Economic Times

  • Eyes fixed on electoral gains, Raman keeps watch on food security plan

    AS BILLBOARDS across Chhattisgarh hardsell the state government's Rs 771-crore food security scheme envisaging distribution of rice at Rs 3 per kg to 34 lakh poor households, CM Ram Singh has embarked on an equally ambitious mission: Monitoring its execution right down to the level of the PDS outlet. It's a tech-savvy monitoring plan, involving not only SMS and internet alerts on availability and supply positions to the beneficiary families and panchayat members of the targeted villages, but also retro-fitting of rice-transporting trucks with GPS devices to track their journey from the godowns to the PDS outlets. Thrown in are a toll-free number


    THE confrontation between the UPA and the Left over the Indo-US nuclear deal has entered the most crucial phase with Prime Minister Manmohan Singh expressing his government's resolve to go ahead with the deal in Parliament and the Left seeking a meeting of the UPA-Left mechanism for discussing the contents of the negotiations with the IAEA. With the government working out a tentative timeline for taking the next step on the agreement, the meeting of the UPA-Left mechanism is expected to be convened before March 15. The leaders of the Left parties interpreted the prime ministerial assertions on the issue in Parliament as an indication of the regime's plans to finalise the text worked out with the IAEA. Although the prime minister refused to divulge details about the negotiations with the IAEA, there are indications to suggest that the text of the agreement is ready. Inside Parliament, the prime minister kept harping about working out a broader consensus within the country on the deal. "We will seek the broadest possible consensus within the country on the agreement. I believe this cooperation (with the US) is good for our energy security,' the prime minister told Parliament. But the Left leaders are not willing to buy into the assertion of the prime minister. For, the lack of political consensus was evident during the debate when a significant majority opposed the agreement. The disquiet in the Left was evident from the response of senior party leader Jyoti Basu to the prime minister's statement in the House. He hinted that the Left could soon sever ties with the UPA. "They are dependent on us. We are also dependent on them for keeping the BJP out of power. I do not know how long this arrangement would continue,' reports from Kolkata quoting Mr Basu said. Mr Basu also contested the government's stand that the Hyde Act will not be binding on India. "We have told them not to proceed in operationalising the deal. How can they say the Hyde Act is not binding on India,' Mr Basu said. The government leadership seems to be of the view that there was no political point in giving in to the biases of the Leftists. With the populist budget providing it the comfort level to take on the Leftists, the pro-deal sections have managed to get the Congress establishment on board in their efforts. Till the other day, the leadership of the Congress was quite unenthusiastic about the nuclear project of the government. But there are many imponderables. For the Congress leadership is yet to sound out the UPA partners on their plans on the deal. The Congress will have to factor in the views of partners like the RJD and the NCP. Parties such as the NCP are against a course that will annoy the Left. Atal Bhishma Pitamah of Indian politics, says PM PM Manmohan Singh bestowed the title of "Bishma Pitamah of Indian politics' on former Prime Minister Atal Bihari Vajpayee while egging on the BJP to support the Indo-US nuclear deal in Parliament on Thursday. He said this while talking about the nuclear deal during his reply to the motion of thanks to the President's address in the Upper House. Mr Singh said that after the former national security advisor to Mr Vajpayee, Brijesh Mishra, had "listened to the call of his conscience' and come out to support the deal, Mr Vajpayee who was "Bishma Pitamah of Indian politics' should let "national interest prevail over narrow political interests'. Mr Mishra, however, is no longer a BJP member.

  • Govt-Left fission over on N-deal soon

    THE CENTRE, which now has the

  • GM's 3rd engine plant in India to cost $200m

    THEworld's largest car maker General Motors (GM) is set to shift gears in India. The company is now looking at investing over $200 million to set up a powertrain plant in India to manufacture engines and components which will reduce the vehicle costs. The powertrain facility is aimed at a lot more than just meeting the domestic demand as engines made at the proposed unit are expected to be used in GM's global brands. Powertrain facility will manufacture engine, transmission and drivetrain that power vehicles. "We have not decided on where to locate the plant or by when it would be operational. But we do know that investment would be in excess of $200 million,' said GM India president and MD Karl Slym. An announcement in this regard is expected soon. Mr Slym, however, did not divulge details on the type of engines or specifications of the engines that would be made in India. This could be GM's third plant in India after Halol (Gujarat) and the under-construction unit at Talegaon (near Pune). The move is aimed at gaining a competitive edge in the domestic market as the company aims to capture a 10% share of the passenger car market here. GM India registered a 68% growth in sales in 2007, selling 60,032 units as against 35,823 units during 2006. GM is also drawing up expansion plans at the Talegaon plant which is to start production by the year-end. It will have an initial production capacity of 1,40,000 units. According to Mr Slym, the second-phase of expansion at Talegaon will see the production capacity being raised to 3,00,000 units. "Expansion at Talegaon is a long-term plan. We don't have a timeframe for this. But once phase-II is over, our production capacity will be in excess of 3,50,000 units

  • For an integrated urban-rural policy

    TALK of the 2008-09 budget as a

  • Basic education from cess pool

    THE burden of financing basic education is directly on the tax payer through the 2% education cess. Indications are that for the next financial year (2008-09), the cess will account for a sizeable portion of the Rs 21,100 crore allocated for Sarva Shiksha Abhiyan and the mid-day meal programme. For 2007-08, the cess accounted for 57.7% (Rs 10, 393 crore) of the Rs 17,995.02 crore dedicated for these two programmes. So even as allocations in the Budget for these programmes increase, the gross budgetary support provided for the programmes has been on the decline. The 2% education cess was levied in the Budget 2004-05, ostensibly to ensure that more money flowed into the basic education segment as promised in the UPA government's common minimum programme. The education cess is levied on all central taxes, such as corporate tax, income tax, service tax, custom duty. It is not that the government isn't committed to providing basic education

  • Public transport policy revisited

    On January 10, the day Ratan Tata launched his much-awaited cheapest car in the world, one of the TV channels aired a panel discussion, mostly featuring auto industry experts. With the exception of Sunita Narain, head of the Centre for Science and Environment, nobody even remotely acknowledged the enormity of the daily travel crisis. If Nano sales take off in a big way, the roads may even get completely clogged. The Nano is a cost and engineering marvel, and a well meaning entrepreneurial endeavour. But the promise of individual mobility will end in collective gridlock. The pro-Nano panelists uttered the usual platitudes about the crying need for more infrastructure. Undoubtedly, a lot more roads are needed. But building more roads by itself will never solve the problem. Cars will expand to fill up the available space, the automobile version of Parkinson's Law. In Los Angeles, despite frequently building ten-lane highways, officials predict that travel times will double by 2020. Besides, the legal and other costs to building roads in cities in India are huge

  • 1 lakh Bhopal gas victims petition PM

    JUSTICE continues to elude the surviving victims of the Bhopal gas tragedy in 1984 when 40 tonnes of the poisonous gas, methyl isocyanate, leaked from a Union Carbide factory in the town and other toxic chemicals leached into the ground. This injustice haunts not only lakhs of victims of the industrial disaster, one of the world's worst ever, but also Dow Chemicals, the company which bought Union Carbide and thereby acquired continuing public hostility to Union Carbide's shoddy response to the tragedy. Legal and bureaucratic delays in estimating the actual number of those affected by the disaster is partly to blame. A mass delegation of gas victims from Bhopal led by the Bhopal Gas Peedith Mahila Udyog Sanghathan (BGPMUS) arrived in New Delhi on Saturday to present a memorandum to Prime Minister Manmohan Singh. The gas victims seek support from the Government of India for their application pending before the Supreme Court for fivefold enhancement of the settlement fund, originally pegged at $470 million by a SC order of February 1989. That order estimated the number of the gas tragedy victims to be 1,05,000, including 3,000 dead. However, the Union of India's submission before the Supreme Court on 19.03.2007 has revealed that, as on February 28, 2007, over 5,73,537 victims, (including 5,294 "proven' death cases and 10,007 other death cases, where claims have been converted from death to injury), have been paid compensation. This was no doubt achieved by spreading thin the Settlement Fund meant for 105,000 victims. At the time, the settlement fund was worth Rs 712 crore. Depreciation of the rupee has increased the rupee equivalent amount three-fold. But the number of victims compensated has gone up more than fivefold. And till now, practically no action has been taken for remediation of the poisoning of soil and sub-soil water sources. The cost of these operations has not been determined and no one has come forward to bear these costs. BGPMUS had mobilised over one lakh individual petitions from the gas victims, saying that there is prima facie evidence for reviewing the basis of the settlement.

  • Clean energy the need of the hour

    THE need to generate power from renewable sources of energy is being increasingly emphasised due to growing awareness about climate change. V Subramanian, secretary in the ministry of new and renewable energy, feels the cost of solar power generation would come down over time due to technological improvements. Subsidy to producers of solar power is inevitable at this juncture, he told G Ganapathy Subramaniamin an interview. Excerpts. Why should the government subsidise solar power? The estimated cost of generating solar power is around Rs 15 per kilowatt hour (KWh). This is the cost of supplying photovoltaic power to the grid, without involving any batteries for storage. Since the unit cost of power generated through conventional sources is far lower and the cost at which power is bought by state electricity boards is cheaper, the government has decided to subsidise solar power generation. The incentive is up to Rs 12 per Kwh for electricity generated from solar photovoltaic and a maximum of Rs 10 per Kwh for electricity generated through solar thermal power plants. We need to provide subsidy in order to encourage generation of clean energy. This subsidy is only for power supplied to the grid. It is not applicable for any private supply or captive use. The subsidy component would go down over a period of time. How will the subsidy, once awarded, go down? The initial cost of solar photovoltaic systems is high because raw materials like silicon wafers are imported. We expect costs to come down over a period of time due to advances in technology. In the next four to five years, we expect conversion efficiency of solar power plants to improve to 18% as compared to 14% or 16% now. The industry, on its part, is trying to reduce consumption of silicon wafers. As a result of these measures, cost of solar cells and modules should come down by about 33%. Therefore, the subsidy component can be reduced over a period of time. There is a built-in provision to bring down maximum subsidies by 5% each year for capacities commissioned from 2010-11 onwards if the current programme is not reviewed in 2009-10. Do you believe the subsidy offer would attract a large number of investors? As much as 97% of the power generation capacity based on renewable energy is built on the strength of incentives and government policies. This includes wind energy, power from waste, bagasse co-generation and biomass conversion programmes. For the sake of clean energy, incentives have been provided. We are confident of the solar power scheme since it is a direct, upfront subsidy. The programme would be implemented through IREDA and there is no chance of bureaucratic red tape coming in the way of the delivery system. State electricity boards will not feel any disincentive since they are buying power at commercial rates, similar to what is paid to other electricity producers. Moreover, we are also providing state electricity boards with an incentive of 10 paise per unit sourced from solar power generation. How much progress have we made in generating renewable energy? By the end of 2007, installed capacity of solar photovoltaic systems in the country has increased to 125 MW in various applications like lighting, rural telecom and offshore oilwell-head platforms. We have street lighting systems, lanterns, home lighting and pumping systems run on solar power, apart from stand-alone units. Installed capacity in the case of wind energy has increased to 7,092 MW, followed by 1,975 MW in the case of small hydro projects, 615 MW in the case of bagasse co-generation, and 524 MW in the case of biomass conversion. In the short-tomedium term, we can generate more power from renewable sources as compared to nuclear power. We have set the ball rolling with the subsidy scheme for solar power and the initial response is very positive. There are people who do not want their investments restricted to 50 MW, but we have kept in mind the need to keep the window open for opportunities from various parts of the country. Can we quantify the projected benefits from the subsidy for solar projects? Every solar plant with 1 MW capacity would produce 2 million KW of electricity, taking care of 5,000 families if we go by the government's commitment of providing at least 1 KW of power to each rural household. Apart from this, each of these plants would create 25 to 40 jobs directly and another 400 indirectly.

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