Economic development assistance is debt trap

The Times of India feature, “A ‘Risky’ State of Affairs,” (Oct. 18, 2016) describes the dismal state of development projects in Kerala.

The report says, “A comparison of the World Bank’s rating for its projects in Kerala and other southern Indian states show that risk factor is ‘substantial’ for two categories in Kerala – ‘Political and Governance’ and ‘Institutional Capacity for Implementation and Sustainability.’

“What is worrying is the ‘substantial’ SORT (Systematic Operations Risk Rating Tool) rating for two aspects of the on-going World Bank part-funded Kerala State Transport Project – 2 (KSTP-2), a five-year project which began in July 2013. The International Bank for Reconstruction and Development (World Bank) is funding $216 million of the total expected cost of $445 million.

“World Bank officials might downplay the substantial risk rating as the Kerala Government is their client and the bank couldn’t survive alienating its clients.” a policy maker commented on conditions of anonymity.

“According to the document, these aspects pose governance challenges to the current project: political interference in project implementation, poor quality of works, delayed payments to contractors, delayed decision-making, repeated termination and rebidding of contracts, poor sustainability arrangements for roads and lack of mechanisms for adequate citizen feedback and public disclosure.

“There is a substantial likelihood that weak institutional capacity for implementing and sustaining the operation or operational engagement may adversely impact the project development outcome. The implementing agencies have limited experience with bank and other multilateral development partner operations. The implementing agencies have some in-house capacity, but external consultants play an important role in the design and day-to-day operation implementation. Staff turnover is substantial and they have limited access to relevant training. There are significant gaps in the agencies’ monitoring and evaluation of arrangements, and the lines of accountability are somewhat unclear.”

“How many of bureaucrats have the expertise to see these projects through?” asks D Narayana, director, Gulati Institute of Finance Taxation. “First thing they need is this expertise and then commitment.”

Even in the World Bank’s restrained language, the problems facing development projects in Kerala are clear: institutional capability deficits, lack of expertise among bureaucrats, lack of management skills, lack of dedication, and corruption.

It is not difficult to trace the causes of these problems. The problem starts with education. Kerala Government has full control of the quality of the education in the state – and the goal is to ensure uniform mediocrity. For example, recently there is a new initiative to offer WiFi in schools. However, such cosmetic efforts will not result in the skills needed for a vibrant economy. Studies have found that computers, smartphones and internet can be an inhibitor for learning. Fundamental education reforms are essential for effective functioning of the state economy. For instance, OECD recommends, “Governments should develop smart innovation strategies for education with the right policy mix to give meaning and purpose to innovation, including creating an innovation-friendly culture.”

Kerala Government and its agencies need change of mindset to bring real benefits from development projects. Here is an outline of a typical process for a development project.

  1. Target an agency to get loan from.
  2. Find a consultant who can prepare a proposal that will be accepted by the funding agency.
  3. Once the loan is approved, find another consultant to manage the project.
  4. Hire other consultants to implement the project.
    (In practice, there may be additional creative steps.)

The result of this process is that the supervising agency does not have the skills, know-how or expertise needed to supervise the project successfully — a problem identified in the World Bank report. In addition, the process inhibits the supervising agencies from acquiring essential expertise and know-how for effective project implementation (institutional capacity).

Kerala Government has so far received development loans from World bank, ADB, governments of Japan, France, Germany and others. Some of them are in the early stages. Projects that are due for completion share the fate of the World Bank KSTP-2 project or worse.

The situation with these development loans is all the more deplorable because there is no need for these loans in the first place. Kerala has huge amount of bank deposits and gold holdings to finance these projects and more. The problem is people (depositors) don’t trust the Kerala Government with their money. Instead, Kerala Government goes to these development agencies for loans to squander away, without accountability — as the World Bank has identified.

The economic development agencies — World Bank, ADB (Asian Development Bank [2]), governments of Japan [2], France [2], Germany [2] — are doing a disservice to the people of Kerala by giving loans to Kerala Government and its agencies by helping politicians and bureaucrats escape accountability.

What Kerala needs is assistance with institutional capability and capacity building. The priority for the economic development agencies need to be helping with institutional capacity building, not loans. Otherwise, they are just helping Kerala Government get deeper into the debt trap it is in.


Loud and unclear

When it comes to a shouting match no one’s a match for us Indians
By Jug Suraiya – Instead of employing logic to bring those who disagree with us to see our point of view we employ lung power, firm in the conviction that he – or she – who can shout the loudest will have the final say – or rather, the final scream – on any given subject.

From whom have we picked up this habit of doing chilla-chilli at each other whenever we encounter a divergence of views?

Who are our role models in substituting freedom of speech with freedom of screech?

Our loudmouth netas who interpret ‘acche din’ to mean creating a deafening din on any given issue or non-issue within or outside Parliament? Possibly. more>


My encounter with the curse of God’s own country

By Rajeev Sunu – Last week, I was trying to soft sell Kerala to a multinational company director in Sydney [2, 3, 4, 5] and was listing out the unique advantages that give my home state an edge over Tamil Nadu [2, 3] for setting up an international logistics operation and an e-commerce platform.

But the executive asked me bluntly: “Isn’t that the south Indian state with 100 percent literacy and all those smart ones working in the Middle East and other countries? I have heard horror stories about trade union activism in that state and we don’t want to get caught in such politics and mess up our business.”

My own experience of trying to facilitate a global business group’s investment has taught me that doing business in Bangalore [2, 3] is far easier than doing it in Thiruvanthapuram [2, 3]. In a way it was simple: in Kerala the potential investor was made to feel that they are sort of receiving a favor from the administrators; in Karnataka [2] there were committed resources to market the investment-destination product and to service the clients on an ongoing basis.

Kerala’s tragedy is that it has no business development managers to market its potential in national and global markets. Innovation and change are alien to the state’s bureaucracy, which is primarily trained in the art of balancing socio-political equations while acting as advisory channels to ministers. more>


Intellectual freedom yet to be won

The Times of India report, “Scientists and academics hit out at draft education policy” (Aug 23, 2016), highlights the regressive policies of the Government of India. It is a good sign that professionals in Kerala are able to see through the gimmicks promoted by politicians.

The report says, “The draft of the new education policy (NEP) 2016 has drawn flak from the state’s scientific community with many of the members pointing out that instead of addressing the real problems faced by the education system, it proposes measures which will further stagnate the education performance in the country. It also mentions that the proliferation of sub-standard institutions has contributed to the falling education standards. However, the policy is silent on replacing such profit-oriented private ventures with well-funded government schools and colleges, said Francis Kalathunkal, General Convener of the Breakthrough Science Society.

“The NEP 2016 document steers away from directly spelling out the Hindutva agenda of the NDA government but academicians point out that the preamble of the NEP 2016 says that the education system which evolved first in ancient India is known as the Vedic System.”

“Scientific methods and the lives and struggles of great scientists are not included in the curriculum. Naturally, students learn science just as any other subject, without understanding that it is a guide to thinking. That is why we see so many people who have studied science subscribing to all sorts of superstitions,” said a senior scientist.

“Our system gives no priority to value-based education. Instead, it looks at making education big business in order to reap profits,” said Calicut University’s life sciences department head Dr. E Sreekumaran.

“Science textbooks are overloaded but there are no facilities to conduct experiments. Science students should be told in the beginning itself that there is no Bible and no God in science. Only then, they can challenge existing paradigms and invent out of the box thinking,” said Praveen Raj, senior scientist at the SIR-National Institute of Interdisciplinary Science and Technology.

India sorely needs to improve its R&D capabilities to achieve the ambitious goals set by Prime Minister Narendra Modi, such as Smart Cities, Make in India, Startup India, Standup India, etc. R&D means original thinking, which is in acute short supply in India. Probably, the best example of this situation is illustrated by the fact that the impressive achievements of ISRO (Indian Space Research Organization) are the result of mimicking or borrowing developments from America or Russia. And, in spite of access to practically unlimited funding to DRDO (Defense Research and Development Organization), India is importing technology [2, 3, 4, 5] for its defense needs wholesale.

Mahatma Gandhi won political independence for India. But India is yet to achieve intellectual independence. Intellectual independence is independent thinking, unhindered by blind faith [2, 3]. It is similar to the situation in Europe in the middle ages, after the collapse of the Roman Empire (“Dark Ages“) [2]. Europe won intellectual independence through the Renaissance [2, 3, 4, 5, 6]. What India needs is a similar transformation to achieve intellectual independence.

Education is at the heart of this problem, without which industrial development, a key component for economic development, cannot progress. Regardless of how glorious the Vedic System may have been, it is rooted in a world that no longer exists. We are in the process of transitioning from the Holocene Epoch to the Anthropocene Epoch, with increasing existential threats to humanity. To be a “superpower” today means having a strong science and technology industrial base in the economy. It also means having citizens with forward looking outlook and independent thinking, not hindered by blind faiths, or clinging to customs and traditions, afraid of today’s challenges.

The purpose of education is to prepare a person to face life effectively. In today’s technology-driven fast changing world, that means scientific thinking skills, and ability to learn new things throughout life. The education system should be helping people achieve intellectual independence, become forward looking, overcome inhibiting behaviors rooted in customs and traditions, in addition to helping learn subject-matter skills in various disciplines.

Unless such a transformation is brought about in the education field, Prime Minister Modi’s ambitious goals will remain just empty words.


A new kind of lawyers want a new kind of rights

the right to abuse judges, beat up reporters
By TJ S George – Imagine a robed lawyer barging into an open court room, exhorting his colleagues to support an ongoing boycott campaign against judges, then telling the Bench: “If you have guts, take action against me.” Well, you don’t have to imagine. It actually happened in the Madurai [2, 3] Bench of the Madras High Court [2] not long ago.

In Delhi’s Patiala court compound, the world watched in amazement as lawyers attacked student leaders, policemen and journalists. Senior lawyers appointed by the Supreme Court to look into the matter were also attacked. The violent lawyers were later seen boasting about their violence.

Bangalore [2, 3] still shudders with the memory of lawyers fighting pitched battles against policemen, press reporters and sundry onlookers. A judge was among some 90 people who were injured when the lawyers hurled chairs, smashed vehicles, set a police post on fire, threw water-bottles and bricks and helmets at whoever came within throwing range.

Across Kerala last month, lawyers have been gunning for journalists. There were fisticuffs and shouting of unprintable slogans. Police kept a safe distance. Judges made little effort to assert their overriding powers in court premises, even when the media room in the high court building was locked up under lawyer pressure.

These are unparalleled happenings in the history of India, or any democracy for that matter. more>


Vigilante action is accepted, even admired in India

By Amulya Gopalakrishnan – Thawar Chand Gehlot [2], Union minister for social justice and empowerment, declared that ‘gau rakshak’ (‘cow protection’) squads were simply social organizations. The problem, he said, was that they rushed off on the basis of a rumor, rather than “find out its veracity and then go.”

In other words, if the cow had truly been slaughtered, breaking the state’s law, then it would have been perfectly alright for a bunch of angry cow protectors to directly attack those responsible, rather than use that law.

This is a stunning statement for the minister to make. But chances are, most people are not stunned. The idea that trial and punishment for a crime follows a process, and is solely the state’s business, is far from common sense in this country. Vigilante action is accepted, even admired.

For all the fantasies of vigilantism as the common man’s revenge on an unyielding system, it ends up as conservative violence that picks on the errant and the non-conforming.

And why blame them, when even lawyers don’t recognize their duties<. more>


Gagging media

In Kerala, lawyers join hands with government to deny citizens’ right to know
Times of India – The media literally waits at the gates of courts – as Kerala witnessed on Wednesday (Jul 27) at Kollam [2, 3] where sentencing in a cop’s murder case was delivered – for details of judgments to trickle out. The result is that it is the citizens’ right to know, as envisaged in the Constitution, and the media’s freedom to gather and disseminate news, that are being forcefully denied.

In a move that complicates the issue, the high court has instituted strict curbs preventing media from accessing judgments. Journalists’ entry into judges’ chambers is banned.

A quixotic idea of emailing judgments to media is being mooted. To say that these steps are lopsided would be an understatement.

The ambivalence of the Kerala government, especially of chief minister Pinarayi Vijayan [2, 3], on the issue shows that he and his party are trying to divide and rule by using the legal fraternity to intimidate the press. more>



The chamcha factor

Pahlaj Nihalani’s declaration that he’s a ‘Modi chamcha’ reflects growing sycophancy across parties
By Sagarika Ghose – Parties are afraid of open and honest ideological debates because they believe that any new idea could lead to loss of vote banks.

Governments pay lip service to making India better for entrepreneurs, yet chamchagiri is killing the space for political entrepreneurs.

Politicians who have new marketable ideas can’t hope to be heard, they have to set up their own parties. Today, personal loyalty has become a substitute for political ideology.

Since there is no space for debate and dialogue, anyone who questions is seen as a rebel, be it Yogendra Yadav in Aam Aadmi Party or Biswa Sarma in Congress or Shatrughan Sinha and Kirti Azad in BJP.

Discordant voices are stilled in the name of party discipline. more>