Author: cprindia

FULL VIDEO BY PRATAP BHANU MEHTA
ECONOMY BUDGET POLITICS

Watch the full video (above) by Pratap Bhanu Mehta on the politics of the Union Budget 2017-18, and what it means for India’s future, as part of the 5-institute seminar on the budget organised earlier this month.

This joint seminar involved the directors of five institutions, namely, the Centre for Policy Research (CPR), Indian Council for Research on International Economic Relations (ICRIER), India Development Foundation (IDF), National Council of Applied Economic Research (NCAER), and National Institute of Public Finance and Policy (NIPFP).

FULL VIDEO BY YAMINI AIYAR
ECONOMY BUDGET POLITICS

Watch the full video (above) by Yamini Aiyar on the politics of the Union Budget 2018-19, and what it means for India’s future, as part of the 5-institute seminar on the budget organised on 10 February 2018 at The Leela Palace, New Delhi.

This joint seminar involved the directors of five institutions, namely, the Centre for Policy Research (CPR), Indian Council for Research on International Economic Relations (ICRIER), India Development Foundation (IDF), National Council of Applied Economic Research (NCAER), and National Institute of Public Finance and Policy (NIPFP).

COMMENTARY BY MUKTA NAIK
ECONOMY POLITICS

It has been a war of words since the release of the Reserve Bank of India’s annual report 2017-18, which stated that 99.3% of the demonetised currency was returned. While critics of the government’s note ban move have felt vindicated, the Finance Minister has defended demonetisation by claiming that it has fulfilled its ‘larger objective’ of making India a tax compliant society. It is worth remembering that the government’s narrative around the objectives of demonetisation has been changing over time. It started with the Prime Minister’s dramatic note ban announcement on 8th November 2018, which was widely termed as a ‘surgical strike’ on black money. Then it changed to a narrative of cashlessness and digitalisation and finally, the current justification of tax compliance.

At each step, there has been an emphasis on morality, and the message sent out by the government and amplified by the press and social media has been clear: those who comply are ‘good citizens’ and others are enemies of India. Given the credibility and popularity that PM Modi enjoyed in 2016 – and given that he was the face of demonetisation – this kind of messaging created real pressures on people to comply with the government’s efforts.

For a large number of poor households in India, however, compliance came at high costs. It wasn’t just the snaking lines to deposit cash at the bank, or the ruptures in cash-dependent supply chains that took away jobs and made food prices soar. For a population that earned barely enough to subsist, digitalisation and tax compliance were objectives that had little resonance with their daily lives. The tax base in India is very small, and income inequality is a glaring reality. Data from the India Human Development Survey II (2011-12) shows us that 90.4% Indian households earn less than Rs 250,000 per year, which means that individuals in these households earn too little to be liable to pay income tax. The situation is only slightly better in cities, with 73.8% households in metro cities and 84.2% in non-metro cities remaining out of the tax ambit because they earn too little (the five years between this survey and demonetisation is unlikely to have much altered this situation). This essentially means that the poor – most of them marginal farmers, agricultural labour and non-farm casual workers – who do not pay taxes anyway, took the hardest hit post-demonetisation in order to facilitate increased direct tax collection to the tune of 18% in FY 17-18. There is no argument about the benefits of increased tax collection, but does the end always justify the means?

Many have wondered why so much suffering did not provoke backlash against the government. One answer lies in the government’s strategic use of nationalistic narratives in which the role of the good citizen is constantly invoked. In our fieldwork in urban neighbourhoods across Delhi NCR, we observe that people recalibrated their responses to fit in with the idea of the good citizen. For example, in the immediate aftermath of demonetisation, the poor saw themselves as hardworking, ordinary citizens who suffered due to the corruption of other, richer people. At the same time, a petty landlord in an urban village in East Delhi told us he was ambivalent about collecting rent by cheque instead of cash and wondered if the government was going to come after people like him even as he defiantly told us he filed his tax returns annually. The moral narrative also created fissures within communities, encouraging those with a foothold in the formal economy to pass judgement on poorer households who were unable to cope without cash. As late as June 2017, we met a Dalit tailor in Gurgaon who invoked demonetisation to explain why he had paid money he could ill afford to a tout in order to get a PAN card made and file taxes.

These are but glimpses of the kind of disruptions that demonetisation caused, adding fuel to fires that had already been set by rising inequality and the inability of the Indian democratic project to fulfil the dreams of a growing number of semi-educated but aspirational young people. Instead of arguing about the success or failure of demonetisation, it might be a good time to put our ears to the ground and re-examine the experience of poverty in India. We must take heed and try to understand the ways in which the poor seek to be included in the larger public discourse, often to their own detriment, and the ways in which they continue to remain voiceless and often vilified.

CPR’s research on demonetisation can be accessed below:

• Demonetisation and its impacts, CPR website, 21 November 2016
• Is the Current Demonetisation Legal?, CPR website, 6 December 2016
• Coping with ‘Notebandi’ (Demonetisation): Voices of informal workers, CPR ThoughtSpace Episode 7, 22 December 2016
• Rule of Law or Law of the Powerful? Deconstructing Demonetisation Legally, CPR ThoughtSpace Episode 8, 13 January 2017
• The government must compensate for the demonetisation setback to migrants’ mobility, Hindustan Times, 16 January 2017

FULL AUDIO OF TALK
INTERNATIONAL POLITICS

Listen to the full audio (above) of the talk by David C Engerman, where he discusses how superpowers turned to foreign aid as an instrument for pursuing geopolitics through economic means during the Cold War.

Looking back to the origins and evolution of foreign aid during the Cold War, Engerman invites us to recognise the strategic thinking at the heart of development assistance—as well as the political costs. India, the largest of the ex-colonies, stood at the center of American and Soviet aid competition, seeking superpower aid to advance their own economic visions, thus bringing external resources into domestic debates about India’s economic future.

Drawing on an expansive set of documents, many recently declassified, from seven countries, Engerman reconstructs a story of Indian leaders using Cold War competition to win battles at home, but in the process eroding the Indian state.

David C Engerman is Otillie Springer Professor of History at Brandeis University, and the author of ‘The Price of Aid: The Economic Cold War in India’.

PART 6 OF A SERIES ON ‘COASTAL REGULATION’ BY THE CPR-NAMATI ENVIRONMENT JUSTICE PROGRAM
COASTAL GOVERNANCE ENVIRONMENTAL JUSTICE RIGHTS

After three Right to Information (RTI) Applications and a file inspection, the Ministry of Environment, Forests and Climate Change (MoEFCC) shares the draft MCRZ Notification, 2017 but full details are yet to be revealed.

On 22 March, 2017, leading national dailies carried the news of the existing Coastal Regulation Zone (CRZ) Notification, 2011 being replaced by a new framework called the Marine Coastal Regulation Zone (MCRZ) Notification, 2017. It was clear that a new law was on the anvil, but its contents were not publicly available. The ministry had only shared copies of the “stakeholder” meetings on MCRZ, in response to an RTI application earlier. A copy of the proposed MCRZ Notification, 2017 was accessed by Meenakshi Kapoor of the CPR-Namati Environment Justice Program following a file inspection on 23rd May 2017. Yet again, the ministry failed to disclose suo moto the proposal to amend the CRZ Notification despite directions of the Central Information Commission (CIC) in 2008 and 2016 and the government’s commitment to transparency.

The draft notification proposes significant changes to the manner in which the coastal zones are to be managed and regulated for variety of activities. The proposed changes are not only a change in nomenclature with the word “Marine” appended to the law, but have far reaching social and ecological implications:

Temporary tourism facilities will be allowed in Ecologically Sensitive Areas (MCRZ I). CRZ Notification, 2011 does not allow temporary tourism facilities in CRZ I areas.
Development in urban areas (MCRZ II) to be regulated as per prevailing local laws. CRZ Notification 2011 allows development in CRZ II areas as per the town and country planning norms of 1991. This was done to acknowledge the need of the local town and country planning norms to be aligned with Coastal Regulation Zone notification, which was issued for the first time in 1991.
Housing and basic infrastructure for local inhabitants will be allowed after 50 metres from the High Tide Line in rural areas (MCRZ III). The CRZ Notification, 2011 permitted houses for coastal communities after first 100 m of CRZ III areas.
State and Union Territory Governments are to prepare tourism plans for their respective MCRZ areas. No such tourism plans are mentioned in the CRZ Notification, 2011 (see detailed comparison between the current and the proposed Notification here).
Area under MCRZ will depend only on tidal demarcations (High Tide Line (HTL) and Low Tide Line (LTL)). Whereas, the CRZ Notification, 2011 links the CRZ area with Hazard line in addition to HLT-LTL demarcation (see details here)
While the notification proposes changes to coastal regulation, the details of the new clauses lie in the 10 annexures that are to go along with the MCRZ Notification. The proposed MCRZ accessed contains mention of these annexures, however, they were not made available at the time of the file inspection. These annexures cover the following aspects of coastal regulation:

I- Methodology for HTL-LTL demarcation
II- Guidelines for preparation of Marine Coastal Zone Management Plans (MCZMP)
III- List of tourism zones
IV- Kinds of Ecologically Sensitive Areas (ESAs)
V-List of the ESAs in each coastal state and Union Territory
VI- Guidelines for constructions in MCRZ I
VII- List of areas that need special shoreline protection measures
VIII- List of municipal towns
IX- Guidelines for development in MCRZ III areas
X- Guidelines for preparation of tourism development plans
XI- List of minerals and hydrocarbons that can be extracted with due permission (despite a prohibition on mining in the MCRZ) in each state and Union Territory.
XII- Composition, tenure and mandate of National, State and District marine Coastal Zone Management Authorities (MCZMA).
XIII- Guidelines for collection of fees and usage of MCRZ fund
XIV- Guidelines for preparation of Integrated Island Management Plans

Since 2014, the entire process of reviewing and revising the CRZ Notification, 2011 has been a closed-door exercise. Instead of the Ministry inviting suggestions and feedback from coastal communities, researchers, urban planners and legal experts on the implementation of the CRZ Notification and proposals for reform, there has been reluctance to share the details of this review.

For over a year and a half, despite repeated RTI applications, the report of the committee that reviewed the CRZ Notification, 2011 was not made public (read how CIC directed the MoEFCC to disclose the report). Four of the nine amendments made to the notification in the last three years were issued without seeking public comments on those (see details here).

This file inspection revealed that even the ministries that were asked to provide comments on the MCRZ Notification on 20 March 2017 were also not provided full information related to the MCRZ, in particular the annexures. In April 2017, the Ministry of Earth Sciences and Ministry of Tourism requested the MoEFCC to share copies of these annexures before they furnished their comments on the draft.

Researchers, activists, fishing unions and coastal communities have been persistent in their efforts to have an informed and participatory review of the primary law governing India’s coastline, the CRZ, 2011. Fisher groups across the country have written to the Ministry based on what was revealed in the news reports, as there has been no attempt by the government to involve them. Such a participatory review is critical because changes in the coastal regulation will have a direct bearing on over 3200 marine fishing villages and several million residents living across India’s coastline.

 

AN INTERVIEW WITH THE PANELISTS AT THE CLEARING THE AIR SEMINAR SERIES
AIR POLLUTION

On 1st February 2018, the Initiative on Climate, Energy and Environment (ICEE) in partnership with the Urbanisation focus area at CPR organised a panel focusing on how transportation impacts air pollution in the Delhi NCR, looking at possible solutions, both immediate and long-term. The following Q&A is based on the discussion between moderator Mukta Naik (CPR) and panelists Sumit Sharma (Fellow and Associate Director at Earth Science and Climate Change group of TERI), Parthaa Bosu (air pollution expert), and Amit Bhatt (Director of Integrated Urban Transport at WRI India).

Vehicles are often underplayed as a source for air pollution. Yet they are obviously both a significant source as well as an opportunity for intervention in a rapidly urbanising context. How would you characterise the contribution of vehicular emissions to the air pollution issue in Delhi NCR and beyond?

Sumit Sharma: To begin with, India’s ambient air quality standards are far higher than WHO norms so even air that is ‘clean’ by our standards is not really clean or healthy. When one goes down from all-India to city-level pollution data, the figures are alarming. In urban areas, vehicles contribute a significant share to air pollution, particularly PM10/PM2.5, but also NOX, VOC and BC emissions. There is no single factor influencing the contribution in Delhi NCR or beyond but it is impacted by vehicle density in a location, age of vehicles on road, fuel type, and speeds at which vehicles are moving.

Parthaa Bosu: Vehicular emissions are a function of the fuel quality, adulteration, and its monitoring, including a lack of technology to measure adulteration. In Delhi NCR and beyond, we see that vehicular traffic on the road is not just conventional urban transport (whether private or public), but also increasing volumes of freight. With penetration of e-commerce there’s been an explosion of “Urban Freight”, which has both direct as well as indirect ways of contributing to air pollution. Enforcement is also a problem: stipulated older vehicles are officially not allowed to ply in Delhi NCR, but they continue to do so.

Amit Bhatt: Our understanding on the impact of transport emissions on health is still evolving. However, physical exposure to pollutants is an important factor. This exposure is the maximum during commuting. In Delhi NCR and beyond, exposure levels will vary depending on the type of vehicle and time of commute, and understanding this micro context is important.

Delhi–NCR has seen a number of policy responses to the problem of vehicular pollution, such as shifting of transport vehicles to CNG, Odd-Even scheme etc. Despite this, the problem continues to persist and even worsen. Why have the earlier policy responses to vehicular pollution not worked adequately? Are current responses likely to face the same fate?

Sumit Sharma: Historically, policy responses to pollution, in Delhi NCR and beyond, have largely driven by the court without adequate understanding of the full context – for instance, shifting of polluting industries out of central Delhi to upwind areas such as Bawana is not helpful since the pollution will be blown back towards the city. Given that transport is a major contributor to PM 2.5, the move towards cleaner Bharat Stage–VI fuel is essential. However, this will only prevent emissions from increasing further and not reduce it from the present level. In terms of improving fuel standards, India has been an early mover, but these gains have been constrained by increase in the number of vehicles as well as presence of old vehicles on the road.

Parthaa Bosu: Fuel quality is a major issue, which has not been given adequate importance. Merely shifting a section of transport to cleaner fuels will not help as vehicles of older technology are still plying. Fuel standards must be nationwide. The PUC emission testing system for vehicles is also broken.

Availability of quality public transit is an important factor. While investments have been made in Delhi’s public transit system, it still does not adequately dis-incentivise owners of private vehicles. It is still cheaper and/or faster to use private vehicles, especially after the recent Metro fare hike. Multi-modal integration and last-mile connectivity remains as a deterrent for people to take public transport. Poor gender planning of a city also has bearings on air pollution, every individual should feel secure to travel on their own, else they will depend on personal vehicles for completing the trips or last mile.

The urban freight sector has not been factored into policy planning for emissions. With the e-commerce and logistics market expanding rapidly in Delhi-NCR and other urban centers, this is also likely to be a major source of pollution. There is no transition plan for trucks – merely restricting their entry or diverting them will not help in the long run.

The lack of scrappage policy means that vehicles which are old or burn dirty fuels have just moved from Delhi to NCR, and then slightly beyond. PM2.5 can travel more than hundreds of kilometres, so banning old vehicles in Delhi while allowing them ply just 20 or 50km away cannot be a solution at all.

Amit Bhatt: Policy has hitherto disproportionately focused on transport vehicles without restricting private vehicles. In Delhi, the reduction in emissions due to transition of public vehicles to CNG was offset by the large increase in private vehicles. Even public transit has not expanded adequately – Metro coverage is slowly increasing but the bus fleet is well below the number required. Due attention needs to be paid to modal share in transport planning- less than 15% of Delhi moves by car, 25-30% by 2-wheeler. The share of buses is falling, but given buses offer least exposure, they should be prioritised.

The Central Government’s plan of transitioning to an all-electric fleet needs to include massive infrastructural expansion for electric vehicles, and a plan to deal with the vehicles that will have to be replaced. There is a serious lack of policy clarity- if we are pushing aggressively for e-vehicles by 2030, there is no roadmap for the transition.

What should be the policy priorities for reducing vehicular emissions? Where do you see quick gains?

Sumit Sharma: I would say, in the context of fleet age, there is a need to have a scrappage policy and invest in modernisation of vehicle fleets. Similarly, responses during episodic peaks are important but not sufficient: the odd-even scheme, for instance, had only limited efficacy. There also needs to be better monitoring and dissemination of information to help the commuting public take informed decisions regarding commuting and transportation.

Parthaa Bosu: Policy solutions to pollution must consider a national approach, while at present they are too city-centric for a problem that is regional and even trans-boundary. For instance, a registry of in-use vehicles is needed. Finally, the policy vision must be long-term and not restricted like all the earlier initiatives which were short-term or focused on only a small segment of the vehicular population.

Amit Bhatt: As I said earlier, from the perspective of reducing exposure, public buses must be prioritised. Focusing on reducing commute time to reduce exposure by giving priority to public transport might also offer quicker gains, for example the odd-even did not succeed in significantly bringing down pollution levels, but it did reduce exposure and this should become an important public debate too.

A DISCUSSION WITH PROFESSOR DANIEL BODANSKY ON THE PARIS AGREEMENT AND THE UPCOMING CONFERENCE OF THE PARTIES (COP25) IN SANTIAGO
CLIMATE RESEARCH

On October 14 2019, the Initiative on Climate, Energy and Environment (ICEE) at the Centre for Policy Research (CPR) hosted Professor Daniel Bodansky (Regents’ Professor, Sandra Day O’Connor College of Law, Arizona State University) for a discussion on recent developments in the international climate change regime. Professor Bodansky analyzed the state of play in the UN Framework Convention on Climate Change regime, outlined relevant articles of the Paris Agreement, and previewed the upcoming Conference of the Parties (COP25) in Santiago in December.

To learn more about the evolution of the international climate change regime, read International Climate Change Law (Oxford University Press 2017) edited by Daniel Bodansky, Jutta Brunnee, and Lavanya Rajamani (Visiting Professor at CPR). You can also read these recent open-access articles:

The Issues that Never Die. In: Special Issue on the Paris Rulebook. Carbon and Climate Law Review 12(3): 184 -190. By Daniel Bodansky and Lavanya Rajamani.
General Issues in Elaborating the Paris Agreement. Center for Climate and Energy Solutions: Arlington, Virginia. By Daniel Bodansky and Lavanya Rajamani.
About the Speaker

Daniel M Bodansky is a leading authority on international environmental law generally and climate change law in particular. Prior to his arrival at the College of Law in 2010, Professor Bodansky was the Associate Dean for Faculty Development and Emily and Ernest Woodruff Chair in International Law at the University of Georgia School of Law. He has served as the climate change coordinator and attorney-advisor at the U.S. Department of State, in addition to consulting for the United Nations in the areas of climate change and tobacco control.

He has previously been awarded the International Affairs Fellowship from the Council of Foreign Relations, a Pew Faculty Fellowship in International Affairs, and a Jean Monnet Fellowship from the European University Institute. His book, The Art and Craft of International Environmental Law, published by Harvard University Press, received the 2010 Harold and Margaret Sprout Award of the International Law Association, as the best book that year in the field of international environmental studies. His co-authored book, International Climate Change Law (with Jutta Brunnée and Lavanya Rajamani) received the 2018 Certificate of Merit from the American Society of International Law as the best book published the previous year in a specialized area of international law.

FULL JOURNAL ARTICLE BY SHYLASHRI SHANKAR
BUREAUCRACY

The Constitution of India envisages three types of emergencies: A national emergency; a state emergency (in the federal setup, regions are called states in India, and the central government has the power to impose an emergency if there is a breakdown of law and order in that state); and a financial emergency. ‘The problem the State faces is how it can respond effectively to exceptional situations without casting its adherence to the rule of law into question.; Ernst-Wolfgang Böckenförde offers a set of solutions within a model structure anchored in constitutional laws. The model structure, which applies at the federal level, advocates a separation between the authorising agency—the political wing—and the implementation agency, as well as creating a distinction between a ‘law’ and a ‘measure’, and between a most extreme and a merely difficult situation. By focusing on the actions of the higher judiciary in India, this article tests whether the safeguards in Böckenförde’s model structure function at the sub-national state level in a very different geography and context. The results highlight the concern that the dynamics of democracy and the reality of how political power is garnered in a federal Westminster style framework effectively stymie the procedural innovations introduced by Böckenförde’s model by creating conditions, not for fair play, but for subverting the spirit of the law. Even the procedures outlined by Böckenförde—such as an emphasis on making the agent who holds the emergency powers a political, and not merely an administrative organisation—accentuates, rather than mitigates, this problem.