This Place is Taken: politricks
Showing posts with label politricks. Show all posts
Showing posts with label politricks. Show all posts

Monday, August 15, 2022

75 years, and still waiting

Funny times, we are living in. I can distinctly remember the hope and energy in the air 25 years ago, during the 50th year celebrations. Yes, political leaders lied even then, but somehow those lies seemed plausible. And the goals they set forth seemed achievable. Do-able. In our lifetime.

Not any more.

After 75 years, a nation still waits. While it slowly destroys itself.


Wednesday, March 2, 2022

Friday, April 16, 2021

Nation doomed

India has long lived in a state of denial. And now it is clear the country is doomed. 

It takes guts to do the right thing. And none of those in power there has these guts.

Somebody please lock the country down already.

Sunday, April 11, 2021

How India lost the vaccine war

Text from the-ken.com/the-nutgraf/how-india-lost-the-vaccine-war/

If you’ve been following the news, two really important events happened last week.

 

The President of the United States, Joe Biden, announced that all adults across the US would be eligible to receive the Covid-19 vaccine in the next two weeks. Earlier, the US had expected this to happen by 1 May. Things are going so well that they’ve decided to move it up by two weeks. 

 

Meanwhile, India is going in the opposite direction. The pace of vaccination, which was steadily picking up, now appears to be slowing down. Multiple states have reported shortages, while the number of coronavirus cases across the nation is accelerating. Adar Poonawalla, CEO of the Serum Institute of India (SII), the largest vaccine manufacturer in the world, has said that existing production capacity is "very stressed, to put it frankly" and that “we are still short of being able to supply to every Indian”. 

Public memory is short, but back then, we weren’t even sure if we’d even get a vaccine. Nobody had created a working vaccine for a coronavirus, and the fastest vaccine ever developed took us over four years. We had to achieve the impossible while the world was in a global lockdown, with supply chains paralysed. 

Even in the early days, any betting person would tell you this—if a vaccine was going to be developed, it would likely be developed by a pharmaceutical company in the US. The logic was obvious. The pharma industry in the US was one of the most advanced in the world. It had the know-how. It had a history of research and development. And it had the capital. 

 

However, if you asked the same betting person to guess where the vaccine was going to be manufactured on a mass scale, the most likely answer you were going to get was… India. 

 

Again, the reasoning was obvious. India is a vaccine manufacturing powerhouse—at that time nearly 60% of the world's vaccines were manufactured by a small group of manufacturers in the country.

 

For the global pandemic to quickly end, the US would have to develop and discover the vaccine, and India would have to manufacture it. 

 

The US was going to be the inventor. India was going to be the factory. 

 

And both of them had to work faster and smarter than they had ever done before to make it happen. 

 

Operation Warp Speed

 

Faced with this reality, in May 2020, the US federal government decided to act boldly and swiftly. It understood that the problem wasn’t whether we’d develop a vaccine but was to identify a vaccine sooner and to manufacture it faster when it was identified. With every additional month, people were dying, lockdowns became more severe, and the economy continued to plummet. This needed to be arrested quickly.

 

So the federal government made a plan. The plan was to support seven different vaccine candidates simultaneously to speed up trials and the approval process and to promote ways to manufacture them at scale.

 

This program was called Operation Warp Speed. And it was conceived as a partnership between the federal government and private companies. 

 

Pay attention to the last bit. It’s important.

 

The US government was smart enough to understand that the only way that a vaccine would emerge faster was if it just gave the pharma companies lots of money to fund their research and got out of the way. Not all companies needed the funding. Companies like Pfizer, which were well-capitalised, didn’t need it. However, others did. And once pharmaceutical companies realised that there was free money on the table and that they didn’t need to put in risk capital of their own, they jumped at the chance.

 

How much money? 

 

Oh, a little over $11 billion. Given out to eight of the biggest pharmaceutical companies in the world. 

 

All tasked with one mission — find a vaccine. 

 

All of them used different methods to get there.  


Here’s a list, from Wikipedia.

And that’s how the American pharmaceutical companies got to work. 

 

In India, on the other hand, something else was happening. 

 

Serum Institute of India

 

India had several vaccine manufacturers, but the biggest one was a company called the Serum Institute of India (SII). 

 

SII is an unusual company for many reasons. First, it’s entirely privately held by a billionaire family. It originally started off as a horse farm and soon graduated to vaccines. By 2020, it was the largest manufacturer of vaccines in the world, churning out nearly 1.5 billion doses every year. SII’s customers are mostly from other countries around the world; it’s an Indian private company with international customers. 

 

And when the pandemic hit, SII saw an opportunity and stepped up. One could argue that they had no other option. Others could argue that it would have been foolish to skip such a business opportunity. 

 

Nevertheless, SII was ready for the challenge. 

 

SII may be a private, family-run company, but it was still a company. Companies have a certain amount of risk appetite. And SII had a choice ahead of it—do they manufacture the vaccine or not? And by when? 

 

From SII’s standpoint, the sensible thing to do would have been to wait until it found out which vaccine would work and then scale up the production of that vaccine. 

 

Instead, SII decided to take a calculated bet. 

Last May, Poonawalla met the AstraZeneca chief executive, Pascal Soriot, on a video call, and negotiated a deal for SII to manufacture about 1bn doses over 12 months – almost half the overall total.

The same month a package arrived at SII’s vast campus in Pune, 150km south-east of Mumbai. Packed in dry ice was a vial containing the components needed to create the Oxford vaccine, cell substrate in which to grow it and detailed instructions. Not included were the results of any clinical trials or regulatory approvals that the vaccine was effective or even safe.

Nevertheless, Poonawalla ordered three of his factories – which were at the time making “some very lucrative [other] vaccines” – to immediately switch production to the Oxford/AstraZeneca coronavirus vaccine AZD1222.

“We produce 1.5bn vaccine doses each year. We never imagined the whole world being so dependent on us, but nobody else has our capacity to scale up,” he said. The decision to invest, he added, was easy because the firm is a private business “and not accountable to investors and bankers and shareholders”.


Instead, he says, “it was just a quick five-minute chat between myself and my father.” It was also, he admits, “a huge gamble – huge, huge, huge. People said I was crazy or stupid doing such a big bet at that time.

Now SII is a company in pursuit of profits, so this wasn’t exactly an altruistic move. Business decisions aren’t supposed to be altruistic. Despite this, it’s hard to deny that it was a risky business decision. 

 

But there was one problem. It was the same problem as in the United States.

 

Money

 

There was no Operation Warp Speed in India. In fact, for a long time, news about whether SII would receive funding to scale up and manufacture the vaccine was quite murky. In one interview back in April 2020, Poonawalla said that “(the government) are very happy to share some risk and fund something with us, but we haven’t really pencilled anything down yet”. Around the time, the Department of Biotechnology had helped fund a Phase-III clinical trial for the vaccine developed by SII. 

 

So in August, SII, for the first time in its history, went for external funding. It spoke to private equity investors, raised $150 million from the Bill and Melinda Gates Foundation and even invested $100 million of its own money. 

 

There are no news reports to be found about any funding for SII from the Indian government. 

 

Incentives 

 

It’s one thing to offer funding for research and development, but in July 2020, the US government went one step further. 

 

It placed an order with Pfizer for 100 million doses of the vaccine. It paid nearly $2 billion to Pfizer for this. And it did this even before it knew whether the vaccine was going to be a success or not. At that time, several critics pointed out that this was a small number, but the US government had another clause in the deal—it gave itself an option to purchase an additional 500 million doses from Pfizer.

 

It didn’t stop there. 

 

It went and signed another $1.5 billion contract with Moderna for another 100 million doses. 

 

It didn’t stop there. 

 

It also signed contracts with Johnson & Johnson, Novavax, and AstraZeneca for more than 500 million vaccine doses. 

 

The US was basically wearing two hats. In one hat, it acted as the State, pumping in taxpayer money to fund research of the vaccine because it was in public interest. In another hat, it was the vaccine companies’ first customer. It pumped in money to boost their cash flow and to be first in line to reap the rewards should the vaccine succeed. It was the ultimate illustration of skin in the game. 

 

Other countries followed suit. The UK decided to purchase 40 million doses of the Pfizer vaccine. In November, the European Union reached an agreement with Pfizer to buy up to 300 million doses. Canada decided to purchase up to 76 million.

 

The vaccine companies wanted capital. And they had gotten it. 

 

The only question was whether they’d be able to manufacture it at the scale that was needed. 

 

So the US government decided to create incentives not just for development but also for manufacturing. 

 

The missing purchase order 

 

Meanwhile, in India, SII was manufacturing the vaccine at full speed. Since it went ahead even before the vaccine was fully tested, SII had accumulated a stockpile of several million vaccines in its warehouses by the end of 2020. 

 

The company had stepped up, but there were a couple of problems. 

 

Problem 1 : Who gets the vaccines?

 

The deal that SII had struck with the Indian government was that India would purchase the first 100 million vaccines at a price of Rs. 200 ($2.66) each. This was one of the lowest prices in the world. And the only reason that SII signed on with the Indian government at this low rate was based on the understanding that it could sell subsequent doses on the private market at a higher price. 

 

However, SII was not unduly worried because it had already received purchase orders from several countries—including Saudi Arabia, Brazil and Morocco—for millions of doses. All of this would help fund SII and enable it to scale up. Morocco had signed a supply contract for 20 million doses back in August 2020.

 

But there was a problem: the Indian government hadn’t signed any purchase orders with SII. 

 

In January 2021, India’s largest vaccine manufacturer had no idea how many vaccines the Indian government would need and by when. 

The vaccines were ready. 

 

50 million of them. 

 

But the Indian government wasn’t. 

 

Problem 2 : More vaccines were needed

 

SII was manufacturing close to 60 million doses a month. It needed this number to be much higher to have any hope of meeting India’s requirement. Then the company had a fire in its factory, which Poonawalla later said cut short its plans to expand production. 

 

India had an entire year to scale up manufacturing capabilities across the nation, all to produce the vaccine at a war footing when it was ready. 

 

But it didn’t.

 

Then on 11th January 2021, the Indian government finally placed an order with SII. It was its first purchase order.

 

It ordered 11 million doses.

 

Two weeks later, the United States federal government exercised its second option with Pfizer and Moderna. 

 

It ordered 300 million doses, bringing the total order to 600 million doses. 

Meanwhile, in India, as the coronavirus cases rose, India quickly suspended exports on all vaccines. 
 

Countries that had booked vaccines with SII much earlier than everyone else were told to wait. India’s needs had to come first.

 

One of them was Brazil, where 3,000 people die from the coronavirus every day. 

 

Two days back, SII received a legal notice from AstraZeneca, the developer of the vaccine, over delays. 

 


Earlier this week, SII asked for financial help from the Indian government to the tune of Rs 3,000 crore (~$400 million). 

 

As of this morning, there has been no official response from the government to SII’s request.

There’s no real moral to this story, but it does reveal some interesting perspectives about the two nations. 
 
The story of India and the US’ contrasting methods of developing the vaccine is one of the oldest in political theory—it’s about the relationship between the state, capital, and the free market. All these entities are quite complex and often exist with a great deal of tension between them. Even more complicated is the fact these entities also operate together—and often have orthogonal goals. 
 
The US federal government understood the rules of the game and played by it. It understood that private players operate in a free market and acted as a buyer while also providing capital. 
 
If you look at the US, it appears as though everyone won—the pharma companies, the government and even the American citizens — every single person received the vaccine for free.
 
India, on the other hand, did everything else. It treated private companies like the SII with a mixture of disdain and ownership, and by the end, it’s clear that nobody is a winner. 
 
Not the Indian government.
 
Not SII. 
 
And certainly not India’s citizens. 
 
It’s going to be a rough few months ahead. 
 

Stay safe and take care.

Tuesday, November 3, 2020

A second chance for an entire nation.

Its November 3rd. The first Tuesday in an election year. Over in the US. A rare second chance for a divided nation. To correct a 'mistake' committed 4 years ago.

One can only hope they do the right thing this time.

C'mon, USA. You can do this.

Sunday, July 5, 2020

Doing the right thing is always tough.

The great state of Victoria is right now the laughing stock and the black sheep in Australia. With rising counts of COVID-19 cases, clearly pointing to large scale community transmission leading to a second peak, and the inability of the government to prioritize resident health over revitalising the economy has clearly shown the lack of strong leadership in the state. And the relative outstanding performance of other states, even neighbouring states, paints a bleak picture for Vic. If these other states can efficiently manage these numbers, why can’t us ?

This is the same failing leadership which was on display during last year’s bush fires. Yes, that was just last year. This ‘wait and watch’ approach to emergency situations is something typically seen in developing nations. It does not sit well in such a developed country.

The truth is, the people in power know what the right thing to do is. But can’t. It takes courage, and commitment, to do the right thing.

The kids in the government need to grow up.


Monday, March 2, 2020

They are out. Or they will be.


Pete Buttigieg, and Amy Klobuchar are out. And all clues point to Warren and Bloomberg going out too. The fight will be between Sanders and Biden.

Yes, I am following the US election news again. Its on the other end of the news,directly opposite the COVID-19 news. Both are killing nations.

To put it bluntly, Buttigieg never stood a chance. He is openly gay, and even America is not ready for this. Klobuchar has passed some bad decisions as an attorney. It might have made sense to her back then, but there are some things people don't forget easily.

This one will be a close call. Everyone loves Sanders, except other politicians. And Biden is known for NOT taking action, then the ones where he did.

Too close to call.

Saturday, December 14, 2019

A burning nation. A doomed world.


2019 is about to come to its end. And this year's loud and clear message has to be 'natural disasters'. From incessant and unforeseen flooding, earthquakes, volcanic eruptions and burning forest fires, specially the man made ones triggered in the Amazon jungles, disasters have ruled the news. It has also exposed the weakness and unpreparedness in mankind's resolve to preserve the planet. Without a will, there surely is no way.

Closer home, Australia has seen bushfires burning just after its winter months. Raging fires in the New South Wales area has spread east and south, coming as far as Canberra, burning through millions of hectares of its reserve forests. Few people have been killed, and millions of tonnes of pollutants have been released into the air, injuring countless others. Sydney has seen a dystopic orange hazed sun for weeks now, and a drought of level 2 severity has been declared across the city.


Elsewhere, Time magazine has fittingly named 16 year old activist Greta Thunberg as it person of the year. The young Swede was fore center of the youth agitations for climate emergency all through the year.

And yet, all the agitations seems to have fallen on deaf ears. Politicians are indifferent or in-denial of a climate emergency. I thought India had the worst politicians, and was dumbfounded by the truly jaw dropping assumptions of the idiots in power down here in Australia. Strayan baffoon Barnaby Joyce blamed , of all people, the Green party for policies which caused the fire. The baffoon also blamed the sun's magnetic fields for causing the bushfires, and declared that most of the affected people were supporters of the Green party.

This just underscores the reality that people voted to power are out of touch, or not open to reading the scientific facts right; that they are quick to blame problems on those who oppose their policies, and are quick to churn out outlandish , unverified claims. Compare this to the calm and scientifically sound way the scientists and supporters of the climate movement have phrased their facts and called for action.


“I want you to panic,” she told the annual convention of CEOs and world leaders at the World Economic Forum in Davos, Switzerland, in January. “I want you to feel the fear I feel every day. And then I want you to act.”


The looming disaster in the earth's climate in the very near future will be the number one talking point in the new year. 2020. And its high time people start looking at the facts right. Our nation is burning, and the world is doomed. The adults in power seem to behave like children. So it is now in the hands of children, that the world now sees a better future.

Fitting. When adults behave like children; children have to behave like adults.

Heres hoping the sky is a little more clearer, and bluer, and forests are a little more greener, and briming with life, in this new year. That you see more of pleasant rain and calm suns, and less of storms and fires, in this new year.

Monday, December 9, 2019

The political significance of Nilakkal.


Today I learnt that Nilakkal, a place near the foothills of sabarimala, has a more prominent history than what most people have known. The village is known as the place for RSS backed religious groups to gather and group. It sits right on the path towards the hillock, which means anyone trekking up the hill can be checked there. I had wondered why is this place chosen for the conflict , instead of a place further downhill ? And I found the true answer only recently.


It seems this place has always been the site for religion driven conflict. At least from 1983. That year a stone cross was found at Nilakkal, on land owned by the Kerala Farming Corporation, barely 200 metres from the Shiva temple.The next day, followers of Mathew Anthiyakulam, vicar of the nearby Pamba Valley Church, arrived at the spot singing devotional songs. Claiming the cross was a remnant of the ancient church established by St Thomas, they built a thatched shed over it and started holding daily prayers. Soon after, the Kerala Catholic Congress, an organisation of the laity, set up a Nilakkal Action Council to prepare for the construction of a church at the site. On the council’s request, the state’s Congress government allotted it one hectare (2.4 acres) of land close to the temple for the church construction.


Christians believed that St Thomas, one of Jesus Christ's 12 disciples, had travelled to Kerala and established 7 churches, and that one of them was at Nilakkal. The hindus who traditionally visited the temples at Nilakkal saw this as a conspiracy, and convened their own agitation against the 'christian takeover'. They claimed there was no proof of St Thomas’s visit to India or of his having established churches. They demanded the removal of the cross, alleging it was of recent origin and had been planted on 'Hindu holy land'.


The main leader of this agitation was a certain Mr Kummanam Rajasekharan, who was then a Vishwa Hindu Parishad leader.Rajashekaran accused the government of sacrificing the interests of Hindus to get Christian votes.


Things quickly took a violent turn, which lasted months. Even K Karunakaran, who was the chief minister, was not spared.


Karunakaran was in the habit of praying at the Sri Krishna Temple in Guruvayur on the first day of the Malayalam months. As usual, he reached the temple on May 15, 1983, for morning prayers. As soon as he entered the temple, a huge gathering of people affiliated to the then Sangh Parivar platform Hindu Aikyavedi prevented him from offering prayers. They accused Karunakaran of illegally handing over land holy to the Hindus at Nilakkal for the construction of a church.


The developments in Nilakkal led to a massive Hindu mobilisation. Violating prohibitory orders, the RSS organised a protest march in Thiruvananthapuram. More than 1,000 of its workers and those of the Hindu Munnanireligious group were arrested from across the state for unleashing violence. In Nilakkal, RSS and Hindu Munnani activists dismantled the thatched shed and manhandled Christians. Tensions soared after Hindu Munnani activist Koorambala Chandran Pillai died weeks after being injured in a police lathicharge.


On June 4, 1983, Nilakkal witnessed an intense hour-long battle as the police tried to disperse a throng of rock-throwing VHP activists with batons and teargas. The clash left 50 injured while 30 protestors, included nine ascetics, were arrested. The VHP said they would not allow a church anywhere near the temple or even within range of the 18 hills surrounding the Sabarimala shrine, asserting that the area belonged to Hindus alone.


On July 16, 1983, hundreds of VHP workers gathered again in Nilakkal for a protest meeting with night-long prayers and rituals. Prominent religious figures such as Vidyananda Saraswathi and Sathyananda Saraswati addressed the crowd.


The next day, Hindu temples across Kerala flew black pennants to protest the church construction plan. In the following days, thousands of Hindus donning black cloths over their mouths and on their hands marched on the streets of all the major towns and cities of Kerala, condemning the police action and arrest of holy men in Nilakkal.


Coinciding with the protests in Nilakkal, two Catholic churches were attacked with homemade bombs, 15 state transport busses were vandalised and 28 protestors arrested.


The violence prompted the government to ban the activities of the Hindu Unity Action Council.


Peace was finally restored after Gandhian MP Manmadhan held discussions with both sides. A meeting of Kerala bishops was held and it was decided that the cross would be relocated to a place agreed upon by both action councils. The church would be built at this spot 4 km south-west of the temple, well outside the area the Hindu side identified as Ayyappa’s sacred grove. The spot where the cross was originally found is now part of a parking lot for pilgrims to Sabarimala.


A small church dedicated to St Thomas now stands in Angamoozhy, the spot that was agreed upon all those years ago. Very few of those who visit it know of its history or its role in what may well be the largest communal flare-up in Kerala’s history.


What makes this church different from others is that it follows the principle of ecumenism, which promotes unity among the various Christian churches. Kerala’s Christian community comprises numerous denominations, prominent among them being the Syrian Catholic, Orthodox, Marthoma and Jacobite churches.


The Sangh Parivar began the process to communalise Kerala in 1983 by hipping up a frenzy against the plan to construct a small church close to the Mahadeva temple in Nilakkal. In a way, Nilakkal is a milestone in the Sangh Parivar’s growth in Kerala.


So you see, Nilakkal has been the centrepoint of violent history in the past, and therefore continues to be the first place supporters of RSS would congregate at for their future political stands.

Monday, November 4, 2019

Choker Delhi


November. Winter is coming. And what better indicator of this than the worsening Air Quality Index of Delhi ? It is that time of the year again, when the animals trying to survive in India's capital city have to struggle more to breath in the thick, smog layered atmosphere, which the citizens themselves helped destroy.


It is painful just reading the news in the air. Air quality generally deteriorates as winter sets in because of a combination of agricultural crop burning in the nearby states of Punjab and Haryana, dust from roads and construction sites, industry, coal power plants and vehicular emissions. The level of carcinogenic pollutants, which increases risk of stroke, heart disease and lung cancer, in New Delhi’s air was almost six times the reading in Beijing, where air quality has seen a considerable improvement over the past years.


India, home to 10 cities with the world’s worst air quality, has been struggling to contain this annual catastrophe that killed an estimated 1.24 million citizens in 2017. Governments have pledged millions of dollars and deployed extra teams to enforce existing laws that include a ban on farmers burning stubble after harvest. But the sheer size of India makes rapid progress difficult.


For the past few years, farm stubble burning — a tradition to clear fields after harvest for the new sowing season — along with festive firecrackers, vehicular and construction emissions have been turning the South Asian nation’s air deadly around October-November. The huge number of crackers burst to celebrate the hindu festival of diwali in october makes matters worse. One of the many ways religion helps kill people.


The government, or at least its PR wing, is back in action planning 'plans' to control the pollution. And this is coming from the same people who have tried to 'correct' the slowdown in the nation’s economy for months now.


What a fascinating time to live in Delhi.


Wednesday, October 30, 2019

USA's legal immigration problem.


We, the whole world has known for decades that US of A has always had a problem with its legal immigration system. And this is a reason why so many people have tried, and still try, to get in illegally. But nobody has documented the problem as concisely as a British immigrant to the US, British comedian John Oliver.


As he so clearly puts it, there are very few avenues for the legal migrant to America. Even for the most qualified & skilled migrant. For the first 100 or so years, they didn't even have a legal immigration pathway, so everyone just got in illegally. But today, the only ways possible is via a family sponsored visa, or an employer sponsored one. Of course we are not counting the lottery system, because the odds of getting that are so low.


Watch on , and contemplate.


Monday, October 21, 2019

The great Indian taxpayer is an elusive creature


There is a very elusive species of creature in India. It works very hard everyday, day and night,sometimes more than 14 hours a day for its food and family. Everyday is a work day, hardly any rest. It also suffers most of modern lifestyle induced sickness. The country, draws significant growth from the hard work of this little species, and ultimately rewards it almost nothing in return.

This species is called the great Indian bustard tax-payer.

I have always known of the hard life this species lives. It does not live, it simply survives. But the data to correlate and breakdown its sad state was buried undred thousand page reports prepared from half informed forms. But recently, there was a nice article summarising its pitiful state.

The salaried income tax payer in India often feels cheated. “What are my taxes being used for," he often asks himself. The roads continue to have potholes. The traffic never ends. The public transport system never seems to expand fast enough. The healthcare system is non-existent. The legal system takes years to give a judgement. The police are corrupt, and so on.


Read on, and pass further into depression.


A few jaw droppers from this piece:

A small portion of India’s salaried population pays the bulk of its individual income tax, which gets redistributed to others and doesn’t benefit the taxpayers that much. In the process, it drives them away from the Indian state. At least, that’s the feeling going around.

“If the state’s role is predominantly redistribution, the middle class will seek—in professor Albert Hirschman’s famous terminology—to exit from the state. They will avoid or minimize paying taxes; they will cocoon themselves in gated communities; they will use diesel generators to obtain power; they will go to private hospitals and send their children to private education institutions."


About 4% of citizens who vote pay taxes, the percentage should be about 23

This last line is truly a clincher. It means the majority of people pariticipate in this democracy do not actually contribute to the country, but instead, feed on the little benefits it is able to pay out.

Individuals paying an income tax of greater than ₹1.5 lakh accounted for nearly 79% of the total tax.

If you happen to belong to this group, you might really feel that you have a good portion of the burden of the nation on your shoulders. Of course, this is good enough reason for the government to start taxing agricultural income over a certain level. Given that the bulk of the tax is paid by a small proportion of the population, there is always talk going around about doing away with the income tax at lower income levels.

But the question is can the government really afford to do this?

Tuesday, October 1, 2019

The Vices of Malayalis, and how the state lives on it

Came across a much needed, and nicely researched article on how the state of Kerala, India, feeds off the taxes paid by its poorest citizens. Keralites, you see, have a penchant for alcohol, and lotteries. And both of these are controlled largely by the state government. A third vice is finance instrument called chit-funds, a remnant of a once stronger economy. Some of the figures being reported in this article is truly scary; and its all debt !

Kerala’s is an interesting, if not curious, economy.  The cash-strapped state -- it has a debt ratio of over 30 per cent -- the highest and most deteriorating debt among all states since 2013 -- is keeping its finances alive through the vices of its people - heavy alcohol consumption and penchant for lottery tickets. The state government has the monopoly to sell alcohol, through the Kerala State Beverages Corporation or Bevco, while the ‘gambling-type’ addiction of buying lotteries of its people is fed through the Lotteries Department, which sells lakhs of lottery tickets on a daily basis. At over 8 litres per person per year, Kerala has alcohol consumption per person per year compared to the national average of 5.7 litres per person per year. The sales tax on alcohol has been going up from 20 per cent in 1960-61 to 210 per cent now.

As per the latest data, the income from the lottery for 2017-18 stands at Rs 9,034.16 crore while the revenue from liquor sales (state excise + sales tax) stood at Rs 12,937.09 crore in the same period. Add to this is the bumper sales during festivals like Onam. In the pre-Onam week alone, Bevco sold a whopping Rs 487 crore worth liquor while the lottery tickets offer eye-popping prize money of Rs 16 crore.

“The entire approach of the state government is flawed and regressive. To manage its coffers, Kerala Government is not only punishing the poorest but it is also encouraging them to buy an addictive product like lottery by selling dreams,” said Jose Sebastian, who teaches at the Gulati Institute of Finance and Taxation.

It’s no secret who’s consuming most liquor and who’s buying the lottery tickets. It’s mostly the poorest sections of society. Gujarat neither sells liquor or lottery, yet it is the top-performing state in the country,” he said.

According to a study by Sebastian, Kerala has a wide tax base covering various sections of people and different kinds of economic activities. This is not reflected in the revenue collection. “Virtually, the effective revenue base has been getting narrowed down to four items -- petroleum and petrol products, liquor of all kinds, motor vehicles and lottery,” he said.

“An unintended consequence of the evolution of Kerala’s revenue structure is that it places a disproportionately high burden on the poor and marginalised sections of society. They are the major consumers of liquor and lottery. The share of these two in SOR increased from 14.77 per cent in 1970-71 to 34.46 per cent in 2016-17. Motor vehicles like three-wheelers, pickup vans and taxis powered by petroleum products are the source of livelihood for many of this class,” he said.

V K Vijayakumar, chief investment strategist, Geojit Financial Services, said the LDF Government and its Finance Minister T M Thomas Isaac have been adopting a policy of borrowing and continued borrowing to meet the day-to-day needs. “Hard decisions such as hiking education fees, concessions for students travel or the property tax, which have not been touched for several decades, are not taken as it will backfire politically,” he said.

Vijayakumar pointed out that property tax has not been hiked since 1995 while students continue to travel at nominal rates though they have no qualms in spending thousands on mobile bills or on autos/share cabs every month.

Another big consumption by the state is gold, but it now comes under the Goods and Services Tax. Recently, the Finance Minister lamented that the state government gets less than Rs 200 crore as tax from gold sales while under the scrapped Value Added Tax (VAT) regime it used to fetch Rs 750 crore. Kerala is the top consumer of the yellow metal and Isaac blamed lack of preparedness and absence of invoices for the ‘huge leakages’ in GST revenue. Economist K V Joseph pointed out that the tuition fees in government medical colleges are as low as Rs 25,000 while in private colleges it is Rs 5.5-6.5 lakh yearly.

“While lower-income bracket people and SC/ST category can be exempted from higher fees, the government should look at hiking fees for those from higher-income families,” he said. Joseph advocated similar hike in taxes from forestry and land/property registration and taxes.

Geojit’s Vijayakumar blamed the state government for spending recklessly when the state coffers are drying up. “The state’s debt is Rs 1.5 lakh crore. When the state is in deep debt, the government has spent Rs 5.90 crore on politically accommodating VS Achuthanandan in Kerala Administrative Reforms Commission. Our Public Service Commission has 21 members while Madhya Pradesh PSC has just four members and Gujarat seven. All these members are paid over Rs 1.5 lakh per month. The government would do well to cut its unnecessary expenditure first when the state is in deep financial crisis,” he said.

Will Finance Minister Isaac think out of the box to find new revenue models? Will he bite the bullet? No chance when the state is heading for an election season -- the byelections followed by the local body polls in 2020, and the Assembly polls in 2021.

Another addictive habit of Malayalees is joining money-saving scheme or chits or chitties, which combine the advantages of both investment and advance. No wonder, while most Kerala PSUs are loss-making or white elephants, the Kerala State Financial Enterprises or KSFE, which runs chitties of several sizes, is flourishing. Compared to unofficial chits run by individuals, which are illegal, the KSFE chits are risk-free safe haven for the public as the institution conducts only chitties fully governed by provisions of the Central Chit Fund Act 1982.


Sunday, September 29, 2019

Go green, and fight the cars

The news nowadays has always been disturbing. But for the past few weeks, there has been a shift in focus. Instead of reporting news of religious conflicts, political interference, and greedy corporations; the focus is now on : the changing climate.

There was a (?) nationwide strike in Australia's cities last week, people standing up for a greener future. Against un-controlled climate change. Greta Thunberg's climate activism has got people talking. Scotland has become the first country to declare a climate emergency. There are petitions being signed, videos and audioblogs being shared.

And I have been listening to the war on cars podcast. Australia loves its big, huge cars. And they get touchy when the topic comes to parking.

Some strongly support market prices—except for parking. Some strongly oppose subsidies—except for parking. Some abhor planning regulations—except for parking. Some insist on rigorous data collection and statistical tests—except for parking. This exceptionalism has impoverished thinking about parking policies. If drivers paid the full cost of their parking, it would seem too expensive, so we expect someone else to pay for it. But a city where everyone happily pays for everyone else’s free parking is a fool’s paradise.


For the first time, I see some hope for this planet. The war against cars has started.

Heres hoping for a greener future.

Wednesday, August 14, 2019

Satirical governance

It is that time of the year again. Half way through,we Indians get this opportunity to observe the anniversary of the day India won its independence. Today is mostly a day of political buffoonery. Speeches, promises, lies. But a great day for flag-sellers. As children, we used to be proud observing this Independence Day, today the meaning of those words is truly lost.


Today, most of the country is drowning in flood water, caused by unprecedented torrential rain, but the actual destruction caused by uncontrolled development, and destruction of natural resources. More than 150 people have died. This after the country reeled under a summer heatwave, droughts, and its cities running out of drinking water. So now one half of the year is time of drought, and the rest if the time for floods.


Multiple reports seem to point to the economy being in severe distress, especially since the date the last budget was announced. Manufacutring, specially automobiles, has nose dived. There are still religion driven atrocities being reported from all over the country. Attacks and molestation on women continue. And the decision to abrogate the special status provision for one if India's own state has now put the nation on the nation's watch citing human rights violation.


The British might have left decades ago. But India still has not learnt to properly govern and run itself. Is there a reason to be happy about any of this ?

Governance has become a joke. And its not even funny.

Tuesday, August 6, 2019

Out with section 370


By now all online media, and most of the western world, will have heard of India' government passing a new rule, abrogating one of its own, self imposed 'special status' clause to a state very much within its sovereignty. While those with prior knowledge of the history, present, and forthcoming future will , I think , rightly agree with this decision, a huge part of those ignorant are going to question if India has this right in the first place.

Short answer: No one knows either way. Political experts, pundits, and citizens of every country are debating both sides. Section 370, the just abrogated law, was not imposed by the UN, or any other country in India. It was designed by India's parliament. So India should have full power to decide when to take it off. That’s where my point of view ends.

But others more knowledgeable than me have spoken wisely on this matter. Change, however small , or even big as this, is good.

. Why not plebiscite?

Answer: Plebiscite is not for Article 370 but for annexation to Pakistan. The plebiscite, promised by once by Chacha Nehru (Greatness be unto him), could only be done, as per T&C, if Pakistan withdrew their troops totally and then India did, just keeping that part necessary to maintain order. Since the preconditions of Pakistan withdrawing from PoK will never happen, neither will the plebiscite. There is also that little moral problem I have that you do not get to do a plebiscite after demographic change, after communally picking out Hindu pandits and ejecting them from their homeland. Any plebiscite is rigged by default.

The power of abrogation of 370 comes to the current government from the people of India, Kashmir included, through our democratic institutions. You may say “this fascist Hitler is not my leader”, but unfortunately this is the way democracy works. Sorry.

Is this the right way forward. Any way forward from a logjam, is good. Will this help the people of the region ? Only time can tell.

Is this change good ?

I do not know, but it is worth a try. Because we have been “talking” for decades, and there has been very little to show for it.

Thursday, May 23, 2019

Orange is the new black


Its exepected, funny and wierd seeing the reactions of those who lost these elections. They are going through all the five stages of grief, in a whole day.

This is exactly how a democracy works. In the end, all that matters is the people's sentiments. Those who know how to play to the masses and win this game.

Orange is the new black.