated in the primaries.


Given the political polarisation in the US, it is not surprising that the election is being framed as a do-or-die battle by both sides. However, a reality check is called for, in America, and outside. The fear that an election result will completely alter the US’s foreign policy stance — its engagement with partners in the Indo-Pacific, for example — is greatly exaggerated. Nor will the fundamental nature of geopolitical competition with China alter with a change in the White House: Vis a vis globalisation and Beijing, Biden has continued in large part with Trump’s policies. It is important for the intellectual and strategic class in India to understand and analyse US politics through its own lens, not one borrowed from US media, or the diaspora. An objective understanding — with New Delhi’s interests as the basis — is needed from a policy and strategic perspective.




January 11, 2024

Music cut short

Ustad Rashid Khan became a link between the traditional and modern spaces and styles of classical music


In the early ‘80s, when Ustad Rashid Khan was just Rashid Khan, a young, curious student at Kolkata’s ITC Sangeet Research Akademi, a concert by Pandit Bhimsen Joshi at the prestigious Doverlane Music Conference changed the direction of his struggle to become a classical musician. Khan sat listening to the stalwart in rapt attention from the wings when he was asked to get off the stage and sit at the back. While it hurt deeply, as Khan would mention in interviews later, it also galvanised a strength of will, pushing him towards working harder so that he could sing on the same stage one day.


Not only did Khan, who died in Kolkata on Tuesday after battling prostate cancer and a cerebral attack, sing at the well-known music conference, he became perhaps the only classical vocalist to find appreciation on a public stage from Joshi. Khan became the link between the traditional and modern spaces and styles of classical music. Armed with a voice emblematic of a musical era now lost, Khan ventured onto the traditional proscenium like an old-fashioned, paan-chewing ustad and one could only marvel at the technical skill of his khayal and thumris. But unlike the older, traditional classical artistes, he wasn’t averse to probing his art form in contemporary and popular spaces — films, music studios, world music. His Hamsadhwani was as powerful as the popular “Aaoge jab…” from Imtiaz Ali’s Jab We Met.


Born in Badaun, Khan was the great-grandson of Ustad Inayat Hussain Khan, the founder of the Rampur-Sahaswan gharana. He learned under the aegis of his maternal granduncle and the exacting Ustad Nissar Hussain Khan and from his uncle Ustad Ghulam Mustafa Khan. After he was brought to Kolkata by Nissar Hussain at the age of 10, the city became home. A place where he found music, appreciation, a family, and where he breathed his last. The city loved him back. Among others, West Bengal Chief Minister Mamata Banerjee bid a poignant farewell to the “Sangeet Samrat” who left too soon.




January 11, 2024

Speaker Speaks, But…

Shinde safe after Narwekar ruling. However, more legal challenges will come. And state politics won’t get simpler


Maharashtra speaker Rahul Narwekar took more than 18 months to decide on petitions for disqualification of MLAs filed by Shinde Sena and Uddhav Sena. But post-decision, don’t expect Maharashtra politics to be any simpler.


SC again | Narwekar said Shinde’s is the real Sena. EC had granted Shinde the party symbol. The speaker’s ruling came because Supreme Court had asked him to determine which is the political wing of Sena. That ruling led to the nub of his decision – that Uddhav did not have the jurisdiction to remove Shinde. This likely made Uddhav Sena say yesterday it will move SC again.


Who’s boss | The bigger question before Narwekar was this: when Shinde-plus-40 MLAs rebelled against then-CM Uddhav, who had the power to decide on the Sena legislators’ course? And from that it would follow, whether it was for the rebel faction to decide its legislative leader.


SC had clearly accorded primacy to the political party over its legislative wing. Therefore, a party’s constitution and the writ of its president have priority over what legislators decide. Narwekar saying Uddhav Sena’s 2018 constitution, which made Uddhav party chief, is invalid helped him decide in favour of Shinde, while complying with the letter of SC’s verdict.


Muddy & muddled | The other issue: Uddhav had disqualified 16 rebel MLAs through the deputy speaker. But an SC vacation bench stayed these notices, when the Shinde faction told the court a no-confidence motion had been moved against the deputy speaker, so he could not decide on disqualifications. The constitutional question raised was: does notice for removal of the speaker restrict him from disqualification proceedings? Further, SC giving those 16 MLAs 12 days to respond was seen by some as court interference in the speaker’s jurisdiction.


Safe harbour, stormy seas | Shinde is safe, his team is intact. But his troubles may not be over. It may come from within. BJP looms large. It has Ajit Pawar, who gives BJP street cred in some Maharashtra regions. It’s really too early for Team Shinde to celebrate.


And there’s more | Since its 2019 assembly election, Maharashtra has been in political turmoil. That will continue. The speaker must decide on NCP’s factions by January 31. That’ll likely trigger another round of neta-circus. Everything’s bound to get murkier.







January 11, 2024

Two’s Trouble

Boeing-Airbus duopoly in passenger plane market creates aviation industry instability. Competition is needed


The global aviation market is on the brink of another disruption. Last week, a domestic flight in the US witnessed an extraordinary incident when a section of a plane blew off at 16,000 feet, forcing an emergency landing. It led to global regulatory jitters about the plane, Boeing’s 737 Max 9.

De facto duopoly | There’s a near duopoly between Boeing and Airbus in passenger aircraft manufacturing, with others making up a small part of the global market. Boeing’s 737 platform, which was introduced in 1967, and Airbus’ A320neo family are the workhorses for airlines in major markets. Even the supply chain delivering critical components to these companies is limited to a handful such as Pratt & Whitney and GE for engines.


Safety disruptions | There have been repeated disruptions to aviation markets because this narrow supply base of planes and their engines have faced safety issues recently. If it was Boeing’s Max 8 range’s problems with crashes in 2018 and 2019, Pratt & Whitney’s issues have impacted Indian aviation. Market leader IndiGo has cautioned that it may face disruption between January and March if planes are grounded because of issues with these engines.


Entry barriers | The only challenge to this limited supply base right now is in the form of China’s state-owned Comac. Backed by billions of dollars of subsidies, Comac’s C919 has taken on Boeing’s 737 Max 8. However, there’s a catch. The C919 engine comes from GE and Safran. Even state-backed Comac has to circle back to Western suppliers of critical parts.


India’s chance | India’s the dark horse here. There are two things going for it. The expanding size of the aviation market will force Western aviation companies to look at setting more local assembly lines. It provides an opening because India doesn’t carry the burden of China’s geopolitical revisionism. For example, the agreement between GE and HAL for joint production of jet engines can lead to local diffusion of knowledge. It’s for Indian industry to use these opportunities to evolve and emerge as a serious challenger.





January 11, 2024

More Bang for Starbucks, India

Serves as a marker for the spread of middle-classes


Global brands across a wide swathe of industries, from automobiles to luxury goods, are betting on the Indian consumer pivoting from price to value consciousness. The top strata of consumers has, indeed, made the transition, which is reflected in altered buyer preference for all manner of goods, from SUVs to iPhones. The transition makes India an interesting market for brands seeking to eke out extra growth in Asia, principally beyond its export powerhouses. India has not delivered similar growth in incomes compared to that during the hyper-growth stages of Japan, South Korea or China. Its curve is flatter, but steadier. And it is the frontline geography for market expansion.


This becomes abundantly evident in the market for affordable luxury represented by Starbucks. The coffee retailer has been around in a nation of tea-drinkers for a while, and has derived adequate traction to place India at the centre of its plans for future growth, as envisaged in an ET interview by Starbucks CEO Laxman Narasimhan this week. The brewmeister intends to roll out nationwide, mapping the rise in disposable incomes and consumption. The premiumisation of a commoditised experience — a third place between office and home — serves as a marker for the geographical spread of India’s middle-classes. Starbucks’ pace of network expansion will also measure how rapidly value sensitivity is rising among Indian consumers.


This should not be difficult for a brand that has, as part of its DNA, redefined the consumer experience. Starbucks is a case study of how to unanchor prices and maintain exceptional customer connect. Brand loyalty in India on a par with what Starbucks has achieved globally will be yet another marker for value consciousness. This makes the job easier for other brands trying to get their value proposition right in India. The messaging improves by adapting to local taste, which Starbucks has internalised through its customised menu for India. Masala chai and filter coffee tell this story, even as frappuccino fills the air with a strong international aroma.





January 11, 2024

Pilgrims’ Progress Across Sacred India


The soon-to-be-inaugurated Ram Mandir in Ayodhya has turned the small UP town into a hot pilgrimage destination. While Ayodhya is steeped in the back story of an ancient kingdom’s capital, now it’s all set to be plugged into India’s 21st-century hospitality and tourism industry — and the sub-sector of religious tourism. That India has always had a burgeoning spread of pilgrimage destinations of all faiths is plain, and glorious, to see. Less obvious is how religious tourism in this country punches way below its considerable weight. The refashioning of Ayodhya — from its redesigned railway station to its sparkling new airport to its range of hotels, including high-end ones — can serve as a template for religious sites.

India needs to provide its plethora of pilgrims comfort along with the available spiritual solace. And, in the bargain, Indian tourism will make considerable material gains. The ₹85,000 crore infrastructure investment in and around Ayodhya underscores the seriousness with which this temple town is viewing its visitors. If Rome can provide splendour as it leads the tourist — both religious and secular — into St Peter’s Basilica in Vatican City, or if Mecca can have first-world facilities and infrastructure on the way to the Kaaba, there is no reason why the likes of Mathura, Ajmer, Kashi, Bainguinim, Sanchi, Hazratbal, Sarnath, Amritsar and other pilgrim sites in India can’t provide equal comfort to the tirth yatri. Attention to logistics — flights and roads, and hotels — are integral to this makeover. More than 60% of India’s tourism is religion-based. In 2022, 1,433 million domestic tourists visited pilgrimages. Rising affluence will require retaining top-tier Indian tourists. Ayodhya may well provide a blueprint.




January 11, 2024

Cosmic brilliance

Aditya L-1 orbits India into another league


Even before the euphoria of Chandrayaan-3 moon-landing subsided, India’s space agency, ISRO, has pulled off another remarkable feat — placing the sun-observing spacecraft, Aditya L-1, in its halo orbit at the Lagrange-1 point. To steer a spacecraft into a specific spot 1.5 million km away from the earth is not a mean task, but Indian scientists have achieved that. Today, Aditya L-1 is not only basking in bountiful sunrays, but also in international adulation.


A Lagrange point is a location between two celestial bodies, where an object is subjected to equal gravitational pull by the two bodies, so that it ‘stays’ in place. As between any two celestial bodies, there are five Lagrange points between the earth and the sun, and L-1 is the closest to the earth, about 1 per cent of the distance to the sun. Aditya L-1 has been placed in a ‘halo orbit”, from where it will be peering at the sun 24×7 while also travelling along with the earth, as the earth moves around the sun. L-1 is the best place to put up a watchtower to keep an eye on the sun and today, happily, Aditya L-1 is there.


The Aditya L-1 mission is unique in many ways. Coming after Chandrayaan-3 moon landing and the got-it-right-the-first-time Mangalyaan (Mars) mission, the Aditya L-1 mission dispels any doubts about India’s ability to do complex space manoeuvres. While this fact has been well-recognised, somewhat under-appreciated is the scientific muscle that the India-made onboard instruments have. The Solar Ultra-violet Imaging Telescope (SUIT) will keep looking at the central disc of the sun — comprising the visible light-emitting photosphere and the chromosphere above the photosphere. The Visible Emission Line Coronagraph (VELC) will train its sights on the outer rim of the sun — the corona. Since both the instruments (developed at the Inter-University Centre for Astronomy and Astrophysics, Pune) will be looking at the same time, it is possible to study the impact of changes in disc of the sun on the corona. This is important.


Since the corona is the region that keeps throwing harmful things — stuff like charged particles, coronal mass ejections— some of which could rain down upon us, any knowledge of the impact of variations in the disc on the corona will be a sort of an early-warning to us of what might be coming from the sun. To look at it from another angle, Aditya L-1 has instruments that pick-up and analyse a big range of electromagnetic radiation from the sun. Some of Aditya’s instruments pick up everything from near-infra-red to soft X-rays and the others catch and analyse sun-spewed particles streaming into them. So, among themselves, the seven instruments can pick up and crunch on monstrous amounts of data. The Aditya L-1 mission is ISRO’s most complex ever, tougher than the three Chandrayaans and the Mangalyaan. In it lie anchored big expectations of the Gaganyaan mission, which will one day take an Indian to space.






January 11, 2024

Investing for growth

Private-sector investment revival is crucial


The Government of India has been pushing capital expenditure to enable higher economic growth in the post-pandemic period. The idea is higher government capital expenditure will not only build the much-needed infrastructure in the country but also increase economic activity, which will encourage the private sector to invest. However, as this newspaper reported on Wednesday, several states are lagging and have reached only about a quarter of their capex target for the financial year. The role of investment in pushing economic growth has once again been underscored in a comprehensive study by the World Bank, published in the latest Global Economic Prospects report. Like the rest of the world, investment in India suffered significantly after the global financial crisis. India faced a twin balance-sheet problem where both corporate and bank balance sheets were stressed. It has now fully recovered from that phase and there are tentative signs of revival in private-sector investment, though their sustainability remains to be seen.


The World Bank study examined 104 economies, which included 35 developed and 69 emerging market and developing economies (EMDEs), between 1950 and 2022. As the study notes, during the periods of investment acceleration, output growth in EMDEs increased to 5.9 per cent per year, which was 1.9 percentage points higher than in other years. Empirical analysis in general and case studies highlighted in the report present three key observations related to the role of policy in enhancing the rate of investment that are worth discussing here. First, policy interventions that improve macroeconomic stability, such as efforts to reduce the fiscal deficit and the adoption of inflation targeting, along with structural reforms, including interventions to ease international trade and capital flows, have been seen to be helpful in increasing investment. Second, specific policy interventions play a role, but a comprehensive package of policy interventions that enables greater macroeconomic stability and focus on structural issues tends to significantly improve the possibility of accelerating investment growth. Third, the role of institutions, such as a well-functioning and independent legal system, is crucial. This is understandable because a well-functioning judicial system inspires confidence among investors and entrepreneurs because it makes enforcing contracts easier.


In this context, it is worth noting that India has a fairly high degree of macroeconomic stability. Nonetheless, it needs to improve its fiscal position. However, a higher level of fiscal deficit, to an extent, is being driven by higher government capital expenditure to induce private investment. A difficult policy question the government perhaps will soon need to address is: At what point should it start withdrawing to create space for the private sector? On the external front, while India has a fairly high degree of capital mobility, there have been some reversals on the trade side owing to tariff increases in recent years, which some economists believe will affect long-term growth.





January 11, 2024

Export potential

The agricultural sector needs policy intervention


The Union government expects agricultural exports to almost double to around $100 billion by 2030. In 2022-23, the value of India’s agricultural exports was $52.50 billion, while in 2021-22 it was $50.21 billion. The growth will need to accelerate significantly to be able to attain $100 billion, which will also help push agricultural growth in the country and raise farmers’ incomes. Notably, contrary to expectations that India’s agricultural exports may remain flat in the current financial year owing to export curbs on various food items, the government expects it to exceed last year’s level. It will indeed be an achievement, particularly given the unprecedented logistical challenges in the form of high freight rates and container shortages due to the Red Sea crisis and an export restriction-induced decline.


Nonetheless, from a medium-term perspective, India will need to take various measures to push exports. According to a recent report by the Global Trade Research Initiative, for instance, India’s agri-export basket is fairly concentrated. Basmati rice, non-basmati rice, sugar, spices, and oil meals constitute around 51.5 per cent of India’s agricultural exports. Other agri products include coffee, tea, tobacco, fresh and processed fruit and juices, groundnuts, fresh vegetables, dairy products, and live animals. India is also a large exporter of buffalo meat and marine products. There are two important issues worth highlighting here. First, India ended up banning exports of those products in which it has held a leadership position in the world market for several years. India, for instance, accounts for more than 40 per cent of global rice exports. Such restrictions not only have implications for global food security, especially for poorer countries in the Global South but also dent India’s credibility as a reliable source of food supply. India should avoid such steps. It has been argued that instead of opting for a protectionist trade policy, the government should calibrate trade policy efficiently to control food inflation. Second, India should aim to increase diversification in its food export basket to be able to contain the risk to overall exports because of a decline in the production of one item or the other. In this context, for instance, India hopes to give a boost to exports of value-added millet products. Higher diversification will help India insulate itself to an extent from fluctuations in global prices and demand.


The government, to be fair, has taken initiatives to boost exports. India’s agri-export policy, for example, calls for overhauling infrastructure and logistics, a greater involvement of state governments, and developing export-centric clusters to ensure surplus produce that meets standard quality parameters. Agri-cells in Indian embassies across 13 countries have also been set up. However, challenges abound for India’s agri-trade sector, and those have forced the country to remain at the lower end of the global agri-export value chain, given that the majority of its exports are low-value, semi-processed, and marketed in bulk. The sector is hindered by inadequate cold chain infrastructure and inefficient logistics, leading to spoilage and export competitiveness issues, including problems related to the quality of products. Small and marginal landholdings, coupled with a lack of access to credit, often deter farmers from transitioning to commercial production. Addressing some of these internal issues and attracting private investment in processing and related activities will help boost exports over time.





January 11, 2024

Going slow on the D-word

The next government must push disinvestments in next fiscal


As the NDA regime gears up for the national elections, there are pre-budgetary indications that the disinvestment target for FY25 may be relatively modest at `30,000 crore, which is 40% lower than the targeted `51,000 crore for the current fiscal. For perspective, this is the lowest in nine years. Clearly, this is underwhelming as the actual disinvestment in the current fiscal itself is likely to be 60% lower than the target. Although it makes sense to set a smaller disinvestment target and over-achieve it, much like what has happened with revenue collections in recent years, there is no doubt that the forthcoming election is responsible for shifting the focus away from divestment and privatisation or strategic disinvestments. The difference between disinvestment and strategic disinvestment is that the former entails incremental scrip sales of listed public sector undertakings while the government retains majority control while the latter involves a shift of management control to the acquiring party. Ahead of elections, governments are generally cautious about scaling up such exercises—popularly perceived to be selling the family silver to pay the butler—because of opposition from powerful trade unions.


While the elections are responsible for going slow on future disinvestments, this exercise has been running out of steam during the past few years. More so with strategic sales despite the government declaring that it has no business to remain in business. For starters, the government has never met its disinvestment targets since FY20 according to a report in this newspaper. The proximate causes include volatility in the stock market and obstacles created by administrative ministries. As for strategic sales, the successful transactions so far have been only Air India and Neelanchal Ispat Nigam Ltd in FY22 and FY23, respectively, both of which went to the Tata Group. This limited progress contrasts sharply with the sweeping agenda announced in Budget 2022, which also included BPCL, Shipping Corporation of India, Container Corporation of India (Concor), IDBI Bank, BEML, Pawan Hans, besides two public sector banks and a general insurance company. On IDBI Bank, the government has received multiple expressions of interest from domestic and foreign investors and the exercise could possibly be concluded next fiscal. Concor has been hanging fire since 2019 as the railway ministry’s processes have been slow. There are doubts whether this transaction would be concluded even in FY25.


As plain vanilla stake sales are not fraught politically, the government must push through divestments next fiscal to cash in on the rallies in the stock markets and must be carried out as frequently as possible. Strategic sales are more complicated. As they are controversial, the bureaucrats involved in these complex processes fear penal action or harassment in the future. Perhaps provisions need to be built into the laws to protect the civil servants working on these transactions. Even though strategic sales take place through transparent bidding processes, there is clearly some anxiety that needs to be addressed. But the disinvestment targets can be more ambitious to fetch the government sizeable non-tax revenues to fund its capex plans to boost overall economic growth. Relying on market borrowings is not desirable. While at some point the private sector must do the heavy lifting in terms of investments, the government must have the tax and non-tax revenues from disinvestments to complement that effort.




January 11, 2024

There’s still time to control the global thermostat


In 2015, in what seemed at the time like a triumph for humanity, the world’s leaders set a stretch goal of limiting global warming to 1.5 degrees Celsius above preindustrial averages. Not even nine years later, you could be forgiven for thinking they’ve failed.


The good news is that they haven’t failed just yet. The bad news is that they’re rapidly running out of time.


Thanks mainly to our unquenchable thirst for fossil fuels, global surface temperatures were just a smidgen below 1.5°C above preindustrial averages in 2023, the EU’s Copernicus Climate Change Center reported on Tuesday—1.48°C to be exact. The strong El Nino weather pattern currently in the East Pacific is temporarily heating things up a bit, which means the planet will likely be even hotter in 2024. Copernicus suggests we could well see more than 1.5°C of warming next year.


You’re probably about as sick of reading last year’s unhappy superlatives as I am of typing them, but one last time:

■ It was the warmest year since at least 1850 and probably since 125,000 BCE.

■ Between June and December, each month was the hottest of its kind on record.

■July and August were the hottest months on record, full stop.

■ Last summer was the hottest season on record.


All of this contributed to heatwaves across China, Europe and the US, wildfires in Canada and Greece, drought in Africa, flooding in Libya and Vermont, the deaths of Florida corals and more. In the midst of all this, global leaders meeting in Dubai last fall could make only vague promises about quitting the fossil fuels at the root of the problem.


They still clung to the shreds of the warming goals they’d set in Paris in 2015— 2°C as the primary target but still hoping for 1.5°C if all goes well. And with more concerted effort beginning eight years ago, 1.5°C might have been reachable. Now even 2°C is starting to look like a stretch. In fact, current policies have us on track for something more like 2.7°C of warming.


The stretch-goal concept, sometimes attributed to Jack Welch, the former chief executive officer of General Electric Co., but with roots in former President John F. Kennedy’s moonshot, imagines that setting seemingly impossible goals can drive people or organizations to do great things. The problem with stretch goals is that they often don’t work without a track record of success and a lot of extra capacity lying around. When it comes to fighting global warming, humanity has little of either. We’re still burning more fossil fuel than ever with no sign of breaking the habit in the near future, as my Bloomberg Opinion colleague Javier Bias notes.


“The 1.5°C global warming ceiling has been passed for all practical purposes, “former NASA scientist James Hansen wrote recently. He warns the global temperature anomaly could hit 1.7°C next year.


But Hansen also thinks warming is accelerating, a controversial take that has divided scientists, as my Bloomberg Opinion colleague Lara Williams has written. And two years of 1.5°C of warming would not guarantee failure. Given that the Paris goals are based on long-term averages, it will be another decade before we know for sure.


In the meantime, no matter how hopeless it might look, we must keep striving for the stretch goal, because every tenth of a degree of heating we avoid will save countless lives and untold billions of dollars in economic losses. Warming of 1.7°C is still better than 2°C, which is way, way better than 2.7°C,and so on.


We must act with far more urgency, though. According to a study by Imperial College London, the world has less than a decade of emissions left in its “carbon budget” before the chance of holding at 1.5 °C is lost forever. Not one country is doing enough to avoid this fate, according to the nonprofit-backed Climate Action Tracker. Your typical corporate leader wouldn’t stand for such lackadaisical efforts to meet stretch goals, and neither should we.



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