Author: Kunal Bose

Humanitarian Crisis Unfolding In Myanmar

A Humanitarian Crisis Unfolding In Myanmar

By Kunal Bose

Democracy in Myanmar proved to be the briefest spring possible following the November 2020 general elections. Aung San Suu Kyi led National League for Democracy had a decisive victory at the polls despite all the army tricks in the face of popular championing of democratic rule. But on February 1, 2021 when the newly elected parliament was due to hold its first session, the military junta staged a coup on the specious plea that in many ways the conduct of elections compromised the country’s sovereignty. However, there never was any elaboration of the junta’s reservations about the poll process.

Whatever that was, brutalities have routinely followed the junta’s accession to power, resulting in the killing of thousands, locking up of much greater numbers of pro-democracy protesters across the country, which shares common borders with India (including a maritime boundary in the Bay of Bengal), China, Bangladesh, Thailand and Laos. Displacement of nearly 2 million people is a massive human disaster story.

Thanks to the brave human rights groups such as Assistance Association for Political Prisoners (Burma), Myanmar Witness and Human Rights Foundation of Monland and an alert Western Press, the world becomes aware of the growing ferocity with which the junta is out to crush dissent. Junta reprisals take the form of wanton killing and condemning dissenters to jail where many routinely perish. Unfortunately and very rarely, India’s English dailies will use stuff about gory happenings in the neighbouring country sourced to Western syndicates.

A New York Times dateline New York story based largely on inputs from civil society and rights groups tells the world of the horrific torture and inhuman living condition that await pro-democracy inmates in Myanmar jails. The NYT story, which has a chilling effect on readers who care for democracy and freedom of speech, says the junta unnerved by growing protests and successes of rebel groups in their encounters with the army in various parts of the country “is meting out increasingly lethal treatment to those in custody. In the first two months of the year, more than 100 prisoners perished, either from torture or neglect… Conditions in military-run prisons have deteriorated further… with prisoners being deprived of food, proper sanitation and healthcare.” More than words, bits of statistics pointing to the gory outcome of growing severity of junta abuses shows human rights in Myanmar have gone for a toss. Unfortunately without the outside world caring.

According to the NYT report, since the February 2021 coup, the number of people dying in detention has crossed 1,500, including dozens dying due to physical torture. Jail inmates themselves confirm the flagrant abuses. It further says, the junta, allergic to elected government running the country, has the notorious reputation to bomb “civilians, using them as human shields, persecuting minorities, including the Rohingya people and torturing pro-democracy activists.”

Despite the fear of reprisals by Tatmadaw, the Burmese word for royal armed forces, the ranks of activists pining for restoration of peace and democracy are growing to junta’s dismay. A much bigger concern for Tatmadaw is the rising spirit of accommodation among ethnically diverse groups. They now have the shared goals to see that the army is divested of political power for it to go back to the barracks. The aspiration is to have a federal democratic future. But to win every bit of freedom, the combine of Arakan Army (AA), Myanmar National Alliance Army and Ta’ang National Democratic Alliance Army will be engaged in a battle to be bloodied by the junta. The combine is formally named The Brotherhood Alliance (TBA).

As is the wont with military rulers and despots of every other kind everywhere, the Myanmar junta will press the repressive button firmly every time it feels challenged. From the progress the rebels continue to make since the success achieved in the ‘Operation 1027’ (named from the date it began last year) with TBA springing lighting attacks on the army in the northern Shan state bordering China, the Myanmar scene is emboldening the activists. Since the October bravery, the rebels have to their credit some other major successes in wresting control of territories from the army.

ALSO READ: We Have Asked All Indians To Leave Myanmar: MEA

The writ of rebels now runs over Laukkai, which earned notoriety for being the den of gamblers and internet fraudsters, Kayin state in southeast and Chin state in the west. More recently, the rebels seized control of main township of Ramree island off the coast of Rakhine state. This particular rebel success is of considerable strategic significance since the place happens to be next to Kyaukpyu wherefrom China sends oil and gas by pipe to its landlocked areas. China has developed a deep water port and terminals at Kyaukpyu and to keep the facilities from being targeted by the rebels, Beijing must find ways to keep them in good humour.

China does not conduct its foreign policy based on scruples or ideology. When the junta overthrew the elected government in February 2021 to run Myanmar, Beijing had no compunction to describe the development as a “major cabinet reshuffle.” What is more besides selling arms worth over $250 million to the junta,  China came down hard on the West for its sanctions on Myanmar liking these to exacerbation of prevailing tensions. But once the TBA, a coalition of ethnically based militias, started getting the better of the junta in northern Myanmar to start with, a flip in Beijing’s policy towards its disturbed neighbour was visible.

No doubt, China not in any way is discouraging the rebels and on the contrary, as reports say providing help to TBA is solely in order to protect its economic interest. The Economist writes: “China, which had long supported the junta, is doing deals with others… China will surely seek an accommodation with the AA at Kyaukpyu to protect its energy supplies there.” Measured support from China alone is, however, not enough to create condition for Myanmar to return to democracy.

As the conflict between the rebels and the junta has by now spread over two-thirds of the country, the people are facing an acute economic crisis. The United Nations Development Programme (UNDP) says in a report released the other day that the ranks of middle class in Myanmar are shrinking dramatically and poverty is spreading widely. The report further says the middle class is now half the size it was three years ago. Rising inflation is forcing households to cut spending on food and other essentials. Nearly half the population lives under the national poverty line of 76 cents a day.

Unnerved by rebel challenge, deepening economic crisis and consequent public unrest, a bewildered junta introduced conscription in February with the provision that anyone trying to avoid the mandatory draft will be consigned in the prison for five years. Expectedly many are trying to flee the country. Many others are joining people’s defence forces pledging loyalty to the National Unity Government in exile.

What the rebels need the most at this stage is moral and material support from democratic countries, the US and India in particular. Their indifference to junta atrocities is only helping China to have growing control both over the junta and the rebels in Myanmar. This, The Economist finds quite concerning. It says: “A Myanmar over which China establishes dominance is in no country’s interests but China’s. Yet America is distracted. India has called for dialogue, but offered little else. The ten-country South-East Asian club, ASEAN, timidly sticks to a lame ‘five-point consensus’ that the junta does not even pretend to honour.”

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Mining Electoral Bonds to Curry Favours

Mining Electoral Bonds to Curry Favours?

By Kunal Bose

India is exceptionally rich in mineral resources, be it thermal coal, iron ore, bauxite or limestone. It also has fairly large endowments of zinc ore, manganese ore and chromite. Helped by resource bounties and growing local demand for energy and metals, India is counted among the world’s major producers of thermal electricity, which, however, meets with increasing frowning by environment activists, and steel, aluminium, zinc and cement. The governments at the centre and in states have over the years introduced many mining related reforms, the most important being the dispensing with the power to make discretionary allotment of reserves in favour of their auctioning. This is aiding transparency in resource allocation.

The authorities had been under growing pressure to introduce reforms as the mining sector’s production performance was not in line with resources lying underneath the earth. Moreover, much to their embarrassment, the extensive wrongdoings in the mining sector, resulting from the nexus between miners and a section of bureaucracy was increasingly coming to light. First in Karnataka and then in Goa, the Supreme Court cancelled iron ore mining leases on grounds of illegalities some years ago.

Such strong action, which had a telling effect on the country’s production of steelmaking ingredient and its supply to local steel mills and for exports must have instilled some fear and discipline among miners. The Goa government was in the firing line for its act of omission. In an indictment of the local administration, the Court said while its direction was to grant fresh licences in accordance with the mining laws, the state government’s renewal of mining leases was found to be “unduly hasty, without taking all relevant material into consideration and, therefore, not in the interest of mineral development.” The Court found violations of environmental norms in the process of ore extraction and its transportation in Goa in particular quite distressful.

After all the reforms, between making a successful bid for lease ownership of a reserve and opening of the mine is still a tortuous process where government agencies at the Centre and in states have a decisive say. Because of the rigmarole, including time-consuming environment and forest clearances, a mine opening in India can take up to eight years against three years in Australia, the world’s largest producer and supplier to the global market of a number of minerals. What will be admitted straightaway is the continuing need for government oversight once a mine is opened because mines in India are found to be prone to breaking rules with impunity and cutting corners endangering the lives of workers and causing harm to the environment. But for such oversight to be effective demands that officials posted in far corners where extraction happens will honestly record all mining related misdoings to be followed up by corrective and also exemplary actions by people at higher bureaucratic echelons.

As sector observer members of civic society will say, if this were the case then the “murky affairs” relating to Karnataka and Goa mining would not have happened. Monitoring of mines operations by using satellites and drones might have curbed what is visible from air. What will, however, always stay under radar are the dubious deals in the sector happening all the time because of the unholy understanding between miners, politicians and government officials. Avarices of miners apart, politicians and bureaucrats will not miss the opportunity to line their pockets by way of withholding required permissions till they get paid and overlooking many acts of omission by mining groups, again for a consideration.  

All these are among the reasons why the mining sector has remained bereft of foreign direct investment (FDI). This is despite New Delhi’s liberalised FDI policy allowing 100 per cent foreign equity holding in the sector on automatic route for all non-fuel and non-atomic minerals. Diamond and precious stones also remain beyond the scope of FDI. Finding the overall environment not to their liking, years ago British-Australian mining giant Rio Tinto (the world’s second largest) and Norwegian bauxite and aluminium producer Norsk Hydro cried off from India. While Rio Tinto had big iron ore mining plans in the then Orissa (since renamed Odisha), the Norwegian group had nursed the ambition to develop a bauxite mine and an alumina refinery in the downstream in the same state in partnership with Tata Sons and Canadian Alcan, part of Rio Tinto since 2007.

What could have been a richly rewarding business for the three iconic houses is now owned by Kumar Mangalam Birla’s flagship Hindalco Industries. Called Utkal Alumina International, a 100 per cent subsidiary of Hindalco, it has a highly cost effective 2.1 million tonne alumina refinery at Rayagada in Odisha and a 8 million tonne bauxite mine at Baphlimali also in the same state.

ALSO READ: Why Business Houses Betting Big on Orissa?

What has underwritten the success of Birla when a combination of bigger entities, unable to take the project forward, sold their entire stakes to the former in phases? The cryptic answer will be the Birla group’s capacity, which several other Indian entities too have, to manage the environment to its advantage. The expression ‘manage the environment’ stands for the skill to find resolution of any thorny issues by taking care of the right people. Ask any media person writing on mining, she/he will confirm the opaqueness of the sector. However big private sector mining companies may be, they will have nothing to do with the media.

Their reluctance to share basic industry related information, which has nothing to do with their own working is galling. They are not listed on stock exchanges. Therefore, they have no obligation to publish quarterly and annual results and annual reports. PSUs in the country’s mining universe such as Coal India, NMDC and Moil are, on the other hand, listed entities and the media has easy access to them. In a government undertaking all income and expenses are to be shown in books and their officials cannot find a way out of a difficult situation by paying bribes.

And also unlike private sector companies, mining, metal and power PSUs were not buyers of electoral bonds, an instrument made available to business houses to support electioneering efforts of political parties of their choice. In the list of top 20 electoral bond purchasers are found Vedanta, a major producer of oil, iron ore, zinc ore and aluminium, Essel Mining, an unlisted money spinner for Aditya Birla group and Haldia Energy, a coal-based power producer in RP-Sanjiv Goenka group. Vedanta bought electoral bonds of Rs376 crore, Haldia Energy Rs377 crore and Essel Rs225 crore.

At this writing, one does not know how the mining and metal groups went about in giving the bonds to political parties. Incidentally, the five companies belonging to Jindals but managed separately by family members bought bonds of Rs195 crore. Jindals have a big manufacturing and mining profile in Odisha and they have a hugely Odisha based ambitious growth plans. It’s a given that BJP being an all-India political party will be the largest recipient of electoral bonds purchased by companies and individuals. What at the same time can be said with certainty is that mining, power and steel groups made large donations to Odisha’s Biju Janata Dal and West Bengal’s Trinamool Congress for obvious considerations. Nothing to do with politics or ideology.

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Vietnam The Emerging Asian Tiger

Vietnam – The Emerging Asian Tiger

By Kunal Bose

This is a race not formally announced but in which every south-east Asian country and prominently India in south Asia are keen participants. The competition is about getting as big a slice as possible of manufacturing capacity touching electronics and telephony to engineering products that is gradually being moved from China by MNCs, principally headquartered in the US and Japan to relatively low cost regions, as part of the China plus one policy. Saving in cost is definitely a consideration for paring MNC manufacturing exposure in China.

Consider Vietnam, which because of state focus on education, boasts of a plentiful supply of educated, hardworking and disciplined workers needed by new generation industries. What further draws MNCs to employ Vietnamese workers is their availability at almost half the cost of Chinese peers in their country’s coastal regions. Manufacturing wages in Vietnam remain the lowest in the entire south-east Asia barring the Philippines.

Cost advantage was certainly not at the top of mind of policy makers of countries now in pursuit of decoupling from China wherefrom earlier huge investments were supporting capacity building of many industries, including hi-tech ones in China and in the process becoming too critically dependent on a single supply source. Geopolitical considerations, growing frictions in trade relations leading countries such as the US, EU and India hauling China to WTO (World Trade Organisation) for dumping of a number of products, including steel and aluminium, arbitrary Chinese policies that became palpably evident during Covide19 pandemic management and reservations about the uncommonly strict data privacy law have underpinned the need to promote investment in other Asian countries that will supplement or cut capacity in China.

Over the years supply chains based in Asia have expanded well beyond China to include Vietnam, India, Indonesia and the Philippines. “We are supplying finished products in large volumes to the US and EU. However, for components and parts we continue to remain dependent on China. The much publicised decoupling from the Chinese economy and all the efforts to expand the supply chain beyond the world’s second largest economy may not have hurt China that much till now. Whatever that may be, Vietnam’s reputation is no longer based on as a global supplier of clothing to American and European companies but of products based on very high technology,” a local head of a leading MNC told this reporter on condition of anonymity.

Because of its strategic location sharing terrestrial and maritime borders with China being wooed by both Washington and Beijing and a population of over 100 million with a per capita income of $4,163.5 in 2022 (source World Bank), it is only natural that MNCs, including the ones dealing with pinnacle of technology, will have a growing presence in Vietnam. From FMCG groups Unilever to Nestle to Procter Gamble to IT companies Microsoft to IBM and Samsung among electronics items manufacturers are finding their businesses growing here.

In Apple’s diversification of supply sources from China, the two countries figuring prominently are Vietnam and India. For Cupertino (California) based Apple, makers of iPhone and MacBook, shifting geopolitical tides, triggered by among other issues President Xi Jinping’s instruction to his military to be prepared to invade Taiwan by 2027 and President Biden’s resolve to defend Taiwan in such circumstances, it has become imperative to ensure that iPhone supplies are not disturbed. Therefore, the company with market capitalisation of $2.87 trillion is constrained to hedge its bet on Vietnam and India by supporting suppliers there.

For example, the Tata group, which already owns an iPhone factory in Karnataka acquired from Taiwanese company Wistron will commission a greenfield iPhone assembly plant at Hosur in Tamil Nadu in the next 18 months. Going beyond assembly, the group has started making iPhone enclosures or metal casings.

ALSO READ: Why Singapore Manufacturers Are Moving To India

In the meantime, Taiwan based electronics manufacturing group Foxconn is successfully running an iPhone assembly unit, one of the largest for Apple outside China, at Sriperumbudur in Tamil Nadu. Production now at 6 million pieces is to be rapidly expanded. In this context, the Wall Street Journal says in a recent report: “Apple and its suppliers aim to build more than 50 million iPhones in India annually within the next two to three years, with additional tens of millions of units planned after that.”

In India suppliers to Apple, however, have to contend with poor infrastructure, logistical challenges getting slowly resolved and trade union issues. Interestingly, China in spite of staying in command of the communist party is spared labour problems. Whatever the challenges of being here, Apple CEO Tim Cook’s visited India in April last and met prime minister Narendra Modi to convey the company’s commitment to be part of this country’s digital journey. In the meantime, the two flagship Apple stores in Mumbai and Delhi that Cook opened have in a short time proved a roaring success. In Vietnam too, Apple products have caught the imagination of the people, especially the young, following the launch of online Apple store and backup service from the online team.

In terms of range products made for Apple by its suppliers, Vietnam has remained nonpareil in Asia outside China. The bright spot that Vietnam is for Apple in its China decoupling move will very substantially increase capacity to make IPads, Apple watches, MacBooks and AirPods by 2025 considering fresh capacity building investments being proposed by existing and new suppliers. For example, Foxconn is to make growing volumes of iPad and MacBook in Vietnam. As the company is in the process to invest $270 million to build a new factory there, one of its subsidiaries is to exclusively supply made in Vietnam servers for Apple to train and test AI services. A shining example of going up in the production value chain. The Taiwanese Compal Electronics, a major supplier to Apple, is too rapidly expanding capacity in Vietnam.

Not only in IT and electronics, Vietnam, according to CLSA, a bank, received in the first three quarters of 2023 foreign direct investment (FDI), which as a share of GDP was twice as large as in Indonesia, the Philippines or Thailand. Whatever that is, neither Hanoi nor New Delhi will not be able to wish away the fact that for many critical components, the two countries continue to remain hopelessly dependent on supplies from China. FDI that propels growth as also supply of technologies fell 16 per cent for India to $70.9 billion in 2022-23 from $84.84 billion in the previous year.

In contrast, a much smaller country Vietnam found FDI rising to $36.6 billion in 2023, a jump of 32.1 per cent year on year. This incidentally happened to be the highest FDI received by Vietnam in the past five years, underlining the destination’s attractiveness to foreign investors, especially the ones keen to reduce their Chinese profile.

The more important considerations that have helped Vietnam to attract FDI from a number of destinations – in 2023, the country received investments from as many as 111 countries – are: adroitness with which the regime continues to handle two antagonists, namely, the US and China; over three and a half decades of opening of the economy and reforms since the end of collectivism; building of human resources to support investment in new generation industries; and incentive package for foreign investors. But now inertia has set in in decision making, specially when it comes to giving approvals to new projects for fear of being hauled up on corruption charges. The inactiveness of politicians and bureaucrats at every level is due to the launch of anticorruption drive some time ago.

Incidentally, President Nguyen Xuan Phuc was forced to resign in January 2023 along with some ministers as part of an anti-corruption campaign. No wonder The Economist highlights “big risks to Vietnam’s tigerish emergence. Its geopolitical sweet spot may not last – especially if Donald Trump returns to power and takes exception to the size of America’s bilateral trade deficit with it. The beneficial demography underlying its growth is weakening.” But the most disturbing phenomenon, according to the magazine, is the rulers’ “resistance to political reform.”

(The writer was lately in Vietnam)

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Reading The Darjeeling Tea Leaves

By Kunal Bose

Nearly a century and a half ago, a renowned English tea expert J. Berry White wrote tea “has the reputation of furnishing a beverage that cheers but does not inebriate.” White at the same time described “tea mania as an addiction.” This addiction was not confined to the ones for whom tea drinking became a religion. Enthusiasm to grow tea for many decades since then became so infectious that Robert Fortune, whose reputation is based on expanding tea cultivation here using seeds smuggled from China lamented that “in India every man seems to think himself qualified to undertake the management of tea cultivation without having any knowledge of the subject.”

Fast forward to the present times. Is not the unchecked wilting of tea industry in Darjeeling, very small in size seen in the context of India making 1,365 million kg in 2022 but commanding an unrivalled reputation for quality, over the past many decades also largely due to poor estate management? What Fortune feared would befall tea industry in general so long in the past if gardens come to be managed by unschooled owners is proving right for gardens in the hills of Darjeeling. Tea being the principal source of revenue and livelihood for Darjeeling, the unchecked setback in its fortunes has been wreaking havoc on the local economy as it is also a cause of social unrest.

In more than one way, the past year would go down in the annals of the famed Darjeeling tea industry abroad as annus horribilis. Production of tea in the hills slid a worryingly around 9 per cent to about 6.3 million kg in 2023. The exact production fall will be known when December plucking and manufacture figures are available. In any case, the cold December when flushing of tea leaves don’t happen is a marginal month in terms of plucking. Quality of the hill origin beverage that begins to turn indifferent at the end of the second flush with the onset of monsoon turns even flatter during the year-end. December neither contributes of any significance to revenue nor to profits with harvesting limited to around 60,000 kg and quality not in line with the hill produce in preceding months. That tea does not find favour in the export market and is almost all sold locally.

The unique beverage of Darjeeling origin and of the first two flushes continues to enchant royalties from the United Kingdom to Japan and connoisseurs with deep pocket across the globe. Select ranges of first flush Darjeeling tea will fetch eye-popping prices from European and Japanese buyers in spite of their economies not having the best of times. But as is the long-time global experience, very high value products from Hermes bag to Bugatti and Rolls Royce cars to Patek Philippe and Berguet watches will do well through all economic seasons. People with astronomical income is spared tightening the belt when the general economy faces headwind. Some lines of Darjeeling first flush harvested in small quantities making them rare and highly coveted would fetch prices of around $300 a kg. The first flush beginning in February and finishing in April with new two leaves and a bud will leave a light, floral, fresh, brisk and astringent flavour in the brew. A divine experience for the few who can afford.

Incidentally, Darjeeling tea was the first among all commodities in India to have been accorded GI (Geographical Indication) status. Securing this recognition following multi-steps scrutiny became essential as large volumes of teas of other origins with some attributes of Darjeeling tea but not in any way comparable in quality with what is produced in the hills of north Bengal were sold in the market here and abroad as Darjeeling tea to the dismay of its makers. Such fakery not only did damage to the brand value of Darjeeling tea but also told on producer margins.

The Tea Board, the administering authority of GI, says the regulations apply to “87 tea gardens” whose harvested leaves have been “processed and manufactured in a factory located in the defined geographic area” and when such tea subject to review by tea tasters is found to have the “distinctive and naturally occurring organoleptic characteristics of taste, aroma and mouth feel, typical of tea cultivated, grown and produced in the region of Darjeeling, India.” The requirement that only 100 per cent Darjeeling tea is entitled to carry the Darjeeling logo has to a large extent succeeded in stamping out teas of other origins being masqueraded and sold as Darjeeling tea.

ALSO READ: Storm Brewing In Darjeeling Teacup

Even then in the domestic market, practically unrestricted arrival of tea from Nepal across the border continues to play spoilsport for Darjeeling tea, especially by way of depressing prices. While large imports from Nepal continue to cause distress to tea producers in Darjeeling, a very few gardens in the hills are in the black, unable to recover production cost, not to speak of earning profits, from auction and private sales. No wonder, as many as ten gardens in Darjeeling remained closed through 2023, knocking off around 1 million kg of production.

But the industry ills go well beyond that. Leave out a little over a dozen estates, the owners of other operational gardens are desperate to exit the business, only if they would find buyers. The figure of ₹200 a kg loss borne by Darjeeling gardens may be an overstatement by Indian Tea Association. The depth of the crisis is, however, not to be denied. For mitigation, the industry is seeking subvention from the state government on two counts – promotion of exports and transport subsidy. Even while West Bengal government’s financial health remains a subject of concern, it cannot but lend a patient hearing to Darjeeling planters, providing livelihood to nearly one lakh people with women engaged in plucking benefiting in a major way.

The unique climatic condition, cool bridge from the Himalayas wafting through the gardens in the hills, which are brushed by thick clouds, soft mountain rains and intensive sunshine help in making that adorable beverage. The rich organic reddish soil is also a deciding factor in making Darjeeling tea the ‘champagne among all teas.’ A planter of nearly five decade standing says the magical properties of Darjeeling brew has got much to do with estates being at high elevation of 600 to 2,000 metre above the sea level. The higher an estate is located in the hills, the better is the quality of its tea.

Whatever the mystique surrounding the tea grown in the southern slopes of the Himalayas covering an area of 17,500 hectares, the crisis surrounding the industry is worsening. Darjeeling tea continues to experience a downhill journey from the time when production would be over 10 million kg, with the withering of a good number of gardens and some experiencing ownership change. When committed planters of the kind of Rudra Chatterjee of Luxmi Tea or Ashok Lohia of Chamong Group will step into a weak estate, the working inevitably improves over time. Goodricke Group is also doing a good job in increasingly difficult circumstances. But all that is not enough to redeem plantation in Darjeeling hills wherefrom tea in 2023 auctions at Rs319.74 a kg sank to its lowest since 2015 when it was a distressingly low Rs285.71 a kg.

Not even a quarter of Darjeeling tea output is sold through auctions, allowing scientific price discovery. Whatever that is, fall in auction prices combined with geo-political crisis involving two raging conflicts involving Russia-Ukraine and Palestinians-Israelis ensured up to 20 per cent erosion in private sale prices over 2022. Calcutta Tea Traders Association secretary J Kalyana Sundaram would attribute the setback in auction and private sale prices to export demand squeeze and the continuing impact of imports of Nepal origin tea on domestic sale of Darjeeling tea. Annual exports of Darjeeling, made up of a very large portion of the first flush and a fairly good amount of second flush, are around 3 million kg.

Much to the concern of planters in Darjeeling, imports from Nepal had a humongous share of 17.36 million kg in total arrivals of 29.84 million kg here from all destinations in 2022. The industry has recommended to the central government some corrective steps to curb imports from Nepal. The more important of these are: fixing of a minimum import price for tea originating in the Himalayan neighbour and subject all imports to quality testing to ensure that foreign origin teas, Nepal and otherwise conform to standards of the Food Safety & Standard Authority of India (FSSAI). Whatever the industry may want, it will do well to remember that New Delhi will not be inclined to initiate any steps that may cause misunderstanding in Kathmandu.

Mizoram’s Measured Approach

Mizoram’s Measured Approach And Search For Peace In Assam

By Kunal Bose

The strategic and also commercial importance of the seven north-eastern states Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland and Tripura and also what is described as the brother state Sikkim cannot be overemphasized. All these states combined have common borders with China, Bangladesh, Myanmar and Bhutan. Security aspect aside, the north-east if given a robust infrastructure and commercial acumen could emerge as an important gateway for trade with neighbouring countries. As it would happen, the potential of the region, which is a rich mosaic of culture and social practices, has very largely remained unexplored because of continuing indifference of mainland powers that be and people in general to the north-east.

Such being the reality causing despair among north-easterners for not being able to meaningfully participate in and benefit from economic progress happening elsewhere in the country, it is good that the largely overlooked region left to fend for itself and periodically the scene of internecine conflicts has now Lalduhoma as chief minister of Mizoram. But what is so special about Lalduhoma that he could become the agent to bring national focus to a long overlooked group of states?

As an IPS officer who looked after the security of Prime Minister Indira Gandhi and subsequently became a member of the Lok Sabha from Mizoram in 1984, Lalduhoma is familiar with the goings on in Delhi. His recent first trip to the capital and apparently productive discussions with Prime Minister Narendra Modi, Home Minister Amit Shah and some other ministers go to confirm while he will maintain the distinct identity of Zoram People’s Movement (ZPM) without aligning with either the Congress or BJP in any way, in true federal spirit he will be seeking the Centre’s help for the state’s development. Lalduhoma conducted himself in true federal spirit during his maiden trip to New Delhi as CM and seemed to have secured assurances of development from central ministers.

What actually is the outcome of the 74 year old Mizoram CM’s visit to Delhi? He came to the capital soon after the Union government announced the plan to build a fence over a 300-km stretch of unfenced boundary with Myanmar and also end the 40 year old free movement regime, allowing people living on both sides of international border to travel within 16 km into each other’s territory without visa. New Delhi’s compulsion to build the fence along the border with a disturbed country is well understood. Mizoram is hosting more than 31,000 individuals belonging to the Chin community from Myanmar who had to flee their country following a coup by the army in February 2021. Now, close to 10,000 displaced people from Manipur, victims of ethnic violence, have taken shelter in Mizoram.

It goes to the credit of Mizoram and all the local parties that they are bearing the burden of sheltering and providing basic support to refugees from across the border and also to Kuki-Zo community members despite fund crunch. That the CM has been able to secure some help from New Delhi in looking after displaced people is clear from what Lalduhoma said on his return to Aizawl: “Even though the Centre can’t accord refugee status to the Myanmar nationals, it is ready to collaborate with us in providing relief to them. People from Manipur, who fled their homes due to ethnic violence, will also be looked after with help of the central government.”

Thankfully, New Delhi took cognisance of the fact that the Chin community from Myanmar and Kuki-Zos from Manipur have common ethnic ties with the Mizos. Lalduhoma was bold enough to tell Modi that the Chin people “are not strangers, but brothers with identical blood running through our veins.” To the relief of the newly minted Zoram People’s Movement (ZPM) government, Lalduhoma secured assurance from Shah that New Delhi though would not grant refugee status to people from Myanmar, it would not ask them to leave till normalcy was restored in their country. Moreover, there will be handholding of Aizawl in looking after the people from Myanmar and Manipur.

ALSO READ: Methodical Mizoram Votes For A Change

A much bigger challenge for Lalduhoma will be to ensure that the 12 priority programmes of ZPM government are implemented within 100 days and 2024 becomes the year of financial consolidation. The new regime having embraced economic development as the mantra says redemption will come with investments coming from the centre, particularly in infrastructure development and private sector making use of the state’s “rich natural resources.”

The Christian dominated Mizoram has a rate of literacy much higher than the national average of 77.7 per cent. Despite this, the employment scene, particularly among the young, has remained dismal. Before the last election in which ZPM won 27 of 40 seats, Mizoram was governed by the Congress and Mizo National Front (MNF) by turn. Both were found wanting in creating an environment for investment. The apathy of the centre was also palpable. In fact, Aizawl found New Delhi to be distant and domineering. That also is a common experience of other north-eastern states.

The other day, the country was witness to unbound rejoice in the Union Home Ministry and also in Assam government, which is ruled by BJP, over the signing of a ‘peace accord’ with pro-talks faction of the United Liberation Front of Asom (ULFA), led by Arabinda Rajkhowa. But such celebrations may be premature and peace in the north-eastern state may still be eluding, for Paresh Baruah heading the more aggressive and militant ULFA (Independent) has stayed away from the peace agreement.

A fugitive from his own country and reportedly moving in Myanmar-China border areas, Baruah has made his participation in peace talks difficult, if not impossible by insisting on the government conceding his demand for discussion on sovereignty. Thankfully, Assam chief minister Himanta Biswa Sarma has expressed the hope that it is only a matter of time before Baruah returns to the mainstream and “joins the peace process.”

ULFA formed four decades ago has a chequered history and the combined outfit was responsible for a series of violent acts in different parts of the state resulting in a couple of major army operations and also dismissal of the first Asom Gana Parishad (AGP) government for its failure to tame insurgency. ULFA militants would carry out disturbingly large insurgency operations striking terror and then disappear in their camps in Bangladesh.

Mercifully, the Sheikh Hasina government removed all such camps and steadfastly refused to play host to ULFA militants from across the border. The split between the pro-talk group and the obstinately uncooperative ULFA wing in finding a solution to contentious issues involving identity, land ownership and claims to natural resources of indigenous population has remained beyond repair.

Howsoever recalcitrant Baruah may still sound from the foreign base, he knows that the tripartite accord to which Rajkhowa group is a signatory has taken some steam out of his sovereignty campaign. The three principal features of the accord that would certainly make Baruah sit up and take note are: The highly controversial and sensitive Armed Forces Special Powers Act (AFSPA), giving Army extraordinarily large powers is lifted from85 per cent of the state; proposed investment of around Rs1.5 lakh crore for a number of development projects and third, delimitation of the majority of assembly seats that should work to the advantage of indigenous communities. Shah has promised “tome-bound implementation of the terms of memorandum of settlement by the centre and the Assam government.” People will be watching the earnestness of the government in implementing the clauses of the agreement in letter and spirit.

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Mizoram Votes For Change

Methodical Mizoram Votes For A Change

By Kunal Bose

What will immediately strike any visitor from a city in the plains to Aizawl, capital of the north-eastern state Mizoram is the disciplined way people live there. Congested Aizawl is with little green left, but life goes on in a quaint way. For instance, unlike drivers in Delhi or Kolkata their counterparts in Aizawl are not prone to take liberty with traffic rules or honk horn to the irritation of others. In the plains, election campaigns these days are marked by noisy processions, public order disrupting meetings and often pasting of revolting posters on the walls. The large cut-out of leaders all over the place once predominant in some southern states are now an all-India eyesore. Nothing like that in Mizoram.

In the kind of medley seen during the recent election campaign in Rajasthan, Madhya Pradesh, Chhattisgarh and Telangana, real issues often got blurred by announcement of promises destined to remain unfulfilled. The opposite was the case in Mizoram where Christians, according to the 2011 census, constitute 87.16 per cent of the population. Likely because of religiosity impacting their behaviourial pattern, the Mizos will unfailingly go by the norms laid down by the Church and civil society. With politicians in the plains prone to running wild in their campaign often describing opponent leaders in derogatory language, the north-eastern state presented an altogether different picture.

The three principal political outfits in the state, namely, ZPM (Zoram People’s Movement), now in power for the first time pulling off a silent revolution, MNF (Mizo National Front) that led a 20-year insurgency but finally signed the Mizoram Peace Accord in 1986 with the Union government and the Congress all agreed ahead of start of election campaign to abide by the code conduct while seeking favour of voters, authored by the Church-led Mizoram Public Forum (MPF).

Akin to what happens in more mature democracies, candidates from all parties will use MPF platforms to present their programmes and invite debates. Big election rallies and vulgar use of money power do not find favour with the code of conduct. Even door to door campaigns must not be intrusive. Election Commission in a rare instance conceding the Church request to postpone the vote counting day from a Sunday (3rd December) to the following day in order that religious activities were not disturbed is a testament of its influence.

Whatever the differences in behaviour of politicians and the public in Mizoram from what we have been experiencing in the plains, elections to the 40 member assembly in the tiny north-eastern state were keenly contested. Even while it was always the Congress or the MNF that would rule the state since its formation in 1987, at no point this time there was any doubt that the duopoly was destined to end and ZPM led by indefatigable former IPS officer Lalduhoma would come up trumps. Not only does Mizoram figure close to the top of state literacy table, but the voters, especially the young ones, are mindful of exercising their franchise. The recent elections saw nearly 90 per cent casting their votes. Mizoram is a vibrant democracy by any reckoning.  

No doubt anti-incumbency had worked both against MNF and Congress. Local identity being a big issue in Mizoram, MNF lost traction with many by being a part of the BJP-led National Democratic Alliance. Data from Election Commission will show that there is no correlation here between the percentage of votes secured and seats won. ZPM got 27 seats with 37.86 per cent votes, MNF won 10 seats with 35.10 per cent vote and Congress secured only one seat with 20.82 per cent vote. Take BJP securing two seats with just 5.06 per cent vote against one last time.  

Anti-incumbency and the concomitant administrative torpor definitely did work against the parties that between them always ruled the state. Poor governance and corruption linked to implementation of New Economic Development Policy and transfer of monetary benefits during the MNF rule convinced the Mizos that ZPM, full of new faces and drawn from different walks of life such as media and sports, has the potential to start a new chapter for Mizoram where poverty is rampant and unemployment high. ZPM promising a “new system” that will usher in “administrative reforms, land reforms and economic reforms” resonated with the voters.

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The state wanted a break with inactivity in management of state affairs and vibrancy in governance was what Lalduhoma promised. ZPM commitment to introduce minimum support prices for locally grown crops of ginger, turmeric, chilli and broomgrass and also their procurement went down well with rural families.

As he was sworn in as chief minister along with 11 ministerial colleagues, Lalduhoma’s three principal challenges will be to create jobs in industry and agriculture, introduce effective welfare schemes for women who stood by ZPM in assembly election in a big way and ensure that Chin refugees from Myanmar and Bangladesh and Kuki-Zomi refugees from Manipur are treated with compassion and respect. Incidentally, the Chin and Mizos are kindred tribes of the Kukis and they collectively are described as Zo people. Naturally, whether it is ZPM or MNF, the feelings are strong for refugee welfare. ZPM has, therefore, no compunction in saying that on the issue of taking care of refugees of identical ethnicity as Mizos, it stays on the same page as MNF.

Here, however, the rub is the Union government is disinclined to support the cause of refugees. Lalduhoma has occasions to register his regrets about the denial of Central assistance to look after the refugees. This, however, will not in any way dim his resolve to give shelter to the ones who fled from the tyranny of the Myanmar military regime. One of his top priorities on assuming the office of chief minister will be to prevail upon New Delhi to share the burden of refugee care. At this point, the state with parlous finances is hosting around 47,000 refugees.

Lalduhoma says: “The state’s financial situation is bad and the government has received a warning from the Reserve Bank on this. We will use the new financial year for consolidation.” The budget for the 2024-25 financial year bearing the stamp of ZPM policy will give the roadmap of attempts to be made at economic revival leading to creation of jobs and resurgence of rural economy, the chief minister has hinted. He wants his ministerial colleagues to embrace austerity. Only the future will tell how their behaviour will be once they taste power. The real challenge for Lalduhoma will be to enlist the support of the Centre without aligning with NDA. Mizo nationalism (one may call it sub-nationalism) is pretty strong. After all, one reason for MNF losing the turf to ZPM was its hitching to NDA. 

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Farmer Welfare Through Food Processing

Farmer Welfare Through Food Processing Promotion

By Kunal Bose

In the mission to raise production and diversification of agriculture and at the same time improve the income of growers, the past UPA and the present NDA governments’ thoughtful prescription is to add value to farm produce by rapidly expanding food processing units across the country. This is besides other measures linked to the mission, including popularisation of cultivation and use of millets and making it globally popular for food security, raising of income of farmers and proven health benefits.  Over the years, the country’s production of cereals such as rice, wheat and pulses, horticulture and dairy products, poultry items and fish and meat has risen, making it either the largest or the second largest producer of many of these items in the world.

At the same time following official thrust, millets output is rising in a number of states, so also their popularity. Here a special mention is to be made of India’s coastal state in the east Odisha whose millets mission New Delhi wants every other state to emulate and implement. Cambridge University has partnered with Odisha to explore the possibility of millets growing as an alternative to green revolution.

Incidentally, the Odisha government is investing over ₹2,500 crore to provide livelihood support to millet farmers. Chief minister Naveen Patnaik described his state as “pioneer in designing a people-centric millet mission with focus on livelihood and nutrition of tribal communities.” The state’s assured procurement of millets at minimum support price has proved to be a major incentive for farmers to boost production.

The importance of building food processing capacity in tandem with rise in production is principally underlined by the following reasons: First, as processed food products are meeting with growing demand both in the domestic and foreign markets and acting as a trigger for crop diversification, the income of farmers is rising in consequence.

Second, postharvest food wastage, particularly of seasonal and fast perishable items such as fruits and vegetables remains a major national concern and an income destroyer for farmers. It is, therefore, essential to go on creating sustainable supply chains seamlessly connecting farmers with processing and marketing outfits. Third, by way of building robust backward and forward linkages from farm gates through food processing units to local retail outlets and exports, this fast emerging sector has tremendous job creation potential through the length and breadth of the country of different skill sets. In fact, the sector has the capacity to discourage many in rural crop growing centres to migrate to urban areas in search of jobs. Fourth, processed foods lead to commercialization of agriculture, freeing farmers from price manipulation and exploitation by ‘adathiyars’ (brokers).

In the event, not only is the freshness of farm produce preserved through cold chain to processing factories, but the value-added food products with a long shelf life with food quality not compromised have proved a boon for consumers of all income groups. The growth of the food processing industry, helped by liberal policies and periodic policy fine tuning, stands on two pedestals – domestic market and exports primarily to Europe, the Middle East and south-eastern and Far Eastern countries.

According to Agricultural and Processed Products Development Authority (APEDA), the country’s export of processed food was an impressive ₹59,580.72 crore ($7.409 billion). In processed food exports, major contributions have been made by processed vegetables, prepared and preserved cucumber and gherkins, processed fruits, juices and nuts, jaggery and confectionery items, cereal preparations, guargum, alcoholic beverages and prepared animal feeder.

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At the same time, the Ministry of Food Processing Industries says in its 2022-23 annual report: “During the five years ended 2020-21, food processing sector had been growing at an annual average rate of 8.38 per cent as compared to around 4.87 per cent in agriculture and allied sector (at 2011-12 prices). Food processing sector has also emerged as an important segment of Indian economy in terms of its contributions to GDP, employment and investment. The sector constituted as much as 10.54 per cent and 11.57 per cent of GVA and manufacturing and agriculture sector, respectively in 2020-21 (at 2020-21 prices.)”

APEDA says a “big retail revolution” is awaiting India and this holds great promise for processed food products in the local market. It opines that food and grocery retail, which figures among the largest sectors in the global economy, is also going through a transition phase in this country. Compared to around 75 per cent of food sales in developed countries occurring through superstores, India, according to APEDA “is the least saturated… with small organized retail” still the dominant phenomenon. It further says food and grocery retail is expected to grow at a CAGR (compound annual growth rate) of 3 per cent from 2022 to 2030. APEDA’s prescription for rapid growth of the sector and more domestic and foreign investment flowing into it is rapid improvement in cost competitiveness and efficiency of marketing channels. All this asks for an efficient logistics system covering the value chain from farm to retail outlets for processed foods.

Being fully aware of the sector’s potential to do good to the economy, particularly for the farming community, the government continues to initiate measures for strengthening the sector and encouraging both domestic and foreign investment. In fact, New Delhi has allowed 100 per cent foreign direct investment in food processing industries and also in trading, including ecommerce in respect of food products produced locally. The country received FDI of ₹7,194.13 crore ($895.34 million) in 2022-23, according to APEDA. In a boost to the industry, the last few years has seen the country’s big retailers owning superstores and smaller sized other outlets have an increasingly big presence in food processing industry mostly using factories

In a boost to the industry, the last few years has seen the country’s big retailers owning superstores and smaller sized other outlets have an increasingly big presence in food processing industry mostly using factories owned by third parties (or merchant producers) but providing them with technologies and subjecting their products to strict quality checking.

It has come as a boost for the sector that the government has either fully exempted from GST or put raw and processed food products in the 5 per cent bracket, numbering well over 70 per of all items of the sector. In order to incentivize investment, the government has classified loans to food and agro-based processing units and also cold chain as priority sector lending. It begs the question that further growth of the industry will require strengthening of the infrastructure, particularly extending the cold chain across the country, widening of R&D base and creating adequate numbers of food testing laboratories. In the building of infrastructure, investment has to come mostly from the government.

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Chidambaram The Psephologist

Chidambaram The Psephologist

By Kunal Bose

What makes a Palaniappan Chidambaram! An extraordinary scholar with an MBA from Harvard Business School, incredibly proficient both in English and Tamil. Among the country’s best legal brains, Chidambaram is heard with respect when he will be arguing a case in the Supreme Court. A politician who held finance, home, law and commerce and industry portfolios under the previous political dispensation with competence. Now an MP in the Rajya Sabha, Chidambaram would keep the house enthralled when he participates in its proceedings in clipped tones in English, which is a fast vanishing trait among Indian politicians. But he had a brush with law enforcement agencies raiding his houses in different cities leading to his incarceration in 2019.

Well ahead of that, his qualities led The Economist ahead of 2014 Indian parliamentary elections to say in a long article that Chidambaram would be an ideal candidate for the office of the Prime Minister after the scholarly Dr Manmohan Singh. For, where is another in the country who could match, if not tower over leaders from any other nation in learning, vision and presentation capacity. The globally respected magazine was fascinated by his command over the English language. Not that there will not be any number of Indians who will remain dismissive of The Economist estimate of the ageing but still a robust politician.

In any case, the performance of United Progressive Alliance, a Centre-Left alliance led by the Congress, was so dismal both in 2014 and 2019 general elections that the once largest all-India political party was consigned into hibernation. Post Covid pandemic, which claimed thousands of lives and left many jobless when BJP was running the government at the centre, Congress thinks the time is right for it to improve its fortunes.

Forget what The Economist had to say about Chidambaram. But here our reference point is his highly readable weekly column ‘Across the Aisle’ in the Sunday edition of Indian Express, a newspaper to have retained its sanity. The column is what succinctness is all about. His universe is large. But in the column his focus is on politics and economy of this country. There will be occasions when he will dip his pen in poison. Critical he is, but with malice towards none.

Chidambaram is not in the business of making forecast of what will be the outcome of elections to be held in Chhattisgarh, Madhya Pradesh, Rajasthan, Telangana and Mizoram. He and his son Karti (a Congress MP from Sivaganga in Tamil Nadu) have strong party affiliations. But when the senior Chidambaram is donning the cap of a newspaper columnist, he is acutely aware that he cannot be blatantly partisan. No denying, however, his sympathies and loyalty to the party will have some bearing on his writing.

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He makes no claims to be a pollster. Even then Chidambaram is always interesting, for he has the capacity to see things which others will generally miss out. First, he disagrees with the analysts saying that the forthcoming elections in five states will put NDA and the recently formed alliance INDIA to a test of strength.

According to him, the contest will be between BJP and Congress. Except for the fact that BJP lost 2018 elections in all the states now to go to the polls. That BJP is in power is because of defections with a frustrated Jyotiraditya Scindia denied chief ministership walking over to the BJP. Chidambaram will argue that desertion of JD(U), Shiv Sena, Akali Dal and AIADMK has virtually extinguished NDA, even though on paper 34 other parties, which hardly anyone will know except for their promoters, are part of the alliance. This makes him say: “The NDA is simply another name for BJP.”

Even while some INDIA constituents like Samajwadi Party are fielding candidates here and there are some verbal duels between Akhilesh Yadav and Kamal Nath, these are not signs of the newly formed alliance coming apart. Poll forecasting is highly seductive. At the same time, it’s a slippery business to read the mind of voters. Having the ability to govern himself by the use of reason at all times, Chidambaram says: “I do not wish to make any predictions.” At the same time, he is not to shy away from making “a cautious preliminary assessment” of elections outcome based on available information and reports.

Here we give a quick run-through of what Chidambaram thinks will be post-poll scene in three of the five states, Telangana and Mizoram having dominance of regional parties. The discredited Raman Singh having ruled Chhattisgarh for as many as 15 years till 2018, the present chief minister Bhupesh Baghel is unlikely to face anti-incumbency issue. According to Chidambaram, welfare scheme showing results on the ground, shift of power to the tribals and OBCs and improving levels of prosperity of farmers, particularly rice cultivators should help the Congress in retaining power. “Privately, even the BJP does not challenge this conclusion,” says Chidambaram.

As for Madhya Pradesh, expectedly, the Congress led by Kamal Nath will not miss an opportunity to remind voters of defections engineered by BJP to unseat the elected Congress government. And Scindia has not gained in popularity by leaving the Congress to become a minister in BJP government. Moreover, the ghost of Vyapam (Vyavsayik Pariksha Mandal) scam involving rigging of results for selection of medical students and state government employees for money remains a permanent feature of the state’s political discourse to BJP’s discomfiture.

Uncertainty about the future of incumbent chief minister Shivraj Singh Chouhan and BJP not naming anybody as chief ministerial candidate but instead fielding seven sitting Lok Sabha MPs, including three Union ministers are working to the advantage of Congress. BJP leadership seems to be a prisoner of confusion as far as Madhya Pradesh goes. The BJP indecision about state leadership, according to Chidambaram “has lit the fire of ambition in too many hearts, including serving Union ministers… Indications are that the bell has tolled for a change.”

The two-time chief minister of Rajasthan and the only woman to hold that office Vasundhara Raje may not again have been projected as CM face. Narendra Modi saying at one of his election rallies in Rajasthan that the party’s face this time would be its ‘lotus’ symbol must have upset Raje to no end. After all, besides being a BJP national vice-president, she has over the years strengthened the party in Rajasthan where Congress is traditionally a force to reckon with. Some high-ups in the party might have reservations about Raje. But she wields enough clout in the state not to be easily sidelined.

After all the wrong noises, Raje filed her nomination papers for Jhalrapatan Assembly constituency, which returned her to the Assembly four times since 2003. Not only that, many of her confidants are in the election fray. All that goes to show that Raje has a standing in Rajasthan independent of BJP. Interestingly Raje has rubbished all the talks about her retirement from active politics. Announcing that she was giving herself another five years in politics, Raje said, “I have just filed my nomination, Jhalwar is my family… Don’t entertain any thoughts of my retirement anytime soon.” Who knows, if BJP manages to outsmart Congress in spite of all its welfare schemes, Raje may stake a claim to CM office.

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From Ship to Mouth to Food Grains Surplus

From Ship-to-Mouth to Food Grains Surplus

By Kunal Bose

Importance of agriculture in India with a population of over 1.4 billion cannot be overemphasised. Besides the challenge of feeding such a large population and improving the nutrition level of masses, India has emerged as a significant exporter of food and cash crops. Food security consideration beside, agriculture and allied sector engages as much as 54.6 per cent of the country’s total workforce. Moreover, the sector has a share of 18.6 per cent of India’s GVA (gross value added).

The story of Indian agriculture is one of transition from “ship to mouth” in the 1960s to self-sufficiency in two principal cereals rice and wheat by the mid-1970s, thanks to the introduction of high-yielding varieties that enabled farmers across the country to raise yield and contribute to food security. The scientist who played a sterling role in ushering in green revolution through his seminal work in agricultural research, institution building and providing inputs for policy formulation backed by the government was Professor MS Swaminathan, who died at 98 on September 28. He also had intellectual and idea support of Nobel Peace Prize winner Norman Borlaug.

Paying tributes to Professor Swaminathan, Prime Minister Narendra Modi said: “His pioneering work has turned India from a food-deficient country into a self-sufficient nation. This tremendous achievement earned him the well-deserved title of Father of the Indian Green Revolution… Five decades after the green revolution began, Indian agriculture has become far more modern and progressive. But, the very foundation laid by Professor Swaminathan can never be forgotten.”

Pertinence demands recalling what Borlaug said about Professor Swaminathan in 2007: “To you, Dr Swaminathan, a great deal of credit must go for first recognising the value of Mexican dwarfs (wheat seedlings). Had this not occurred, it is quite possible that there would not have been a Green Revolution in Asia.” In a way, therefore, Professor Swaminathan was the inspiration for green revolution in Asia.

The proof of remarkable progress in the farm sector was India becoming the only country in the world to give free ration to 800 million people during the Coronavirus pandemic. Further, in a major support to the poor, New Delhi has decided to give food grain free of cost for a year till December 2023 to 813.50 million people under the National Food Security Act (NFSA) at a cost of around Rs2 lakh crore. This has now been further extended for another five years.

India is able to undertake a humanitarian programme of this scale because of multi-pronged farm sector supportive measures that are being regularly upgraded, countrywide protests by farmers playing a major role in forcing the government to do so. What has particularly incentivised farmers is the package that includes, among other things, minimum support prices fixed at 1.5 times of all-India average cost of production since 2018, continued growth in institutional credit to agricultural sector, introduction of agriculture infrastructure fund and post-harvest support to farmers. No wonder then, the sector supportive policy measures and incentives for farmers enabled the country to achieve a record food grain production of 329.68 million tonnes in 2022-23, up 4 per cent or 14.1 million tonnes a year ago. This happened despite climate change challenges.

In the meantime, Modi in a sensible initiative is rapidly taking forward millet (Shree Anna) mission which as it lifts the income of millions farmers, specially in water stressed centres, it will be a cornerstone of nutrition and food security for the countrymen. Shree Anna mission could become a “door to prosperity” for small farmers and Adivasi community, if it continues to receive support from the government at the centre and in sates and private sector food and FMCG groups. “Shree Anna means getting more crops for less water. Shree Anna is a big foundation for chemical-free farming. Shree Anna is a huge help in fighting climate change,” Modi aptly said. Thankfully, the consumption of nutri cereals such as bajra, jowar, ragi and small millets is steadily growing. The country produced 20.5 million tonnes of millets in 2022-23.

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Thanks principally to efforts made by farmers and transfer of research results from lab to the field, food grain production has continually improved since 2012-13 when output was 257.1 million tonnes. In fact, 2022-23 production was 30.8 million tonnes higher than the average for the earlier five years. The redeeming feature of Indian farming is that from rice (135.75 million tonnes) to wheat (110.55million tonnes) to pulses (26 million tonnes) are consistently participating in production improvement. In the midst of all these positives, a gnawing concern for the government is India’s high dependence on edible oil imports.

For instance, the country’s imports of edible oils rose from 4.365m tonnes during the oil year 2002-03 (November-October) to 14.193 million tonnes in 2021-22. Explaining the phenomenon, minister of state for food and consumer affairs Sadhvi Niranjan Jyoti says, the “demand for edible oils has been increasing at a pace faster than local production due to population growth and improvement in living standards of people, particularly in urban and semi-urban centres. Annual rise in edible oils demand is around 1 million tonnes.” While it will be only over time that India’s edible oils import dependence now at around 55 per cent of total domestic consumption can be reduced, thankfully during 2022-23, India’s oilseeds production was up 3.39 million tonnes to a record 41.35 million tonnes. But that is not enough.

In attempts to reduce dependence on costly imports, the government has launched National Food Security Mission-Oilseeds (NFSM-OS) in 2018-19 with productivity and production improvement of nine major oilseeds and area expansion of oil palm (incidentally palm oil has the largest share in our import basket) and tea-borne oilseeds. In its Atmanirbhar quest, New Delhi introduced in 2021-22 National Mission on Edible Oil – Oil Palm (NMEO-OP) in order to lift the crop area to 1 million hectares from the present 370,000 hectares.

India, however, is making steady progress in horticulture production. The 2022-23 fruit output at 108.34 million tonnes is ahead of previous year’s 107.51 million tonnes. Vegetables production of 212.91 million tonnes in 2022-23 exceeded the year before output by 3.77 million tonnes. India has a holistic approach to farm sector.

This has ensured the country remaining the world’s largest producer of milk with a share of around 24 per cent of global production. National Dairy Development Board informs that since 2013-14, milk production here rose 61 per cent from 137.7 million tonnes in 2013-14 to 221.1 million tonnes in 2021-22. During this period, daily per capita milk availability improved from 307 gms to 444 gms. At the same time, there is considerable improvement in production of eggs and meat. A leading supplier of meat, dairy and poultry products to the world market, the country earned $4.03 billion from their exports in 2022-23. 

(To be continued)

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The Wind Beneath Air India Wings

By Kunal Bose

There is magic about glamour, which, however, is an abstraction. It could relate to an exclusive line of clothing, haut monde, destinations beyond the reach of hoi polloi or to stretch it to the maximum owning an airline. It is because of the indefinable glamour factor some high net worth individuals in every part of the world would from time to time be in this cash guzzling venture of flying people and cargoes from one point to another. Legend has it that deep pocket is a precondition to owning an airline.

But as it has been seen over the decades, owning big money may facilitate an entry into the industry, but access to funds (read capacity to borrow and finding favour with banks and one’s own money) will not underpin success or be an insurance against disastrous consequences. So many privately owned airlines have perished over the decades and dreams of promoters turning sour.

Who could believe that Trans World Airlines (TWA), which in the 1980s was carrying half of all passengers between the US and Europe would land in bankruptcy in January 1992 leading to winding up of operations. TWA owning proved to be ruinous for the reclusive Howard Hughes and thereafter the enormously rich American businessman and investor Carl Celian Icahn. The airline had been on ropes for a long time, not least because Icahn went on loading the company with debts – this remains the bugbear of many operating airlines – and refusing to buy new, more efficient planes. No doubt, for the highly egoistic corporate raider Icahn filing of bankruptcy of TWA was a hugely humiliating experience. He later told the Washington Post: “I’ve lost on TWA; it has been the worst investment I’ve made in the last decade.”

Not TWA alone, but the iconic Pan Am, which had to its credit a series of firsts in the world aviation industry, including pressing into service wide body 747 jumbo, was done in principally by a series of oil crises, introduction of the US Airline Deregulation Act giving fillip to competition and finally the 1988 Lockerbie disaster killing 270 people. Though never a flag carrier of the US, Pan Am had a unique identity, representing the country’s leadership of global air travel. That, however, was not enough to negotiate the headwind that would come Pan Am’s way at regular intervals.

The British airline industry too had a chequered history as the events leading to privatisation of British Airways, resulting from merger of BOAC and British European Airways in 1974, under the oversight of prime minister Margaret Thatcher would show. Thatcher, as she made it clear on more than one occasion, never had faith in government ownership of businesses. The Conservative government that she headed presided over the privatisation of number of industries and utilities from steel to railways and from electricity to water.

What supposedly motivated privatisation were hopes of employee productivity improvement, better management practices under private ownership, sparing government of debts and encouraging wider share ownership. Japan Airlines was privatised more or less at the same time as BA. From time to time, governments, most notably in Europe, have divested ownership in airlines in favour of the private sector. At the same time, governments have retained significant ownership in Finnair, SAS, Air Serbia and Turkish Airlines. In Air France-KLM, the government has retained minority holding. Interestingly, Moscow has divested as much as 49 per cent of national carrier Aeroflot.

There is a lot of pull for governments to get out of airline business altogether, thanks to mounting debts, ballooning of losses and growing trade union pressure. Then the skies are coming to be dominated by slick no frills carriers operating largely domestically and the likes of Emirates, Qatar, Etihad and Gulf Air with their hubs in the Middle East expanding their global networks all the time and in the process increasing their market share. The writing is there on the wall that state involvement in airline running will bring miseries for all stakeholders.

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Air India is an interesting story. It was a modest size airline flying to a few foreign destinations before New Delhi stepped in as the sole owner some years down the Independence. At the same time, the country in the 1950s had a number of small airlines operating domestic routes. Whatever critics may say their nationalisation in 1953 made sense. They were not in a position to mobilise funds to acquire a modern fleet and critical mass, which alone could underwrite profitable operations. Jawaharlal Nehru knew what kind of ambition the founder of Air India JRD Tata had for the airline and though the ownership vested with the government, Nehru was not to ask for a change in the helmsman. So JRD was free to draw on the marketing knowledge of his lieutenant Bobby Kooka to make Air India among the preferred airlines in the world and unarguably the best in Asia.

All this became possible because bureaucrat-politician clique would not dare interfere in the airline running as long as Tata remained chairman. Even though Tata group no longer had any financial stake in Air India, JRD would find all the time for something he was obsessively in love. Beyond Nehru, JRD enjoyed full freedom in growing Air India the way he wanted during the prime ministership of Lal Bahadur Shastri. But bureaucrat-politician clique had the last laugh when an antagonistic Morarji Desai saw the easing out of the no-nonsense JRD. Soon thereafter Kooka was shown the door. Bureaucrats were only waiting for the exit of JRD followed by Kooka, who was credited with giving Air India the Maharaja mascot and lured droves of foreigners to experience Indian hospitality on board, to seize control of the airline.

Even then, the rich legacy that JRD left behind, including able managers at all levels saw Air India doing well for a long time. Interestingly, the performance would peak when somebody from the private sector – in this case, YC Deveshwar of ITC – would be drafted to lead the airline. The farsighted Prime Minister Narasimha Rao would commission the services of legendary manager Russi Mody to head both Air India and Indian Airlines. Such prime ministerial interventions would usher in a brief spring in Air India. In retrospect two moves that did considerable damage to finances, services and operational efficiency of the airline are: decision to leave the charge of running the Air India to members of Indian Administrative Service and merger of Air India and Indian Airlines. Incidentally, Air India started suffering losses every year since the domestic carrier’s ill-advised merger with it in 2007-78. The inevitable result was mounting losses requiring the government to keep the merged entity to limp along with financial support.

The bruised airline in every sense with market share down to around 10 per cent compared with over 60 per cent for private group Indigo was passed on to the Tata group in January 2022. A few months ahead of 100 per cent sale, Air India had piled up debts of Rs61,562 crore, but 75 per cent of that was transferred to a special purpose vehicle of the government before its handover to the Tata group. In the past, the government made several attempts to sell the major portion of Air India equity to a private group but without success.

The compulsion for privatisation was summed up succinctly by a government spokesperson in the following way: “We want to finish the handover quickly, because we are paying Rs20 crore a day to run the airline. The new owner will need to put in a lot of capital because they have to do capital expenditure to improve aircraft, refurbish and give new orders for aircraft. Only then they may be able to turnaround.”

With this acquisition, the group now has four airlines: Air India, Air India Express, Vistara and Air Asia India and according to Air India CEO Cambell Wilson, “The four together have a market share close to 30 per cent. But we will be adding aircraft and expand capacity considerably.” What Wilson will emphasise is that the group is not to chase capacity for the sake of it. But it will continue to build capacity to “ensure that we are a credible significant competitor.” If all things go according to plan, Air India transformation will happen over a period of five years. Getting rid of historical baggage will be no less a challenge than to create a new airline that will do JRD proud.