THE HINDU EDITORIAL - MAY 3, 2022

 

THE HINDU EDITORIAL – MAY 3, 2022

 

GST signals Record revenues can smoothen upcoming Centre-State reform parleys The first month of the new financial year has yielded a sharp surge in Goods and Services Tax (GST) collections, taking them well past 1.67 lakh crore rupees – the highest, by a wide margin, in the five years since the levy was introduced by subsuming myriad State and central duties. In fact, GST revenues have scaled fresh highs in three of the last four months, having hit 1.41 lakh crore rupees in January and 1.42 lakh crore rupees in March. Overall GST revenues had grown 30.8% in 2021-22 to 14.9 lakh crore rupees, despite slipping below the 1 lakh crore rupees mark for two months when the second COVID-19 wave raged. The 20% year-on-year revenue uptick this April could be seen as a comforting signal about 2022-23 revenue prospects for policy makers at the Centre and the States, whose treasuries are fretting about the prospect of income falling off a cliff from this July when the assured compensation for implementing the GST comes to an end. Compensation cess levies will persist till at least March 2026, but they will be used to pay off special borrowings of 2020-21 to bridge revenue shortfalls and recompense States. The Centre needs a mechanism to expedite payment of outstanding compensation dues to States (78,700-odd crore rupees, or four months of dues). The Finance Ministry has blamed ‘inadequate balance’ in the Compensation Cess fund, and promised to pay up ‘as and when’ the requisite cess accrues.    If overall GST collections sustain around April levels, a dialogue with States on their pending dues along with those that will accrue from now till June, could become less thorny. But the conversation needs to begin soon. The GST Council, which has not met properly since September 2021, must be convened at the earliest. Higher tax inflows backed by improved compliance, should give the Council more flexibility to approach the impending rationalization of the GST rate slabs, beyond a mere scramble to fill coffers and factor in larger socio-economic considerations. The Centre, which called the April inflows a sign of ‘faster recovery’, must also state whether these revenue levels warrant a rethink of its concern that the effective GST tax rate had slipped from the revenue-neutral rate envisaged at its launch. A clear acknowledgement is also needed that the higher revenues are not solely driven by a rebound in economic activity. Persistently higher input costs facing producers for a year and their accelerating pass-through to consumers, seen in higher retail inflation, have contributed too, along with tighter input credit norms introduced in the Union Budget. That revenue growth from goods imports has outpaced domestic transactions significantly in recent months, also suggests India’s consumption story is yet to fully resurface. Urgent policy action is needed to rein in the inflation rally and bolster consumer sentiment, so as not to sink hopes of more investments, faster growth and even greater revenues.                                     No short circuits Safety is an imperative and should be built into the cost and utility of electric vehicles A spate of incidents related to the burning of electric vehicles (EV) has resulted in the Union government announcing an expert panel to investigate the battery explosions causing them and a few manufacturers recalling batches of electric scooters after some caught fire. EVs have increasingly become a viable transportation device, with more than 11 lakh electric/battery-operated vehicles registered in India (Vahan database, April 2022). The increase in the utilization of EVS has also been largely helped by the significant reduction in costs of lithium-ion batteries that have fallen by an estimated 89% since 2010. With climate change concerns driving governments, including India’s, to incentivize the shift to EVs, their manufacture for commercial use has undergone acceleration with an increase in indigenous companies in the Indian market as well. The enhanced use of EVs and utilization of the underlying technology is welcome as despite the institution of fuel emission norms and building these into fossil fuel-driven vehicles, the shift to EVs from petrol and diesel ones is expected to gain significant net environmental benefits. But it must also be remembered that the Li-ion battery packs that form the core of the technology, are sophisticated devices and there should be no compromise on the inbuilt safeguards.    As an energy storage scientist explained in The Hindu (‘FAQ’ page, May 1, 2022), battery fires occur due to the convergence of heat, oxygen and fuel, and the controlled manufacturing of devices is specifically required to prevent these. Engineering higher safety into EVs can result in higher costs but the smooth functioning of Li-ion batteries without accidents is reliant on the absences of “shoddy engineering” and “cutting corner approaches”. With long-term device changes in Li-ion batteries such as the use of solid state electrolytes, special safety switches, etc. still some time away in implementation, the onus is on manufacturers and regulators to ensure that testing and certification standards related to battery management systems such as devices that prevent accidental shorting of the cells, and thermal management solutions among others are met in existing EV systems and supply chains. Union Transport Minister Nitin Gadkari has said that the Ministry of Road Transport will issue guidelines for EVs which would include tests for compliance with specific safety norms. While the regulation of a fledgling albeit growing sector that has shown a lot of promise but requires adequate safety norms to be put in place is an imperative, manufacturers and other companies in the EV supply chain should also proactively work in recalling defective hatches of vehicles and ensuring safety compliance to prevent the recurrence of mishaps.                           A grand old party, the demanding path to its revival The Congress’s decline is to be seen in the context of majoritarianism as well as internal factors ZOYA HASAN The Congress party is no stranger to crises, but those it has faced since 2014 are unprecedented and probably the worst in the course of its long history. The party reached a historic low of 44 Lok Sabha seats in 2014 and that only increased to 52 in 2019. It has lost 39 out of 49 State elections since 2014. It managed to win only 55 of the 690 seats in the recent Assembly elections held in Uttar Pradesh, Punjab, Uttarakhand, Manipur and Goa. A series of leaders have deserted the party – even those close to the Gandhi family. These defeats and desertions have raised questions and concerns about its very survival. The fact that Congress leaders held extensive talks with a much sought-after election consultant, and was planning to employ his services to revamp the party, brings into sharp relief the existential crisis of the Congress. How do we understand Congress’s existential crisis, and what are the prospects of revival? A platform that does not work Historically, the Congress had always come to power on a centrist platform reflecting its varied social base, but centrism does not work in a deeply divided polity dominated by a politics of polarization and communal mobilization. Essentially, the old form of accommodative politics, which for long held together the Congress’s social coalition, is not capable of galvanizing the imagination of new India. The Gujarat model of politics marked by an exclusive focus on individual leadership as the driver of election campaigns, a strong sense of Hindu pride, a shift in popular attention to aggressive nationalist appeals regardless of reality or facts, and a complete rejection of the entire democratic past and superimposition of perception over performance appears to hold voters in thrall. Changes unleashed by liberalization, globalization, and the information-communication revolution initiated by the Congress have undercut its political ethos and ideological architecture to a greater degree than that of its principal rival. The Congress’s decline (and that of other Centre-Left and Left parties) transformations provoked by the growth and expansion of neoliberalism and majoritarianism, and other factors that are internal to the Congress, most notably, the strong resistance to structural changes within the party. The party’s main problems The Congress has faced three major structural problems in a political conjuncture defined by ‘the great moving Right show’, to borrow a phrase from cultural theorist Stuart Hall, and the polarization engendered by it. These include the leadership issue, organizational stagnation, and the need to project and propagate a clear ideological alternative to the Bharatiya Janata Party (BJP). I have explored these themes in my recent book on the Congress and am taking up some aspects of that here.    The Congress’s leadership crisis has undoubtedly played a role in its decline; however, the challenge facing the party is not just about the ineffectual leadership. Simply appointing a non-Gandhi will not dramatically alter the party’s dwindling fortunes. In fact, removing them might well reinforce the right-wing agenda. What the Congress needs is an organizational regeneration, with democratization at the front and centre. But fundamental issues concerning organizational change have been repeatedly set aside and weighed down by the debate on dynastic leadership and an obsessive focus on the Gandhis.    It is however, important to reconstitute the party’s leadership at various levels through internal elections. This can transform the Congress into a more representative Organisation and could give a boost to the party by changing the perception that it is a family business. At present, the top decision-making bodies are occupied by people who have either never contested a Lok Sabha or Vidhan Sabha election or did so decades ago. Their influence has however grown in direct proportion to the weakening of the party across India. These structural problems have existed for years, and yet the party has not faced them head on. It has demonstrated no urgency for drastic remedial measures despite defeat after defeat. The feeble attempts at revitalization have focused more on regaining quick electoral viability than on addressing long-term structural issues. Short on communication By far the Congress’s biggest short-coming is its inability to communicate its ideological positions and values clearly. The great challenge is to define its message and communicate it to the electorate as an underpinning for political mobilization. For this, it must unequivocally reaffirm its inclusive vision for a democratic India, and take credit for its past achievements, which resulted from an adherence to these commitments.    One big failure has been the Congress’s reluctance to tell its own story. The party did not publicise or highlight its distinctive approach, and that was one reason why it did not play to its strengths during the United Progressive Alliance (UPA) rule, allowing itself to be outsmarted by its critics. The BJP has correctly calculated that so long as it sustains the argument that the Congress was elitist, corrupt and dynastic, it can prevent the Congress from emerging as a credible alternative. What aids and abets these half-truths is the passivity of the Congress in defending its record and letting its achievements to be dismissed and derided, even as the National Democratic Alliance (NDA) government successfully obfuscates data on its own underperformance in the last eight years. Combating the communal The key issue for the Opposition is defining its response to Hindu nationalism. While the Congress is largely agreed on the necessity of combating communal ideas, politics and policies, it has swung between making ideological compromises with majoritarian nationalism and plotting a frontal battle against it. It has often adopted a majoritarian tenor on certain controversial issues in the name of religious sentiment. However, this makes no sense amidst the growing influence of the Hindu Right. Both as a strategy and as an actuality, the mixing of religiosity and politics does not guarantee electoral dividends. Moreover, the conflict in India is not about the growing prominence of Hinduism in our public life, which most parties accept and promote, but about the BJP’s idea of nationalism, which is utterly exclusivist, pitted against the inclusive nationalism championed by the Congress during the freedom struggle.     Indian politics has never been more polarized than it is today; never before has the gulf been so wide. Hence , today, the battle is more fundamental; it is about the very idea of India – the idea of a diverse, pluralistic nation committed to liberal values. By remaining silent on the way in which nationalism has been redefined, the Congress has ceded the nationalist space to Hindu Right which poses as the pre-eminent torch-bearer of nationalism today even though organizations associated with it made no contribution to the freedom struggle, the crucible which defined Indian nationalism from which they were absent. Yet, its conception of Indian nationhood which it has fought for has prevailed, over the past decade and more against the Congress’s inclusive ‘Idea of India’    Defending a pluralist view of politics and governance is one aspect of the political strategy; the other is grounding its politics in the idiom of social justice which both sidesteps identity politics and resonates with an aggrieved population, alienated by the current dispensation’s policies and politics. Overall, the 137-year-old party’s revival depends on three things – a consistent narrative to counter divisive politics, the will to restructure the organization, and drawing strength from constant public action rather than just elections.   DC and Delhi engagement as a two-way street Shaping opinion in Congress is a continuous process and needs efforts beyond formal and informal official interactions K.V. PRASAD The recent visit of Congress-woman Ilhan Omar to Pakistan and her trip to Pakistan Occupied Kashmir received condemnation from India, and the United Stated swiftly drew distance clarifying that the administration did not underwrite the journey by the Member of the House of Representatives from Minnesota. As the centre The Capitol Hill has a distinct place in the United States Constitution and its separation of powers. Members of the legislative branch work independently to write laws for the administration to implement. The Members of Congress take a special interest in foreign policy and carry out regular oversight over policies pursued by the government across the globe. These could be on a track different from the official policy pursued by the administration of the day. It is said each member’s thoughts on foreign policy are like that of the Secretary of the State.   Over the past couple of years, much water has flown down the Potomac in Washington DC and the nature of representation in the United States Congress has undergone a change in terms of the issues member pursue. There in turn also depend on the nature of the districts, its constituents, issues of interest to the member and the larger political debate.   One issue with reference to countries or developments, views on the Hill are shaped by a combination of factors including outreach from the country at the official level, engagement of the diasporas with Members of the Congress and staff, advocacy and professional lobbies at work. These provide continuous inputs that supplement independent status papers published by the Congressional Research drafted by subject experts.    At times, the House or the Senate organizes hearings on country/issue-specific subjects, for example the Senate Sub-Committee on Asia held last month on U.S. policy towards India, where, among other issues, Jammu and Kashmir figured. Some of these concerns do translate into a resolution, in turn having an amplifier effect. In the final run-up, what matters is a Congressional determination or passage of a legislation that binds the government. Adding perspective, support Today, while there are more Indian-Americans serving as Members of the House of Representatives than ever before, correspondingly, there is an exponential growth of the second generation of the community members who work in separate branches of the administration and the legislature, adding a different dimension. They bring to offices their own perspective which has been accumulated through personal exchange of information from friends in India and various public sources.    It is well established that there is bipartisan support for India in the U.S., especially the Congress, which means both the Democrats and the Republicans favour engagement and developing ties with the country, which in turn smoothens the work of successive administrations irrespective of which party enjoys a majority in Congress and has a President in the White House.    For instance, it took over two years of sustained work at all levels in the Congress before it passed the historic Civil Nuclear Cooperation Agreement (with India) amid determined opposition from the non-proliferation advocates on the Hill, a majority of them belonging to the Democratic Party. In the final stage, over 100 members on the House side and 13 Senators (including Independent Bernie Sanders) voted against it. It did not reflect the party line unlike the GOP Senators and a majority of Representatives who went with the decision of Republican U.S. President, George W. Bush.     Among the Democrats who called a Nay was Congressman Jim McDermott, a founding member of the India Caucus. The vote reflected his commitment to non-proliferation that overrode his affection for India. A vote and stand taken by the Member does not follow party dictates but is driven by individual choice, unlike in India where the party takes a decision and members vote accordingly and on important pieces of legislation through a whip.    Ilhan Omar raking up Kashmir in an Indian territory under occupation attracted sharp comment from New Delhi. Ms. Omar is known to advocate on issues such as education, environmental justice, immigration, and health care, while in the pursuit of foreign policy, the Congresswoman feels human rights, justice and peace should form the core and also represent domestic values. Her policy prescription does not favour sanctions or interventionist measures. Much of her public life work is well known as is her stand on issues of religion. Last December, she sponsored a Bill Combating International Islamophobia that was cleared by the House and is with a Senate Committee.    Migrating to the U.S. as a child from civil-strife torn Somalia, she got drown towards public office, winning a seat in the Minnesota House five years ago by unseating an established incumbent from a district with majority consisting of while population. In her book tracking changing political landscape, People Like Us – The New Wave of Candidates knocking at Democracy’s Door, author Sayu Bhojwani noted: “Omar’s …campaign [for state legislature] mobilized multiple stakeholders… the young, immigrants, and progressives… beyond individual voters... Organizers in the Back Lives Mater movement, the business community, local imams and media in the East African Community…around issues that directly affected these communities.” Today, Ms. Omar is in a leadership role as the whip in the Democratic Party’s Progressives Caucus which remains influential. Is many layered       There are voices reaching out to offices across the aisle on the Hill which projects a different perspective of what is happening in India and other parts of the World. There are a number of Members who form opinions based on varied inputs and articulate these at various fora.    The need to continue engagement with offices in the Congress, its emerging leadership and build a counter-narrative would require effort beyond formal and informal official interactions. It is a continuous process and a two-way street.