In a bid to tackle the problem of mounting dues to sugarcane farmers – estimated to be Rs 21,000 crores as on date – the Cabinet Committee on Economic Affairs (CCEA) recently approved a loan of Rs 6000 crores to sugar manufacturers the interest cost on which for one year amounting to Rs 600 crores will be met by government [the money will come from Sugar Development Fund (SDF)]. Coming on top of a loan of Rs 6600 crores earlier sanctioned by erstwhile UPA dispensation for 5 years [also to facilitate payment of dues to sugarcane farmers], the sop granted by Modi – government should have come as a further relief to the industry. Alas, the decision has irked it!...
More No comments
Blog
‘Premium’ pricing of gas – is government falling in to a trap?
In August, 2014, Modi – government had set up an inter-ministerial committee of secretaries (CoS) under chairmanship of secretary, ministry of petroleum and natural gas (MPNG) to recommend a new structure of pricing domestic gas. The committee submitted its report on September 16, 2014 Guidelines for pricing domestic gas Based on its recommendations, on October 18, 2014, cabinet committee on economic affairs (CCEA) approved guidelines for pricing of all domestic gas [except supplies from fields awarded prior to NELP (new exploration licensing policy) where PSC (production sharing contract) did not provide for approval of price by government] based on ‘modified’ Rangarajan formula. Nicknamed after Dr C Rangarajan, chairman, economic advisory council to prime minister [he headed a committee on gas...
More No comments
‘Unshackle’ food sector before cash transfer
Emboldened by the success of DBT (direct benefit transfer) in LPG, the government is keen to launch this in food and fertilizers. To begin with, it will launch a pilot scheme in Puducherry where 330,000 ration card holders could receive Rs 300-400 a month each in their bank account in lieu of their monthly quota of rice after the lists are validated and their bank accounts are seeded with Aadhaar. Beneficiaries will be free to spend the money on any thing, not necessarily grain. If, the pilot in Puducherry is successful, it will be rolled out in other Union Territories (UTs) When juxtaposed with Modi – government’s tall claim about implementing DBT [a committee under Mr Shanta Kumar – a...
More No comments
Indian economy on ‘fast track’ – jobs will follow
In an open letter addressed to Prime Minister, Mr P Chidambaram, former finance minister in the erstwhile UPA government has taken pot shots at Modiji for his ‘alleged’ failure to create jobs. He laments that during 2014-15, jobs were generated at a measly rate of 100,000 per quarter which works out to 400,000 in the whole year. Mr Chidambaram’s observation is reminiscent of a phrase coined by ex-Prime Minister, Dr Manmohan Singh “money does not grow on tree”. Dr Singh was alluding to efforts-led creation of wealth even as right under his nose, people witnessed a contrasting spectre of huge amount of national wealth being plundered and given to close contacts/favourites of political bosses in the grand old party. However,...
More No comments
Urea price hike – put in deep freezer
A major decision taken by the government in the May 13, 2015 meeting of the Union Cabinet – chaired by Prime Minister, Shri Narendra Modi – was to keep maximum retail price (MRP) of urea frozen for a period of 4 years. This can throw any logical person in to a state of bewilderment! During the last one-and-a-half decade or so, urea MRP which is under statutory control [for close to six decades now] was not touched at all except once in 2010 when it was increased by a meagre 10%. This was despite inflationary forces gripping all other sectors and minimum support prices (MSP) of paddy, wheat and other cereals increasing manifold. The current MRP is ridiculously low at...
More No comments
E-tailers vs retailers – ‘level off’ playing field
Mr Kishore Biyani of Future Group has alleged discrimination against brick-and-mortar players in FDI (foreign direct investment) policy vis-a-vis e-commerce companies in the retail space. Meanwhile, seeing threat from near explosion in e-commerce transactions, the Retailers Association of India (RAI) [besides Future Group, it includes Reliance Retail, Bharti Retail etc] had petitioned the government seeking a level playing field. It also approached Delhi High Court (DHC) who directed that let government deal with it first and if problem persists, it will hear their plea after 4 months. So what is the concern flagged by brick-and-mortar players? How does the discrimination arise? Are mom-and-pop stores also feeling the heat from e-commerce onslaught? What is the stance of government on FDI? What...
More No comments
Modi delivers ‘scam-free’ India
On May 26, 2015, Modi – government completes one year in office. Naturally, it is time to review and reflect on the pluses and minuses; on what it did and what it did not. But for die hard critics, those wearing coloured glasses and determined to see only negatives, all others viewing happenings from an objective and un-biased mindset will only be able to see positives as this is all that the present dispensation – led by a charismatic leader Modiji – has put on the plate of 1.25 billion people of India. Poor catapulted to center stage For the common man, the poor and the poorest among them, there is a lot to feel relieved and rejoice as the...
More No comments
New urea policy – rocks reforms boat
On May 13, 2015, the government approved a so called ‘Comprehensive new urea policy’ which seeks to (i) promote energy efficiency; (ii) maximize indigenous urea production and (iii) reduce subsidy burden on the budget. At present, under the new pricing scheme (NPS) in vogue since 2003, each of the 30 urea manufacturing units gets a retention price (or ex-factory price) based on production cost specific to it. Since, all of them are required to sell urea at ‘uniform’ controlled price which is lower, the difference is reimbursed as subsidy. Initially, NPS was designed as a group-based uniform pricing scheme whereby each unit in a given group [6 groups were carved out depending on feedstock and vintage based on recommendation of...
More No comments
Modi’s land bill won’t squeeze agriculture
Ever since the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act (RFCTLARRA) or in short Land Acquisition Act (LAA) 2013 – passed by then UPA dispensation – came in to force from January 1, 2014 not even 100 acres of land has been acquired all over the country. Indeed, in mid-2014 majority of chief ministers (CMs) including from Congress ruled states had during consultations initiated by Modi – government emphatically stated that it was impossible to acquire land under LAA (2013) and that this was becoming a major stumbling block in the way of development. Sensing the mood and in the true spirit of cooperative federalism – inculcated by hon’ble prime minister in every aspect...
More No comments
Gas supply ‘conundrum’ – haunting India
In its Performance Audit Report on Supply and Infrastructure Development for Natural Gas (tabled in the Parliament on May 5, 2015), the comptroller and auditor general (CAG) has pulled up the government for failing to create infrastructure for domestic gas production and supply. CAG said that India lost subsidy savings of Rs 11,800 crores between 2010 and 2013 on this account. Infrastructure for domestic gas – CAG revelations It noted that non-availability of long-term gas supply and inadequate pipeline connectivity were the main constraints in increasing of urea production capacity. During 2011-12 and 2012-13, urea production was only 44.6 million tons against the requirement of 60.4 million tons. The shortfall of 15.8 million tons was imported at much higher cost...
More No comments