Go green, Calcutta

Hybrid trolley buses and trams are a way out

Calcutta’s mayor Firhad Hakim announced that reducing the city’s pollution would be a priority. A significant volume of Calcutta’s pollution emanates from the transportation sector. With India setting its net-zero emission target for 2070 Calcutta’s transportation needs to be geared towards that goal. Calcutta ranks sixth among 14 cities when it comes to overall emissions according to the Centre for Science and Environment but emerges as the least energy-guzzling and GHG-emitting megacity. Calcutta which has the most diverse public transport system for urban commuting does better than even Pune and Ahmedabad.

 Of late the West Bengal Transport Corporation has been electrifying its public transport network. It procured 80 battery-operated electric buses and selected bus depots and bus terminals to support fleet operations. There are plans to increase the share of battery-operated electric buses. As a result of these efforts Calcutta received the C40 Cities Bloomberg Philanthropies Award in the ‘Green Mobility’ category in Copenhagen for the ‘Low Carbon Commute Transition’ project. It was the only South Asian city to receive this global award.

The award notwithstanding Calcutta is making a mistake by adopting battery-operated electric buses for public transportation. These undoubtedly are to be preferred over vehicles running on diesel/biofuel/CNG. But they pose some challenges. For example battery-operated electric vehicles cost more than standard buses. Since modern batteries do not power a bus for the same number of trips as those that run on fossil fuels the WBTC has to maintain nearly twice the number of electric buses. Battery life is limited: therefore the cost of maintaining a battery-operated EV fleet will be significantly higher than one that runs on CNG/diesel. Furthermore the disposal of used batteries — a hazardous material — is an issue and not much attention has been paid to this aspect while pushing for battery-operated EVs.

What would be a feasible solution then? The light railway system — the tram — is making a comeback globally. Trams have existed in Calcutta for over a century. The curtailment of tram routes seems to suggest that the city has decided that trams are not a viable option. One hears quite often that they add to traffic congestion. Truth be told most of the congestion takes place due to other vehicles encroaching upon tram routes. Trams vary from single to triple carriage cars depending on the availability of traffic space. If congestion is a problem Calcutta can operate single-carriage trams.

Hybrid trolley buses are now being adopted in many cities as they are cheaper than battery-operated EVs. In this system the electrical energy is supplied by two trolley poles. The trolleys are swivel-attached to the roof of the trolley bus and have a length of about 6m which gives the trolley bus freedom of lateral movement of up to 4.5m. Unlike the tram it does not add to traffic congestion and operates like an ordinary bus. This is a proven technology is cheaper and has a longer life than battery-based EVs.

 Current trolley buses have small batteries designed to allow them to go off-wire for a fraction of a mile. In-motion charging expands this concept by equipping the bus with enough battery power for about five miles of off-wire travel. This technology is becoming increasingly popular in small Central European cities.

 Ideally Calcutta should adopt this mode and depend more on trams to achieve the net-zero transition.

The writer is professor at the National Council of Applied Economic Research. Views are personal.

Education should be priority, not banning of hijab

It is time for us to focus on empowering all women including Muslim women by ensuring their access to education employment and public safety.

After two years of living behind a mask and trying to decode muffled voices and hidden expressions one begins to develop empathy for millions of women hidden behind face coverings. Whether they are called ghunghat pallu burqa or hijab face coverings with varying levels of restrictions are a fact of life for 58 per cent of Hindu and 88 per cent of Muslim women in India. Imposing them on young girls in educational institutions seems particularly worrisome. Hence one can understand the impulse that drives educational authorities in Karnataka to ban the hijab although the head covering imposed by hijab is much less restrictive than full burqa or ghunghat. However external interventions tend to have the opposite effect when it comes to cultural transformations.

The Indian opposition to the colonial Age of Consent Bill setting the minimum age at marriage to 12 for girls best illustrates this challenge. Lokmanya Bal Gangadhar Tilak who was highly progressive in his personal life summed up his crusade against this law in an 1891 editorial: “We have often pointed out that we are not against the particular reform advocated. Individually we would be prepared to go even further than what the Government proposes to do. Still we are certainly not prepared to force our views upon the large mass of orthodox people… We have every confidence that in time most of the reforms now preached would be gradually accepted.”

Demands for veiling in the guise of modesty are unlikely to disappear until women themselves seek change. Arguably the most impressive demonstration comes from Haryana. In a state known for its solid adherence to ghunghat a quiet revolution began a few years ago when Manju Yadav a schoolteacher started a campaign to get women leaders together to cast off their ghunghats. This campaign faced initial hurdles but gained momentum when one of the largest khaps the Malik Gathwala Khap asked women to give up ghunghat.

However mobilising to protest veiling is not easy in the Muslim community. Sania Mirza has faced considerable criticism from fellow Muslims for refusing to play tennis while being covered head to toe. Shabana Azmi was told to stick to singing and dancing by clerics for seeking a debate on whether face covering was ordained by Quran.

Ironically gender seems to be a crucial battleground for the culture wars making for strange bedfellows and creating situations that make the oppressed complicit in their own subjugation. Demanding freedom from oppressive gender norms requires release from external pressures that force women to choose between their gendered interests and banding together to protect their communities.

As Flavia Agnes notes following the anti-Muslim riots in Mumbai Muslim women’s groups found themselves cancelling anti-domestic violence programmes for fear of providing additional ammunition to the police to harass Muslim men. The Karnataka hijab incident has framed the debate in such a way that the lawyers for the plaintiffs the media and civil society at large portray the hijab as being a central tenet of Islam and hence protected from control by educational authorities. This unfortunate conflation between religion and dress code will make it difficult for Muslim women to follow Najma Khan pradhan of Dhauj village in Haryana and a member of Manju Yadav’s movement in casting off their veils.

Education is a crucial resource in women’s ability to resist oppressive gender norms. Whether among the Hindus or the Muslims data suggests that education is associated with a lower prevalence of purdah or ghunghat. About 67 per cent of women with less than a Class V education practice ghunghat or purdah compared to 38 per cent of college-educated women. However requiring the abandonment of the hijab to obtain education puts the cart before the horse. For Muslim girls this is a troublesome development. The National Statistical Office estimated gross attendance ratios in secondary education for Muslim women to be 43 per cent compared to 63 per cent for all Indian women. The education systems should be doing all they can to encourage participation among Muslim girls rather than placing obstacles in their way.

The timing of the hijab storm in Karnataka is regrettable. Schools and colleges have been closed for nearly two years. Returning to education will be difficult for all students most of all for those already falling behind in learning. Data from the India Human Development Survey conducted by the National Council of Applied Economic Research and the University of Maryland shows tremendous inequalities in learning outcomes among various social groups. Whereas 68 per cent of forward caste children aged 8-11 can read a short paragraph the proportion is barely 47 per cent for Muslim children. These inequalities are likely to have been exacerbated as students struggled to learn on their own during the lockdown. At a time when schools and colleges need to focus on bringing children back to classrooms and helping them overcome the learning deficits that are likely to have accumulated the diversion created through the hijab controversy is counterproductive for all students most for the students who were already burdened by the learning gaps.

It is time for us to focus on empowering all women including Muslim women by ensuring their access to education employment and public safety. With enhanced power will come increased agency to transform gender norms if and when women themselves choose to do so.

This column first appeared in the print edition on February 26 2022 under the title ‘The hijab hurdle’. The writer is professor of Sociology at the University of Maryland and the National Council of Applied Economic Research. Views are personal.

Does the Budget give a leg-up to agriculture?

A marginal re-allocation of expenditure away from income support towards more productivity and employment enhancement schemes could have been adopted

The agriculture and allied sector is going through a slow but dynamic change. Does Union Budget 2022-23 anchor the sector into its more dynamic growth path? The answer lies in the details.

The real growth of the agriculture and allied sector has averaged around 3.6 per cent for the last decade (2012-13 to 2021-22) with a 70 per cent coefficient of variation (CV) — that is growth in this sector has been volatile. It was the only sector that exhibited positive growth in 2020-21 at 3.6 per cent and is forecast to grow at 3.9 per cent in 2021-22 (MoSPI). Growth in real gross capital formation (GCF) in this sector has been highly volatile (CV of 392 per cent). The GCF-output ratio in the sector declined from 14.1 per cent in 2011-12 to 10.8 per cent in 2020-21 in nominal terms (MoSPI).

Within the sector the share of the crops sub-sector has decreased from 65.4 per cent in 2011-12 to 55.1 per cent in 2020-21. The shares of livestock and fishing & aquaculture have gone up from 21.8 per cent and 4.5 per cent in 2011-12 to 30 per cent and 6.7 per cent in 2020-21 respectively. While the decadal average growth of real GVA of ‘crops’ was barely 1.6 per cent it was 7.3 per cent for ‘livestock’ and 8.2 per cent for ‘fishing’.

Productivity growth

There has been a rapid rise in agricultural productivity of foodgrains (driven mainly by rice and wheat) whereas the productivity growth in the case of pulses oilseeds nutri-cereals and horticultural crops have remained sluggish (RBI Bulletin January 2022). Even then agricultural productivity in foodgrains is lower than that of many emerging countries because of low farm mechanisation and irrigation levels etc.

Agricultural exports as a percentage of total goods exports have gone up from 8.3 per cent in 2016-17 to 10.2 per cent in 2020-21 (Ministry of Commerce). The share of the allied sector in agricultural exports has risen over time (RBI Bulletin January 2022). Specifically the share of animal husbandry has risen from 10.4 per cent in the triennium ending (TE) 2000 to 20.2 per cent in TE 2020. Further there has been an expansion in agricultural export destinations.

In 2019-20 the agriculture and allied sector formed 16.7 per cent of GDP and employed 45.5 per cent of the workforce (versus 48.8 per cent in 2011-12). Further the sector acted as the shock-absorber — in April-June 2020 the share of agriculture in the workforce rose to 46.5 per cent. The average monthly income per agricultural household has gone up from ₹6426 in 2013 to ₹10218 in 2019 ( Economic Survey 2021-22).

After accounting for retail rural inflation the compound annual growth rate was 3.4 per cent lower than real GDP (6.8 per cent). The share of income from wages/salary went up from 32 per cent to 40 per cent farming of animals rose from 12 per cent to 16 per cent but cultivation came down from 48 per cent to 37 per cent between 2013 and 2019.

The need of the hour is to improve productivity of the agriculture and allied sector create jobs in the rural sector and provide income support in that order.

Allocation of funds

The combination of expenditures of agriculture and allied activities rural development and fertiliser subsidies form 11.7 per cent of total Central expenditure. It is 6.3 per cent lower than 2021-22 Revised Estimates (RE). Within that fertiliser subsidies PM-KISAN and Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) together form around 53 per cent of total expenditure.

Despite the allocation of expenditure coming down by almost 25 per cent between 2021-22 RE and 2022-23 BE the share of fertiliser subsidies in Budget 2022 was high at 22.8 per cent. Allocation to irrigation has come down by 11.6 per cent driven by a 67 per cent fall in allocation to major irrigation.

Allocations to major & medium irrigation and minor irrigation have risen by 32.6 per cent and 16.5 per cent respectively. The Sub Mission on Agriculture Mechanisation was underutilised in 2021-22 and there is no allocation to the scheme in 2022-23 BE. The Market Intervention Scheme and Price Support Scheme (MIS-PSS) and the Pradhan Mantri-Annadata Aya Sanrakshan Abhiyan (PM-AASHA) which were set up to ensure proper price for farmers’ produce have seen drastic cuts in this year’s Budget.

The earlier one saw a cut of 58 per cent over 2021-22 RE and the latter was almost done away with. Also allocation to the Agriculture Infrastructure Fund (AIF) which is earmarked for post-harvest infrastructure decreased to ₹500 crore in 2022-23 BE from ₹900 crore 2021-22 BE.

Allocations to fisheries and animal husbandry sub-sectors increased by 50.5 per cent and 44.4 per cent respectively in 2022-23 BE compared to 2021-22 RE. Eighty-nine per cent of total allocation in the former is devoted to the Blue Revolution scheme. In the animal husbandry department only 68.9 per cent is for Animal Husbandry and Dairy Development.

The allocation to MGNREGS has come down by 25 per cent in 2022-23 BE compared to 2021-22 RE but is the same as 2021-22 BE. It forms 15.8 per cent of total expenditure in Budget 2022. The MGNREGS data shows that the April-January gap between jobs provided and demanded remained virtually stagnant between 2020-21 and 2021-22 at 17 per cent and 16 per cent respectively.

Allocations to other job-creating schemes were enhanced. Compared to 2021-22 RE the 2022-23 BE allocation increased by 35.7 per cent 13.9 per cent and 46.7 per cent for Pradhan Gram Sadak Yojana National Rural Livelihood Mission and Shyama Prasad Mukherjee Rurban Mission respectively. Allocation to Pradhan Mantri Awas Yojana came down by 1.9 per cent. However the increase in all these schemes put together is lower than deduction in MGNREGA.

The allocation to the income support scheme PM-KISAN has gone up marginally by 0.8 per cent in 2022-23 BE versus 2021-22 RE. The government has appropriately increased expenditure on the more dynamic allied sub-sector. There is a relatively lower focus on improving the productivity of the crops sub-sector both pre-harvest and post-harvest.

There is an effort to change the mechanism of creating rural jobs away from MGNREGA to other schemes but the deduction away from MGNREGA is higher than the increase to other schemes. Marginal re-allocation of expenditure away from income support towards more productivity and employment enhancement schemes could have been adopted.

Bhandari is a Senior Fellow and Sahu is a Senior Research Analyst at NCAER. Views are personal

The Real Buzz behind the Fizz—The Truth about Alcohol Consumption in India

Opinion: Sanjib Pohit Anupma Mehta Samarth Gupta and Soumi Roy Chowdhury 

The latest data on alcohol consumption in India is bound to cause a mental hangover unless the seriousness of the addiction at the national level is viewed with a clear rather than a befuddled mind.

A report released in 2019 by the Ministry of Social Justice and Empowerment titled “Magnitude of Substance Abuse in India” asserts that alcohol is the most widely consumed psychoactive substance in India among all population groups though adult men are the largest consumers and also the worst affected by alcohol use disorders (AUDs).

In terms of absolute numbers the report finds that about 16 crore persons in the age group of 10-75 years regularly consume alcohol in the country.       

Rising Consumption of Alcohol

Further a Drinks Market Analysis undertaken in 2020 by the London-based International Wines and Spirits Record (IWSR) widely seen as a significant source of data on the global alcoholic beverages market suggests that India is the largest consumer of whisky in the world about three times higher than the US which is the second largest consumer.

The IWSR analysis also documents that when the global consumption of liquor dipped in 2018 India was an outlier accounting for a 7 per cent upward trend in the global whisky market. 

The fact that alcohol consumption is emerging as a serious public health challenge in the country is also ratified by an earlier Global Status Report on Alcohol and Health released by the World Health Organization (WHO) in 2018 which revealed that the per capita alcohol consumption in India had doubled between 2005 and 2016.

In this context a recent WHO-sponsored study undertaken by the National Council of Applied Economic Research (NCAER) which assesses the implications of taxation on alcohol to determine its affordability and price elasticity patterns in India and their role in curbing alcohol consumption assumes critical significance from a policy perspective.   

Issue of Alcohol Taxation 

In order to delve deeper into the issue of both alcohol consumption and the market dynamics of alcohol pricing and sale the NCAER study estimated the overall tax burden and elasticity of alcohol products over the last decade in seven States representing various regions across India viz. Delhi Madhya Pradesh Sikkim Maharashtra Bihar Karnataka and Himachal Pradesh.

The analysis emanating from the NCAER report was based on a review of the State-wise price mechanisms taxation structures and sales and consumption trends associated with different types of alcohol products as well as the ramifications on revenue generation due to a State-wise increase in taxation on alcohol over the last ten years. 

The complex issue of taxation on alcohol is however complicated further by the fact that alcohol policy in India is a State subject. Every State in the Union thus has absolute control of legislation excise rates and the production distribution and sale of alcohol products. Moreover there is no national database for systematically collating and compiling this information as each State levies different rates of excise duty and customs duty (wherever applicable) on different types of alcohol products. 

Although selling alcohol in India is mired in ambivalence and proxy marketing paradoxically many States earn high revenues from liquor sales.

The research wing of the analytical and ratings company CRISIL for instance finds that in the five southern States of Andhra Pradesh Telangana Tamil Nadu Karnataka and Kerala more than 10 per cent of the tax revenue comes from taxes on liquor sales.

Further six other large States Punjab Rajasthan Uttar Pradesh Madhya Pradesh West Bengal and Maharashtra also account for 5-10 per cent of their revenues from liquor sales. And yet the promise of prohibition seen as a potential vote-winning strategy is regularly brandished as a poll pledge across all States. 

What then would be a prudent nation-wide policy for both controlling alcohol consumption and rationalising alcohol taxation and production across the country?

While it is important to keep an eye on the economy one should not lose sight of the health and social dimensions of alcohol consumption. The Global Burden of Disease Study 2019 conducted by the US Institute for Health Metrics and Evaluation estimated that excessive consumption of alcohol was responsible for 3 per cent of all deaths in India.

The concomitant study in 2017 had found that alcohol was the cause for more than 580000 deaths in India with three leading attributable reasons being pulmonary tuberculosis affliction road injuries and self-harm.    

Need for Innovative Policies 

Another shocking piece of data emerging from the NCAER study is that the number of heavy drinkers (or people who drink alcohol everyday) among consumers aged less than 18 years rose from 1.2 per cent in 2005-06 to 13.9 per cent in 2015-16.

All States therefore need to be on the same page while enforcing the minimum legal age for drinking. A caveat here would be the need for certain State-specific intervention packages in keeping with variations in the kind of alcohol consumed across the States.

For example as per NCAER research nearly 50 per cent of the alcohol consumers in Madhya Pradesh were found to consume only toddy whereas nearly 47 per cent of the alcohol consumers in Sikkim consumed only beer and a similar proportion of alcohol consumers in Delhi consumed only Indian-made Foreign Liquor (IMFL) or hard liquor.

This obviously necessitates out-of-the-box thinking on ways to reduce consumption as well as to control access to illicit liquor and cheaper and unrefined variants like arrack especially for the marginalised sections of society.

The association between alcohol consumption patterns and the key socio-demographic characteristics in the States under study is substantiated by the finding that the poor less educated and rural populations show a higher propensity of consuming it irrespective of the State. 

Both the Central and State governments therefore face a policy dilemma in restraining alcohol consumption significantly enough to arrest its deleterious impact.

One way forward could be the imposition of an incremental tax as proposed in the NCAER study which could help reduce alcohol consumption in India by 10 per cent by the year 2025.

What is also needed is the implementation of evidence-based policy and sensitisation campaigns by States to educate their populations about the consequences of uncontrolled alcohol consumption and the social ills arising from it.  

Sanjib Pohit is Professor Anupma Mehta is Editor and Samarth Gupta and Soumi Roy Chowdhury are former Associate Fellows at NCAER. Views are personal.

State Financial Management Systems Are Bringing Checks And Balances To Public Finance…

The Covid-19 pandemic has brought public finances into the eye of the storm. Efficient and effective Public Financial Management (PFM) in the 21st century involves the usage of Financial Management Information Systems (FMIS).

The key objectives of PFM are—“to maintain a sustainable fiscal position effectively allocate resources and efficiently deliver public goods and services” (Cangiano Curristine and Lazare 2013).  Diamond and Khemani (2005) define FMIS as a management tool that provides a wide range of both financial and non-financial information. It involves the computerisation of public expenditure management processes including budgets financial management of line ministries and other spending agencies.  

The developments of FMISs in the country started in the last decade the technology of which was not available before that. The NCAER Direct Benefits Transfer Survey conducted in 2018 found that States were using two FMISs – one developed by the Centre namely the Public Financial Management System (PFMS) and their own State’s in-house FMIS. 

Modern PFM comprises a set of complex processes rules and systems which are intrinsically linked with each other through the architecture of the FMIS. These architectures are being developed by different States and the Centre independently in a phase-wise manner. Consequently these FMISs are at different stages of maturity. The Centre is well-positioned to consider handholding States in developing their FMISs and interlinking the Centre & State level FMISs. Unlike Goods & Services Tax Network (GSTN) such interlinking should aim to maintain functional & data autonomy of State Governments which ensure their control over the developments in their own FMIS Systems ensure sufficient checks & balances to promote fiscal sustainability and minimise ‘float’ in the Systems. Interlinked yet independent Systems would lead to sustained capacity development in States and encourage higher innovations in PFM through healthy competition on one hand and promote fiscal federalism on the other. It would reduce the dependence on Bank Accounts to manage Public Finances. These systems could complement each other and systematically strengthen the exchange of learning between States and Centre.

Amongst the State-level FMISs West Bengal (WB) is one of the more advanced ones. It is moving towards developing all features of an ideal FMIS as defined in literature (Table 1). The Integrated Financial Management System (iFMS) is a web-based application for streamlining the financial & fiscal management of the State Government. 


                      Source: Authors’ conceptualisation from the literature.

Hashim and Piatti (2016) in their World Bank working paper titled “A Diagnostic Framework to Assess the Capacity of a Government’s Financial Management Information System as a Budget Management Tool” said that the effectiveness of the FMIS as a budget tool will depend on it having the following five features.

Treasury Single Account: It is a tool for consolidating and managing government resources. The iFMS has a web-based Centralised Treasury System. All Treasuries and their functions are integrated onto a unified architecture including Treasury functions like receipts payments pensions stamps PL Operations Deposit Accounts Provident Fund Monthly Accounts etc.  Similarly the Bank Operations are linked into iFMS through Schematic Bank Account Management System (SBMS) Module.

FMIS coverage: All government transactions are covered by the iFMS (Table 1).

Online budget tool: The Centralised Budget Monitoring System a module within the iFMS has been developed for online submission of budget requirements by administrative departments and its processing at the Finance Department. Besides this the module has scope for an online integration with the RBI for obtaining the Clearance Memo for funds received from the Government of India through the Budget Route. The module also has provision for online submission of a request for creation of scheme head of accounts to Accountant General West Bengal thus reducing the time required for opening of any new subhead under any Head of Account. Further all Centrally Sponsored Central and State Schemes can be monitored online and utilisation of funds tracked on a real-time & actual basis.

Ancillary Features: It has all aspects of human resource management from appointment stage to pension stage of an employee’s lifecycle provides support for various auditing functions accords administrative approvals and financial sanctions links schematic bank accounts generates all kinds of role-based MIS Reports etc. The iFMS was also the first FMIS in the country to integrate with RBI’s e-Kuber Platform. It is also linked with the GSTN.  A different platform iBudget exists for the preparation of State Budget and budget allotments of respective Departments which is integrated with the iFMS. Tools for managing fixed assets are being planned next in iFMS 2.0.

Technical Aspects: The entire IFMS is hosted in the State’s Data Centre (SDC) with its Disaster Recovery site at NDC. It runs its operations on a secure Multi-Protocol Label Switching network with West Bengal’s State Wide Area Network serving as backup. All the Treasuries are connected to the Central Server located at the SDC.  

In sum there are alternative FMISs that exist at the State level which can be complementary to the PFMS.  While the WB FMIS has the desirable properties & features and has proved its mettle during the pandemic detailed systematic impartial independent analysis can help States cross-learn from each other improve financial management and assess their effectiveness.

Bornali Bhandari is a Senior Fellow at NCAER and Pawan Kadyan is an IAS Officer belonging to the West Bengal cadre. Views are personal.

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