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The sugar industry in India – preliminary notes

SBP issued a press release on the sugarcane industry yesterday.

This has led to a question regarding the calculations in the media release.

“The market price of molasses is around Rs.7,000 per ton but the UP state government pays mills a no more than Rs.2000 per ton.” But the price you have quoted is the MSP, a price applicable only if the farmers fail to sell their produce in the running season and this is the amount government offers to them as a degree of relief. It is not true that the farmers are forced to sell at this price initially. Even when they fail to sell sugarcane in the running season, there is no force to sell it to the government. It is an offer, which they may take to reduce their losses or decline and suffer the full loss.

Besides, we would like you to furnish some links of credible reports that say that the Uttar Pradesh government is offering Rs 2,000 per tonne for molasses.

My initial response

This matter is rather complex as farmers receive a price for sugarcane, not for molasses. A key leader of SBP made calculations and worked out that the effective price being paid to farmers for the molasses component is well below Rs.2000 per ton.

The issues raised in our press release have been raised here:

http://www.business-standard.com/article/economy-policy/molasses-policy-in-up-embitters-sugar-mills-114082600711_1.html

“A sugar industry official said the compulsory sales to the liquor manufacturers would result in a distorted market, where price of molasses to liquor manufacturers is one-sixth or 16-17 per cent of open market price.”

and here: http://www.sugaronline.com/website_contents/view/1217071 “But with the state government favoring blatantly the liquor industry,”

The problem is that this is a highly detailed calculation, and all the facts are not available to the outsider (i.e. farmers). There are wheels within wheels in the sugar industry. It is hard to disentangle the mess.

All one can say is that there is no business for the government to be dabbling in administering prices, setting quotas, restricting trade, etc.

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RESEARCH NOTES

Rangarajan Report of 2010: Report of the Committee on the Regulation of Sugar Sector in India: The Way Forward

Parliamentary research blog’s report: http://www.prsindia.org/theprsblog/?tag=frp

Indian sugar policy: Government role in production expansion, and transition from importer to exporter  [this report suggests that farmers are being given higher prices than international prices, to ensure high supply of sugar in India.]

Question in Parliament: http://www.indiansugar.com/PDFS/FRP%20FOR%20SUGARCANE-LS-1754.pdf

Quora question: Why are Indian sugar mills running under a loss? If there is surplus production, why don’t they export it?

Various Problems of Sugar Industry in India

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SC/ST (Prevention of Atrocities) Act 1989 – good intentions, but at the expense of fundamental rights

Here’s a news item of considerable interest: Maratha protests: Maharashtra’s caste cauldron boils over

One of the issues raised there is the “misuse” of the SC/ST (Prevention of Atrocities) Act 1989 [PDF | Word]

The Act was amended in 2014 (PDF) and 2016 (image file -PDF); OCRd (poor quality Word). Summary of the changes are detailed here.

According to wikipedia, key features include:

The provisions of SC/ST Act and Rules can be divided into three different categories, covering a variety of issues related to atrocities against SC/ST people and their position in society.

  • The first category contains provisions of criminal law. It establishes criminal liability for a number of specifically defined atrocities, and extends the scope of certain categories of penalizations given in the Indian Penal Code (IPC).
  • The second category contains provisions for relief and compensation for victims of atrocities.
  • The third category contains provisions that establish special authorities for the implementation and monitoring of the Act.

The salient features of the Act are

  1. Creation of new types of offences not in the Indian Penal Code (IPC) or in the Protection of Civil Rights Act 1955 (PCRA).
  2. Commission of offences only by specified persons (atrocities can be committed only by non-SCs and non-STs on members of the SC or ST communities. Crimes among SCs and STs or between STs and SCs do not come under the purview of this Act).
  3. Defines various types of atrocities against SCs/STs (Section 3(1)i to xv and 3(2)i to vii).
  4. Prescribes stringent punishment for such atrocities (Section 3(1)i to xv and 3(2)i to vii).
  5. Enhanced punishment for some offences (Section 3(2)i to vii, 5).
  6. Enhanced minimum punishment for public servants (Section 3(2)vii).
  7. Punishment for neglect of duties by a public servant(Section 4).
  8. Attachment and forfeiture of property (Section 7).
  9. Externment of potential offenders (Section 10(1), 10(3), 10(3)).
  10. Creation of Special Courts (Section 14).
  11. Appointment of Special Public Prosecutors (Section 15).
  12. Empowers the government to impose collective fines (Section 16).
  13. Cancellation of arms licences in the areas identified where an atrocity may take place or has taken place (Rule 3iii) and seize all illegal fire arms (Rule 3iv).
  14. Grant arms licences to SCs and STs (Rule 3v).
  15. Denial of anticipatory bail (Section 18).
  16. Denial of probation to convict (Section 19).
  17. Provides compensation, relief and rehabilitation for victims of atrocities or their legal heirs (Section 17(3), 21(2)iii, Rule 11, 12(4)).
  18. Identification of atrocity prone areas (Section 17(1), 21(2)vii, Rule 3(1)).
  19. Setting up deterrents to avoid committing of atrocities on the SCs amongst others (Rule 3i to 3xi).
  20. Setting up a mandatory, periodic monitoring system at different levels (Section 21(2)v):
  • District level (Rule 3xi, 4(2), 4(4), 17).

  • State level (8xi, 14, 16, 18).

  • National level (Section 21(2), 21(3), 21(4)).

Here is a copy of a PIL filed against the Act in Chennai High Court [PDF | OCRd Word] – full text (accurate)

I’ve not had a chance to understand this but prima facie it appears that:

  • it is one more discriminatory law (in that it only applies to some groups of people – indeed, it perpetuates the caste system);
  • it violates the fundamental rights of the accused. (Section 438 (of the Criminal Procedure Code) does not to apply to persons committing an offence under the Act.- Nothing in section 438 of the code shall apply in relation to any case involving the arrest of any person on an accusation of having committed an offence under this Act). Where “verbal abuse” is reported, which may prove false, it should clearly be bailable.
  • It is understood that the accused is generally not allowed bail.

It is understood that the compensation requirement in the Act is being used to extract ransom from an accused.

While the intention of the act was good, its structure is inconsistent with basic principles of liberty and accountability; it also means that those “Dalits” (this very idea of caste is obnoxious; but let’s assume that some such “category” exists) who are so inclined could accuse anyone of certain crimes and be able to extract ransom, as a condition of withdrawing the accusation.

(a) I disagree in principle with the idea of laws that apply only to one “category” of Indians. I  believe that the same set of crimes should apply to the whole country, to all citizens. I may not agree with Uniform Civil Code but I do suggest a Uniform Criminal Code. (b) I believe the solution to social oppression lies in equal opportunity and that requires basic governance reform to deliver. (c) I believe that ALL crimes should be fast tracked. SBP’s Open Letter to Modi emphasises additional funding for police and judiciary to clear all backlogs.

I don’t condemn the “Dalits” who misuse the act: it is not their fault – the act is quite stupid and should not have been so designed to allow its misuse. I condemn the Rajiv Gandhi government for enacting such a bad law.

Would appreciate inputs from readers.

 

 

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HC Gupta (IAS 1971 RR, UP cadre) and the Coal Block scam – preliminary analysis #2

A number of people who know HC Gupta have come out in his support. I’m not passing any judgement at this stage, but just noting some of the comments I’ve come across.

  1. MY BATCHMATES

My batchmates who know him (and I’m only talking about those whose views I trust) vouch for his integrity.

2. OTHERS

“Mr Gupta is known across the state for being a humble and an upright official. The fact that he has chosen to go behind bars and not even take legal recourse for lack of funds has pained us immensely and we are trying to help him in as many ways as we can,” a principal secretary of Uttar Pradesh told IANS. [Source]

The officials pointed out that under the Prevention of Corruption Act, there was no watertight case against Mr Gupta, as there was neither intent nor a money trail. “We believe he did what is alleged to have done at the beck and call of the then PMO and he is not involved in the whole issue anyhow,” said a senior bureaucrat, not wishing to be named.  [Source]

Former Coal Secretary H C Gupta, an accused in several coal scam cases and presently out on bail, has been known among his colleagues, subordinates, and batchmates as a clean and studious civil servants who obeyed the orders of his political boss and former Prime Minister Manmohan Singh. It’s a travesty of justice that for doing what he was obligated to do as a civil servant, he has been hauled up in as many as 20 cases [Source]

“this fine bureaucrat, whom everyone unhesitatingly certifies to be “the most honest officer” of his generation” [Source]

IAS officers back ex-coal secy H C Gupta, to approach PM Modi [Source]

(Further: ‘Coalgate’: corruption, an honest bureaucrat and a deeper malaise in India)

MY VIEWS

Once again, I’m not putting out my own views till I understand this case better. I’ve asked the mining industry to advise me, as well. I may add, that prima facie, HC Gupta appears to be an honest officer.

On the policy matter, though, it is my view that the Supreme Court went overboard (and incorrectly) in their intervention into coal block allocation.

I’ve already posted about this issue (see this: Modi government’s disastrous mining policy for India. Article: Coal block auctions: A Himalayan blunder?)

And my views on Modi’s mining policy are clear: Fundamental design flaws in the Modi government’s mining ordinance

This does NOT mean I’m absolving HC Gupta of wrong doing (e.g. he may have been honest himself – much like Manmohan Singh is personally honest – but may have agreed to do the biddings of political masters whose only goal is to make money; I consider that corruption as well – even though that may not be precisely covered under the Prevention of Corruption Act).

All I’m saying is that this matter needs careful consideration of policy aspects, as well as implementation aspects. The CBI is (as is the Supremet Court) sorely ill-equipped to evaluate the policy aspects involved.

HOW POLITICIANS MAKE MONEY

Let me elaborate how politicians actually make money. It is never the case that they make money by directly passing written orders in favour of the person who is going to bribe them. When Hiteswar Saikia asked me (when I was Director, Rural Development Assam) to give a cement contract to a particular private company, he wanted me to make all kinds of written excuses in the file to not give the contract to the lowest bidder. It would then appear that I took the decision, not Saikia. I would not get any money (since I never took any corrupt money) but Saikia would get the money and would be exempt from any direct trail to him.

I was kicked out of my job by Saikia the moment I awarded the cement contract to the lowest bidder (Cement Corporation of India).

But here’s the deal: I’d rather be kicked out and do nothing (while in the IAS) than sign things on behalf of corrupt politicians.

It is NOT good enough to not take money for oneself. Is one doing one’s job honestly? That is the question.

In the case of HC Gupta, that’s still an open question. He may not be culpable under the PC Act, but he may still be guilty of corruption in my broader definition of corruption.

Can those who know Mr HC Gupta confirm that he NEVER violated the ideals of integrity in order to appease any politician? Can he be asked to say so?

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We must support Constitutional, not sectarian nationalism, says SBP President, Vishal Singh

SBP’s press release here.

National Press Release – to be released across India

4 April 2016 – for immediate release

Mr Vishal Singh, President of the Swarna Bharat Party, said that India needs Constitutional nationalism, not sectarian nationalism of the kind that some saffron groups, supported by India’s ruling party, are attempting to forcefully impose on the country.

While a nation needs a narrative, a sense of history, India is perhaps the world’s oldest melting pot and has a multiplicity of such narratives. Expecting everyone to adopt a common shared history is an illusion. “Unity in diversity” is the correct language for a multitudinous nation like India.

Further, India is a constitutional republic, not a theocratic state. Our Constitution does not ask us to imagine the nation in the form of a human being, god or goddess. People are free to chant Vande Mataram or Bharat Mata ki jai if they wish, but no one has the right to mandate such slogans. Mr Singh noted that many SBP members are happy to chant such slogans, but this is a matter of their personal choice.

There is a vast difference between well-considered patriotism and rabid, divisive nationalism. SBP condemns the atmosphere of euphoric sectarian nationalism created by saffron groups in which rowdies are starting to beat up people for not chanting slogans.

In our Constitution, the individual is sovereign. SBP opposes fascist approaches that restrict individual liberty.  Compulsion attacks the very basis of nationhood. Attempting to force a particular worldview upon the vast nation of India has already backfired once, leading to India’s partition. Aggressive saffron nationalism is causing new and dangerous fissures.

Mr Singh said that BJP, like all other Indian political parties, has sworn to bear true faith and allegiance to the Constitution of India. How can it justify its support for divisive saffron groups? He also wondered whether the BJP is raising the bogey of sectarian nationalism to draw attention away from its poor performance.

Mr Singh expressed regret that the liberal values underpinning our Constitution are being eroded at a time when India needs them most in order to develop into a modern nation. He noted, for example, how the Delhi High Court made unwarranted comments on nationalism recently in a bail case relating to Kanhaiya Kumar, thus losing sight of its Constitutional obligations.

SBP supports Constitutional nationalism in which patriotism is a well-considered rational response to the nation’s unrelenting commitment to reason and liberty. The intrusion of compulsion into such matters can only take weaken India. Let all flowers bloom in the great garden of India.

End

Notes for Editors

SBP is India’s only liberal party, committed to defending liberty and promoting prosperity.

Contacts:

Sanjay Sonawani (Pune), Spokesperson, +91 9860991205

Vishal Singh, President (Bengaluru), President, +91 9920613669

Madhusudhan K. (Hyderabad), Joint Secretary, +91  9885496473

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