Coal and India in it’s Union Budget 2020-21. Is India really serious about its Climate Change commitments?

Centre’s Expenditure (figures in crore)

Revenue

Capital

Total

Actual 2018-19

708.34

0

708.34

Budget Estimate 2019-20

1159.05

0

1159.05

Revised Estimate 2019-20

933.60

0

933.60

Budget Estimate 2020-21

882.61

0

882.61

The breakup for this head is Rs. 819.98 crore for R&D, conservation, safety & infrastructure development in coal mines, and exploration of coal and lignite; Rs. 22.35 crore for coal mines pension scheme; and the remaining Rs. 40.28 crore is for the secretariat, statutory bodies and sub-ordinate bodies. The coal mines pension scheme allocation is the same as a social services developmental need and is covered under Labour, Employment and Skill Development. R&D’s main thrust area is promotion of clean coal technology and to identify coal blocks for coal to liquid projects. Conservation, safety and infrastructure’s emphasis is towards conservation of coal through protective works and safety improvement. The infrastructure component in coal field areas is development of road and rail network. Exploration of coal and lignite is to meet the demand for coal, including provisions for detailed drilling in n0n-Coal India Limited coal mining blocks (like the NTPC blocks) that would help the prospective investors in taking investment decisions regarding coal mining and reduction of time for preparing the mining plan. The allocation for the exploration of coal and lignite is Rs. 700 crore, which is to assess the coal availability to meet the sizable increase in the demand for coal. This scheme is to be implemented by the Central Mine Planning and Design Institute Limited (CMPDIL). Also, this step would help build promoting the private investment in the coal mining industry. 

The Government has eased restrictions on foreign investment in coal mining, in an effort to attract more capital from abroad. The allocation for the Coal Ministry has seen a 5.4% reduction to Rs. 882.61 crore for the FY 2020-21, a dip from the revised estimates for the FY 2019-20 of Rs. 933.60 crore. While the expenditure was Rs. 1159.05 crore for 2019-20, the actual was Rs. 708.32 crore for 2018-19. This year, however, the major increase in the allocation was towards the central sector schemes, that are entirely and directly funded and executed by the central government. However, there has been an increase in investment in public enterprises, including Coal India Limited in FY 2020-21 that stands at Rs. 18467 crore over the revised estimate of Rs. 18121 crore in FY 2109-20, which is a rise by 1.91%. What is really surprising is the mining of dirty fuel/coal by CIL which has got an overall capital outlay of Rs. 9500 crore this year. Juxtaposing this allocation with the Finance Minister’s focus on closing down thermal plants that violate carbon emissions is a paradox in itself. 

For the thermal power plants that are in violation of the National Clean Air Program (NCAP with an allocation of Rs. 4400 crore for FY 2020-21), the Finance Minister has announced a closure of such plants. These plants that are old and whose carbon emissions are higher than the preset limit would be advised to close down and the land will be put to alternative energy purposes. On the mitigation of polluted air, the International Solar Alliance will help in SDGs, climate change, disaster resilience and the NDCs under the Paris Accord. Earlier, a total of 47.95 GW of thermal capacity missed the December 31 deadline to install Flue Gas Desulphurization (FDG) units to minimize SO2 emissions level. According to the five-year National Clean Air Action Plan, the Government plans to reduce by 20-30% the concentration of particulate matter PM10 and PM2.5 by 2024, and according to the Finance Minister, the plan is India’s best effort basis and kicks off in 2021 on January 1. Interestingly, according to the Budget speech, the climate action targets under the 2015 Paris Accords were to be executed under the normal budgetary allocations. Also, according to the Paris Accords, India has committed to reduce by 2030 the emission intensity of its GDP by 33-35% over the 2005 levels. It has also pledged to generate 40% of India’s power capacity from non-fossil sources and create and additional carbon sink of 2.5-3 billion tonnes of carbon dioxide equivalent through afforestation by 2030. 

So, what the Budget does is provide a conflicting picture of furthering mining either by domestic players, or by inviting mine-cum-developers by way of FDI on the one hand and its commitment to mitigate pollution standards either by retiring old plants or switching to renewables on the other. These two avenues clash in principle and throws up a confused state of affairs in India’s contributions to Paris Accords of 2015. 

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The Code of Capital or the Legal Structure of Finance – How the Law Creates Wealth and Inequality with Katharina Pistor

In The Code of Capital: How the Law Creates Wealth and InequalityKatharina Pistoroffers an expansive analysis of the construction of capital, showing legal coding to be at the heart of this process. This is a welcome interdisciplinary contribution which attaches fresh dimensions to debates on the political economy of wealth and inequality and will be a valuable resource for anyone seeking to grapple with the formidable nature of global capital.

The economic and legal reforms coincided with the demise of the Iron Curtain and socialist governments, and were implemented in developing as well as emerging markets, and promised eventual benefits for everyone. But instead, contemporary levels of inequality are comparable to those that prevailed before the French Revolution. A standard response to such disparity is simply to hold ‘capitalism’ accountable. But Pistor argues that even to do just this, it is necessary to be cognisant of how capital is made. To do so is to resist simplifications in which capital is a thing, or a core feature of social relations between a proletariat and a bourgeoisie: ‘Against this background, one might even question whether it makes sense to bundle historical epochs that differ so fundamentally from one another under a single rubric of “capitalism”’.

 

China’s Belt and Road and India’s Infrastructural Ambitions – Where is the line to be drawn?

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When in 2017, China organized the first-ever Forum on Belt and Road, almost 130 countries from all over the world, including the United States had sent in their representatives to witness and be part of the diplomatic showcase of China’s global ambitious project, which aims to create an interlocked trade, financial and cultural network stretching from East Asia to Europe and beyond. There was, however, one notable miss, India. India was always opposed to Chinese ambitions of erecting this vast infrastructural network and the primary reason was that it violated India’s state sovereignty. The showcase arm of the Chinese Belt and Road happens to be the China-Pakistan Economic Corridor, a $62 Billion pet project of Chinese President Xi Jinping and traversing the entire length and breadth of Pakistan with nodal points in Xinjiang province of China, and Pakistan’s port town of Gawdar. CPEC is marked by modern infrastructure of transportation networks, special economic zones, industrial clusters and energy hubs, and considered China’s main plank of Belt and Road Initiative aimed to underscore China’s economic might and dominance over the Asian-Pacific seas. That a segment of CPEC cuts through the disputed territory of Pakistan Occupied Kashmir has irked India no ends, which it considers a direct, uncalled-for and aggressive nature of China’s global ambitions at the cost of state sovereignty. Though, the CPEC is yet to be fully commissioned, some segments have started to function. This is turning out to be major bone of contention between the two Asian economic giants. But, relations have a gotten a bit murkier since 2017, and two major geopolitical events have confounded matters further. 

CPEC-projects

The first one is the Doklam Standoff between China and India. This tiny plateau nestled between China, India and Bhutan witnessed a three-month standoff between the two largest armies in the world over a road that the Chinese were building and which India apprehended would function more as a surveillance apparatus over the narrow path of land that connects the Indian mainland with the Northeastern states. Though the tension was eventually diffused, the state of affairs between China and India never really thawed as could have been anticipated. It was in 2017 that India and Pakistan became newly installed members of the Shanghai Cooperation Organization (SCO), having been elevated from observer states. China, anticipating an increasing amount of divisiveness within a regional economic and security organization by being accustomed to extreme comity and cooperative discussions was frustrated at India’s becoming a member state that Russia, another founder-member of SCO pushed for. Russia wanted to constrain China’s growing influence in the organization as it was concerned that post-Soviet SCO members were drifting too far into the Chinese geostrategic orbit. Moscow had long delayed implementing Chinese initiatives that would have enabled Beijing to reap greater benefits from regional trade. As China gained more clout in Central Asia, Moscow choice New Delhi’s inclusion to slow and oppose Beijing’s ambitions. It is under these circumstances that New Delhi would likely continue to criticize the CPEC in the context of the SCO because, as a full member, India now has the right to protest developments that do not serve the interests of all SCO members. The SCO also offers another public stage for India to constantly question the intent behind China’s exceptionally close ties to Pakistan.

Doklam-Yatung-RS.004

The second is the recent escalation of hostilities between India and Pakistan, and how Pakistan felt betrayed over China’s so-called neutral stand by asking both countries to take recourse to meaning dialogue in resolving the contentious issue of Kashmir and Terror and cease all military adventures. It is to be noted that the second convention of the Belt and Road Forum is to take place in April this year, and China is all hopeful to get India’s positive support for its infrastructural might. India’s notable absence from the 2017 meet has hit Chinese plans, and the latter wants to reverse the course this time around. Even if India were to take part this year, or send in their dissent note via an official communique, it would reliably and reasonably highlight the contradiction between China’s stated anti-terrorism goals and the reality of its policy. Most notably, Beijing has consistently looked the other way as Pakistani Intelligence Services continue to support terrorist groups in Afghanistan and Pakistan. Moreover, because India is particularly close to the Afghan Government, it could seek to sponsor Afghanistan to move from observer status toward full SCO membership. This would give India even greater strength in the group and could bolster Russia’s position as well.  

Lingering border disputes and fierce geostrategic competition in South Asia between China and India is likely to temper any cooperation Beijing might hope to achieve with New Delhi in latter’s inclusion at the Forum. Mutual suspicions in the maritime domain persist as well, with the Indian government shoring its position in the strategically important Andaman and Nicobar island chain to counter the perceived Chinese “string of pearls” strategy – aimed at establishing access to naval ports throughout the Indian Ocean that could be militarily advantageous in a conflict. Such mutual suspicions will likely impact Forum’s deliberations and discussions in unpredictable ways. Although India may be an unwelcome addition and irritant, China’s economic and military strength makes it far more formidable on its own – a point that is only magnified as Russian influence simultaneously recedes, or rather more aptly fluctuates. Even when India rejected Beijing’s Belt and Road Initiative overture, China remains India’s top trading partner and a critical market for all Central and South Asian states, leaving them with few other appealing options. India’s entry into the Forum, however, could put Beijing in the awkward position of highlighting the value, while increasingly working around or outside of it. Outright failure of the Forum would be unacceptable for China because of its central role in establishing it in the first place. Regardless of the bickering between countries that may break out, Beijing can be expected to make yet another show of the importance, with all of the usual pomp and circumstance, at the upcoming summit in April, 2019.

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What then is India’s infrastructural challenge to Belt and Road? India’s Prime Minister Narendra Modi instantiated the need for overhauling the infrastructure in a manner hitherto not conceived of by emphasizing that the Government would usher in a ‘Blue Revolution’ by developing India’s coastal regions and working for the welfare of fishing communities in a string of infrastructure projects. That such a declaration came in the pilgrim town of Somnath in Gujarat isn’t surprising, for the foundations of a smart city spread over an area of about 1400 acres was laid at Kandla, the port city. The figures he cited during his address were all the more staggering making one wonder about the source of resources. For instance, the smart city would provide employment to about 50000 people. The Blue Revolution would be initiated through the Government’s flagship Sagarmala Project attracting an investment to the tune of Rs. 8 lakh crore and creating industrial and tourism development along the coast line of the entire country. Not just content with such figures already, he also promised that 400 ports and fishing sites would be developed under the project. One would obviously wonder at how tall are these claims? Clearly Modi and his cohorts are no fan of Schumacher’s “Small is Beautiful” due to their obsession with “Bigger is Better”. What’s even more surprising is that these reckless followers of capitalism haven’t even understood what is meant by “Creative Destruction” both macro- or micro- economically. The process of Joseph Schumpeter’s creative destruction (restructuring) permeates major aspects of macroeconomic performance, not only long-run growth but also economic fluctuations, structural adjustment and the functioning of factor markets. At the microeconomic level, restructuring is characterized by countless decisions to create and destroy production arrangements. These decisions are often complex, involving multiple parties as well as strategic and technological considerations. The efficiency of those decisions not only depends on managerial talent but also hinges on the existence of sound institutions that provide a proper transactional framework. Failure along this dimension can have severe macroeconomic consequences once it interacts with the process of creative destruction. Quite unfortunately, India is heading towards an economic mess, if such policies are to slammed onto people under circumstances when neither the macroeconomic not the microeconomic apparatuses in the country are in shape to withstand cyclonic shocks. Moreover, these promotional doctrines come at a humungous price of gross violations of human and constitutional rights of the people lending credibility once again to the warnings of Schumacher’s Small is Beautiful: A Study of Economics as if People Mattered…

So, is there any comparison between Belt and Road and Blue Economy? Well, pundits could draw far-fetched comparisons between these infrastructural advances, but, for the Chinese, Belt and Road is geographically much vaster as compared to Indian Blue Economy, which is more confined to domestic consumptions but do have elements of exim and trade aspects to it. Apart from that, when it comes to fulfilling these ambitions, China with its economic might have much better resources at commissioning the initiative, whereas India, with its faltering banking industry and waning investor confidence is finding its increasingly difficult to map out routes of funding and financing. On a more geopolitical note, and especially in the wake of current events between India and Pakistan, china would do well to factor in the larger perspectives of its relations with South Asia. It’s well known that China has been using Pakistan as a foil against India since the 1960s, and with its CPEC has upped its commitment to Pakistan that includes the assurances of Pakistani well-being. But can China remain oblivious to Pakistan’s scorpion-like behavior of devouring itself? On the other hand, a stable India is providing opportunities for Chinese companies to expand themselves. The reset in Sino-Indian ties following the Wuhan Summit of 2018 has created conditions which can be of great benefit to Beijing in an era when it is facing a fundamental challenge from the United States. Who knows, New Delhi may even consider supporting the Belt & Road Initiative in some indirect fashion as the Japanese are doing?  

न्यूनतम समथर्न मूल्य: एक जन-केंद्रित परिप्रेक्ष्य (Minimum Support Price: A People-Centric Perspective)

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न्यूनतम समर्थन मूल्य (MSP) एक वायदा है जो भारत सरकार द्वारा किसानों और कृषि श्रमिकों को किसी भी तरह की कृषि उत्पादक दामों में तीव्र गिरावट के दौरान सुरक्षा मुहिया कराता है| न्यूनतम समर्थन मूल्य सरकारी व्यवस्था में एक नीतिगत साधन है और इसे आमतौर पर फसलों की  बीजारोपण  के  शुरुआत में कृषि लागत और मूल्य आयोग (CACP) की सिफारिशों के आधार पर पेश किया जाता है। न्यूनतम समर्थन मूल्य का प्रमुख उद्देश्य  भरपूर  उत्पादन अवधि के दौरान किसानों को सुरक्षा देना, और उन्हें समर्थन करना तथा सार्वजनिक वितरण प्रणाली के लिए अनाज इकठ्ठा करना है.  वस्तुओं की खरीद और पारिश्रमिकरूप, ऐसे दो  माध्यम  है  जिससे एक प्रभावी न्यूनतम समर्थन मूल्य लागू किया जा सकता है. किसानो के लिए पारिश्रमिक की प्रकृति ही न्यूनतम समर्थन मूल्य और  प्राप्त कीमतों के बीच के अंतर की भरपाई कर सकता है |

बड़े पैमाने पर कृषि संकट  के चलते,  ऐसे नीतियों पर जोर देने की आवश्यकता है जो तत्काल प्रभाव से सकारात्मक परिणाम  सामने ला सकते हों। इन  परिणामों  को मूल्य और गैर-मूल्य कारक के घटकों के माध्यम से प्राप्त किया जा सकता है। गैर-मूल्य कारक दीर्घकालिक योजना से संबंधित हैं जो  बाजार  सुधार, संस्थागत सुधार और प्रौद्योगिक   क्षेत्र में नवीनीकरण पर  आश्रित  है,  जिससे  किसानो की स्थिति में सुधर हो सके   उनके  आय  में भी वृद्धि हो सके। मूल्य कारक अल्पकालिक योजना से संबंधित है जो कृषि उपज के लिए पारिश्रमिक कीमतों में तत्काल प्रभाव से वृद्धि करने पर जोर देता है | न्यूनतम समर्थन मूल्य, मूल्य के कारकों के दायरे में शामिल होता है| सरकार 23 वस्तुओं के लिए न्यूनतम समर्थन मूल्य और गन्ने के लिए FRP (उचित और पारिश्रमिक मूल्य) को अधिसूचित करती है। ये फसलें  एक कृषि अवधि में उपयोग होने वाले भूमि के  कुल क्षेत्रफल में से लगभग 84% हिस्से को सम्मिलित करता है |  लगभग 5% क्षेत्र चारा फसलों के अंतर्गत आता है  जिसे न्यूनतम समर्थन मूल्य के अंतर्गत शामिल नहीं किया जाता |  इस गणित के अनुसार, यदि न्यूनतम समर्थन मूल्य को पूरी तरह से लागू किया जाता है तो कीमतों में लाभ के लिए उत्पादकों के एक छोटे से भाग को छोड़कर कुल कृषि क्षेत्र के करीब 90% पर न्यूनतम समर्थन मूल्य लागू  होगा|  

तो, सवाल यह है कि, CACP कैसे न्यूनतम समर्थन मूल्य (MSP) का निर्धारण करता है? न्यूनतम समर्थन मूल्य का निर्धारण करते समय CACP निम्नलिखित कारकों को ध्यान में रखता है:

  1. प्रति हेक्टेयर खेती की लागत और देश में विभिन्न क्षेत्रों में लागत की संरचना और उसमें हुए परिवर्तन।
  2. देश के विभिन्न क्षेत्रों में प्रति क्विंटल उत्पादन की लागत और उसमें हुए परिवर्तन।
  3. विभिन्न उत्पादक सामग्री की कीमतें और उसमें हुए परिवर्तन।
  4. उत्पादों  के बाजार मूल्य और उसमें हुए परिवर्तन।
  5. किसानों द्वारा बेची व खरीदी गयी वस्तुओं की कीमतें और उसमें हुए परिवर्तन।
  6. आपूर्ति से संबंधित जानकारी जैसे क्षेत्र, उपज और उत्पादन, आयात, निर्यात और घरेलू उपलब्धता तथा सरकार / सार्वजनिक एजेंसियों या उपक्रमों के पास भंडार की उपलब्धता| 
  7. मांग से संबंधित जानकारी, जिसमें कुल और प्रति व्यक्ति खपत, प्रोसेसिंग उद्योग की प्रवृत्ति और क्षमता शामिल है।
  8. अंतरराष्ट्रीय बाजारों में कीमतें और उसमें हुए परिवर्तन।
  9. कृषिउत्पाद  से ली गई  साधित वस्तुएं मसलन चीनी, गुड़, जूट, खाद्य और गैर-खाद्य तेलों, सूती धागा की कीमतें और उसमें हुए परिवर्तन।
  10. कृषि उत्पादों की प्रोसेसिंग लागत और उसमें हुए परिवर्तन।
  11. विपणन और सेवाओं की लागत, भंडारण, परिवहन, प्रोसेसिंग, करों / शुल्क, और बाजार के  कारक द्वारा बनाए गए लाभांश, और
  12. व्यापक आर्थिक चर वस्तुएं जैसे की सामान्य स्तर की कीमतें, उपभोक्ता मूल्य सूचकांक और मौद्रिक व राज कोषी  करक | 

जैसा कि देखा जा सकता है, यह मापदंडों का एक व्यापक  समूह है जिसपर आयोग न्यूनतम समर्थन मूल्य (MSP) की गणना के लिए निर्भर करता है। परन्तु  सवाल यह है की : आयोग को इस डेटा   कहाँ से मिलती है? डेटा आमतौर पर कृषि वैज्ञानिकों, किसान नेताओं, सामाजिक कार्यकर्ताओं, केंद्रीय मंत्रालयों, भारतीय खाद्य निगम (FCI), नेशनल एग्रीकल्चरल कोऑपरेटिव मार्केटिंग फेडरेशन ऑफ इंडिया (NAFED), कॉटन कॉर्पोरेशन ऑफ इंडिया (CCI), जूट कॉर्पोरेशन ऑफ इंडिया तथा व्यापारियों के संगठन और अनुसंधान संस्थानों से एकत्र किए जाते हैं। आयोग फिर MSP की गणना करता है और इसेके अनुमोदन के लिए केंद्र सरकार को भेजता है, जो फिर राज्यों को उनके सुझावों के लिए भेजता है। एक बार जब राज्य अपनी मंजूरी दे देता है,  आर्थिक मामलों की मंत्रिमंडलीय समिति इन आंकड़ों पर सहमति प्रदान करता है, जिन्हें फिर CACP पोर्टल पर जारी किया जाता है।

2004 में, केंद्र में शासित UPA-1 सरकार ने अपने प्रथम वर्ष के दौरान, एम.एस स्वामीनाथन  की अध्यक्षता में  राष्ट्रीय किसान आयोग (NCF) का गठन किया ।आयोग का प्रमुख उद्देश्य कृषि वस्तुओं को लागत-प्रतिस्पर्धी और  लाभदायक बनाना था। इस  उद्देश्य को प्राप्त करने हेतु, खेती की लागत की गणना के लिए एक तीन-स्तरीय संरचना तैयार की गई , जो इस प्रकार  है, A2, FL और C2। A2 वास्तविक भुगतान की जाने वाली लागत है, जबकि A2 + FL वास्तविक भुगतान की जाने वाली लागत और परिवार के श्रम का प्रतिशोधित मूल्य के बराबर है, जहाँ  मानसब्बद्ध किसी चीज़ का मूल्य निर्धारण करने में उत्पाद या उसके प्रोसेसिंग जिसमे  उसका योगदान  के  अनुमान के  तहत  किसी वस्तु    का मूल्य  निर्धारित किया जाता है | C2  एक  विस्तृत  है, जिसमें स्वामित्व वाली भूमि और पूंजी पर लगा  किराया और ब्याज शामिल  है। यह स्पष्ट है कि C2> A2 + FL> A2 |

कृषि लागत और मूल्य आयोग (CACP)  कीमतों की सिफारिश करते हुए उत्पादन की लागत, इनपुट कीमतों में बदलाव, इनपुट/आउटपुट मूल्यों का अनुपात, बाजार के कीमतों में रुझान, अंतर फसल मूल्य का अनुपात, मांग और आपूर्ति की स्थिति, किसानों द्वारा देय कीमतों और प्राप्त कीमतों के बीच समता आदि महत्वपूर्ण कारकों को ध्यान में रखता है। समर्थन मूल्य तय करने में, CACP लागत की अवधारणा पर निर्भर करता है जो खेती में खर्च होने वाले सभी मदों को शामिल करता है, जिसमें किसानों के स्वामित्व वाले इनपुट्स का मूल्य भी शामिल होता है, जैसे कि स्वामित्व वाली भूमि का किराया मूल्य और निश्चित पूंजी पर ब्याज। कुछ महत्वपूर्ण लागत अवधारणाएं C2 और C3 हैं:

C3: किसान को प्रबंधकीय पारिश्रमिक के लिए C2 + C2 का 10%

स्वामीनाथन आयोग की रिपोर्ट में स्पष्ट रूप से कहा गया है कि किसानों को उनके उत्पादन की सम्पूर्ण लागत से 50% अधिक की न्यूनतम समर्थन मूल्य मिलना चाहिए। यह लागत + 50% का सूत्र स्वामीनाथन आयोग से आया  और जिसमे स्पष्ट रूप से कहा गया  कि उत्पादन  लागत उत्पादन की व्यापक लागत है, जो  C2 है,  ना कि A2 + FL । C2 में वास्तविक मालिक द्वारा उत्पादन में पट्टे की भूमि के लिए किया गया किराया भुगतान  + परिवार के श्रम का प्रतिधारित मूल्य + स्वामित्व वाली पूंजीगत संपत्ति के मूल्य पर ब्याज (भूमि को छोड़कर) + स्वामित्व भूमि के किराये का मूल्य (भूमि राजस्व का  कुल मूल्य)  जैसे वास्तविक खर्च, जिसका भुगतान नकदी  व् अन्य प्रकार से किया गया हो, शामिल हैं|  उत्पादन की लागत की गणना प्रति क्विंटल और प्रति हेक्टेयर के आधार पर की जाती है। चूंकि राज्यों में लागत भिन्नता बहुत ज्यादा होने के कारण CACP अनुग्रह करता है की  न्यूनतम समर्थन मूल्य को C2 के आधार पर माना जाना चाहिए। हालाँकि, धान और गेहूं के मामले में न्यूनतम समर्थन मूल्य में बढ़ोत्तरी इतनी ज्यादा है कि अधिकांश राज्यों मे न्यूनतम समर्थन मूल्य न केवल C2, बल्कि C3 से भी ऊपर है।

रबी सीजन, 2017- 18  की  अनुमानित लागत और सिफारिश की गयी न्यूनतम समर्थन मूल्य (रु प्रति क्विंटल में)

Untitledस्रोत: कृषि लागत और मूल्य  आयोग और कृषि मंत्रालय

यहीं पर न्यूनतम समर्थन मूल्य की राजनीतिक अर्थव्यवस्था असहाय किसानों की समस्या को जटिल बनाती है । हालाँकि 23 फसलों  का  न्यूनतम समर्थन मूल्य  अधिसूचित किया  जाता है, लेकिन वास्तव में 3 से अधिक को सुनिश्चित नहीं किया  जाता  हैं। भारतीय कृषि क्षेत्र  छोटे आकार के कृषि स्वामित्व के चलते निम्न  स्तर के उत्पादन से त्रस्त है, प्रचलित प्रणाली के अंतर्गत लागत पर मुनाफा  किसानो के लिए कम आय पैदा करना सुनिश्चित करता है ।  इन्ही  महत्वपूर्ण बिन्दुओं पर जोर देते हुए  किसान  न्यूनतम समर्थन मूल्य को  प्रभावी लागतों की तुलना में 50% अधिक बढ़ाकर, न्यूनतम समर्थन मूल्य के प्रभावी क्रियान्वान की मांग  कर रहें हैं। किसान और किसान संगठनों ने मांग की है कि न्यूनतम समर्थन मूल्य को उत्पादन की लागत + 50% तक बढ़ाया जाए,  चूँकि  उनके लिए उत्पादन की लागत का मतलब C2 है और A2 + FL नहीं । वर्तमान में, CACP, A2 और FL को जोड़कर न्यूनतम समर्थन मूल्य निर्धारित  करता है। सरकार फिर A2 और FL को जोड़कर प्राप्त किये गए मूल्य का 50% जोड़कर न्यूनतम समर्थन मूल्य तय करती है, और इस प्रकार C2 को अनदेखा कर दिया जाता है। किसान व किसानों के संगठन  मांग है कि न्यूनतम समर्थन मूल्य में C2 का 50%  जोड़ा  जाये, जो  सरकारी घोषणाओं के मुख्यरूप   से गायब है।  न्यूनतम समर्थन मूल्य के संदर्भ में किसानों  की मांग  व सरकार क्या  दे रही है, इनका अंतर ही तनाव का मुख्य कारण है | 

रमेश चंद, जो वर्तमान में निति आयोग  में  सेवारत  होने के बावजूद भी,  सरकार के द्वारा दिए जा रहे सहुलियातोँ के तार्किक विश्लेषण पर जोर देते हैं|   उनका यह भी सिफारिश है कि कार्यशील पूंजी पर ब्याज मौजूदा आधे सीजन के  बजाय  पूरे सीजन के लिए  दिया जाना चाहिए, और गाँव में प्रचलित वास्तविक किराये के मूल्य को किराए पर बिना किसी उच्चतम सीमा  के माना जाना चाहिए। इसके अलावा, कटाई के बाद की लागत, सफाई, ग्रेडिंग, सुखाने, पैकेजिंग, विपणन और परिवहन को शामिल किया जाना चाहिए।  जोखिम प्रीमियम और प्रबंधकीय शुल्कों को ध्यान में रखते हुए C2   को 10% तक बढ़ाया जाना चाहिए।

 रमेश चंद के अनुसार, न्यूनतम समर्थन मूल्य की सिफारिश करते समय  बाजार निकासी कीमत को ध्यान में रखना आवश्यक है। यह, मांग और आपूर्ति,  पक्षों को प्रतिबिंबित करेगा । जब मांग-पक्ष के कारकों के आधार पर न्यूनतम समर्थन मूल्य तय किया जाता है,  तब न्यूनतम समर्थन मूल्य को लागू करने के लिए सरकारी हस्तक्षेप की आवश्यकता केवल बाज़ार प्रतिस्पर्धा की गैर-मौजूदगी व् निजी व्यापार के शोषक रूप लेने तक ही सिमित हो जाता है  । हालाँकि, अगर कोई न्यूनतम मूल्य भुगतान तंत्र या फसलें हैं  जिनपर न्यूनतम समर्थन मूल्य  घोषित किया गया हैं, लेकिन खरीददारी ना होने पर  सरकार को न्यूनतम समर्थन मूल्य और बाज़ार के निचले मूल्य के अंतर के बीच के आधार पर किसानों को मुआवजा देना चाहिए। ऐसा ही एक तंत्र, भावान्तर भुगतान योजना के नाम से मध्य प्रदेश में लागू किया गया , जहाँ पर सरकार ने किसानों से सीधे खरीद में अपने पुराने ख़राब रिकॉर्ड को स्वीकार करने के  बजाय,  बाजार मूल्य न्यूनतम समर्थन मूल्य से  कम होने पर  किसानों को सीधे नकद हस्तांतरण के माध्यम से मुआवजा देने का व्यवस्था किया गया है . भुगतान में देरी और भारी लेनदेन लागतें  इस योजना  की   नकारात्मक पक्ष हैं। बाजार में कम गुणवत्ता वाले अनाज के आधिक्य आपूर्ति जो  पहले से ही कम फसल की कीमतों पर  दबाव बनाती है। जब तक, इनकी और एम.एस स्वामीनाथन की सिफारिशों को गंभीरता से नहीं लिया जाता है, कृषि संकट का समाधान पूंजीवादी तबाही में छिपा है। और कोई ऐसा क्यों कहता है?

मूल्य की कमी वाले तंत्र पर बातचीत करने और संकल्प की ओर बढ़ने के लिए, सरकार के पास को  खरीद के रूप में एक  विकल्प  बच जाता है। लेकिन, इसमें एक विरोधाभास है। जिन फसलों लिए न्यूनतम समर्थन मूल्य की घोषणा की गई है, जिसकी संख्या 20 है, उनके लिए सरकार के पास स्पष्ट रूप से पहले एक प्रणाली बनाने और फिर उन फसलों की खरीद का प्रबंधन करने का बैंडविड्थ (bandwidth) नहीं है। यदि यह  स्थिति गतिरोध तक पहुँच गयी है, तो सरकार की निजी बाजारों की ओर रुख करने की संभावना से इनकार नहीं किया जा सकता है।  यदि ऐसा होता है तोह  बाजार स्थानीय राजनेताओं की मनमानेपन और पसंद की चपेट में  आ जायेगा, जो आमतौर पर अपने क्रिया-कलाप में सत्ता के केन्द्रों को प्रभावित करते हहुये  सिस्टम को  अपने सुविधानुसार चलातें हैं ।

स्पष्ट रूप से कुछ ऐसे सवाल हैं जो  उत्तर की मांग करतें हैं  और ये सभी सवाल नीति बनाने के दायरे में आते हैं। उदाहरण के लिए, क्या बजट में न्यूनतम समर्थन मूल्य के दायरे में आने वालेसभी किसानों के  सीमा को बढ़ाने का प्रावधान है?  दूसरा, न्यूनतम समर्थन मूल्य की गणना में निजी लागत और लाभ शामिल होते हैं, और इस  प्रकार केवल  एक पक्ष प्रदर्शित   होताहै। संपूर्ण समझ के लिए, सामाजिक लागत और लाभों को भी शामिल किया जाना चाहिए। मुख्य रूप से निजी लागतों और लाभों पर ध्यान केंद्रित करने के साथ, सामाजिक रूप से बेकार उत्पादन और विशेषज्ञता को प्रोत्साहित किया जाता है, जैसे उत्तर भारत में धान के उत्पादन में होने वाले परिणाम जिसके  गवाह  हैं। क्या इस दोहरे बंधन को दूर किया जा सकता है, यह एक नीतिगत मामला है, और फिलहाल जो देखा जा रहा है यह एक नीतिगत पक्षाघात है और राजनीतिक इच्छा की कमी केवल वोट बैंक को बनाने के लिए की जाएगी। यह बेहद अफसोसजनक है! 

Albert Camus Reads Richard K. Morgan: Unsaid Existential Absurdism

Humanity has spread to the stars. We set out like ancient seafarers to explore the limitless ocean of space. But no matter how far we venture into the unknown, the worst monsters are those we bring with us. – Takeshi Kovacs

What I purport to do in this paper is pick up two sci-fi works of Richard Morgan, Altered Carbon (teaser to Netflix series), the first of Takeshi Kovacs trilogy and sometimes a grisly tale of switching bodies to gain immortality transhumanism, either by means of enhanced biology, technology, or biotechnology, and posthumanism. The second is Market Forces, a brutal journey into the heart of corporatized conflict investment by way of conscience elimination. Thereafter a conflation with Camus’ absurdity unravels the very paradoxical ambiguity underlying absurdism as a human condition. The paradoxical ambiguity is as a result of Camus’ ambivalence towards the neo-Platonist conception of the ultimate unifying principle, while accepting Plotinus’ principled pattern, but rejecting its culmination.

Richard Morgan’s is a parody, a commentary, or even en epic fantasy overcharged almost to the point of absurdity and bordering extropianism. If at all there is a semblance of optimism in the future as a result of Moore’s Law of dense hardware realizable through computational extravagance, it is spectacularly offset by complexities of software codes resulting in a disconnect that Morgan brilliantly transposes on to a society in a dystopian ethic. This offsetting disconnect between the physical and mental, between the tangible and the intangible is the existential angst writ large on the societal maneuvered by the powers that be.

Morgan’s Altered Carbon won’t be a deflection from William Gibson’s cyberpunk, or at places even Philip K Dick’s Do Androids Dream of Electric Sheep?, which has inspired the cult classic Ridley Scott’s Blade Runner, wherein the interface between man and machine is coalescing (sleeves as called in the novel), while the singularity pundits are making hay. But, what if the very technological exponent is used against the progenitors, a point that defines much of Artificial Intelligence ethics today? What if the human mind is now digitized, uploaded and downloaded as a mere file, and transferred across platforms (by way of needlecast transmitting DHF, individual digital human freight) rendering the hardware dis- posable, and at the same time the software as a data vulnerable to the vagaries of the networked age? These aren’t questions keeping the ethic at stake alone, but rather a reformatting of humanity off the leash. This forever changes the concept of morality and of death as we know it, for now anyone with adequate resources (note the excess of capitalism here) can technically extend their life for as long as they desire by reserving themselves into cloned organics or by taking a leaf off Orwell’s Government to archive citizen records in perpetual storage. Between the publication in 2002 and now, the fiction in science fiction as a genre has indeed gotten blurred, and what has been the Cartesian devil in mind-body duality leverages the technological metempsychosis of consciousness in bringing forth a new perception on morality.

Imagine, the needle of moral compass behaving most erratically, ranging from extreme apathy to moderate conscience in consideration of the economic of collateral damage, with the narrative wrenching through senses, thoughts and emotions before settling down into a dystopian plot dense with politics, societal disparity, corruption, abuse of wealth and power, and repressively conservative justice. If extreme violence is distasteful in Altered Carbon, the spectacle is countered by the fact that human bodies and memories are informational commodities as digitized freight and cortical stacks, busted and mangled physical shells already having access to a sleeve to reincarnate and rehabilitate on to, opening up new vistas of philosophical dispositions and artificially intelligent deliberation on the ethics of fast-disappearing human-machine interface.

If, Personal is Political, Altered Carbon results in a concussion of overloaded themes of cyberpunk tropes and is indicative of Morgan’s political takes, a conclusion only to be commissioned upon reading his later works. This detective melange heavily slithers through human condition both light and dark without succumbing to the derivatives of high-tech and low-life and keeping the potentials of speculative fiction to explorations. The suffusive metaphysics of longevity, multiplicity of souls and spiritual tentacles meeting its adversary in Catholicism paints a believable futuristic on the canvass of science-fiction spectra.

Market Forces, on the other hand is where cyberpunk-style sci-fi is suddenly replaced with corporatized economy of profit lines via the cogency of conflict investment. The world is in a state of dysphoria with diplomatic lines having given way to negotiations with violence, and contracts won on Ronin-esque car duels shifting the battlefield from the cyberspace of Altered Carbon to the more terrestrial grounds. Directly importing from Gordon Gekko’s “Greed is Good”, corporates enhance their share of GDP via legal funding of foreign wars. The limits of philosophy of liberal politics are stretched on analogizing the widening gap between the rich and the marginalized in the backdrop of crime-ravaged not-so futuristic London. Security is rarefied according to economic stratifications, and surveillance by the rich reach absurd levels of sophistication in the absence of sousveillance by the marginalized.

Enter Chris Faulkner, the protagonist defined by conscience that starts to wither away when confronted with taking hard and decisive actions for his firm, Shorn Associates, in the face of brutality of power dynamics. The intent is real-life testosterone absolutism maximizing the tenets of western capitalism in an ostentatious exhibition of masculinity and competition. The obvious collateral damage is fissuring of familial and societal values born as a result of conscience. Market Forces has certain parallels from the past, in the writings of Robert Sheckley, the American sci-fi author, who would take an element of society and extrapolate on its inherent violence to the extent of the absurd sliding into satire. It’s this sliding wherein lies the question of the beyond, the inevitability of an endowment of aggression defining, or rather questioning the purpose of the hitherto given legacy of societal ethic.

With no dearth of violence, the dystopian future stagnates into dysphoria characterized by law and apparatus at the mercy of corporations, which transcend the Government constitutionally along rapacious capitalism. A capitalism that is so rampant that it transforms the hero into an anti-hero in the unfolding tension between interest and sympathy, disgust and repulsion. The perfectly achievable Market Forces is a realization round the corner seeking birth between the hallucinogenic madness of speculations and hyperreality hinging on the philosophy of free-markets taken to its logical ends in the direction of an unpleasant future. The reductio ad absurdum of neoliberalism is an environment of feral brutality masked with the thinnest veneer of corporate civilization, and is the speculation that portrays the world where all power equates violence. This violence is manifested in aggression in a road rage death match against competitors every time there is a bid for a tender. What goes slightly over the board, and in a pretty colloquial usage of absurdity is why would any competition entail the best of staff on such idiotic suicide missions?

Camus’ absurdity is born in The Myth of Sisyphus, and continues well into the The Rebel, but is barely able to free itself from the clutches of triviality. This might appear to be a bold claim, but the efficacy is to be tested through Camus’ intellectual indebtedness to Plotinus, the Neo-Platonist thinker. Plotinus supplemented the One and Many idea of Plato with gradations of explanatory orders, for only then a coalescing of explanations with reality was conceivable. This coalescing converges into the absolute unity, the One, the necessarily metaphysical ground. Now, Camus accepts Plotinus in the steganographic, but strips the Absolute of its metaphysics. A major strand of absurdity for Camus stems from his dic- tum, “to understand is, above all, to unify”, and the absence of such unifying principle vindicates absurdity. Herein, one is confronted with the first of paradoxes, in that, if the Absolute is rejected, why then is there in Camus a nostalgia for unity? The reason is peculiarly caught between his version of empiricism and monism. His empiricism gives accord to comprehensibility of ordinary experiences by way of language and meaning, while anything transcending the same is meaninglessness and hinges on the Plotinus’ Absolute for comprehensibility, thus making him sound a monist. Add to this contradiction is the face of the Christian God to appear if the Absolute were not to be rejected, which would then have warranted a clash between good and evil in the face of the paradox of the existing of the latter when God was invested with qualities of the former. Invoking modernism’s core dictum, Camus then, questions spontaneity in the presence of Absolute by calling to attention scholastic perplexity.

Having rejected the Absolute, Camus takes the absurd condition as a fact. If one were to carefully tread The Myth of Sisyphus, it works thusly: If a man removes himself, he destroys the situation and hence the absurd condition. Since, the absurd condition is taken as a fact, one who destroys himself denies this fact. But he who denies this fact puts himself in opposition to what is, Truth. To oppose the Truth, recognizing it to be true, is to contradict oneself. Recognizing a truth, one ought to preserve it rather than deny it. Therefore, it follows that one ought not to commit metaphysical suicide in the face of the meaningless universe. This is a major paradox in his thought, where the evaluative absurdity is deemed to be preserved starting from the premise that man and the universe juxtaposed together is absurdity itself. So, what we have here is a logical cul-de-sac. But, what is of cardinal import is the retention of life in mediating between the man and universe as absurdity in polarities. If this were confronting the absurd in life, eschatology is another confrontation with the absurd, an absolute that needs to be opposed, a doctrine that becomes a further sense of the absurd, an ethic of the creation of the absolute rule in a drama of man as a struggle against death.

It is this conjecture that builds up in The Rebel, death as an antagonist subjected to rebellion. The absurdity of death lies across our desire for immortality, the inexplicability of it, and negating and denying the only meaningful existence known. Contradictorily, death would not be absurd if immortality were possible, and existence as is known isn’t the only meaningful existence that there is. Camus is prone to a meshwork logic here, for his thought fluctuates between viewing death as an absolute evil and also as a liberator, because of which it lends legitimacy to freedom. For, it isn’t the case that Camus is unaware of the double bind of his logic, and admittedly he ejects himself out of this quandary by deliberating on death not as a transcendental phenomenon, but as an ordinary lived-experience. If the Myth of Sisyphus holds murder and suicide in an absurdist position by denying the transcendent source of value, The Rebel revels in antagonisms with Nihilism, be it either in the sense of nothing is prohibited, or the absolutist nihilism of “permit all” with a fulcrum on the Absolute. The Rebel epitomizes the intellectual impotency of nihilism. But due credit for the logical progression of Camus is mandated here, for any utopia contains the seed of nihilism, in that, any acceptance of an Absolute other than life ultimately leads to tyranny. If this were to be one strand in the essay, the other is exposited in terms of an unrelenting and absolute opposition to death. Consequently, The Rebel, which is the embodiment of Camus’ ethic cannot kill. To avoid any danger of absolutism in the name of some positive good or value, the absolute value becomes oppositional to death, and hence the Rebel’s ethic is one of ceaseless rebellion, opposition and conflict.

Now, with a not very exhaustive treatment to Camus’ notion of absurdity as there is more than meets the eye in his corpus, let us turn to conflation with Richard Morgan and justify our thesis that we set out with. We shall bring this about by a series of observations.

If antagonism to death is the hallmark of rebellion, then Altered Carbon with its special hard-drives called “Stacks” installed in the brainstem immortalizes consciousness to be ported across humans across spacetimes. Needlecasting, the process by which human consciousness in the format of data gets teleported suffers disorientation across human hardwares, if it could even be called that. Interestingly, this disorientation aggrandizes the receiver conflict-ready, a theme that runs continuously in Market Forces as well as in Altered Carbon. The state of being conflict- and combat-ready is erecting armies to quash down rebellions. To prevent immortality from getting exploited in the hands of the privileged, these armies are trained to withstand torture, drudgery, while at the same time heightening their perception via steganography. But where the plot goes haywire for Camus’ rebel is Richard Morgan’s can neutralize and eliminate. Thats the first observation.

On to the second, which deals with transhumanism. A particular character, Kovac’s partner Kristen Ortega has a neo-Catholic family that’s split over God’s view of resurrecting a loved one. The split is as a result of choosing religious coding, a neo-Catholic semblance being the dead cannot be brought back to life. In these cases, Altered Carbon pushes past its Blade Runner fetish and reflexive cynicism to find something human. But, when the larger world is so thin, it’s hard to put something like neo-Catholicism in a larger context. Characters have had centuries to get used to the idea of stacks begging the larger question: why are many still blindsided by their existence? And why do so few people, including the sour Meths, seem to be doing anything interesting with technology? Now Camus’ man is confronted with his absurd and meaningless existence, which will be extinguished by death. There are two choices to consider here: either he can live inauthentically, implying hiding from truth, the fact that life is meaningless, and accepting the standards and values of the crowd, and in the process escaping the inner misery and despair that results from an honest appraisal of facts. Or, he can take the authentic choice and live heroically, implying facing the truth, life’s futility, and temporarily, submitting to despair which is a necessary consequence, but which, if it does not lead to suicide, will eventually purify him. Despair will drive him out of himself and away from trivialities, and by it he will be impelled to commit himself to a life of dramatic choices. This is ingrained in the intellectual idea of neo-Catholicism, with Camus’ allusion as only the use of the Will can cause a man truly to be. Both Takeshi Kovacs in Altered Carbon and Chris Faulkner in Market Forces amply epitomize this neo-Catholicism, albeit not directly, but rather, as an existential angst in the form of an intrusion.

Now for the third observation. The truth in Altered Carbon is an excavation of the self, more than searching data and tweaking it into information. It admonishes to keep going no matter whichever direction, a scalar over the vector territorialization in order to decrypt that which seems hidden, an exercise in futility. Allow me to quote Morgan in full,

You are still young and stupid. Human life has no value. Haven’t you learned that yet, Takeshi, with all you’ve seen? It has no value, intrinsic to itself. Machines cost money to build. Raw materials cost money to extract. But people? You can always get some more people. They reproduce like cancer cells, whether you want them or not. They are abundant, Takeshi. Why should they be valuable? Do you know that it costs us less to recruit and use up a real snuff whore that it does to set up and run virtual equivalent format. Real human flesh is cheaper than a machine. It’s the axiomatic truth of our times?

In full consciousness and setting aside the impropriety above, Morgan’s prejudicing the machine over human flesh extricates essentialism, mirroring Camusian take on the meaning of life as inessential, but for the burning problem of suicide. This is a direct import from Nietzsche, for who, illusion (the arts, Remember Wagner!) lends credibility to life and resolves despair to some extent, whereas for Camus, despair is only coming to terms with this absurd condition, by way of machination in the full knowhow of condition’s futility and pointlessness. This fact is most brilliantly corroborated in Morgan’s dictum about how constant repetition can even make the most obvious truths irritating enough to disagree with (Woken Furies).

To conclude: Imagine the real world extending into the fictive milieu, or its mirror image, the fictive world territorializing the real leaving it to portend such an intercourse consequent to an existential angst. Such an imagination now moves along the coordinates of hyperreality, where it collaterally damages meaning in a violent burst of EX/IM-plosion. This violent burst disturbs the idealized truth overridden by a hallucinogenic madness prompting iniquities calibrated for an unpleasant future. This invading dissonant realism slithers through the science fiction before culminating in the human characteristics of expediency. Such expediencies abhor fixation to being in the world built on deluded principles, where absurdity is not only a human condition, but an affliction of the transhuman and posthuman condition as well. Only the latter is not necessarily a peep into the future, which it might very well be, but rather a disturbing look into the present-day topographies, which for Camus was acquiescing to predicament, and for Richard Morgan a search for the culpable.

Minimum Support Price (MSP) for Farmers – Ruminations for the Grassroots.

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Minimum Support Price (MSP) is an insurance given by the Government of India to insure farmers and agricultural workers against any sharp fall in farm prices. MSP is a policy instrument at the disposal of the government and is introduced based on the recommendations of the Commission for Agricultural Costs and Prices (CACP) generally at the beginning of sowing season. The major objective of MSP is protecting and supporting farmers during bumper production periods by pouring food grains for public distribution. There are two ways in which an effective MSP can be implemented, viz. procurement of commodities and as remunerative. The remunerative nature for farmers compensates the difference between MSP and the prices received by them.

With the agrarian crisis looming large, the policies need to emphasize on measures that can bring forth immediate results. These results could be achieved through the components of price and non-price factors. Non-price factors are long-term oriented and rely on market reforms, institutional reforms and innovations in technology in order to bring in an upward drift growth and income brackets of the farmers. Price factors are short-term oriented that necessitate immediate upward drift in remunerative prices for farm produce. It is within the ambit of price factors that MSP stands. The government notifies MSP for 23 commodities and FRP (fair and remunerative price) for sugarcane. These crops cover about 84% of total area under cultivation in all the seasons of a year. About 5% area is under fodder crops which is not amenable for MSP intervention. According to this arithmetic, close to 90% of the total cultivated area is applicable to MSP intervention, leaving a small segment of producers amenable to price benefits, if the MSP were to be fully implemented.

So, how exactly does the CACP determine the Minimum Support Price (MSP)? CACP takes the following factors under consideration while determining the MSP:

  1. Cost of cultivation per hectare and structure of costs across various regions in the country and the changes therein.
  2. Cost of production per quintal across various regions of the country and the changes therein.
  3. Prices of various inputs and the changes therein.
  4. Market prices of products and the changes therein.
  5. Prices of commodities sold by the farmers and of those purchased by them and the changes therein.
  6. supply-related information like area, yield and production, imports, exports and domestic availability and stocks with the Government/Public agencies or industry.
  7. Demand-related information, which includes the total and per capita consumption, trends and capacity of the processing industry.
  8. Prices in the international markets and the changes therein.
  9. Prices of the derivatives of the farm products such as sugar, jaggery, jute, edible and non-edible oils, cotton yarns and changes therein.
  10. Cost of processing of agricultural products and the changes therein.
  11. Cost of marketing and services, storage, transportation, processing, taxes/fees, and margins retained by market functionaries, and
  12. Macroeconomic variables such as general level of prices, consumer price indices and those reflecting monetary and fiscal factors.

As can be seen, this is an extensive set of parameters that the Commission relies on for calculating the Minimum Support Price (MSP). But, then the question is: where does the Commission get access to this data set? The data is generally gathered from agricultural scientists, farmer leaders, social workers, central ministries, Food Corporation of India (FCI), National Agricultural Cooperative Marketing Federation of India (NAFED), Cotton Corporation of India (CCI), Jute Corporation of India, traders’ organizations and research institutes. The Commission then calculates the MSP and sends it to the Central Government for approval, which then sends it to the states for their suggestions. Once the states given their nods, the Cabinet Committee on Economic Affairs subscribes to these figures that are then released on CACP portals.

During the first year of UPA-1 Government in the centre in 2004, a National Commission on Farmers (NCF) was formed with M S Swaminathan (Research Foundation) as its Chairman. One of the major objectives of the Commission was to make farm commodities cost-competitive and profitable. To achieve this task, a three-tiered structure for calculating the farming cost was devised, viz. A2, FL and C2. A2 is the actual paid out costs, while, A2+FL is the actual paid-out cost plus imputed value of family labour, where imputing is assigning a value to something by inference from the value of the products or processes to which it contributes. C2 is the comprehensive cost including imputed rent and interest on owned land and capital. It is evident that C2 > A2+FL > A2

The Commission for Agricultural Costs and Prices (CACP) while recommending prices takes into account all important factors including costs of production, changes in input prices, input/output parity, trends in market prices, inter crop price parity, demand and supply situation, parity between prices paid and prices received by the farmers etc. In fixing the support prices, CACP relies on the cost concept which covers all items of expenses of cultivation including that of the imputed value of the inputs owned by the farmers such as rental value of owned land and interest on fixed capital. some of the important cost concepts are C2 and C3:

C3: C2 + 10% of C2 to account for managerial remuneration to the farmer.

Swaminathan Commission Report categorically states that farmers should get an MSP, which is 50% higher than the comprehensive cost of production. this cost + 50% formula came from the Swaminathan Commission and it had categorically stated that the cost of production is the comprehensive cost of production, which is C2 and not A2+FL. C2 includes all actual expenses in cash and kind incurred in the production by the actual owner + rent paid for leased land + imputed value of family labour + interest on the value of owned capital assets (excluding land) + rental value of the owned land (net of land revenue). Costs of production are calculated both on a per quintal and per hectare basis. Since cost variation are large over states, CACP recommends that MSP should be considered on the basis of C2. However, increases in MSP have been so substantial in case of paddy and wheat that in most of the states, MSPs are way above not only the C2, but even C3 as well.

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This is where the political economy of MSP stares back at the hapless farmers. Though 23 crops are to be notified on MSP, not more than 3 are are actually ensured. The Indian farm sector is also plagued by low scale production restricted by small-sized holdings, which ensures that margin over cost within the prevailing system generates at best low income for the farmers. This is precisely the point of convergence of reasons why the farmers have been demanding effective implementation of MSP by keeping the MSP 50% higher than the costs incurred. Farmers and farmers’ organizations have demanded that the MSP be increased to cost of production + 50%, since for them, cost of production has meant C2 and not A2+FL. At present, the CACP adds A2 and FL to determine the MSP. The Government then adds 50% of the value obtained by adding A2 and FL only to fix the MSP, thus ignoring C2. What the farmers and farmers’ organizations have been demanding is an addition of 50% to C2 to fix the MSP, which is sadly missing the hole point of Governmental announcements. This difference between what the farmers want and what the government gives is a reason behind so much unrest as regards support prices to the farmers.

Ramesh Chand, who is currently serving in the NITI Aayog, is still a voice of reason over and above what the Government has been implementing by way of sops. Chand has also recommended that the interest on working capital should be given for the whole season against the existing half-season, and the actual rental value prevailing in the village should be considered without a ceiling on the rent. Moreover, post-harvest costs, cleaning, grading, drying, packaging, marketing and transportation should be included. C2 should be hiked by 10% to account for the risk premium and managerial charges.

According to Ramesh Chand of NITI Aayog, there is an urgent need to take into account the market clearance price in recommending the MSP. This would reflect both the demand and supply sides. When the MSP is fixed depending on the demand-side factors, then the need for government intervention to implement MSPs would be reduced only to the situation where the markets are not competitive or when the private trade turns exploitative. However, if there is a deficiency price payment mechanism or crops for which an MSP declared but the purchase doesn’t materialize, then the Government should compensate the farmers for the difference between the MSP and lower market price. such a mechanism has been implemented in Madhya Pradesh under the name of Bhavantar Bhugtan Yojana (BBY), where the Government, rather than accept its poor track record in procurement directly from the farmers has been compensating the farmers with direct cash transfers when the market prices fall below MSP. The scheme has had its downsides with long delays in payments and heavy transaction costs. There is also a glut in supply with the markets getting flooded with low-quality grains, which then depress the already low crop prices. Unless, his and MS Swaminathan’s recommendations are taken seriously, the solution to the agrarian crisis is hiding towards a capitalist catastrophe. And why does one say that?

In order to negotiate the price deficient mechanism towards resolution, the Government is left with another option in the form of procurement. But, here is a paradox. The Government clearly does not have the bandwidth to first create a system and then manage the procurement of crops for which the MSP has been announced, which now number 20. If there is a dead-end reached here, the likelihood of Government turning towards private markets cannot be ruled out. And once that turn is taken, thee markets would become vulnerable to whims and fancies of local politicians who would normally have influencing powers in their functioning, thus taking the system on their discretionary rides.

There obviously are certain questions that deem an answer and these fall within the ambit of policy making. For instance, is there a provision in the budget to increase the ambit of farmers who are covered by the MSP? Secondly, calculations of MSP involve private costs and benefits, and thus exhibit one side of the story. For an exhaustive understanding, social costs and benefits must also be incorporated. With a focus primarily on private costs and benefits, socially wasteful production and specialization is encouraged, like paddy production in north India with attendant consequences to which we have become grim witnesses. Would this double-bind ever be overcome is a policy matter, and at the moment what is being witnessed is a policy paralysis and lack of political will transforming only in embanking the vote bank. Thats a pity!

Blue Economy – Sagarmala Financial Engineering: Yet Another Dig. Skeletal Sketch of an Upcoming Talk in Somnath, Gujarat.

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Authorized Share Capital in the case of Sagarmala happens to be INR 1000 crore, and is the number of stock units Sagarmala Development Company Limited (SDCL) has issued in its articles of incorporation. This ASC is open, in that share capital isn’t fully used, and there is ample room for future issuance of additional stock in order to raise capital quickly as and when a demand arises. SDCL can increase the authorized capital at anytime with shareholders’ approval and paying an additional fee to the RoC, Registrar of Companies. 

Capital Budgeting: Business determines and evaluates potential large expenditures/investments. Capital Budgeting is generally a long-term venture, and is a process that SDCL would use (and uses) to identify hat capital projects would create the biggest returns compared with the funds invested in the project. The system of ranking helps establish a potential return in the future, such that the SDCL management can choose where to invest first and most. Let us simply call it the first and most principle of budgeting. Blue Economy that instantiates itself via Sagarmala in India has options to choose from as regards its Capital Budgeting, viz. 

  1. Throughput analysis – This defines the main motives behind a project, where all the costs are operating costs, and the main emphasis is on maximizing profits in passing through a bottleneck. The best example for Sagarmala speculatively thought out is the marking of Western Shipping Corridor for container traffic and posing a livelihood threat to traditional fishermen. Throughput is an alternative to the traditional cost accounting, but is neither accounting, not costing, since it is focused on cash flows. It does not allocate fixed costs to products and services sold or provided and treats direct labour as a fixed expense. Decisions made are based on three critical monetary variables: throughput, investment or inventory and operating expenses. Mathematically, this is defined as revenue minus totally variable expenses, the cost of raw materials or services incurred to produce the products sold or services delivred. T = R – TVE. 
  2. Net Present Value (NPV) – this s the value of all future cash flows, either positive or negative over the entire life of an investment discounted to the present. NPV forms a part of an intrinsic valuation, and is employed for valuing business, investment security, capital project, new venture, cost reduction and almost anything involving cash flows. 

NPV = z1/(1 + r) + z2/(1 + r)2 – X

      , where z1 is the cash flow in time 1, z2 is the cash flow in time 2, r is the discount       range, and X is the purchase price, or initial investment. NPV takes into account the timing of each cash flow that can result in a large impact on the present value of an investment. It is always better to have cash inflows sooner and cash outflows later. this is one spect where SDCL might encounter a bottleneck and thereby take recourse to throughput analysis. Importantly, NPV deliberates on revolving funds.  

  1. Internal Rate of Return (IRR) – this is an interest rate at which NPV from all cash flows become zero. IRR qualifies attractiveness of an investment, whereby if IRR of a new project exceeds company’s required rate of return, then investment in that project is desirable, else project stands in need of a rejection. IRR escapes derivation analytically, and must be noted via mathematical trial and error. Interestingly, business spreadsheets are automated to perform these calculations. Mathematically, IRR is:

0 = P0 + P1/(1 + IRR) + P2/(1 + IRR)2 + …. + Pn/(1 + IRR)n

, where P0, P1,…, Pn are cash flows in periods of time 1, 2, …, n. 

 With a likelihood of venture capital and private equity expected in Sagarmala accompanied with multiple cash investments over the life-cycle of the project, IRR could come in handy for an IPO. 

     4. Discounted Cash Flow – this calculates the present value of an investment’s future            cash flows in order to arrive at  current fair value estimate for an investment. Mathematically, 

DCF =  CF1/(1 + r) + CF2/(1 + r)2 + CF3/(1 + r)3 + … + CFn/(1 + r)n

, where CFn are cash flows in respective n periods, and r is discount rate of return. 

DCF accounts for the fact that money received today can be invested today, while money we have to wait for cannot. DCF accounts for the time value of money and provides an estimate of what e should spend today to have an investment worth a certain amount of money at a specific point in the future. 

       5. Payback period – mathematically, this is defined as: 

Payback Period = Investment required/Annual Project Cash flow

This occurs the year plus a number of months before the cash flow turns positive. Though seemingly important, payback period does not consider the time value of investment/money, and is quite inept at handling projects with uneven cash flows. 

As a recap (and here, here, here)

Sagarmala is a 3-tier SPV structure

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Private Players/PPPs OR EPCs/Turnkey – the latter are used for projects with high social impact or low IRR. 

Expenses incurred for project development will be treated as part of equity contribution by SDCL, or, in case SDCL does not have any equity, or expenses incurred are more than the stake of SDCL, SPV will defray SDCL. Divestment possibilities cannot be ruled out in order to recoup capital for future projects.